HR Management & Compliance, Learning & Development

Onboarding Regulations—Steps for Success

Onboarding new hires—it’s the first step in training the next generation of workers that will help shape your company’s future. There are regulations that guide the process, however, and employers need to know the facts. Today, we discuss how to achieve compliance with state regulations in an article by Julia Bailey, senior director of product management for Equifax Workforce Solutions.

Many organizations strive to optimize their recruiting processes to find and hire qualified talent as quickly as possible, yet the challenge isn’t over once their selected candidate accepts the job offer. Companies must also onboard the new hire efficiently, effectively, and compliantly.
More than just setting up the new hire’s work space and giving a tour of the office, onboarding entails a number of forms and processes that must be completed by the employer and new employee, which, if done incorrectly, can lead to unnecessary fines and possible future litigation.
What makes onboarding so challenging for many organizations is that federal and state legislation continues to change rapidly in regard to new hire notifications, tax forms, identity verifications, and employment eligibility. And the requirements can differ drastically from state to state, putting even greater pressure on employers hiring in multiple locations.
Moreover, many companies still rely on paper-based forms and processes, which lack centralized control and can make it difficult to manage compliance. As a result, today’s businesses need a new approach to automate and streamline the onboarding process.

The Growing Regulatory Environment

Managing the growing state compliance requirements has become more and more demanding for employers. As the complexity increases, employers must stay up to date with changing requirements, properly interpret regulations, and ensure they distribute the right forms to the right employees at the right time.
Just consider the fact that almost 40 states now have some type of new hire notification requirements, mandating that new employees be notified of various policies like wage notifications, paid sick leave, and pregnancy accommodations.
Complicating compliance further is the fact that most states do not offer a standard template for their required notifications; businesses must determine for themselves how to create and distribute such forms. And even when there are templates available, employers often find them confusing, which can introduce the company to risk if not completed appropriately.
At the same time, more than 30 states require the use of the E-Verify tool or have pending E-Verify legislation for identity verification to determine the eligibility of their new hires to work in the United States for some or all employees. Forty-three states have specific tax forms that must be completed at the time of hire.
This regulatory environment around onboarding will only increase in the near future; since the beginning of 2016, 36 bills have been introduced in state legislatures for additional new hire form requirements. Still, it’s not only the laws that have been expanded; government enforcement efforts at the federal and state levels have also grown, putting new pressures on employers to get it right.

Steps to Effective Onboarding

Given the challenges around new hire onboarding, consider the following two of six steps to help streamline the process, minimize risk, and achieve compliance.
1. Identify current requirements in each state. With increasing requirements and regulations, understanding the existing new hire policies in each state you currently hire in—and those you may be expanding to in the future—is essential. Working with counsel or your onboarding provider can help you identify the various state notification and verification requirements and react accordingly.
2. Stay up to date on new legislation. You can stay current with all new and pending regulations by subscribing to compliance updates from a law firm or by using automated onboarding solutions and services that provide regular legislative updates as part of their offering.
In tomorrow’s Advisor, Bailey provides four final steps to effective onboarding in this regulatory environment.