Companies must maintain equal employment opportunity (EEO) and affirmative action (AA) compliance, but many leaders mistakenly view it as a set-it-and-forget-it responsibility.
With some forms of compliance, such as adhering to SEC regulations, the path is straightforward. But EEO and AA compliance demands a dynamic and evolving approach. Businesses might implement the required EEO/AA policies, but they don’t always allocate resources to develop their affirmative action compliance training programs in meaningful ways.
From a risk-reduction standpoint, a strong compliance team is necessary to avoid complaints and lawsuits. It is not enough to check the boxes and say you’ve fulfilled mandated policies or regulations. Instead, think about how those policies are enforced at your company and how you can integrate them into your processes.
Why Every Company Needs Compliance Professionals
Naturally, small businesses have a harder time establishing dedicated compliance teams than larger organizations because they don’t have massive legal teams or compliance budgets. But even small companies need to appoint compliance professionals who can create and oversee programs that reflect the business’s ethics while lowering risk.
We worked with one client that wanted to do a compliance compensation analysis with the minimum investment possible. This client wanted to effectively “look the other way” unless it was audited, and it only relented upon realizing that doing so would create discoverable and documented noncompliance evidence. Not only would this approach put the company in a bad position, but it would also set a poor ethical standard for its employees.
Businesses that invest as little as possible in developing HR compliance best practices are doing themselves a disservice. When they scramble to put together compliance analyses, the reports are often rife with errors — and the executive team may have no interest in building a genuine affirmative action compliance training program or any other meaningful system.
What Does Smart HR Compliance Look Like?
Compliance professionals often wear multiple hats at a company. When their focus has to be in so many different areas, you can imagine how difficult it is for them to develop vital resources such as diversity, equity, and inclusion training or other types of compliance programs. Even at companies with dedicated compliance teams, there is little extra assistance from the broader HR department — so they are stretched extremely thin.
To get organizational compliance right, companies must view compliance as an ongoing concern rather than a box to be ticked once a year. Here’s how:
1. Elevate compliance priorities.
Many companies hire chief diversity officers, but fewer create roles for a chief affirmative action officer or chief nondiscrimination officer. Yet equal opportunity employment compliance must be prioritized at the same level as diversity and inclusion training because it directly impacts that program’s success.
When companies “check the box” on compliance, they typically gather data on workforce demographics and look for red flags. They need to go deeper, investing resources to discover why those red flags are appearing and how they can shape their EEO/AA policies to address them.
Sit down with your compliance professionals to figure out what they need in terms of money and personnel to take that deep dive and make compliance a consistent, robust part of your organization — not just when it’s time for annual reports. Provide them with those resources and demonstrate that the company’s leadership is deeply committed to compliance.
2. Encourage compliance professionals to collaborate.
Businesses task their talent acquisition teams with important compliance responsibilities, but those responsibilities can take a back seat to the more immediate demands of hiring managers — and recruiters are not often properly incentivized to focus on EEO/AA compliance. The talent team does not usually report to HR or legal, where the EEO/AA compliance function resides. The disconnect between these departments hurts the talent team’s efforts and causes qualified prospects to fall through the cracks.
The professionals in charge of affirmative action compliance should collaborate with those who are recruiting and interviewing candidates — and with those overseeing the legal framework for these programs. They must also have some level of authority to oversee those efforts.
3. Understand the scope of compliance work.
Whoever you assign to compliance should be able to focus primarily on affirmative action and EEO initiatives. There is no one-size-fits-all affirmative action policy, and your compliance experts need time to develop solutions specific to your company. They need to study past compliance reports, analyze your shortcomings, and explore ways to recruit and retain a more diverse candidate pool.
While generic solutions might technically be in compliance, they will do little to build a dynamic and genuinely inclusive company. Give your team the bandwidth it needs to effect real change through innovative compliance policies.
If you’re ready to dig deep in these areas but aren’t sure how best to support your compliance team, we’re here to help. We specialize in helping compliance professionals put all the pieces together and build excellent human resources compliance programs that leverage the resources your company already has.
Contact us for a consultation on how we can work together to make your business stronger and reduce your risk potential.