Managing a globally distributed team while remaining compliant with multiple sets of employment laws can be extremely taxing and challenging, especially for a small business. Tackling this part of your HR processes on your own can become overwhelming from many points of view, including timing, costs, and resources.
To avoid incurring fines from local authorities, failing legal audits, and receiving remote employee claims against your company, you can trust an expert global recruitment partner like Skuad. With Skuad, you won’t need to navigate the complexities of multiple legal systems and employment laws. We will handle all of that on your behalf, and always ensure that you stay legally compliant.
In this article, we will explore global HR compliance, unravel the most common compliance issues that businesses face, and guide how to solve them effectively, efficiently, and proactively.
What Is Global HR Compliance?
Global HR compliance refers to the ability of a company to act in full respect of all the required standards around HR procedures that different countries have put into place. One of the most complex aspects of global compliance is the fact that each country in which you have established a remote team will often have policies of which you may not be aware.
Adding to this difficulty is the fact that there are sometimes linguistic or cultural barriers that can further hamper your company’s ability to fully comply at all times. This is why approaching these issues on your own normally doesn’t work, besides being very costly and time-consuming. Your best bet is to join forces with an expert partner like Skuad who can take on the legal burden for you.
When talking about global HR compliance, it’s important to mention that there are three different types of compliance, each of which is explored in turn below.
Statutory compliance means abiding by the laws that a government has created and enforced. Generally speaking, such laws include the minimum wage, minimum legal working age, discrimination and harassment, and other issues affecting the workforce.
In the case of a federal country, statutory compliance incorporates both local and national laws, and these can sometimes differ. A company that fails to meet statutory compliance risks having its reputation tainted, and can even be prosecuted by a criminal court.
Rules around regulatory compliance are determined by public bodies within a specific country or area. These may be, for example, authorities that deal in matters of health and safety, sexual harassment and discrimination, maternity protection, and workers’ rights.
The guidelines established by these authorities usually include formal compulsory training and other industry-specific mandates.
Finally, contractual compliance encompasses all the rules and regulations that individual companies create for their staff. These may include provisions around working hours (including overtime work), bonuses and benefits, special permits, and flexible working arrangements, to name a few.
All these guidelines should be included in an employee’s employment contract and stated in a clear, easy-to-understand way.
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What are the common HR compliance issues?
There are several HR compliance issues of which companies should be aware. Among the most common are;
Wages and Working Hours
Arguably, wages and working hours are one of the top priorities when it comes to maintaining legal compliance. These are also some of the most challenging aspects to manage, as they often vary remarkably depending on the employee’s location.
For example, a U.S, employee based in a state other than the one in which their company is located will need to be offered wages and working hours that are compliant with the rules and regulations of their home state. This applies even if those rules are different from the ones in place in the state where their employer is based.
Matters can get even more complicated if a remote employee works in a different country altogether. In this case, it’s vital to be able to understand the laws about wages and working hours that are in effect where the employee is based. Failing to do so will inevitably put the employer in a very dangerous position.
Another crucial aspect to bear in mind, when it comes to wages and hours, is employee classification. Knowing exactly how every one of your employees is categorized — whether they are full-time employees, part-time employees, or contractors — is vital as it allows you to determine their wages and working hours in full compliance with their specific category.
Safety in the Workplace
Just because one or more of your employees is working from home, doesn’t mean that your company is exempt from providing a safe working environment. If your remote employee suffers an injury or another similar issue while working remotely for your company, you will still need to provide them with adequate compensation.
Nonetheless, the line between what an employer should take care of and what is the responsibility of an employee becomes very blurred in the context of remote work. To ensure that your company errs on the side of caution, you might want to follow the guidance below.
- Keep educating your remote workforce on how to maintain a safe and healthy work environment, no matter where they are working..;
- Provide your remote employees with a regular bonus that can help them cover any expenses related to setting up a safe workspace at home
- Maintain all your job descriptions up-to-date and clearly describe the specific tasks that your employees are expected to do to minimize the chances of something harmful happening to them.
- Ensure that all your systems and networks are safe and secure and that your employees’ confidential data and information are protected at all times. Remember to always update your security protocols and run the most recent version of all your software products to further reduce the risk of cyberattacks and cybercrime.
Another hurdle that many U.S. businesses face is underestimating — or completely neglecting — the scope of the difference in HR compliance laws that are present across different states. Even bordering states can have very different rules and regulations in place, and failing to comply with them may be incredibly risky for any company.
Discrimination and Harassment
One of the most common HR compliance issues — and a major reason for employee complaints and lawsuits — is the area of discrimination and harassment. While this may seem like a problem that only in-person workers face, the reality is much more complex.
Both in-person and remote employees can face issues of discrimination and harassment in the workplace, albeit in different ways. For example, cyberbullying, trolling, and mobbing can and do happen online, and they all count as serious harassment toward the targeted employee.
As a result, an employee may begin to suffer both physical and mental health concerns, sometimes to the point of requiring medical support and, in a few extreme cases, deciding to leave the company.
The likelihood of discrimination issues doubles if your company operates a hybrid work environment. For example, your remote workers might express that they feel treated differently — in a negative sense — than your employees who work in the office.
How HR Teams Can Ensure That They Follow Global Compliance
While the potential issues and risks surrounding global HR compliance can be very serious, it’s important to know that there are ways for HR teams to prevent, minimize, and eliminate them. Let’s find out how.
Protect Employee Privacy
Make sure that all the information about your employees that you save, store, and use is always protected. Follow the specific data usage and protection rights of the region where your remote employee is based, and always ensure that you are using fully up-to-date software and security protocols.
Standardize and Automate Payroll
With standardized and automated payroll across your international teams, you will be able to ensure that all the labor and employment laws remain up-to-date, verifiable, and easy to follow. Achieving this is simple if you choose to team up with a skilled, knowledgeable partner like Skuad.
By managing global payroll in such an accurate way, you will also help decrease the risks associated with audits, human error, delays, and data sharing.
Deliver a Consistently Positive HR Experience
Relying on a timely, standardized, and accurate global platform to manage all your global HR compliance issues will also enable your company to deliver a positive HR experience across the board. This, in turn, will show your remote employees that you are always willing to support them, wherever they may be based, by offering exactly what they need, expect, and deserve. and what their local laws require.
Ensuring that your business always stays compliant with a myriad of labor and employment laws is no easy feat. This, however, becomes even more complicated if you employ a team of people based in different geographical areas.
Instead of spending time, money, and other valuable resources trying to understand how to comply with a huge array of rules and regulations, choose to team up with Skuad. Our team of experts will navigate complex legal landscapes on your behalf, while you focus on growing your international team through strategic activities and effective decision-making.