In breach of company policy for creating art?

December 12, 2023 4:16 PM

I am a literary artist and have a low-level admin position at a small, but prominent financial institution in one of the big metros. Recently, I was contacted by my compliance department and was told that I am in breach of its policy for not reporting outside business activities because I did not fill out a form to report that I was working on a book (that is completely unrelated to my work). The company is now requiring me to sign a form to acknowledge the breach and to do a remedial training session. I do not want to sign a form that acknowledges this as a breach, but am willing to do the training. What are my options? I'm looking for reasonable strategies/approaches/responses that will help me be effective in conveying that the policy needs to be more specific and to not have to sign the form.

I have written maybe 40 pages over the last 5-6 years and this activity functionally looks more like a hobby in my day-to-day life. But because I have an agent (who has not sold my puny manuscript) over the last two years, my company considers this a business activity. I have not made any money off of this.

I have no plans to leave and would prefer not to.

For my own protection and because it is explicitly stated in internal documents, I cannot provide quotes from the company policy manual nor the breach forms I'm expected to complete. However, I can say that the policy manual only covered outside activities in one short paragraph and the primary example it gave as an outside business activity is sitting on the board of an org.

posted by mild deer to Work & Money (17 answers total)

What was the actual “business activity” that they objected to, and how did they find out about it? I can’t imagine a way in which “having an agent” would qualify.
posted by not just everyday big moggies at 4:35 PM on December 12, 2023 [3 favorites]

I'm an HR person. What is your reason for not wanting to sign the form? Just that you don't think you violated the policy? It feels like semantics here.

As an outsider HR person hearing your side of the story, it does sound like you have something that could be classified as an outside business activity (you have an agent, to me that is more than a hobby or at least that you have plans for it to be more than a hobby), the success of the outside business is pretty irrelevant to the company. So I think you did technically violate the policy, even if it's poorly worded and classes are probably an over-reaction to it.

I haven't done HR for a financial institution but I also wonder if they have some higher obligation to document these types of activities and that's why they are having you jump through these hoops.

They can absolutely fire you for either violating the policy or refusing to the sign the form that says you violated it so I'm not sure why you wouldn't just sign it and then roll your eyes with your friends later about how dumb it is. I feel like you're making a much bigger deal about this than is necessary for the situation.

Sorry, I'm not actually answering your question about language to use to get out of signing the form because I think you should sign it.
posted by magnetsphere at 4:36 PM on December 12, 2023 [8 favorites]

You’re asking a legal question. I think it is inadvisable to discuss legal questions over the Internet, but I must say I am very curious to see how this behavior could be regulated. The notion that the entire universe of “outside business activities” can be regulated in this way, even if they produced no money, is puzzling to me.
posted by PaulVario at 4:44 PM on December 12, 2023 [3 favorites]

Best answer: I work in HR, which notably IS different than "compliance" for financial institutions. To me, it seems odd that your activity rises to the level of "business activity" but like the previous commenter, I suspect that this relates to the myriad unique rules financial institutions are required to follow, which go beyond traditional HR. Without knowing how they found out about your activity and the specific language in the handbook, it's hard to know exactly why they are coming in so hard and if they are correct.

However, I think it's perfectly reasonable for you to push back a bit on signing the acknowledgment given that it could have some sort of future impact on promotions, compensation changes, etc. I suggest that you politely request some clarification on the policy by email in an effort to get their interpretation of the situation in writing. I'd do something like: "Thanks for reaching out. I was surprised to get the notification regarding this issue, and I have a few follow-up questions now that I've reviewed what you sent. My writing hobby does not (and never has) generated income or involved financial transactions, so I never viewed it as business activity. Could you please explain how business activity is defined for the purposes of this policy and clarify how my hobby meets those terms? I value my role here, and I would never put it in jeopardy by purposely violating a policy. I am optimistic that we might find there's been a misunderstanding over this issue."

