Last Updated on November 9, 2026 by MyHRConcierge
HR compliance involves more than maintaining an employee handbook. How employers enforce policies, respond to complaints, document performance and handle terminations can create significant legal and financial risks. In the final part of our HR Compliance Series, we’re covering four common HR mistakes and how employers can take proactive steps to avoid them.
In Part Three of our “10 HR Mistakes” series, hosts Emily Frederick, SHRM-CP, and Chris Cooley, discuss four common mistakes that can put employers at risk: inconsistent employee treatment, ignoring workplace harassment, failing to document performance issues and improper termination procedures.
Inconsistent Treatment of Employees
Consistency is essential to effective HR management. When employees in similar situations are treated differently, employers can create the appearance of favoritism or discrimination. For example, disciplining one employee for repeated tardiness while allowing another to continue the same behavior could raise questions about fairness and potentially lead to a discrimination complaint.
Inconsistent enforcement also affects workplace morale. Employees who perceive favoritism or unequal treatment may lose trust in management, become disengaged, or seek employment elsewhere. Research cited in our correlating podcast series episode indicates that employees who perceive favoritism or inconsistent workplace rules are 45% more likely to leave their jobs.
Consistency does not mean every employee must receive identical treatment, however, it does mean that employers should apply the same standards and processes while considering individual circumstances. When exceptions are necessary, the reasoning should be documented.
Ignoring Workplace Harassment
A written anti-harassment policy is important, but it is not enough on its own. Employees need to understand what constitutes harassment, how to report it and what steps the organization will take when a concern is raised. Managers and supervisors also need training to recognize inappropriate behavior and respond appropriately.
Employers should establish clear reporting procedures, including an alternative reporting option when a supervisor is involved in the complaint. Anonymous reporting channels can provide another way for employees to raise concerns. When a complaint is received, employers should conduct a prompt, thorough and impartial investigation. Any temporary steps, such as separating the individuals involved, should not unfairly disadvantage the employee who reported the concern. Employers should evaluate the findings and take appropriate action.
Ignoring harassment can lead to legal claims, employee turnover, reduced productivity, absenteeism and reputational damage. To reduce this risk, employers can provide ongoing harassment prevention training, maintain clear handbook policies and establish accessible reporting channels. Every complaint should be taken seriously, investigated fairly and documented.
When performance concerns are not documented, employers may struggle to explain or defend employment decisions. A sudden paper trail created immediately before termination can appear suspicious, especially if the employee has never received prior feedback or warnings.
Without documentation, discrimination or wrongful termination disputes can become difficult to resolve. Employers may also have trouble supporting unemployment claims if they cannot demonstrate the performance issues or misconduct that led to termination.
Documentation should be an ongoing process, not something that begins when an employee is about to be let go. Managers should keep records of coaching conversations, written warnings, performance reviews, and improvement plans.
Poor Employee Termination Procedures
A poorly managed termination can create legal, operational and reputational problems. Employers must understand final paycheck deadlines, applicable vacation payout requirements, and other state-specific obligations. Failing to follow wage and hour requirements can result in costly penalties.
Employers should also consider potential retaliation claims when a termination occurs shortly after an employee reports harassment, raises a complaint or participates in another protected activity. Decisions should be supported by legitimate, documented business reasons.
Termination procedures should also address company property, confidential information, system access and communication. A disorganized or disrespectful separation can damage employee morale and an organization’s reputation.
Case Study: Better.com’s 2021 Mass Layoff
In December 2021, Better.com received widespread criticism after its CEO announced that approximately 900 employees were being laid off during a brief Zoom meeting. The incident became a highly publicized example of how poorly handled terminations can create significant public relations challenges.
The layoffs also raised questions about compliance with federal WARN Act notification requirements. The situation demonstrates why employers must consider legal obligations, communication and employee impact when planning workforce reductions. Involve HR before sensitive terminations to help identify potential compliance concerns.
Strengthening Your HR Compliance Practices
Consistent policies, effective training, thorough documentation and clear termination procedures can help employers reduce risk and create a more productive workplace. Addressing these areas proactively is far easier than responding to a costly complaint or legal dispute after the fact.
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