Avoiding HR Issues
Owning a small business can be a major juggling act. Being a leader, chief financial officer, office manager and all the other roles that go into making a successful business can be hard. Keeping all the “balls in the air” can be a tough juggling act, which can cause mistakes – sometimes serious ones. Mistakes in the human resources area can be easy to make if you don’t understand and are compliant with the law.
Here are five of the most common HR management pitfalls small businesses face today and how to avoid making them.
- Outdated Employee Handbook – The employee handbook is your guidebook for all employees and company leaderships about work-related policies. These policies could include: discrimination policies, standards of conduct, compensation, benefits, work schedules, security, and vacation/sick policies. Each business is different so the policies laid out in the handbook should be updated regularly and be specific to your field of business. Not having company policies in writing and updating regularly is just asking for trouble.
- Staying knowledgeable of Changing HR Laws –
Understanding federal, state, and local labor laws are critical when running a successful small business. Compliance with these laws can be a big headache for small businesses. There are a multitude of regulations, and these laws continue to change rapidly. Have a dedicated employee or HR consultant who can stay on top of changing laws and compliance requirements.
- Handling Terminations Poorly – No business leader wants to deal with a termination but they happen all the time. Messy fires can lead to unwanted lawsuits. Both performance and policy violations require documentation and a paper trail. “Make sure that you document any disciplinary issues, safety inspections, performance discussions, and the like. These records can save you if done right — or kill you if done poorly or not at all.”(Source: Intuit Books) This is yet another reason why the well-written employee handbook is needed.
- Develop a Reward System – Employees want to know how they are doing.
Recognition of good performance is essential to a healthy workplace; without it, your business could face retention issues. Plan and maintain a reward system that will allow your company to maintain employees that do their job well. It is easier to maintain a good employee than to train a new one.
- Weak Hiring and On-boarding System – Too many employers hire hastily because they need the position filled quickly. Spend time weeding out unqualified candidates and on-boarding exceptional ones. Take the necessary time to be sure the candidate feels at home, has a mentor and understand the daily running of the office so they don’t feel overwhelmed or out-of-place.