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The Top Five Workplace Compliance Must-Do's That You Need To Know!

Prevent legal disputes, maintain compliance, and effectively manage people by putting these five important items into place.


#1 Policy Handbook


If you don't have one, you need one!


A poorly written handbook allows for errors and misconceptions of workplace policies and procedures. By clearly defining your company's operating expectations, employees are guided in a direction motivated by the company's mission and values, which leads to a positive and cohesive culture. In order to cultivate a collaborative structure and establish proper and compliant workplace expectations, the well-written handbook should be the first compliance item on your to-do list.


If you already have a policy handbook in place, make it a task item to review it annually and provide employees with any updated federal, state, and local laws and rules as well as changes in the company's policies. Below are a few critical disclaimers that are necessary to include in your policy handbook.


At-Will Employment

What does at-will employment mean?  The employee’s employment may be terminated at any time, with or without notice and with or without cause. Likewise, the company respects the employee’s right to leave the company at any time, with or without notice and with or without cause.  All employee handbooks should include the at-will disclaimer.  


Here are a few examples that you can easily include in your handbook:


“Nothing in the handbook creates a contract for employment or alters the employee’s at-will employment relationship”.


“Nothing in this handbook should be interpreted and/or understood as creating a contract of guaranteed or continued employment.”


“Neither this handbook nor any other communication by a management representative or other, whether oral or written, is intended in any way to create a contract of employment.”

For more information about at-will employment, click here.


Workplace Situations

Handbooks also should include a disclaimer explaining the handbook’s purpose is not to address every situation that could possibly arise in the workplace.  Here are a few examples of how to achieve this:


“The employee policy handbook cannot address every situation in the workplace. If you have questions about your employment or any provisions in this handbook, contact management.”


“The employee policy handbook cannot detail every possible circumstance that may arise during employment and is not intended as the only resource for the company’s policies.”


“Understand that no employee handbook can address every situation in the workplace.”


Handbook Changes

Changes in policy are a normal practice as employment laws and rules evolve. Policy handbooks should always reserve the right to revise the policy.  Below are a couple of examples of revision disclaimers.


“This handbook supersedes any previously issued handbooks or policy statements dealing with the subjects discussed herein.”


“The company reserves the right to revise, add, or delete from this handbook as we determine to be in our best interest, except the policy concerning at-will employment.”


#2 Workplace Posters and Notices


All employers are required to post workplace notices in a clearly visible place where employees can regularly see them and at each location where there are employees.  It is a common practice to inform employees of federal, state, and local compliance measures and changes.


Workplace posters and notices can be found online at no charge and some are provided by certain agencies at no cost, for example by the workers' compensation policyholder or the employment department upon an employee claim. There are also all-in-one workplace posters available for purchase online.

For more information about workplace posters, click here.


#3 Hiring Policies and Procedures


Your employees are an important part of your company. They enable the company operations to be carried out and they offer valuable knowledge that helps the company become successful. Hiring the right employees starts with an ethical and fair recruitment process.  Be sure that your hiring procedures are consistent and up to date. The company's hiring strategy is vital for the success of the company and its loyal employees.

Employers should establish a streamlined and consistent hiring process in order to recruit and retain qualified talent and create equal opportunity for each new hire. Include these easy steps in your hiring plan:


  1. Clearly define the day-to-day job functions and the education skills and experience requirements to perform the job.

  2. Collect a resume and/or employment application.

  3. Perform an in-person or online live video interview.

  4. Contact professional references and verify former employment.

  5. Verify that required licensing or certifications are active and without negative claims that are required to perform the job.

  6. Present a formal offer of employment, either written or verbal, that details the start date, pay, and benefits if the position is accepted.

  7. Perform a criminal background screen and a drug screen when the job functions require one.

  8. Send the welcome letter along with the job description, policy handbook, training schedule, and necessary hiring forms.


There are standard federal, state, and local employment laws and rules that should be clearly described in every policy handbook, including the federal Equal Opportunity Employment statement and policy against workplace harassment. 

A clearly defined hiring process is cost-effective and will streamline your onboarding process to be fair and equitable for every hire.


#4 Correctly Classify Workers


One of the leading causes of payroll and tax mistakes is the misclassification of workers. The misclassification of workers can cause big problems for employers and can result in repayment of employment taxes, interest, and penalties.


The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments. Depending on the classification, employers must ensure compliance with the FLSA and include minimum wage and hour rules for overtime pay.


Employees are considered exempt or nonexempt under the FLSA and it depends on limited criteria such as how much you pay the employee, how you pay the employee, and the type of work the employee performs. Because exemptions are narrowly defined under the FLSA, employers should carefully check the exact terms, conditions, and responsibilities of workers related to financial or behavioral control, relationship, and W2 employee or independent contractor.

For more information about the FLSA, click here.


#5 Know Your State's Final Pay Requirements


What is final pay? Upon an employee's resignation, termination, retirement, or separation of employment, the employer is responsible for all monies owed for hours worked. Some state laws provide civil penalties for willful failure to pay wages at separation as well as interest, fines, and other fees.


According to the US Department of Labor, employers are not required by federal law to give former employees their final paycheck immediately. Some states, however, may require immediate payment.


In Oregon, employers that fail to pay final wages when they are due, risk the imposition of a penalty wage equal to eight times the employee’s regular rate of wage for each day that final wages go unpaid for up to 30 days. Oregon law also issues a $1,000 civil penalty for willful failure to pay wages at termination as well as costs, interest, and attorney fees. With certain exceptions, employers may limit this liability to 100% of unpaid wages by paying final wages within 12 days of written notice from the employee that wages remain due.


Employers may only withhold amounts that are legally required or are agreed to in writing, and the deduction is for the employee's benefit. Employers may not withhold, deduct or divert any portion of the employee’s wages unless they are:


  • Deductions required by law such as taxes or garnishments

  • Deductions for health insurance premiums

  • Deductions authorized in writing if the employer is not the recipient of the money

  • Deductions for a cash loan to the employee if the employee had signed a loan agreement


To maintain compliance, it's critical that employers are up to date with their state's Bureau of Labor and Industries final pay rules. Additionally, employers should clearly communicate the separation of employment policies and procedures with employees.

For more information about your state's final pay laws, click here.

For More Information About Compliance And Assistance With Establishing Effective Policies And Procedures, CLICK HERE!

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