The term “compliance” in the employment context means satisfaction of whatever is required by those laws and regulations applicable to the employment relationship. Accomplishing this requires an expert-level understanding of not just employment law, but also the basic skills underlying any legal practice. This means understanding the rules of statutory interpretation; the capacity to distinguish between differing legal authorities and identify which is controlling; an ability to read and understand case law, and then—this may sound familiar—apply the legal precepts to a new set of facts. Clients and the legal community judge an attorney’s services fiercely in these respects.
The Critical Distinction Between Legal Compliance and HR Practice
So-called “HR professionals” lack the training to apply these skills properly and are likely unaware that they are engaging in the practice of law; the notion of “HR compliance” often leads to disastrous results.
Avoid These Compliance Errors Commonly Committed by Human Resources
Here are just a few examples I have seen, with the details just specific enough to be useful:
- An employee with a non-physical disability demonstrates a verbal tic to a customer during a sales interaction. The customer, disturbed and offended, promptly complained to management. The complaint reaches “HR,” who reviews the employee’s conduct as described by the customer and immediately terminates the employee. The employee brings a lawsuit under state and federal law against the employer for disability discrimination and retaliation, which the employer is compelled to settle for a large sum.
- A manager makes a discriminatory remark to a recently hired employee, who contacts HR to complain. At the same time, the manager, knowing that they exposed themselves to potential discipline or termination by the company, reaches out to HR to seek the employee’s termination instead. HR, seeking to please company management, arranges for the summary termination of the employee before a complaint is filed. The company now faces a lawsuit for discrimination, retaliation, and public embarrassment once the case reaches federal court.
- An employee requests FMLA leave for a minor injury she sustained at home after failing to show up for work for several days. The employee refuses to present documentation of the injury other than verification of an emergency room visit. The company’s HR staffer grants the employee leave, and the employee takes the full 12 weeks. The employee, who would have been ineligible for FMLA leave, works a second job. A lawsuit for FMLA retaliation and interference followed the company’s employee termination. Their inability to contest her eligibility after granting her leave limits the employer’s ability to dismiss the suit.
- A pregnant employee working as a hotel room cleaner requests accommodation. Human Resources makes strenuous efforts to meet the particular employee’s accommodation demands, including interfering with the work of other employees. None of these measures satisfy the employee, and, out of frustration, HR takes steps to terminate without explanation during the interactive process. The company faces a lawsuit under state and federal law applicable to pregnant workers.
- An employee engages in sexual harassment of another employee. The accused employee is a member of a protected class. The employee complained to Human Resources about harassment. HR quickly fired the accused employee after a brief investigation. The now-terminated employee threatens legal action after identifying another employee accused of sexual harassment who still works for the company and is not a member of a protected class. HR responds to the terminated employee in writing with seemingly inconsistent explanations for their termination of employment and failure to conduct a thorough investigation. The company is now vulnerable to a “pretext” argument in a lawsuit by the former employee, as the now-terminated employee’s plaintiff-side attorney quickly discovers and leverages in settlement discussions.
- An HR professional withholds an employee’s cash benefits on the belief that the employee was not using them and believes the benefits are available on a “use it or lose it” basis. This policy is not reflected in the company’s handbook, and the HR employee turns out to be mistaken about the employee’s use of the benefit. The employee brings a wage complaint with the state Department of Labor, and the employer is subject to liability for up to twice the amount of withheld payment.
The Importance of Early Legal Consultation
As illustrated by the examples above, by the time you are in litigation, the die is already cast; whether you have complete or partial defenses available or can succeed on a motion to dismiss is determined by your decisions well before the complaint is served. The scenarios I describe are anything but an exception; they are the rule. Non-legal professionals cannot view the long-term impact of their actions and the legal exposure that may result down the line.
These real-world scenarios share a common thread: Human Resources too often waits until after a lawsuit or threat of one to consult an employment lawyer. At that point, the damage is done. The HR employee’s sheer incompetence is exposed because involvement of an employment attorney would have counseled precisely against the actions taken by so-called “HR professionals” in each instance. The employer faces far greater legal liability because HR acted independently and forwent legal counsel.
Problematic HR-Crafted Employee Handbooks
No less irresponsible is entrusting “HR compliance” supposed experts to prepare materials such as handbooks or individual employer policies. Handbooks frequently serve as key evidence in lawsuits. I have prepared and revised handbooks for national, regional, and local companies. The difference between one previously reviewed by legal professionals and one from one of many “HR compliance vendors” is night and day.
