Today we honor the US Women’s Soccer team who won their fourth World Cup over the weekend by defeating The Netherlands. The US controlled the entire match, much as they had for the entire tournament. They were tested to be sure by host country France, England and Sweden but they were clearly the most talented and deepest squad. The tournament capped off a great few weeks of soccer, not women’s soccer, just soccer. The US team did all this while locked in a dispute with the US Soccer Federation about their unequal pay with the men’s team. Even though the US Women’s team now brings in more revenue than the men’s team; the US Soccer Federation claims that should not be the basis of compensation. The blatant discrimination by the US Soccer Federation informs today’s consideration of the role of Human Resources (HR) in compliance.

I have long advocated for a greater role of HR in compliance. Indeed, one sign of a mature Foreign Corrupt Practices Act (FCPA) compliance and ethics program is the extent to which a company’s HR Department is involved in implementing a compliance solution. While many practitioners do not immediately consider HR as a key component of a compliance solution, it can be one of the lynch pins in spreading a company’s commitment to compliance throughout the employee base. HR can also be used to ‘connect the dots’ in many divergent elements of a compliance and ethics program.

Even more important is the operationalization of compliance into the fabric of the business. One of the key indicia of compliance program effectiveness is how thoroughly each separate corporate discipline incorporates compliance into its everyday job functions. An active and functioning compliance program will literally be alive in each department in an organization.

HR has as many touchpoints as any other corporation function with employees. From interviews to onboarding, through evaluations and performance appraisals, even to the separation process; HR leads many of the corporate touchpoints. Each one of these touchpoints can be used to teach, educate and reinforce the message of doing business ethically and in compliance with laws such as the FCPA.

The Evaluation of Corporate Compliance Programs, 2019 Guidance, listed at least three specific areas of HR touchpoints in a best practices compliance program:

Human Resources Process– Who participates in making disciplinary decisions, including for the type of misconduct at issue? Is the same process followed for each instance of misconduct, and if not, why? Are the actual reasons for discipline communicated to employees? If not, why not? Are there legal or investigation-related reasons for restricting information, or have pre-textual reasons been provided to protect the company from whistleblowing or outside scrutiny?

 Consistent Application– Have disciplinary actions and incentives been fairly andconsistently applied across the organization? Are there similar instances of misconduct that were treated disparately, and if so, why?

 Incentive System– Has the company considered the implications of its incentives and rewards on compliance? How does the company incentivize compliance and ethical behavior? Have there been specific examples of actions taken (e.g., promotions or awards denied) as a result of compliance and ethics considerations? Who determines the compensation, including bonuses, as well as discipline and promotion of compliance personnel?

When you consider the number of touchpoints HR has in the employment lifecycle, from pre-employment screening and interviewing; onboarding; training; annual reviews and assessments; promotions to exit strategies, its role in facilitating the operationalization of compliance becomes clear. At each of these touchpoints, HR can take the lead in operationalizing compliance. Additionally, each touchpoint provides an opportunity for ongoing communications with a prospective employee, newly hired employee, seasoned employee or one moving up into the ranks of management about the need for ethical dealings and compliance with company values as set out in the Code of Conduct and operationalized in the compliance policies and procedures.

By using these touchpoints HR can demonstrate the shared commitment requirement found in the 2019 Guidance as well as the requirement for ongoing communications. There are few other corporate departments which have so many employee touchpoints as HR. Every compliance practitioner should use HR to operationalize compliance through the variety of touchpoints and expertise available to a compliance professional through a corporate HR department. As a key first step, I would suggest that every compliance professional head down to your corporate HR department and have a cup of coffee with your functional equivalent in HR. Find out not only what they do but how they do it and then explore how you can further operationalize your compliance program through these HR-employee touchpoints.

Hats off the US Women’s team for true excellence in the face of such discrimination by their own soccer federation.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2019

 

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