How Does the Industry Define “Compliance”?
Generally, compliance describes the ability to conform to relevant laws, regulations, policies, standards, procedures, or contractual obligations1—whether local, state, federal, or from a third party.
Legal regulations apply to most companies and are put in place to ensure that candidates and applicants alike have an equal opportunity to engage in the employment market, while being protected from things such as discrimination and unsafe working environments.
As it relates to legal and recruitment compliance, most companies consider data storage and retrieval of some kind, which is often necessary, but can be a challenge for many businesses.
The Complexity of Recruitment Compliance
Employment laws, regulations, and the recruitment landscape are constantly changing, making compliance extremely challenging, especially for small to medium size businesses. Not only do these businesses face tighter resources, their human resource departments are often responsible for all people-related processes within the organization.2
As a result of increasing regulatory requirements, many organizations today are investing in and relying on new technologies to address compliance concerns.3
With recruiters facing the pressure to hire top talent faster than ever, recruitment compliance, although important, can get pushed to the side. It’s up to every employer to ensure that they are in compliance and an equal opportunity employer.
Some Helpful Labor Laws & Regulations to Know
Having an overview of various labor laws and federal regulations that impact your recruiting activities is a start to understanding compliance within your organization as a whole.
45% of CFO’s stated that proposed regulations were causing their companies to become more cautious.4
U.S. Equal Employment Opportunity Commission (EEOC)
The U.S. Equal Opportunity Commission is the governing body responsible for enforcing federal laws that make it illegal to discriminate against both an employee or a job applicant because of the person’s race, color, religion, sex (including pregnancy, gender identity, and sexual orientation), national origin, age (40 years of age or older), disability or genetic information.5 While it is known that employers should practice non-discriminatory hiring practices, once a company hits its 15th employee then that company becomes covered by the EEOC’s laws. Meaning that the EEOC then has the authority to investigate and assess charges against employers covered by the law.6
The EEOC reported evaluating 92,641 charges in 2015 alone which resulted in a collection of more than $525 million in monetary damages against employers.7
What could these charges be on? Well, the laws apply to a variety of work situations from hiring, wages, benefits, and training to promotions, harassment, and firing.
When the EEOC uncovers that discrimination has occurred, they try to settle the charge. If they are unsuccessful in doing so, then they can opt to file a lawsuit to best protect the rights of individuals and the interests of the public, however they do not always file lawsuits. It depends on the case. Notably, the EEOC works to prevent discrimination before it occurs offering outreach, education, and technical assistance programs.8
Companies that fail to comply with the EEOC can face charges including substantial fines or penalties.
The Basics | Some Links to Learn More:9
Federal Laws exclude workplace discrimination and are enforced by the EEOC.
Regulations fulfill federal workplace discrimination laws.
The Office of Federal Contract Compliance Programs (OFCCP)
The Office of Federal Contract strives to protect workers, encourage diversity, and enforce the law. The OFCCP holds those who do business with the federal government (for example, federal contractors and subcontractors) responsible for complying with the legal requirement to take affirmative action, and to not discriminate against employees or applicants on the basis of race, color, sex, sexual orientation, gender identity, religion, national origin, disability, or status as a protected veteran.10
The OFCCP’s responsibilities include:11
- Offering compliance assistance to help federal contractors and subcontractors understand the regulatory requirements and review process.
- Conducting compliance evaluations and complaint investigations of federal contractors and subcontractor’s personnel policies and procedures.
- Monitoring federal contractors and subcontractors progress in fulfilling the terms of their agreements through periodic compliance reports.
- Obtaining Conciliation Agreements from federal contractors and subcontractors who are in violation of regulatory requirements.
- Forming linkage agreements between federal contractors and Labor Department job training programs to help employers identify and recruit qualified workers.
- Presenting relief to victims of discrimination, such as back pay for lost wages.
Manual data entry and inefficient reporting puts many of today’s companies at risk for being out of compliance with the OFCCP. To ensure compliance with these laws, the OFCCP runs random yearly audits on federal contractors.12
It may help to keep in mind that three major laws enforced by the OFCCP are Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, and The Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA).
With reports that audit evaluations may increase each year, an applicant tracking system that helps companies meet OFCCP compliance standards is a necessity today.13
To remain compliant, it is vital that organizations take proactive steps to track and record all information necessary. An applicant tracking system (ATS, for short) that automatically stores appropriate data will help support recruitment compliance.
