Regulators are Like Sharks – How to Keep from Becoming Chum
I was chatting with our Director of Customer Success and the General Counsel of one of our customers recently. I asked them, “What’s one critical thing companies need to do to speed up automating their corporate compliance system?” Without blinking, Dick, Compli’s Wise Man of Customer Success said, “Get their job titles and descriptions in order.”
The conversation that followed was fascinating.
When working with new clients, Dick continued, the job titles companies have in place are often a mess. Especially for companies with dynamic workforces that grow and change over time. You see this acutely in companies that have grown through acquisition. Sales Manager, Sales Director, and Sales Associate…you may have inherited these three job titles over time for a role that does the exact same thing. If this is you, it’s a big red flag.
This is when our friend, the General Counsel stepped in. He mentioned something that stuck with me.
He said, “Regulators are like sharks. One drop of blood and you’re in a feeding frenzy.” I found this hair-raising description for you. Replace the word “shark” with “Department of Labor” and let me know if this keeps you up at night too.
Studies have shown that sharks can sense distressed prey; they respond to scents emitted by injured fish, and they can hear the sounds of a wounded person thrashing around in the water. Given the choice between healthy and injured prey, the shark will always pick the injured prey because it will take less energy to catch it. But things get crazy when more than one shark shows up to take advantage of the prey’s misfortune.
I haven’t slept in days since finding that quote.
You can successfully swim in shark infested waters if you’re smart.
If regulators like the DOL don’t sense any waves, they won’t dig in, look around, and see what other anomalies they can find. They’ll more likely swim on. But one drop of blood, some inconsistencies in job titles, and you’re on their radar.
Knowing this, what do you do?
Audit your job titles and descriptions across your organization. You’ll get 3 big benefits out of this exercise:
- The sharks swim past
You haven’t disturbed the water or signaled in any way that you’re “injured prey” to regulators. You steer clear of wage and hour law traps, and have a common understanding of who in your organization is exempt and who is not. - You boost your company culture.
Think of this from your employee’s point of view. When there’s lack of clarity among titles and job descriptions, the gray area can stir up resentment. “Why does this person have a better title when they do the exact same thing as me?” Clarity is a key component in successful corporate compliance programs. - You take a critical step toward automating your compliance program.
One of the keys to automation is determining what compliance activities need to be undertaken by what roles. Within each role there are compliance activities that affect them…and just as important, activities that don’t. Set this up once and rest assured the process you’ve laid out happens repeatably.
Want to see how TKO group is swimming with sharks?
Check out their case study. Tracking employee data through Compli dashboards avoids time-consuming, expensive litigation, allowing TKO Group to get back to the business of auto sales.
