It’s easy, as a small business owner, to ignore the human resources side of your business. However, ignoring HR could lead to costly mistakes with serious consequences. Here are 6 things you should know about human resources:
Implement a consistent interview process.
To avoid hiring pitfalls, such as hiring less-than-stellar employees, created a consistent interview process for your business and stick to it. Have an accurate, clear job description that displays the right information such as job duties, company information, and bonuses. You want to weed out unqualified candidates from the start.
Consider your company’s culture.
You want to attract quality talent to work for your company, but you also want to consider your company’s culture and hire a good fit. What do we mean by that? You want to hire someone who will fit into the vibe and community of your company, especially when running a small business, because every single personnel matters greatly to represent your company. A good way to get a sense is to get more of your team involved in the interview process, which will result in better hiring decisions.
You will need to properly classify your employees.
To avoid problems with the IRS down the line, you will have to classify your employees correctly. Do not misclassify your employees as “contractors” if they are indeed employees of your company. In general, a person is only considered an independent contractor if your company doesn’t have control over what that person does or how they do their job, does not control the financial aspects of the worker’s job such as how they are paid, and does not provide the worker employee benefits.
You will need to keep employee files and and provide an employee handbook.
You will need to keep three files on each of your employees — an I-9 file, medical file, and employment file. If you don’t fill out these forms properly and keep good records, you could face severe fines. And, if you don’t have an employee handbook, you should, even if you just have a few employees. An employee handbook lays out the rules and regulations, as well as the expectations you have as a company for them. This fosters better communication up front, and will also cover you in case of employee disputes.
Employee training is key.
Training your employees is a vital investment in your company. Providing employees the tools they need to start working for your company successfully, including opportunities to grow within your company, will ensure your employees are doing their most quality work. This includes a training process for new hires and continued professional development programs for current employees.
Make sure to document any performance issues.
To avoid messy, unwanted lawsuits, you will want to document any performance issues with an employee when they arise, and address them immediately during performance evaluation, which gives your employee a chance to correct the issue. Sometimes terminations are unavoidable, and they certainly are never positive, but documenting them along the way can avoid any unwanted issues, and also serve as evidence if needed.
Closing:
The bottom line is that you will need some kind of HR presence even if your business is small. You will possibly save time and even money down the line by using HR and HR professionals from the start. This doesn’t mean that you have to hire a full HR department — one team member may be able to handle all of your HR duties, or you could hire a part time HR professional.