Business Legal Compliance 101
While there was a time when businesses and corporations could shrug off some of their regulatory obligations in favor of profitability, that time has come and gone. Today, enterprises of all size – from small to large – face a bevy of new regulations, standards and policies that aren’t so easily ignored and need to understand the complexities of business legal compliance.
Facing mounting pressure from industry insiders, watchdog groups, the media and the general public, failing to maintain legal compliance could cost your entire business.
Achieving Employment Compliance
Employment compliance is hardly ever a straightforward matter but it’s an important part of any business legal compliance plan. Often bogged down by unclear or confusing language, some of the laws and regulations included in the laws that are meant to protect employees are actually causing more confusion than anything else.
For starters, it pays to know the different types of legal regulations that apply specifically to the general workforce. Designed to benefit unemployed jobseekers and newly employed or long-term professionals alike, these laws include:
- National Labor Relations Act: This law, which grants employees the right to join a union, applies to all private employers who are participating in interstate commerce and have one or more employees on their roster. An important note is that, with only a few exemptions, the NLRA applies to all employers who meet the above criteria – whether they actually have any employees in a union or not.
- Americans with Disabilities Act: Also known as the ADA, the Americans with Disabilities Act protects employees and jobseekers from discrimination against certain disabilities. There are many exceptions and nuances associated with the ADA.
- Family and Medical Leave Act: The FMLA is a source of widespread confusion amongst the general workforce. Ultimately, it grants employees up to 12 weeks of unpaid leave within any 12-month period to give birth and care for a newborn child, place a child up for adoption, provide emergency care for a family member or take a medical leave due to a personal medical condition. Apart from general confusion, the FMLA is also the source of much debate and controversy.
- Age Discrimination in Employment Act: As its name suggests, the ADEA protects workers who are 40 years or older from age discrimination in the workplace. The specific act only applies to employees who maintain a full-time roster of 20 or more staff members.
- Fair Credit Reporting Act: One of the newest acts established to protect employees and job-seekers alike, the FCRA establishes several standards and requirements that employers must follow when performing individual background checks. The FCRA is also the subject of a lot of controversy in the 21st century.
Although all of these acts apply specifically to the general workforce and your employees, many of them have a direct benefit to your business. There are also other standards that apply solely to the corporate or enterprise level, too.
Implementing Corporate Compliance
Corporate compliance is also critical to your business legal compliance strategy. Not only does it protect your company from evolving laws and regulations, but these laws were originally established to ensure the availability of top talent in your industry.
Generally speaking, there aren’t a slew of legal acts that apply on the corporate or enterprise level. Instead, business owners have much more freedom when it comes to designing and maintaining their corporate culture, establishing unique standards or expectations and building their brands. Nonetheless, there are still some corporate compliance issues to consider, including:
- Making your presence known and getting paid: If your company is currently doing business under a different name, which is sometimes done to maintain a sense of anonymity before going public, the name must be legally registered with your own country. This also lets you obtain your Federal Employer Identification Number or EIN, as required by the IRS, and gives you everything needed to open a bank account in your new company’s name.
- Choosing your location: As in good real estate agent will tell you, location is everything. Not only are their local zoning laws and requirements that you must abide by, but, depending on your industry and line of business, some community organizations might object to your presence in the neighborhood.
- Filing for trademarks and patents: Now is the time to register for any trademarks or patents needed to protect your intellectual property. The last thing you want is for someone to steal your idea – or unveil something similar – in the days, weeks or months leading to your launch.
- Obtaining the necessary licensure: Different states, cities and districts all have various licensing requirements, too. Make sure to research the laws in your location to verify compliance before establishing your footprint in a new area.
Many companies enact internal corporate compliance programs to keep track of the various policies, rules, and standards so the keep in line with their business legal compliance plan. Unfortunately, many of these directives are directly challenged shortcomings or gaps in programming. Some of these roadblocks are unique to a particular industry or area of expertise, while others are commonly seen amongst all industries and businesses.
Maintaining A Corporate Compliance Program
Keep in mind that subordinate employees often model their behavior after their managers, supervisors, and in some cases, executive-level figureheads. How can you expect your entry-level workers to follow the guidelines if your topmost leaders cannot?
Corporate compliance programs are often challenged by pitfalls like this. Not only do these roadblocks limit the potential of your entire workforce, but they have a negative impact on your company’s overall profile and reputation, too. Some other common issues to consider include:
- A lack of centralization or synchronization between programs or internal processes.
- Inefficient processes and procedures that must be followed at all times.
- Too much complexity or confusion within the program itself.
- Failing to establish scope or objectives during the program’s initialization.
- Misunderstanding your own corporate culture.
Much like employment compliance, corporate compliance is rarely cut and dry. Between evolving rules and regulations, unclear or confusing laws and your company’s internal policies and procedures, it can be difficult to implement and maintain full corporate adherence to your business legal compliance plan.
Nonetheless, it’s a necessary step on the road to success that every company – regardless of their industry – must face.
Are you in a position where you need to examine your business legal compliance plan to make sure it’s accurate and being followed? Perhaps you have other concerns such as finding funding for new projects or ventures? HJR Global is a resource for business owners. We can help you plan, align your business, or even help you secure funding for your next venture. Contact HJR Global today to see how a partnership with our company can benefit you now.
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