Sales. Sales never changes much from business to business. Or even when stepping out of the business world and entering the public sector. If you’re a good salesperson, you can transfer those skills to a very different sales position. But whether you work in human resources or accounting, departments and industries that process a lot of records will have different regulations specific to their profession. These need to be learned anew when entering the field or when starting your own organization. From Sheriff’s offices to hospitals to banks, compliance is a multi-faceted beast.
Some key rules and restrictions don’t vary much between industries though. Some matter for each and every department at your company. Labor laws and tax codes impact every business. Even if you only have one employee or run a non-profit. Advertising and marketing regulations even matter for government agencies. Luckily, there are some extraordinary benefits for maintaining compliance.
The Good News about Compliance
Compliance takes the burden of risk off of your organization, and by extension your shareholders and partners. You can avoid law suits and fines simply by staying within regulatory guidelines. This savings can be passed onto stakeholders or invested in growth and new profit opportunities. In addition, many compliance practices require extensive and in-depth data collection, indexing, and analysis. This opportunity can be turned into a valuable data mining campaign. All of this big data at your fingertips can improve efficiency and fix previously unknown mistakes in your processes.
Investors will see a compliant company as an asset and a non-compliant one as a risk. Government agencies have no incentive to award bids to contractors who ignore regulations. What’s more the reports you’ll have from data mining will be a boon to current and future shareholders. Not to mention how your workforce will benefit. Transparency is vital to today’s top talent. While you’re attracting investors, you can also be creating a positive work environment, which is a competitive edge in today’s talent market.
Speaking of Employees (and Labor Law)
As should be expected with such a serious and diverse issue, labor laws are broken into several different agencies’ regulations, union rules, and state laws. OSHA (the Occupational Safety and Health Administration) handles workplace environments safety guidelines and injuries. The Fair Labor Standards Act (FLSA) has set the standard for minimum wages, overtime pay, pay with tips, child labor, hours, and most importantly record keeping of employers. The PPACA (Patient Protection and Affordable Care Act) put into law new rules concerning pregnancy and pregnant employees in the workplace, including maternity leave.
The Equal Employment Opportunity Commission (EEOC) governs hiring processes for organizations, helping secure an even playing field for qualified candidates of different backgrounds, race, gender, religion, ability, and so on. These regulations may all seem like a lot to keep track of, but these are standard across industries for medium to large organizations. Some small businesses do not fit the bracket which must comply with these laws. Especially if you are going to be hiring at least fifteen employees, you should consult a legal advisor who specializes in labor law.
Tax Code for Small, Medium, and Large Businesses
We have all had to deal with taxes. Income tax and tax returns, sales tax, vehicle stickers, property taxes. Now add to that the taxes that go along with owning or managing the books for a business. Which tax code your business must follow is a matter of the business type, sources of revenue, bracket, employees, where you do business, and several other factors. Most owners who are not savvy with this sort of thing can hire an accountant or keep one on retainer.
For starters, there are multiple forms of employment tax, including withholding income tax and unemployment taxes. Businesses must pay income tax or an estimated tax just as individuals do. Not to mention property taxes on the office, brick-and-mortar store front, and warehouses. Businesses which buy or manufacture certain types of goods must also pay an excise tax on those goods. While meeting every form of regulation is important, most won’t get you a visit from the IRS. Understanding the basics of tax code should be the first thing you do when considering founding a new business.
Whatever Happened to Truth in Advertising?
In the food supply and agricultural industries, labeling your jars and cans is crucial. There are rules in place dictating which item types require ingredients lists and nutrition facts. The FDA (Food and Drug Administration) controls what you can put in these areas of your label. The EPA (Environmental Protection Agency) controls whether you can tag products as environmentally friendly. However, outside of these industries, many organizations assume that advertising is more of a wild west. They couldn’t be more wrong.
The obvious one is your company or product name. You must make sure that it is not too close to another product in your same vertical and that it hasn’t already been registered for copyright. The US Patent and Trademark Office has authority to grant patents, copyrights, and trademarks. They assist in matters of intellectual property theft. You will need to maintain your trademark and copyright records every few years. The USPTO sends notices to copyright holders, but it’s better to use a content management solution with notifications about document tasks so that you can stay on top of these items.
In terms of marketing and advertising, the CAN-SPAM Act and the recent GDPR from the European Union cover the most important laws in digital advertising today. If you want to send out email blasts or initiate telemarketing campaigns, you must follow those regulations first or face fines from the FTC and the EU. The Digital Millennium Copyright Act gives corporations the ability to self-police their own content on the web, shutting down any attempt to illegally repost or use their content. If you want to advertise online, you need to follow these rules closely or hire a marketing agency already familiar with them.
Tips for Implementing Regulatory Compliance Policy
Start with a system. Most compliance is about paperwork. Filling it out, organizing it, sending it in, and keeping it on file. You could use a content management solution built with a versatile feature set that can handle many different rulesets for security, privacy, purging, document retention, and version control. Some software is only built for organizing particular document types, but a powerful ECM will be able to store matter, emails, PDFs, images, and hundreds of file types.
Hire experts. On retainer, freelance, in-house, as a consultant. Bring in the people you need now so that you don’t end up paying surprise legal fees when you’re not ready for them. So long as you have a series of business processes programmed into your ECM solution, you can complete most of the hard work of regulation up front. Make sure your employees and colleagues set redundant reminders for compliance due dates and onboarding or tax tasks. If you save to the cloud, also keep a local list of these tasks in case your cloud server is compromised (likely by a tech company not following regulations).
Make it a part of your office. We’ve all been through numerous HR seminars for ethics and onboarding. Don’t stop there. Put up visible posters about workers’ rights. Encourage transparency by maintaining an open door policy. Send reports about compliance to your team and to your stakeholders so that everyone is on the same page. If you foster an environment of responsibility and trust, your employees and investors will flourish and in turn increase the company’s value.
This is just the beginning for compliance and you. Most agencies keep up websites with key regulations listed and elaborated upon. Use this free information to your advantage. Whether you’re founding a company or joining one, knowing your way around the legalese, forms, and best practices will keep you ahead of the game.