If you feel like your business is constantly struggling with compliance, you're not alone. 60% of business owners feel they struggle to stay compliant, especially as federal, state, and local regulations constantly change. Medium-sized and enterprise organizations can have dedicated professionals and entire teams for compliance management, but small businesses don't have that luxury.
But that doesn't mean you have to navigate the process entirely alone.
A professional employer organization, or PEO, can help you navigate changing regulations, manage HR and administrative tasks on your company's behalf, and support your growth. A PEO can also help keep you informed.
With that in mind, let's walk through these five important workplace compliance laws that all small business owners need to know.
The Occupational Safety and Health Act mandates that employers maintain specific safety standards in the workplace. That includes keeping physical and psychological hazards out of the workplace, ensuring that regulated elements of the space comply with OSHA regulations (such as maintaining proper lighting and handrails), keeping employees educated and informed, and maintaining hazard signage.
Maintaining these commitments isn't easy, no matter your industry. It requires constant vigilance and ongoing attention to detail. PEOs can help you manage these responsibilities by:
Passed in 1963, the Equal Pay Act (colloquially known as Equal Pay for Equal Work) is legislation that prohibits wage discrimination based on sex. A position must require equal skill, effort, and responsibility and have the same working conditions in the same establishment to warrant scrutiny under the Equal Pay Act. Violations can bring hefty penalties and sour your reputation as a business owner. Even accidental violations are a problem, and they may slip through the cracks if you don't have systems in place to audit the compensation levels you have for all of your employees.
By partnering with a PEO, you can rely on the support of knowledgeable professionals who can review your employees' pay, alert you to potential violations, and introduce compensation guidelines to minimize or outright eliminate the risk of EPA violations.
The administrative burden can steeply rise if you have employees but no dedicated payroll department. You must juggle on-time payments, reporting, payroll taxes, and benefits. Managing all those tasks every other week, let alone updating your practices to reflect changing regulations and compliance requirements, can take too much time away from your other obligations.
Your PEO can manage these responsibilities on your behalf, including these tasks:
Every state has different payroll and tax obligations. Even those localized laws will change depending on how many employees are in your organization. For example, your business may have an obligation to provide additional benefits once you reach a threshold of a certain number of employees. A well-managed PEO will stay up to date on local and state workplace compliance laws so you can rely on their expertise.
The FLSA is the framework that governs how much you must pay employees and how much they can work. It covers topics such as:
Again, the administrative burden of staying compliant with FLSA is high, and small businesses can quickly run afoul of its regulations while trying to operate in good faith. Small employers can more easily ensure that their employees are appropriately paid, categorized as exempt or non-exempt, and given a legally fair number of work hours by partnering with a PEO. Along with monitoring to ensure your present and past records comply with requirements, your PEO can establish a framework guide that helps you operate more confidently as you hire more employees in set roles.
Originally established in 1993, the Family and Medical Leave Act is a vital labor law for employees nationwide. It guarantees unpaid time off without job loss and continued access to benefits for qualified employees. But FMLA may or may not apply to your organization, and it may or may not apply to specific employees. There must be 50 employees within a 75-mile radius for employees to qualify for FMLA. Even then, the employee must have worked 1,250+ hours for you over the past year. Because there are so many specific guidelines (and because it offers such significant security to employees), having practices in place that guarantee compliance is essential.
These five areas of HR compliance are some of the most significant laws that govern the workplace, but they're only a small handful. Partnering with an organization specializing in HR compliance and administration can protect your organization from accidental violations that result in fines, penalties, and even lawsuits. Proactively ensuring compliance also protects yourself and your employees from workplace accidents, tax infractions, and a turbulent business future.