For HR and compliance teams in the finance and insurance industries, the nature of the field brings with it more scrutiny — especially when it comes to employment law compliance.
Dealing with personal information and enhanced government oversight can prove especially challenging. With that in mind, here are the top five compliance challenges for the finance and insurance industries.
As many companies have employees working from home these days, cybersecurity takes on an added dimension of complexity in the finance and insurance industries.
The threat of a cyber attack is always present, but with finance and insurance companies dealing with social security numbers, banking information and more, they can be ripe targets for hackers.
And as employees working off site are inherently in a less secure environment, it can be more difficult to maintain compliance with the standards and regulations associated with the finance and insurance sectors.
Many finance and insurance companies have remote workers, as do many employers, as the nation continues to wade through the pandemic. Teleworking employees create a host of issues beyond cybersecurity, however.
Chief among them are paid leave and labor law postings.
For paid leave, the true challenge is determining how the laws apply. Many paid leave laws, for example, have regulations about how many hours an employee works in a city. There may be a paid leave law in the city where an employee regularly works, but if they are only coming into the office sparingly, the leave benefits may not apply.
Likewise, labor law postings present another challenge with remote workers. How do HR and compliance teams display a poster in a conspicuous place when the employee isn’t even in the office? Many finance and insurance companies turn to intranet poster programs to ensure compliance for remote workers.
Labor Law Postings
Speaking of labor law postings, large finance and insurance companies often have locations spread across the U.S., making posting compliance a major hurdle.
How do you keep track of new and updated postings at hundreds (if not thousands) of locations? For banks for insurance companies, on-site staff is necessary, and that means maintaining a strong postings compliance program.
Plus, federal contractor postings can find themselves subject to more frequent audits, putting an extra layer of importance on labor law posting compliance.
Labor Law Posting Compliance. Simplified.
The finance and insurance industries may not often be associated with minimum wage, but it remains a compliance issue on a couple of levels.
First, it’s the minimum wage rates themselves. Dozens of jurisdictions across the country have passed their own minimum wage laws, with many now moving from scheduled increases to indexed rates, making them more difficult to track and apply. (The federal minimum wage rate has remained unchanged for more than a decade.)
Meanwhile, the financial industry specifically has seen many companies opting to create their own across-the-board minimum wage rates. But while this may ease the burden on compliance teams, it also comes with the obvious financial implications.
Companies with locations in primarily rural areas or parts of the U.S. with lower cost of living expenses may have to weigh the pros and cons of a single rate — or set a rate that more closely aligns with those areas.
Minimum Wage Management. Simplified.
Finally, we come to paid leave laws. Across nearly every industry, not just finance and insurance, paid leave laws are becoming increasingly difficult to manage.
Paid leave laws vary widely and require more oversight and attention to detail. Employers have to consider:
- Accrual rates
- Eligible reasons for use
- Definitions of family members
- Benefit requirements
- Waiting periods
- Caps on use
These factors and others can make paid leave management a compliance conundrum.
Paid Leave Management. Simplified.
The finance and insurance industries bring a number of employment law issues compliance and HR teams have to tackle.
With more scrutiny and greater oversight, compliance is a primary concern for the finance and insurance industries.