GPHR (GPHR) Global Risk and Compliance 2 — Questions and Answers
Question 1: A multinational company is expanding into a country with ambiguous labor laws regarding overtime pay. What is the BEST risk mitigation approach?
- Apply home-country standards until local law clarifies
- Consult local legal counsel and document the interpretation used (Correct answer)
- Wait for a government ruling before paying overtime
- Follow the most employee-favorable interpretation globally
Correct answer: Consult local legal counsel and document the interpretation used
Engaging local legal counsel and documenting the rationale provides a defensible compliance position in ambiguous regulatory environments.
Question 2: Which international framework specifically addresses anti-bribery compliance for multinational corporations operating in the UK?
- FCPA (Foreign Corrupt Practices Act)
- UK Bribery Act 2010 (Correct answer)
- OECD Anti-Bribery Convention
- UN Convention Against Corruption
Correct answer: UK Bribery Act 2010
The UK Bribery Act 2010 applies to companies with operations in the UK and criminalizes both domestic and foreign bribery, including failure to prevent bribery.
Question 3: An HR manager discovers that a subsidiary in a developing country is using child labor as permitted under local custom but violating ILO Convention 138. What action should be taken FIRST?
- Report the situation to local authorities
- Immediately terminate all minor employees
- Escalate to senior leadership and initiate a remediation plan aligned with ILO standards (Correct answer)
- Issue a public statement denouncing the practice
Correct answer: Escalate to senior leadership and initiate a remediation plan aligned with ILO standards
Escalating internally and developing a remediation plan ensures the issue is addressed systematically without causing abrupt harm to the affected children.
Question 4: When conducting a global HR compliance audit, which risk category refers to the potential financial loss from failing to comply with employment regulations?
- Reputational risk
- Operational risk
- Regulatory/compliance risk (Correct answer)
- Strategic risk
Correct answer: Regulatory/compliance risk
Regulatory or compliance risk specifically encompasses fines, penalties, and financial losses stemming from violations of employment and labor regulations.
Question 5: A global company's code of conduct prohibits facilitation payments. An employee in a country where such payments are culturally routine reports being pressured to make one. What is the MOST appropriate HR response?
- Allow the payment since it is culturally accepted locally
- Advise the employee to make the payment discreetly
- Support the employee in refusing and escalate through the ethics hotline (Correct answer)
- Transfer the employee to avoid cultural conflict
Correct answer: Support the employee in refusing and escalate through the ethics hotline
Supporting the employee to refuse and using established reporting channels upholds the company's global compliance standards regardless of local custom.
Question 6: Which document best demonstrates a company's commitment to ethical labor practices across its global supply chain?
- Annual financial report
- Supplier code of conduct (Correct answer)
- Employee handbook
- Total compensation statement
Correct answer: Supplier code of conduct
A supplier code of conduct formally communicates ethical labor standards expected of third-party suppliers and supports global compliance efforts.
Question 7: A GPHR professional identifies that the company's data transfer practices for employee records between the EU and a non-adequate country violate GDPR. What is the immediate FIRST step?
- Cease all international HR operations
- Implement standard contractual clauses (SCCs) or binding corporate rules (Correct answer)
- Notify all affected employees immediately
- Delete the transferred data
Correct answer: Implement standard contractual clauses (SCCs) or binding corporate rules
SCCs or binding corporate rules are the approved GDPR mechanisms for lawfully transferring personal data to countries without an adequacy decision.
GPHR (GPHR) Global Risk and Compliance 2
A multinational company is expanding into a country with ambiguous labor laws regarding overtime pay.
What is the BEST risk mitigation approach?