Concerned woman makes a phone call on her cell phone at her desk.
By empowering employees to speak up using an employee hotline, you can improve employee satisfaction, worker retention and solve problems faster. — Getty Images/ PeopleImages

You might think you know everything that goes on inside your business, but you could be unaware of issues that employees aren’t comfortable voicing to their managers, such as compliance concerns, inappropriate behavior, theft and harassment. An employee hotline gives workers a safe way to report complaints anonymously without the fear of retaliation. By empowering employees to speak up, you can improve employee satisfaction and retention, solve problems faster, and you may even be able to prevent potential lawsuits and criminal investigations.

A report on occupational fraud and abuse from the Association of Certified Fraud Examiners found that organizations with hotlines detect fraud more quickly than those without hotlines — and median losses were nearly doubled at organizations without hotlines. Here’s what you need to know to create an employee hotline today.

Choose a hotline service

Although you could set up an in-house number managed by someone within your company, it’s usually more effective to hire an outside company that specializes in employee hotlines. “If you want people to truly feel that the hotline is confidential, I think it’s better to go with an external company,” said Cecilia Vocke, a senior human resources consultant with strategic HR, Inc. Below are some general tips for selecting a service:

  • Choose a company that offers both a telephone hotline and an online form for filing complaints so employees can communicate in the way that’s most comfortable and convenient for them. Inquire about what hours the hotline is open (some are available 24/7) and make sure that the website for filing claims is straightforward and easy to use.
  • Ask about pricing to make sure the service is affordable for your small business. “Usually the costs are to scale to the size of the organization, so a small business would pay less than a larger one,” said Karen Puleo, a human resources expert and principal consultant for Arc Human Capital, LLC.
  • Ask if the company serves clients in your industry or a related industry. “This is important because they would truly understand what type of complaints would arrive that could be filed anonymously,” said Puleo.
  • Make sure the company allows you to view complaints quickly after they are filed and provides an easy way to access them. “Do they send you an email with the complaint or a notification telling you to check a portal on their website?” said Vocke.
  • Talk to other small businesses to find out which hotline services they have used and what their experiences have been like. You can connect with other businesses through your local chamber of commerce or any business associations you’re a part of.

Tell them that although they still have the ability to go to their manager or HR directly, you put this service in place in case they’re not comfortable doing those things. Ensure confidentiality and anonymity, and that there will be no retaliation for reporting something.

Cecilia Vocke, a senior human resources consultant with strategic HR, Inc.

Spread the word

Once you have registered for an employee hotline service, you’ll receive the telephone number and website that employees can use to file complaints. Be sure to get the word out to your employees to make sure they are aware of the hotline and the confidentiality it offers.

“From hanging up a poster in the break room, to sending an email to the staff, to making it part of your company policies in your employee handbook, you should be communicating to your employees all the ways they can file a report,” said Vocke. “Tell them that although they still have the ability to go to their manager or HR directly, you put this service in place in case they’re not comfortable doing those things. Ensure confidentiality and anonymity, and that there will be no retaliation for reporting something.”

Consider including a disclaimer that employees may be encouraged to disclose their identity when making more serious allegations. “If something illegal is reported, in order to do a thorough investigation, the employee might have to be contacted for additional details,” said Puleo.

Address complaints

Follow these best practices for handling employee complaints made through your hotline service:

  • Investigate all reports, even those that may seem trivial. “Don’t ignore claims because employees will think that they shouldn’t bother reporting issues,” said Vocke.
  • Determine who is responsible for resolving the complaint. For instance, an accounting manager might be best suited to investigate accusations of fraudulent billing, while a human resources manager could handle discrimination complaints or employee disputes.
  • If the complainant chooses to leave their contact information, promptly reach out to them to gather more information. “Thank them for raising the concern, and ask open-ended questions to find out more,” said Vocke. Even if the complainant chooses to remain anonymous, you might be able to reach them through other means to ask additional questions. For instance, if they filed the complaint through the hotline’s website, you might be able to communicate with them anonymously through an online portal.
  • Gather additional evidence if necessary. For instance, if there are claims of an unsafe work environment, visit the worksite to determine whether the claim is valid. If there are reports of theft or fraud, set up security cameras or review existing video footage, said Puleo.
  • Interview employees named in serious allegations. Present them with the complaints made against them, and give them an opportunity to respond. If the investigator determines that other witnesses who could provide testimonials, they should interview those individuals as well.
  • In more minor complaints (like someone talking too loudly on the phone), consider addressing the whole group instead of singling out one person, such as through a staff email or newsletter.
  • Keep a file of all the reports that have been received. “Include notes on how the claims were addressed and how long it took to resolve them,” said Vocke.

[Read more: 5 Employee Theft Prevention Strategies]

CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.

Follow us on Instagram for more expert tips & business owners’ stories.

To stay on top of all the news impacting your small business, go here for all of our latest small business news and updates.

CO—is committed to helping you start, run and grow your small business. Learn more about the benefits of small business membership in the U.S. Chamber of Commerce, here.

A message from
Attract & retain top talent at your business with a 401(k) plan
Offering a retirement plan does more than just prepare you and your employees for a secure financial future – it can also help you attract and retain top talent. Fidelity’s new 401(k) plan designed for small businesses like yours has simple plan choices and fewer administrative burdens, so you can spend less time managing a 401(k) and more time focusing on running your business.
Get Started
Published February 02, 2022