The human resources (HR) department is essential to the success of any organization. Contrary to common misconceptions, the role of HR extends far beyond basic functions. Regardless of other factors, like company size or industry, HR manages more than just recruitment, employee relations, and benefits. The responsibilities of HR especially overlap with labor and employment law and compliance. What’s more, HR is inextricably intertwined with labor and employment law.
It is crucial to carefully navigate this complex regulatory landscape to ensure compliance and protect businesses from potential legal risks. This blog discusses where HR and labor and employment law intersect. Additionally, it answers what this overlap means for HR professionals and companies alike.
Core HR & Employment Law Overlap Areas to Consider
Hiring and Recruitment
The hiring process is more than just filling a vacancy; it’s a legal minefield that requires careful attention to various laws and regulations. HR professionals must be vigilant during the hiring process to avoid discrimination, comply with legal requirements and ensure fairness.
Anti-discrimination laws, such as Title VII of the Civil Rights Act, the Americans with Disabilities Act (ADA), and the Age Discrimination in Employment Act (ADEA), are key facets to ensure the proper treatment of employees. These policies prohibit discrimination and support the foundation of a fair and equitable workforce. HR must ensure that job postings, interviews, and offer letters are compliant with laws such as these, among thousands of other local, state and federally required policies and protections.
Even seemingly simple tasks, like conducting background checks, require HR compliance. For example, HR and hiring teams must adhere to requirements set forth by the Fair Credit Reporting Act (FCRA). This Act regulates how employers can use consumer reports for employment purposes. HR needs to provide proper disclosure and obtain consent before conducting these checks.
By adopting legally compliant recruitment processes, HR professionals will not only attract the right talent, but also avoid costly lawsuits and discriminatory practices.
Wage and Hour Compliance
The Department of Labor (DOL) sets minimum wage and overtime pay standards. Additionally, these requirements can vary from state-to-state. So, HR professionals must consider all requirements, job titles and responsibilities to properly classify employees as exempt or non-exempt. In turn, an employee’s eligibility for overtime by is determined by their exemption status.
Proper timekeeping, scheduling, and payroll practices ensure employees are paid fairly and compliantly. Misclassification or improper recordkeeping can lead to significant legal repercussions and financial penalties. For this reason, HR bridges traditional human resources responsibilities and labor and employment law. Responsibilities like maintaining accurate records, creating compliant scheduling and pay processes, and ensuring employees receive the compensation that they are entitled to under the law are crucial.
Employee Benefits and Compensation
Navigating the legal landscape of employee benefits and compensation is another incredibly complex task that HR professionals manage for the organization.
For instance, knowledge of compliance with the Employee Retirement Income Security Act (ERISA) is essential for managing retirement plans and other benefits. ERISA sets minimum standards for most voluntarily established retirement and health plans. This helps ensure that plans are managed and administered fairly.
The Affordable Care Act (ACA) also requires employers to provide health insurance options to employees. HR must stay abreast of changes made to these regulations to avoid penalties and to ensure employee satisfaction.
Further, compensation packages must be structured according to labor and employment laws. One example of a compensation consideration is equal pay policies, which prohibit wage discrimination based on gender and other demographics. By understanding these legal requirements, HR can create fair and competitive compensation packages that attract and retain top talent while ensuring compliance.
Workplace Safety
Workplace safety is a critical aspect of HR compliance. The Occupational Safety and Health Act, or OSHA, governs workplace safety. HR professionals must ensure that their organizations create and maintain a safe work environment. This includes implementing safety protocols, conducting regular training, providing required signage and equipment, and ensuring all employee rights under OSHA are protected.
HR is also responsible for reporting and documenting workplace issues, injuries, and illnesses. Failure to comply with federal and state reporting requirements can have severe legal repercussions. Simply put, HR’s role in maintaining workplace safety is not just about protecting employees; it’s also about protecting the organization from legal liabilities.
Employee Relations and Conduct
What is employee relations in HR? Employee relations refers to the management of relationships between employers and employees. Additionally, it includes ensuring that workplace policies are followed and conflicts are resolved fairly and legally. Effective employee relations contributes to a positive work environment, fosters employee satisfaction, and helps prevent legal disputes.
HR professionals often handle harassment and discrimination claims, which require a deep understanding of the law to ensure fair and legal outcomes. Otherwise, HR professionals could inadvertently create a hostile work environment, violate workers’ rights, and expose the organization to significant legal liabilities.
Developing and enforcing employee conduct policies is an overlap between HR’s roles and labor and employment law. Therefore, these policies must be clear, consistent, and most importantly, compliant with all applicable labor laws to protect employees and the organization.
Addressing grievances and ensuring fair treatment of employees is also essential. By managing these issues effectively, HR can foster a positive work environment while minimizing the risk of legal disputes.
Termination and Layoffs
Terminating an employee or conducting layoffs involves significant legal considerations. HR must have a solid understanding of the laws and regulations surrounding terminations. This is particularly essential in the case of wrongful termination claims. For example, these claims can arise if an employee is terminated in violation of their employment contract or public policy.
Note that while at-will employment allows employers to terminate employees without cause, there are exceptions to this rule. HR professionals must know these exceptions and ensure that terminations are conducted legally to avoid wrongful termination lawsuits.
Compliance with policies, such as the Worker Adjustment and Retraining Notification (WARN) Act, are also critical during layoffs. This act requires employers to provide notice of significant layoffs at least 60 calendar days before to give employees time to seek alternative employment. Otherwise, employers may face substantial legal consequences, including back pay, reinstatement, and punitive damages.
HR’s role in managing layoffs is crucial to mitigating these legal risks while ensuring a smooth transition for affected employees.
Recordkeeping and Documentation
Proper recordkeeping is not just a best practice; it’s a legal requirement. HR teams must ensure their organization complies with recordkeeping requirements under various laws, including the FLSA and the Family and Medical Leave Act (FMLA).
This is important because documentation is essential for supporting legal compliance and protecting the organization in legal disputes. HR must maintain accurate and secure employee records, including timekeeping records, benefits information, and disciplinary actions, among many other types. Accurate, secure, and compliant recordkeeping and documentation is key for maintaining legal compliance and protecting the organization from potential legal issues.
Union Relations, HR, & Employment Law
In unionized work environments, HR often mediates between management and unions, union reps, or unionized employees. Human resource professionals have complex and difficult duties, like ensuring collective bargaining agreements are upheld or verifying disputes are resolved compliantly with labor laws. For example, the National Labor Relations Act (NLRA) governs the management of collective bargaining agreements and the handling of union grievances.
HR professionals must support their organization’s adherence to the terms of the collective bargaining agreement and work to compliantly resolve disputes. By carefully managing union relations, HR can foster a cooperative work environment while ensuring compliance with labor law.
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The intersection of HR and labor and employment law presents complex challenges for HR professionals and in-house attorneys. From hiring and recruitment to termination and layoffs, HR departments must navigate a myriad of legal requirements to protect their organizations from legal risks while ensuring fair treatment for their workers.
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Disclaimer
This article should be a starting point for educating Human Resources and Legal professionals. While it covers certain aspects of employers’ legal obligations, its not a comprehensive resource or complete explanation of requirements. It offers practical information concerning the subject matter. This content is provided with the understanding that ComplianceHR is not rendering legal advice or other professional services. The contents are for general informational purposes only. We urge you to consult your attorney concerning any particular situation and any specific legal questions you may have.
