There is always more to do to be compliant but that doesn’t mean HR needs to take on a policing role. Head of Content, Simon Kent investigates how to drive more value from getting things right.
As HR and the organisations it serves face one of the most challenging times in terms of compliance and changes to employment law, there is a danger that all HR might be known for among employees is policing and risk management. As employing people becomes more complex and arduous it falls to HR to apply the new laws and requirements and make sure everyone within their organisation is operating correctly.
But does it have to be this way? Is compliance simply nothing more than keeping on the straight and narrow, or can be more human?
“HR compliance, handled in the right way, should not be seen as a tool of control, it is the foundation of trust,” says Kayleigh Wright, HR Director at HSS ProService Marketplace. “When organisations treat compliance as something that is ‘done to’ people, it can feel like box ticking and policing, but when it is governed well, it creates the conditions for fairness, consistency and confidence, which ultimately benefits employees and employers alike.”
Consistent and transparent
Wright goes on to note than handled correctly, compliance can create clarity, consistency and transparency. All positive elements to promote within the workplace. It sets expectations that people can actually understand and rely on, rather than leaving them to interpret a shifting set of informal norms: “That matters because workplaces are rarely undermined by a lack of policies, but by a lack of predictability,” she notes. “When the rules are clear and applied consistently, it becomes easier for managers and leaders to act confidently, not cautiously. Decisions can be made more quickly because the organisation is not constantly negotiating what is ‘allowed’ or ‘fair’ on a case by case basis. In that sense, compliance is not the opposite of agility – done properly, it is what makes agility safe.”
Addressing the forthcoming employment law changes, Wright believes it is wrong to frame the changes ‘more bureaucracy’ and to simple respond with more policies, process, and complexity. She believes transparency and simplicity can be achieved instead with businesses being open with leadership teams and colleagues about enhanced rights and the areas that impact their work. She advises companies to communicate early: “If organisations are vocal, clear and consistent, the changes can be framed as progress in fairness rather than a compliance burden,” she says.
Charlotte Wills, Partner, Fragomen believes the current combination of economic pressure, geopolitical instability and acute talent shortages means organisations need to act faster and start accurately anticipating risk. “A unified workforce strategy – anchored in immigration expertise, risk management and grounded in data – is no longer optional but is fundamental to achieving both operation objectives and broader business priorities,” she advises. “HR and global mobility functions sit at the centre of this shift.”
Compliance, control, competitiveness
Wills argues that HR and mobility functions have evolved beyond simply being operational support roles. They are governance instruments, cost-control levers, communication channels and enablers of talent strategy. “The organisations we support are seeking more sophisticated strategic guidance, typically structured around three interconnected pillars – compliance, cost control and competitiveness through robust talent pipeline design.”
Wills also see compliance linked to other parts of business activity, particularly reputational risk and brand integrity. With the digitisation of borders and other initiatives, there is increased scrutiny of who travels, when, and for what purpose. This element can be complicated by the use of remote and hybrid working models with the result that creating the modern workforce can bring with it a series of new and complex risks. “Organisations that treat immigration and mobility compliance as a strategic risk function, rather than a reactive process, are better positioned to protect both their workforce and their organisational reputation,” says Wills.
It transforms mobility from a transactional process into a strategic enabler aligned to short, medium and longer term business objectives.
Importantly Wills also sees a competitive advantage to be gained from good compliance. “Without proactive workforce planning, hiring and mobility becomes reactive, most expensive and more time pressured,” she says,”often resulting in a diminished experience for both the business and the individual.”
Getting compliance right and integrating it into the everyday operation of the business and the company can develop a forward looking approach to workforce planning enabling agility, cost efficiency and longer term operational resilience. “It transforms mobility from a transactional process into a strategic enabler aligned to short, medium and longer term business objectives,” Wills says.
Know your workforce
“Compliance gets a bad rap because people treat it as the destination,” says Jools Barrow-Read, Founder, RedWizard. “It isn’t – it’s actually a very important enabler.”
Barrow-Read notes that for permanent staff, HR has always owned compliance – having sight over who’s employed, on what terms, with what rights. However, if the rest of the workforce are considered — the contractors, freelancers, agency workers, umbrella workers she says most HR teams are ‘flying blind’ with up to 40% of people who work for a business sitting completely outside HR’s awareness.
“Every new piece of legislation – whether it’s employment rights reform for perm staff or the upcoming umbrella changes for contractors – is essentially asking the same question – do you know your workforce?” She says. “The policing narrative comes from HR feeling like they’re being made responsible for something they don’t control. And that’s fair. But the opportunity is to flip it – use compliance as the reason to finally get that visibility, because what you find on the other side is genuinely valuable.”
It stops being about risk and starts being about strategy – capacity planning, cost visibility, make-vs-buy decisions.”
For Barrow-Read in IR35 ‘off-payroll’ legislation is as case in point. Design to combat tax avoidance where individuals working through their own limited companies were actually full-time employees the businesses that handled it well didn’t just avoid penalties but came out with better supplier relationships, cleaner governance and a workforce picture that actually reflected reality. “Compliance forced a conversation that unlocked something much more strategic,” she observes.
“Once HR knows what their total workforce looks like, the questions change,” she continues. “It stops being about risk and starts being about strategy – capacity planning, cost visibility, make-vs-buy decisions. That’s where HR’s real opportunity is. Not policing. Orchestrating.”
Barrow-Read also draws attention to the human dimension of compliance that is often missed: “Compliance isn’t just about protecting the business,” she says. “It’s about making sure the people in that workforce are being paid correctly and treated fairly. HR is well placed to own that – and it’s a much more compelling reason to care about compliance than avoiding a penalty.
“In the right hands, compliance does not make HR a risk management function,” says Kayleigh Wright. “It makes HR the builder and steward of trust, which is what allows organisations to perform well, fairly, and to remain commercially viable.”
