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Compliance Regulations Alert: Employment Related Practices to Avoid

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Compliance Regulations Alert: Employment Related Practices to Avoid

Michael Volkov recently published a blog on new human trafficking compliance regulations proposed by the Federal Acquisition Regulatory (FAR) Council. The new compliance regulations would affect both government contractors and subcontractors, and while currently human trafficking regulations relate mainly to sex trafficking and forced labor, under the proposed amendments, regulations would expand to cover a number of other employment related practices.

The new compliance regulations include these prohibitions:

  • Misrepresenting or omitting terms and conditions of employment (i.e. wages, fringe benefits, location, hazardous nature of the work, etc.)
  • Destroying, withholding or denying employees their personal identification documents
  • Charging recruitment fees
  • Providing or setting up living conditions that do not meet safety standards

Companies will be required to attest that they neither they or their third-party vendors have violated these employment practices. And, the Department of Defense has gone as far as to say that all contractors and subcontractors operating at margins above $5 million must have a whistleblower hotline, as well as posters displayed in the workplace promoting the hotline so that employees know how to report non-compliance. This includes making sure that you provide awareness materials in all employees native languages. The new provision will take these precautions into consideration for mitigation in cases where organizations can prove that they took steps to reduce non-compliance.

If your organization does not already have a whistleblower hotline, the proposed amendments to human trafficking regulations and more broadly, employment related practices, should scare you into action. This is one more thing you need to think about as compliance professionals. To avoid undue litigation ensure that employees are fully aware of the terms and conditions of their employment, that their personal identification documents are not tampered with, that recruitment fees are not charged and that if housing is provided that it meets local safety standards. Implement a whistleblower hotline, launch an awareness campaign about it, conduct employee training to inform employees of their rights (so if they witness non-compliance they can report it) and let them know you plan to protect them.

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