Even if an employment attorney prepared a handbook some time ago, it may contain statements that do not reflect recent legal changes. These handbooks usually require minimal updates. “HR handbooks” are often chock-full of boilerplate, meaningless regurgitations of something that once came from a lawyer. They are often prepared without regard to controlling state law, omit mandatory provisions, and are vague where a lack of detail is necessary to avoid unintended inferences.
The Accountability Difference: Attorneys vs. HR Professionals
Well, what about incompetent attorneys, one might ask? Aren’t these anecdotal examples unfairly selective? Lawyers are expensive, and not everyone can afford to hire employment counsel! If a business is running just fine as is, that’s evidence enough that we don’t need to talk to employment counsel!
These refrains reflect an easy-to-spot ignorance of the role of an attorney versus that of an “HR professional” that can only be the fault of the lawyers and licensing bodies that permitted it to flourish.
In the first instance, as the ABA’s proposed definition made explicit, attorneys are subject to mechanisms of accountability that are virtually unheard of in their severity and strictness across other professions. An attorney who commits an egregious error is subject to professional discipline, which may result in the revocation of his or her license to practice. He or she is liable to the client for malpractice and may be responsible for damages as determined by a court of law. Complaints against attorneys for misconduct are public, and anyone interested in hiring an attorney will review his or her disciplinary history or lack thereof. Moreover, holding a bar license is a sign that an attorney has satisfied rigorous educational requirements, testing, character investigations, and fitness to practice.
There is no equivalent system of accountability for “HR professionals.” The certifications are meaningless in that they are easily obtained with little cost or time investment, do not require educational attainment, and do not imply satisfaction of any uniform or objective standard that means anything. You have no right to sue an HR professional who leads you into a legal pothole any more than you can sue your gardener for his or her legal advice. And the HR professional has no obligation of confidentiality. Finally, human resources professionals who commit these errors face little transparency or accountability. Suppose a human resources professional hired by a company handled one or more scenarios I described a few paragraphs above. In that case, the company hiring them would likely never know.
The ABA’s Missed Opportunity
Increased legal exposure and enlarged liability are the consequences of engaging a non-legal professional or other generalist to perform services for which they are not qualified and lack any certification or accountability. The ABA should have enforced the basic premise that practicing law requires a law degree two decades ago. Their failure to do so has harmed the public interest and served neither employees nor clients. HR professionals are eager to justify their positions (and high rates, often higher than many small law firms) by taking a heavy-handed approach to personnel management. As a result, HR administrators frequently violate employees’ rights in obvious ways that an employment attorney would spot and preemptively address.
In short, “HR compliance,” to the extent it goes beyond mere administrative implementation, is a misnomer and a fraud, and one the ABA had the exclusive opportunity to call out two decades ago. To call the ABA resolution adopted a punt to the legislatures is to understate the degree to which the ABA failed its role as a professional licensing body.
Indeed, the ABA drafted a “Model Rule,” recommending to legislatures how to word a statute if they adopt its underlying principle. The ABA has no authority over state legislatures or state bar committees; the model rules are advisory. Faced with pressure from the HR industry, the ABA buckled and refused even to articulate a coherent model rule that would have threatened a widespread but improper practice.
The Proper Role of HR: A Bridge to Legal Counsel
Therefore, the proper role of HR is that of a two-way conveyor belt between the workforce and legal counsel. To shield employers from legal exposure, HR must implement written policies and procedures drafted by legal counsel and approved by management. HR should inform employment counsel of employee interactions implicating these policies, including misconduct reports, leave requests, disability accommodation requests, and wage issues, and ensure ready access to these records for attorney review.
A single lawsuit can lead to hundreds of thousands of dollars in litigation fees, so that responsible HR staff will recognize and adhere to such a system. Any resistance to oversight by employment counsel from HR “professionals” is itself a red flag that employers would do well to heed. Resistance to legal oversight creates the liability that these individuals were hired to prevent. Employers shouldn’t allow HR professionals to decide when to hire an attorney because they lack the certification, training, and qualifications to make such critical decisions. Employers and businesses must set those boundaries; allowing others to set them for you will only lead to disaster.
Concluding Remarks:
Businesses should fail or succeed based on their judgment of the market demand for their product or service and how best to provide that product or service. Avoid simple mistakes to prevent legal and financial trouble; consult the right legal professionals.