Home Business Insights & Advice Why and how HR is essential for small businesses

Why and how HR is essential for small businesses

by John Saunders
24th May 22 2:52 pm

The HR (Human Resources) department is integral to a company’s operations. HR consultancy ensures your employees are comfortable with the workplace environment. However, there is more to HR’s responsibilities than most small business owners think. Setting up suitable solutions for your company must adhere to specific federal regulations. You must ensure you comprehend and comply with these rules to establish trust and equality in the office between the employer and employees.

We have compiled a checklist on establishing an HR department for your small business to help you understand these federal laws and their impact. The tips shed light on managing monthly payroll and employee benefits, efficient hiring, and the significance of training programs.

1. Hire the best candidate

Many small business owners conduct their hiring process quickly, bringing onboard talent based on intuition. It is a mistake they later regret. After all, they cannot fire their recruits because they are disappointed with their decision, lest they face lawsuits citing workplace discrimination. Therefore, take the time to evaluate all potential candidates, scrutinising their qualifications to ensure they can fulfill the job description. You also might train the new employees to keep them abreast of other responsibilities and expectations in your company. Much of this requires HR’s involvement and support.

2. Have an employee handbook

Employers must have an employee handbook to let the workers know what is expected from them and protect the business from workplace disagreements. The information in your manual can be as straightforward or complex as you want, depending on your industry and objectives. It should clarify the company’s procedures, policies, expectations, and communication protocols.

3. Encourage feedback and reward your staff

To register exponential growth, small businesses must set employee performance targets and reward those that meet established goals. It is best not to overlook your workers and issue verbal responses. The rewards for meeting targets can include tickets to a movie or sports games, taking them for lunch, or commission payments included in their wages. It is a means of showing them they are a great addition to the business and valued. Hence, you keep them happy, and they respond by ensuring you have few to no turnovers.

4. Understand and comply with HR laws and regulations

Employment laws are there for a reason, and it is best for business owners to understand and appreciate their significance. The regulations are meant to protect and uphold the employer and employee’s rights. The focus on the employees is to ensure they are not subjected to workplace discrimination, harassment, labor inequality, and other illegal acts. It also addresses concerns about workers’ safety and right to fair wages.

5. HR related files confidential and must be organised

All files in your HR department are private and must be kept organised. The documents keep you abreast of every employee’s resume, certificates, job application forms, performance evaluation reports, wages records, I-9 forms, leave requests, and medical histories.

6. Process and pay salaries on time

Poor time management is a significant issue that causes employers not to process and pay the staff on time. Hence, with the HR department in place, your business can ensure its payroll software and system are updated, ensuring the employees get their salaries at a particular time each month. It is best to invest in a paperless payroll system because it is more efficient in gathering and organising information. Opting to outsource this to an independent HR contractor could see you pay more due to payroll taxes.

7. Hire a good lawyer

Disagreements in the workplace might blow out of proportion, creating a situation that calls for an experienced lawyer’s intervention. The HR department will oversee this, ensuring the business has a reliable attorney on retainer to protect it from lawsuits or employee issues that might have legal implications.

8. Evaluate your workers

Employee evaluation is essential because it helps measure job performance to ensure their skills and professional proficiencies match the job description. It enables the employer to understand the staff’s strengths and weaknesses to develop training programs, set performance targets, and reward productivity.

9. Get your workforce onboard

The HR department is tasked with prepping the new candidates on their first day of work, which helps streamline the onboarding processes and acquainting them with the workplace culture. The HR will ensure business cards, name tags, and other essential forms are ready so that the new employees hit the ground running. Briefing them on their first day lets them understand what to do and what’s expected of them.

10. Go paperless

Paperless systems are less prone to errors. They promote accuracy and efficiency in business operations. Consider investing in the latest HR software to ensure the human resources department tackles onboarding processes, managing schedules, and tracking staff attendance effortlessly. The paperless system also saves space because the data can automatically be backed up to secure online servers.

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