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The 4 Biggest HR Compliance Challenges Facing Businesses

16 January 2020 4 min read

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With what seems like a mountain of regulations that businesses need to adhere to, HR must stay on top of all compliance rules. The smallest of slip-ups in compliance could cost your business thousands of pounds.

However, it isn’t an easy job to keep up to date with new rules due to various regulations around employee working hours, pay, security, annual leave, and so much more. It can feel like a complete minefield for those working in HR.

With this in mind, to help you navigate your way through the minefield of employment laws and regulations, we have looked into some of the biggest compliance challenges HR is facing and how we can help you stay on top of them. Read our top 4 compliance challenges below.

Man staring at a document with a pile of paperwork behind him


1. Security of personal data

Number 1 on the list is ensuring all data held on employees is stored in a secure location. The reason this is top of our list is that businesses could be fined 4% of their annual global turnover or €20 million if they are in breach of GDPR.

GDPR doesn’t just relate to customer data, the regulations apply in the same way to employee data too. HR needs to get consent from employees that explicitly says they are allowed to store their personal information. This generally isn’t a difficult one for HR to get, but they need to be able to document the consent and keep all the information secure.

To help keep all personal and business documents safe, why not store them in a secure online document storage portal.

2. Equal treatment and fair pay

Ensuring that all employees are paid fairly, regardless of their gender, race, religious belief or any other reason, is vital. There have been numerous lawsuits filed for unfair treatment and unequal pay, with many winning.

Back in 2017, the UK government made it mandatory for any organization with more than 250 employees to publish and report on their gender pay gap, with those failing to do so, facing legal action from the EHRC.

If you are a business with more than 250 employees or just want to be able to report on the gender pay gap, you can use our enhanced reporting dashboard to easily do so.

3. Work and pay regulations

HR needs to be vigilant around employee working regulations with huge differences in working hours between countries. For example, employees in the UK are allowed to work as many hours as they like in a week, but in the Netherlands, they can only work a maximum of 60 hours a week.

However, this doesn’t mean employees can work 60-hour weeks for the whole year, both in the UK and Netherlands employee working hours must not exceed a set length, which is averaged over a specific number of weeks. Yet another compliance minefield.

It isn’t just working hours that are different between countries, the UK and France have different regulations around paying overtime, number, and length of breaks, sick pay, and much more.

To ensure you are compliant around working regulations, in whatever country you are based, we have created a compliance guide that you can read here: Holiday Compliance Guide: Rules & Laws by Country.

4. Holiday compliance

Annual leave is not only different from country to county, but each organization will have different rules around annual leave. Furthermore, within those businesses, some employees will receive more holidays than others.

Examples of different business holiday allowances:
Long service award – For every 3 years worked, employees receive an extra day’s holiday.
Carryover – Allowing employees to carry over 5 days of annual leave to use the following year.
Buying and selling holidays – Employees can buy and sell up to 5 holidays.

These are just a few of the many ways that holiday allowance varies between businesses, with many having unique holiday allowances that can be extremely hard to implement and track if you don’t have the right system. If your business is going through a merger and acquisition, it’s especially important to consider the associated challenges.

One of our customers, Syngenta AG, had some of these issues as they are based in numerous countries all with their own rules. To help them, we created country-specific templates to match the legislative requirements in each country. To see how we help them to be compliant across different countries read the full case study here: Syngenta: HR teams immediately benefit from statutory absence reporting.

To ensure you are compliant around holidays and annual leave, our employee holiday planner can be built around your specific rules and regulations, helping you to book annual leave easily and stay compliant.

Start making absence matter with an intelligent, centralized solution that helps growing organizations to thrive.

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Katrina Bennett People Director at edays
January 16, 2020

Katrina is edays' own People Director with significant UK and international experience in delivering people strategy and value-adding HR solutions across a range of organisations and sectors (including Arriva, Boots, Rolls Royce, the utility and charity sectors). Katrina has over 20 years of experience in Human Resources and is CIPD qualified.