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The importance of HR documentation

The importance of HR documentation

Why is documentation important? 

When it comes to compliance, there always seems to be one more thing to do. Not only does an administrator need to be aware of workforce regulations, but they also need to understand how those regulations should function within their unique organization. Because compliance is so complex, employers should routinely document internal practices. 

Documentation can prove compliance

You've done all the work, but you have to prove it.When audits come around you want to make sure you have full documentation of your compliance efforts. If your organization is fully compliant, good documentation can serve as indisputable proof. At minimum, documentation of HR compliance practices should include:

  • Recognition of the standard
  • Detailed record of the effort taken to comply with the standard
  • A timeline of actions taken to comply with legal standards
  • Evidence of actions taken
  • Proof of stakeholder acknowledgement of standard (if applicable)

Documentation can reduce penalties

If your organization is not 100% compliant, documentation can still work in your favor. Through a legal principle called “good faith,” employers can significantly reduce the fines and penalties resulting from noncompliance. 

So what exactly does good faith mean? Good faith means that the organization made a true effort to comply with federal, state and local laws. Of course in order to prove good faith, an organization needs documentation of efforts made to reach compliance standards. One of the best ways to prove good faith is to conduct an internal audit, a full review of compliance.


Documentation can improve internal practices

Documentation can also help improve internal practices. By reviewing a timeline of a company's efforts to comply with various regulations, administrators have the opportunity to identify trends within their own organization. Once these trends have been identified, they can assess factors within their business such as: risk, efficiency and company culture. By taking this fine-toothed-comb approach, employers and administrators gain more insight on their organization and, as a result, can make improvements that facilitate growth.


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