In the off chance your organization gets audited, you can rest easy knowing that your ATS has been storing valuable information and can create comprehensive reports effortlessly.
Department of Labor (DOL)
The mission of the Department of Labor is:
To foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights.14
The DOL is responsible for managing and enforcing more than 180 federal laws. Here are two major laws that the DOL covers and their corresponding area within the Human Resources area:15
- Wages & Hours | The Fair Labor Standards Act (FLSA)—Administered by the Wage and Hour Division, the FLSA proposes standards for wages and overtime pay. The FLSA requires employers to pay covered employees who are not otherwise exempt, at least the federal minimum wage and overtime pay. The FLSA also monitors the hours and conditions that children under the age of 18 can work, as well as, enforcing the labor standards provisions of the Immigration and Nationality Act (INA) that apply to aliens authorized to work in the U.S. under certain non-immigrant visa programs.
- Workplace Safety & Health | The Occupational Safety and Health (OSH) Act—Administered by the Occupational Safety and Health Administration (OSHA), OSH ensures that safety and health conditions are regulated by approved state programs. Employers covered by the OSH Act must comply with their safety and health standards providing all employees with work and a workplace free from serious hazards. OSHA enforces the Act through workplace inspections and investigations.
The Need for a Trustworthy Applicant Tracking System
The liability for being out of compliance can be significant for an organization.
According to Career Directions, more than one-fourth of all companies in industries such as technology, healthcare, and government use some kind of applicant tracking system to manage their applications, candidates, and processes.16 A quality ATS has the ability to help organizations minimize risk and correct compliance issues.
In fact, having access to more automated recruiting technology ranked highest among companies with 500-999 employees.17 While there are various applicant tracking options on the market, it is important to find one that will handle the complexities that come with ensuring your company is in compliance. iCIMS advanced applicant tracking system Recruit, may be able to help companies of various sizes address legal compliance needs with seamless data entry, automation, and comprehensive reporting capabilities
Have You Asked Yourself: Are We Compliant?
47% of organization are unsure which data compliance standards apply to their organizations.18
To adhere to the OFCCP, EEOC, and DOL laws and regulations, there is a significant amount of information organizations must collect making it difficult to know if your company is truly compliant or not. An applicant tracking system may help provide the infrastructure to support current processes and adapt to any new changes that occur, safeguarding your organization.
To take on the challenge of recruitment compliance, here’s a checklist to get you started:
- Technology—invest in an applicant tracking system with reporting capabilities.
- If you do not already have an ATS in place, then your first step towards ensuring compliance is to invest in an ATS that can help automate and improve the accuracy of your data tracking and seamlessly report on your recruiting activities.
- Choose an ATS that provides audit trails and easy access to information such as the candidate’s application journey, and notes from your hiring managers.
- Education—provide all employees with compliance training.
- Train your employees on compliance behavior restrictions and how to report inappropriate conduct such as harassment and discrimination.
- Compliance training promotes consistency in how discrimination and harassment are reported, documented, and investigated—helping organizations defend themselves against any charges employees file with the EEOC.
- Proper training prevents administrative mistakes, such as failing to record a complaint.
How iCIMS Can Help
iCIMS is the leading provider of talent acquisition solutions that help businesses win the war for top talent. iCIMS empowers companies to manage their entire hiring process within the industry’s most robust Platform-as-a-Service (PaaS). Built on the foundation of a best-to-market talent acquisition software suite, iCIMS’ PaaS framework, UNIFi, allows employers to expand the capabilities of their core talent acquisition technology by integrating with the largest partner ecosystem in talent acquisition to help them attract, find, screen, and manage candidates. Offering scalable, easy-to-use solutions that are backed by award-winning customer service, iCIMS supports more than 3,500 contracted customers and is one of the largest and fastest-growing talent acquisition solution providers.
For more resources: Connect with iCIMS on social media and visit www.icims.com/hiring-insights.
iCIMS, Inc. and its affiliates do not provide legal or compliance advice. The information contained herein has been prepared for general information purposes only and is not intended to be legal advice, is not to be acted on as such, may not be current and is subject to change without notice. The information is presented “as is” without representation or warranty of any kind. Any representation or warranty that might be otherwise implied is expressly disclaimed. You agree that iCIMS is not liable to you or others, in any way or for any damages of any kind or under any theory, arising from this the information, or your access to or use of or reliance on the information. Any use of the information is at your own risk. You should consult with your own legal and compliance advisors to address any inquiries in relation to the information.