Club Insider

Key Components of an Effective Compliance Program

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Paul R. Bedard, EsquirePaul R. Bedard, Esquire

Policies and procedures, including but not limited to those prohibiting sexual harassment and discrimination, or those detailing how to respond to sudden emergencies or handle issues of confidentiality, are ultimately useless if they cannot be consistently complied with. Whatever the policy or procedure, an effective compliance program will help to ensure that theory translates into practice.

An effective compliance program requires clearly articulated written policies and procedures, designated oversight, ongoing education and training, internal auditing and monitoring, reporting mechanisms, active enforcement and discipline and demonstrated response and prevention. This piece is intended to provide an overview of these components. However, this article is not intended as legal advice. Widely varying business needs and legal requirements prohibit one-size-fits-all recommendations. Please consider these comments as merely an educational guide to assist you when you consult your own attorney or compliance professional for specific direction.

Written Policies and Procedures

Written policies and procedures must be developed and clearly communicated across the organization. This will help shape your company's culture by establishing the values of the organization and by defining expectations as they relate to employee behavior. An employee code of conduct can be coupled with your employee handbook, the latter of which I've talked about in detail in past editions of Club Insider, as an effective compliance tool for widely communicating company values and employee expectations. The employee code of conduct cannot contradict the employee handbook or any other company publication and should be distributed to all employees and be publicly available on your organization's website.

The code of conduct, like the employee handbook, should demonstrate a tone of compliance from the top of the organization. It should also be readable and expressed in terms easily understood by the target audience. Your employee code of conduct may include prohibitions on discrimination, harassment, smoking, foul language, illegal activities or any prohibited behaviors. It may also detail expectations for confidentiality, dress and appearance requirements or any other organizational expectations. As is the case with the employee handbook, the employee code of conduct should be signed by the receiving employee and kept within the employee's personnel file.

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