Compliance and the HR Functions
Reviewing the laws and Identification of two HRM compliance issues
Organizations as few as 14 employees are required to comply with at least 15 federal labor laws as well as some local and state laws. However, organizations that have at least 50 employees can be subject to 20 federal labor laws. Management of some small employees may believe that labor laws only pertain to large organizations, however, all small, medium and large organizations are required to comply with federal labor laws that affect them. Compliance of labor laws is very critical for effective human resources management (HRM). HRM compliance is the process where organizations are required to respect the federal labor laws during recruiting, selection, promotion and compensation of employee. (KPMG, 2013).
GINA (Genetic Information Non-discrimination Act) is one of the labor laws that organizations are required to comply to protect employees from genetic discrimination of employment and health insurance. (National Library of Medicine, 2014).Typically, employers are required to comply with the GINA Act to abide to the federal labor law. Under the labor law, genetic discrimination occurs when an employer treats employees or applicants differently based on their genetic change that can increase risks of an inherited disorder. In the United States, GINA Act is a federal labor law designed to protect employees and applicants from all form of genetic discriminations. Essentially, employers are required to comply with GINA Act to avoid the risks of prosecution. The law comes into effect on May 21, 2009, and the Title II under the GINA Act prohibits employers to implement genetic discrimination within an employment environment. Moreover, it is illegal for employers to use genetic information of an employee when making decision regarding promotion, hiring and other employment terms.
Consumer report is another issue that focuses on HRM compliance. Employers can use consumer report to make an employment decision, however, when employer decides to use a consumer report to make a decision...
The FCRA states that employers should inform an applicant or employee that they could use a consumer report to make an employment decision. The notice should be in writing and stand-alone format. Additionally, employers must get a written permission from an applicant or employee before carrying out a consumer report on an applicant or employee. Failure of employers to inform employee is non-compliance with FCRA regulation. Part of FCRA regulation is that employers should not discriminate against an employee or applicant based on the information collected. Moreover, employers should refrain from misusing the information collected. (Bureau of Consumer Protection, 2014). Typically, employers are required to comply with the regulations discussed above to carry out effective HRM compliance.
HRM functions that might be affected by FCRA and GINA
Although both the GINA and FCRA stipulate that employers should not discriminate against an employee or applicant based on the information collected, however, it is very difficult to rule out completely that employers may not discriminate against employees or applicants based on the information collected. Typically, some positions within an organization is very sensitive which could force employers to base their hiring or selection decision based on the information collected on an employee or applicant. For example, many primary schools in the United States will need to carry out a background check on primary school teacher applicants before making a selection decision on applicant. It will be very difficult for primary school employers to select an applicant who has a past record of child abuse. Thus, information collected on a particular applicant in this issue can affect HRM functions on the selection and recruitment of primary school teachers.
Moreover, increasing number of financial institutions is using information from a consumer report to make a selection and recruitment decision. For example, it will be very…