If they reply and it still doesn't make sense, I think you come right out and say, "This was an honest mistake related to a policy that was not clearly detailed for employees by the company. I understand that corrective action may need to be taken to generate documentation for the XYZ Oversight Board, but I am concerned that signing the breach acknowledgment may have negative effects on my career. I would be happy to take the training course and will be sure to report any future business activities, but I'd like to know if there are any alternate routes to fully resolving this issue aside from the breach acknowledgment."

After these interactions, you'll have to see what happens and how they respond. They might be able to just move on without it, or it may be really important to someone else's job security. Perhaps they can offer you some kind of assurance that the breach acknowledgment won't have a negative effect, and you'll be comfortable signing it. Either way, I think it's valuable and reasonable to ask some questions first. Good luck!
posted by luzdeluna at 5:09 PM on December 12, 2023 [64 favorites]

It's absolutely normal, in my experience, for a company to require a declaration of any outside business activities and it doesn't matter if you make money from it or not. I'm sure it's not the case but, for all they know, you could be writing an expose on your experiences working in the financial industry or something that may conflict with your work.

Both the remedial classes and the signed acknowledgment of a breach seem like overkill in my view, but the path of least resistance is probably best here, as long as the stupid classes are in work time. I agree that it's worth initially pushing back a little because this seems like overreach, but someone is just following the appropriate procedure, probably without any knowledge of what you're actually doing. It doesn't seem like something that's worth pushing back on too hard, though.
posted by dg at 5:16 PM on December 12, 2023

This is going to depend entirely on the specifics of your institution's policy and how it's implemented. But I do professionally engage with outside activity disclosures at a different kind of institution and I can say that it doesn't sound outrageous to me from my own compliance-professional life that what you describe is a disclosable outside business activity.

But at my workplace, if you wanted to dispute a determination of mine that you had breached a policy, you would probably start by asking to meet with me and asking me to explain what part of the policy was breached and how you were to know given that it's not anything like the examples given. You could explain if you thought I had misunderstood something, and perhaps I would end up agreeing with you and the whole thing would go away. If you were still unhappy with me after that meeting you could ask to meet with my manager next and see if you could get her to overrule me. If you really had a bee in your bonnet you could keep on doing that up the chain until someone either agreed with you or told you to knock it off. Assuming you ultimately had to sign a form like that (which wouldn't actually happen where I am, but for the sake of argument), you could ask to have a statement of your own on file with it documenting your belief that the determination was unfair or incorrect, to hopefully help soften any future impact of the form being in your records.
posted by Stacey at 5:42 PM on December 12, 2023 [4 favorites]

I work at a small financial services company. You don't mess with compliance. These are the people who have read the 700 volumes of regulations and have written the 70 volumes of policies explaining how the company will comply with the regulation. Compliance at a US financial institution isn't normal HR stuff.

I'm sorry it feels icky to admit doing something you think you didn't do. You could try explaining to them again, "it really isn't a business, but I'm happy to disclose it now in case it ever does become one, but it's really just a hobby." However, they'll probably respond by saying, "it fits our definition of a business, and we need you to sign these three forms because that's what our policies say we'll do." If that happens, I wouldn't bother arguing. I wouldn't bother hiring a lawyer. Just sign the paper and let them count their compliance beans. No one will hold it against you.
posted by Winnie the Proust at 6:15 PM on December 12, 2023 [4 favorites]

I would be more concerned about what they expect you to do going forward. Are you expected to stop working on this writing project altogether? Ate you willing to do that? If you do continue with the writing after having signed something you would be basically knowingly violating company policy which seems bad. Seems important to understand the expectations for the future before signing anything.
posted by brookeb at 8:00 PM on December 12, 2023 [5 favorites]

You don't mess with compliance.

This. I would sign the form and do the training. This is a slap on the risk, basically, the main point of which is to officially document for regulators that they took the action described in their policies. They will let you go in a heartbeat rather than risk regulatory problems over this.
posted by Blue Jello Elf at 9:44 PM on December 12, 2023 [3 favorites]

It feels like semantics here.

