Compliance Tech Revolutionizes HR’s Approach to Legal Changes

Staying up-to-date on legal and regulatory changes is an ever-present challenge for employers, but technology can be a big assist, proactively monitoring labor and employment law changes and saving significant time for HR and in-house counsel.

Jocelyn King, SHRM-SCP, CEO and founder of VirgilHR, a software-as-a-service platform that helps HR professionals navigate the complex legal landscape through automated employment and labor law guidance, sat down with SHRM Online to discuss how compliance technology can help HR, how it supplements core HR systems, and which compliance areas are currently the most worrisome to HR practitioners.

Jocelyn King, SHRM-SCP

SHRM Online: How can technology help HR teams stay on top of and ensure compliance with legislative and regulatory changes?

King: HR should focus on automation and proactivity when evaluating technology solutions to assist with compliance. Today, many in HR are using a vendor’s database for research or just going on Google. It is a very manual and time-consuming process, with a high risk of error. Many are hoping that they are doing the right thing and hoping they don’t get sued. It is challenging for anyone to track the hundreds of laws that may apply to your workforce. Unless you’re up-to-date and understand the intricacies of all the federal, state, and local laws and how they interact with one another, it gets to be very confusing and overwhelming. Back when I was in HR, I would get the SHRM newsletters on new laws and track everything on an Excel spreadsheet. It was not scalable at all.

Technology should tell you what you are supposed to do without your having to think about it. The solution should integrate with your HR information system (HRIS) or payroll provider and track what the HR user is doing in the system. If the practitioner is looking at a leave request or conducting a termination, a tool like ours can pull information about that employee from your system; analyze the federal, state, and local employment laws that apply; and then offer prescriptive guidance for HR to stay compliant.

Automated technology is going to present all the information you need in real time, take work off your plate, mitigate risk, control legal costs, and allow you to focus on people strategies.

I’ll give you an example. Connecticut expands its paid-sick-leave law, going into effect Jan. 1, 2025. Employers with employees in that state have to update their paid-sick-leave policy and provide written notice to employees and a specific workplace poster, as well. VirgilHR automatically does those things and pings you to let you know about it. You don’t have to think about it anymore. That’s the power of automation.

SHRM Online: What makes a compliance-specialized platform a more attractive option for HR professionals than simply using the features included in many human capital management technology systems?

King: The features in the big HR information systems are great, and you should be using them. However, those systems don’t cover the full life cycle of a worker. A payroll provider that ensures you are compliant with payroll tax won’t necessarily let you know how to stay compliant when terminating an employee in California, for example. Or you may use an HRIS to manually configure how to calculate sick time in a certain state. It’s reactive and prone to error. As another example, if New York City increases the minimum wage, your HRIS isn’t going to automatically make those changes. You’ll have to manually go in and make the changes yourself for your New York City workers.

Our software pulls the specific workers who are impacted by the law’s change and lets you know to change them. Or you can customize the technology to make the change automatically.

If you have a tool that can supplement what the HRIS is doing, to cover the full life cycle of the employee, and that is proactive rather than reactive, you are set up for success.

SHRM Online: What compliance areas are customers seeking help with the most right now?

King: Leave is a hot topic area. Everybody needs help with leave—not just because it’s extremely complicated, but because we’re seeing new leave laws or amendments to existing laws popping up all over the place. Another area is termination, especially around what constitutes final wages and when to pay final wages. Every state is different, and the circumstances matter. For example, if an employee in the District of Columbia interfaces with any company finances, you have four days after termination before you have to pay final wages to allow for an accounting of the accuracy of the employee’s accounts. Otherwise, if it’s an involuntary termination, you have to administer final pay the next business day following termination. Employee classification has become another area of interest because the laws are in flux around exempt or nonexempt and employee versus independent contractor.