Business compliance is a term that some budding entrepreneurs may not have come across or perhaps have heard of it but not known exactly what it means. This is a knowledge gap that needs to be addressed for anybody looking to start a business, as failing to remain compliant with national or state-level regulations could have dire circumstances for both the business and its owner.
What is Business Compliance?
To ensure that every business operates within the law of either the United States or the particular state in which the company is based, governments regularly check that they are being “compliant”.
There are many different bodies which regulate the compliancy of different types of specialist laws – for instance, the United States Environmental Protection Agency (USEPA) checks on businesses big and small to ensure that they are being compliant with regulations relating to the environment.
This could be to limit the effects of climate change, prevent air pollution or reduce the uses of fossil fuels. It is a legal requirement for businesses to operate within these regulations, and there are risks associated with failing to do so.
The risks of not being compliant
As business compliance is a legal requirement, legal action can be taken against businesses to find out if they are being compliant and, if they are not, punish them.
To help prove that you are being compliant, retain all of your documentation as evidence. This includes licenses, permits and certification as well as proof that you have paid all necessary taxes or registration fees. Any changes to your business such as address or shares should also be reported. As a golden rule, keep and file everything.
Making sure you stay compliant
It can be a tiring and time-consuming task to keep on top of all of this business compliance, not to mention the expertise needed to file everything in the right place.
This is why more and more businesses are turning to software for HR support, using intelligent digital systems to automatically calculate and pay taxes, report newly hired employees, successfully protect employee data and tailor HR requirements to the specific state the company is registered in.
While seeking the advice of experts is also recommended – as is having a full-time compliancy officer if you can afford one – this type of software is making business compliance easier than ever.
Planning for compliance deadlines
Even the most organized businesses forget certain compliance deadlines.
This is most common when operating in heavily regulated states. As examples, California has the most business regulations of any American state, while the regulations of New York are generally considered as the most complex.
To stay on top of these regulation deadlines, it is essential that you plan ahead. Create calendars with recurring entries and review it at the beginning of every month to check that nothing has changed without you realizing. Hold regular meetings with your compliancy officer to create priority lists for document creation or debt payments and convert your business into having a compliancy-first culture.
Compliance is important to get right consistently, both for the health of society and your employees as well as for the success of your business. It’s important to not treat it as an after-thought, but to be proactive in managing it.