Same but for a different reason. They don't need you to sign the form. They can just write on it "refused to sign, [person delivering the message's signature]" and it has the same effect. That effect is, if it ever happens again, they will remember (or discover, if it's someone else by then) they told you once already. Next time, "I didn't know" won't be available as a defense, and it will be considered a second offense.

If it never happens again, the form has no effect. It's just a documented "you've been told", not discipline.
posted by ctmf at 11:30 PM on December 12, 2023

So it's important that you do get clarity on exactly WHAT you've been told, as luzdeluna suggests, because the generic "training" might not actually resolve your confusion. But it definitely would be used as further evidence next time that "you've been told" ("and even received specific training on it!")
posted by ctmf at 11:38 PM on December 12, 2023 [1 favorite]

The point for compliance btw isnt necessarily whether you make money. It's possibly more something like, if someone said "we can give you a book deal but we need some papers from your job" or similar, identifying points of leverage in their staff.
posted by Iteki at 1:33 AM on December 13, 2023 [1 favorite]

From a non-member:

IANAL, but I work in financial services and have helped write and edit compliance policies. Sign the disclosure if you want to keep your job.

Here’s the thing: Financial services is heavily regulated, with plenty of rules and laws on the books aimed to prevent and/or punish bribery, conflicts of interest, and insider trading. The rules saying you have to disclose outside business activities are a part of this. You’re required to disclose everything to make it easier for regulators to spot the stuff that might be shady.

But merely disclosing doesn’t mean you have to stop doing that work, particularly in an admin role which is neither client- nor public-facing. If your outside work presented a conflict of interest, your firm might tell you that you must choose between that work and your job with them. They aren’t going to care one whit if you’re pursuing your literary aspirations off the clock.

They are going to care about you refusing to disclose. These firms are audited regularly, and failure on their part to maintain proper disclosure records or require their employees to adhere to SEC regulations can in and of itself land them with thousands or millions in SEC fines. They are unlikely to risk that for an admin. I wouldn’t die on this hill.

posted by goodnewsfortheinsane at 3:40 AM on December 13, 2023 [15 favorites]

I agree with others that you will almost certainly need to sign if you want to keep your job.

In terms of the policy, you may be able to push them to provide more detail in their handbook. To be taken seriously, I suggest that you need to internalise that what you are doing does need to be declared as a business activity and it's the internal documentation that could be improved and work from there. If you approach it from the starting point that what you are doing shouldn't count then I think you are likely to make your existing position worse.
posted by plonkee at 4:11 AM on December 13, 2023

What the non-member said. This isn't about the company wanting to control your activities, or someone in HR being unusually interested in you. This about compliance with the law/regulatory bodies. Did you not have to take some training around this when you onboarded? Check your employment contract - it likely states that you must disclose all outside business activities. You may have been asked to sign a form or two related to disclosure when you were hired as well.
posted by Stoof at 6:40 AM on December 13, 2023 [1 favorite]

* very late edit: my post should read "slap on the wrist"
posted by Blue Jello Elf at 7:53 AM on December 13, 2023 [1 favorite]

Best answer: I am a Compliance person at a large financial institution who has written and administered a number of Outside Business Interests policies, but I'm not your Compliance person. I know you can't provide their content but I would review the definition of OBI in the policy and the general policy framework to give feedback on the clarity of the doc/ framework. If there's some ambiguity there, you may be able to push back on the 'breach' IF your management are supportive. However, it may not be worth burning capital on this, especially if the only penalty is remedial training and signing an acknowlegement. And in any case, disclosure will likely be required, even if there's currently a deficiency in the defintion or policy wording.

FWIW, if I were your Compliance person and you asked me for advice about disclosing this activity as an OBI, I'd advise you to disclose it. My angle would be the relationship/ affiliation with the agent which could potentially lead to a conflict of interest (e.g. does the FI have investments in publishing companies? Could they ever?) and any potential reputational risk associated with the work you create (though this is a more distant and tenuous concern, based on what you've said).
posted by hellomiss at 1:11 PM on December 13, 2023 [5 favorites]