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Well-run workplaces abide by certain standards. Having a solid workplace compliance framework is key to keeping everyone on the same page with regard to regulatory requirements. But what is compliance in the workplace, and why is it so important?
Workplace compliance refers to the efforts made by organizations to comply with legal requirements and internal policies. It typically involves training employees on compliance best practices and implementing certain tools and frameworks to remain up to standard.
The main purpose of compliance is to ensure alignment with relevant legal and regulatory standards. The goal is to create a culture of compliance so that the process becomes second nature, something that’s built into the fabric of the company. But on a more granular level, compliance serves many intricate purposes.
Workplace compliance isn’t just about following rules made by faraway entities––it’s also about keeping people safe in the work environment. The Occupational Safety and Health Administration (OSHA) requires that employers provide safe working conditions to prevent injuries and illness.
To that end, companies implement certain safety protocols and conduct regular training to ensure all operations meet safety standards. A safe work environment helps boost employee morale and improves productivity by encouraging uniformity in operations.
Businesses that wish to remain competitive in their respective sectors must maintain a stellar reputation, and part of that involves workplace compliance. By creating a compliance culture, organizations demonstrate an ongoing effort to protect their employees, workspaces, and sensitive data. This can really help an organization stand out from the crowd.
When employees and management are committed to upholding regulations and ethical standards, it creates an environment wherein everyone takes accountability for their actions; everyone plays a role in mitigating risk. This type of culture promotes transparency and can help build long-term trust with stakeholders.
Non-compliance can cost businesses an arm and a leg. To avoid paying through the roof, it’s important to establish a workplace compliance program. While this may involve some upfront costs––if you choose to implement new tech solutions, for example––it can save you loads in the long run.
Sustainability is a vital yet often overlooked component of workplace compliance. PwC’s Voice of the Consumer Survey 2024 found that customers are willing to pay 9.7% more on average for sustainably-produced goods. By adhering to environmental compliance standards, companies can boost revenue and drive customer loyalty.
Compliance requirements vary based on several factors, including business size and industry. However, there are a few standards that almost universally apply across the board, no matter which sector you operate in.
The General Data Protection Regulation (GDPR) is a good example of a widely-adopted framework that’s part and parcel of modern workplace compliance. This regulation dictates the proper way businesses should collect, store, and process the personal data of individuals residing within the EU. California adopted the California Consumer Privacy Act (CCPA) which is basically the U.S. version of the GDPR, but other states have their own laws.
So what does this type of compliance look like? First, businesses must conduct thorough data audits to learn more about the data they collect, where it’s stored, and how it is used. Following auditing, companies implement data protection policies and procedures. This might involve upgrading IT systems and using stronger encryption tools.
Employee education and training is crucial to maintaining workplace compliance to data protection laws. In addition to the technical aspects, organizations must train staff on the correct way to handle data and how to report and manage incidents.
Recognizing non-compliance is the first step in taking effective corrective action. Here are some things to look for, as well as some tips for getting back on track.
Labor law violations are among the most serious incidents of non-compliance in the workplace. Misclassifying employees as independent contractors to avoid paying benefits can lead to serious consequences; so can denying workers overtime pay.
To rectify labor law non-compliance, businesses are usually required to compensate affected employees for unpaid wages, overtime, and any other benefits they are entitled to. They should also be transparent about the corrective actions being taken and update their payroll systems to avoid future incidents.
One of the most obvious examples of non-compliance is failing to abide by safety standards. Your employees’ safety should be a top priority, but things can sometimes go wrong even with a solid compliance framework in place.
For example, businesses may fail to provide adequate safety training, or they might accidentally expose workers to harmful substances or materials. These oversights can result in serious workplace accidents. In 2022, such accidents totaled $167 billion.
If you experience non-compliance issues around workplace safety, look for any gaps or weak spots and work to address them immediately. Make sure employees are aware of safety protocols and check to see that equipment is in good working order. You might even consider appointing a health and safety officer to oversee these processes.
In this day and age, data privacy is paramount. Businesses that violate compliance rules regarding data protection risk all sorts of monetary and non-monetary penalties. Data protection violations most often take the form of data breaches, where personal data is exposed to nefarious parties.
Should you become non-compliant with data laws, it’s important to take swift action. Before doing anything else, you need to contain the breach to prevent further damage. Once systems are secure, you will need to notify affected parties and relevant regulatory bodies.
Next, conduct a forensic investigation to determine the cause of the incident. Take whatever remedial measures are necessary to tighten security, and review your data privacy policies to check for irrelevant or outdated procedures.
Compliance in the workplace may seem like a gargantuan undertaking, but with the right tools and frameworks, you can stay on track. Educating employees on what compliance is and why it matters is key to getting started. Compyl can work with your company to foster a culture of workplace compliance. Contact us to see how.
