The Cost of Non Compliance

By Molly Wood, SDEA HR Consultant

COMPLIANCE. It doesn’t even sound fun.

$1,862 penalty for I-9 “Technical” violation, $875,000 in settlements for harassment claims, $35,000 fine for Required Notice discrepancy, $1,000 statutory damages for background check violations. That sounds even less fun!

While compliance may be a mundane part of your business, failure to monitor compliance issues can be a very costly business expense. Considering that fines, lawsuits, and settlements can usually be mitigated by proactive, up to date policies and procedures, it stands to reason that a review of Employment Practices is something that should be done with some regularity.

Let’s get more detail on the a few employment practices that can get expensive quickly:

1. I-9’s – The U.S. Department of Homeland Security monitors I-9 compliance, and they can be very particular about how the process is handled. The fines for “Substantive/Uncorrected Technical Violation” are $220 – $1,862 per violation. Technical violations include failure to ensure that Section 1 and 2 dates are correct, failure to provide title, business name, and business address in Section 2, failure to state “Individual underage 18” in Column B of Section 2 for employees under 18 using only a List C document, and several other items to tedious to get into in this article. Fines for “knowing hire” or “continuing to employ” are higher.

2. Stated and Acknowledged Harassment Prevention Policy – The EEOC Press Release headlines specify $875,000 in settlements for harassment claims, just for the month of June!!!

3. Required Notices – Failure to post required state and federal employment law notices can result in fines of more than $35,000.

4. Background checks – The Fair Credit Reporting Act has strict technical requirements with statutory damages ranging from $100 to $1,000 per violation with no cap on recovery.

Now that we are looking at dollar amounts easily in the thousands, and potentially in the millions, compliance is a little more compelling! With tight margins, even a minor violation could have a devastating impact on a small business.

San Diego Employers Association provides a complimentary Employment Practices Review to new members within the first year of membership. We can also provide periodic checkups as needed. Our HR Employment Practices Review is a comprehensive evaluation designed to help identify “red flags” and help you to protect your company from fines and litigation.

If you have any concerns about compliance in your organization, give us a call to schedule your HR Practices Review at 858.505.0024 or click on the button below.

 

Contact us: 858.505.0024