The Five Hidden Risks: What All HR Professionals Should be Aware Of

94% of HR professionals are overwhelmed. A statistic reported by a survey from Workvivo that may leave some wondering, “How could this be?” When we think about an HR professional’s job responsibilities, the tasks can be bucketed into a few main categories, hiring, retention, and end of employment. Within each category, there are tasks like: screening candidates, onboarding, maintaining company culture, rolling out development opportunities, updating the handbook, assigning mandatory training, exit interviews, and more.

Just from the short list alone, it’s no wonder that HR professionals are busier than ever, burnt out, and need help. But when the to-do list keeps growing and there is no sign of slowing down, sometimes high priority initiatives accidentally slip through the cracks. This often leads to harmful consequences that impact the entire organization.

To help HR professionals avoid negative consequences, we determined that everyone should be aware of five hidden risks. We feel these risks are vitally important to understand for organizations to remain compliant, safe, respectful, and long-lasting.

So, let’s go over each risk:

1. Legal (compliance): this type of program ensures that legal standards are communicated and understood by employees. Some good questions to prompt thinking through what is necessary to keep your organization compliant are:

How does your organization work to avoid legal issues?
Do you have employees located in different states? How are you keeping up with the state-specific compliance requirements?
Many organizations have different groups responsible for Cybersecurity, how is your organization handling it?
What worries you about the processes you currently have in place?

2. People (ethics, DEIB): programs like anti-harassment, DEIB training, and others are put in place to create a respectful workplace. While these programs aren’t always required by a state’s government, their popularity is rising as Gen Z prioritizes creating equitable workplaces for everyone. Some questions to think about when reviewing your people programs are:

How would you say that your leadership team views ethics and diversity?
If you had to assess your DE&I initiatives on a scale of 1 to 10, with 10 being the best – how would you assess it? What do you think could be improved?

3. Process (safety): many industries like construction, manufacturing, and healthcare, require additional training to ensure employees are kept safe and protected from potential dangers in their field. This type of program is incredibly important, so when reflecting on your program, think about the following:

How is your organization prioritizing the importance of creating a safe work environment?
How is your legal team advising you on safety topics?
How are you tracking all the training pertaining to these topics? How frequently are you reporting, and to who?

4. Systems (onboarding): ensuring the right paperwork is filled out and filed, employees are aware of expectations at the 30-, 60-, and 90-day marks, and feel welcome are all part of a successful onboarding process. It creates a memorable first impression of what employees can expect from their new employer and ensures all proper documentation is completed. When thinking about your onboarding experience:

Many organizations have different groups responsible for onboarding, how is your organization handling it?
Do you have a mentor program in place? Why/Why not?
How is your organization connecting your company’s values and culture to the onboarding experience?

5. External (wellness): the pandemic brought the concept of work/life balance to the forefront of employee expectations. When they’re feeling overwhelmed and overworked it can lead to heightened stress like never before. Keeping employees reminded of various wellness techniques they can tap into can look different for each organization, but some things to think about are:

In light of macroeconomic uncertainties, how are you prioritizing employee wellbeing to avoid burnout and create a good work/life balance?
There are various aspects that influence company culture, how does the idea of employee wellness play a part?
How are you creating empathetic leaders capable of prioritizing wellness amongst their teams?

Failure to understand these risks and have mandatory programs stood up to mitigate them can bring damaging consequences.

Financial Loss

The first consequence an organization can experience is penalties and loss of revenue. Globalscape reports that, “the average cost of non-compliance has risen more than 45% in 10 years, amounting to 14.82 million.”

Not only do the penalty costs of non-compliance come from government sanctions, but also payouts to customers who could’ve been victimized. For example, when investigations concluded from the Bernie Madoff Ponzi scheme, banking institutions beyond Wells Fargo, like JPMorgan Chase, had to pay $1.7 billion to Madoff’s victims because of poor oversight on their end – a compliance nightmare.

Furthermore, when we think about impacts to profit, most of the time we think about losing money to fines and restitutions, but there are also hidden sunken costs. When an employee’s wellness begins to affect the workplace, it can translate to being disengaged, which can cost an organization approximately 18% of their salary, according to Gallup.

Internal Struggles

When the hidden risks aren’t accounted for and mitigation practices aren’t put in place, that can lead to internal turbulence. When employees first start a new position at a new organization, their first few months are crucial, the 2022 Job Seeker Nation Report found that 30% of employees leave during the first 90 days.

Not only does this leave the position open again and HR professionals must go back through the hiring process with new candidates, but other employees are left to take on additional responsibilities which can contribute to them feeling stressed. This aligns with what Career Builder found stating that 41% of surveyed employers believe that a lack of structured onboarding harms their company.

Also, not only could neglecting the hidden risks lead to people leaving a job much sooner than anticipated, but it could also tie up other employees dealing with lawsuits. Preparing discovery documentation for the courts, meeting with lawyers, going to court on several occasions all take time (and money).

Take it from Cash App, who in 2022 fell victim to a data breach by a former disgruntled employee. This data breach could’ve been avoided had Cash App had tight access control policies, but instead it went undetected for over four months. Now, they find themselves amid multiple class action lawsuits.

Then there is the extreme scenario where because a rigorous safety program was not in place employees suffered from injury related deaths on the job site. The National Safety Council (NSC) reported that in 2021, there were 4,472 preventable injury-related deaths in U.S. workplaces. The loss of a fellow employee creates an uneasy and nervous atmosphere leaving employees to wonder if they could be next.

Reputation Damage

The last consequence that comes with not prioritizing programs that avoid falling victim to the hidden risks is reputation damage. Reputation damage is extremely hard to overcome because customers no longer feel that they can vouch for a good experience from their vendor.

Hurt reputation can also come from employees sharing what it’s like at their organization through review sites like Glassdoor or even social media. According to a Deloitte report, 52% of Gen Zs and Millennials are not satisfied with their current organization’s progress in creating a diverse and inclusive workplace. They are being more vocal about this now than ever, and it’s important to know the new generation entering the workforce is looking for in an ethical employer.

How BizLibrary Can Help

Being responsible for creating, rolling out, and maintaining programs that avoid the consequences of not prioritizing the hidden risks can be incredibly overwhelming, especially when you feel like you must do it all on your own. That’s where having an online learning partner can help.

Coupling award-winning off-the-shelf content with BizLMS, creating training programs that educate employees on how to be compliant, safe, respectful, and well has never been easier. BizLMS allows program administrators to assign out content, track progress, and pull reports all within one platform.

Admins can also use our AI-powered search to find content videos that align with important topics like anti-harassment, workplace safety, having an inclusive mindset, workplace stress, and more. Your legal department and C-Suite members can also rest well knowing we partner with a law firm to vet our state-specific content to bring you the most accurate guidelines. We also offer the suggested program curriculum for all the hidden risks to keep your organization running smoothly.

Talk to a BizRep to get started learning about how BizLibrary can help cover your organization’s training needs.