You don’t know what you don’t know and that simple fact can get you into hot water fast when it comes to managing human resources as a small business. There’s A LOT to know, and your expertise is in running your business, not necessarily, HR. When you hire your first employee it’s a big deal in so many ways, but it also brings a whole host of additional considerations.
1. Educate yourself. The laws are constantly changing and as an employer you’re expected to be up to date on all of them. Be sure to review state and federal requirements surrounding topics such as safety and security, compensation, benefits required, work schedules, vacation/leave/PTO. While it may seem easy enough to get DIY payroll software and do it yourself, using a payroll service can end up saving you in the long run as these are people whose primary job function is to keep up with all of the constantly changing laws and requirements. Something as simple as misclassifying an employee can bring the IRS calling and cost far more further down the road.
2. Create an Employee Handbook from the start. This will help to shape the culture of the company and will also serve as a guide for all employees as to what the expectations are for employment. No one likes playing a game when they don’t know the rules and an employee handbook, even if you only have one employee, will serve as a reference for them regarding policies and procedures. That being said, it doesn’t have to be stiff. Check out these tips for creating an engaging handbook your employees will truly utilize.
3. Establish a clear anti-harassment policy and include it in the aforementioned handbook. In 2018 U.S. companies paid out more than $56 million in sexual harassment claims. EEOC recommends implementing a clearly defined policy (which also includes social media activities) that offers multi-faceted reporting procedures such as using a 3rd party HR resource, a team of respondents, a violation hotline, or a peer review board. Upon report and investigation, responses should be consistent, prompt, and proportionate to the severity of the infraction.
4. Do yourself, and your job candidates, a favor and utilize personality tests during the interview process to determine whether or not they would be a good fit. You can ask all the questions in the world but these tests are designed to identify someone’s natural personality and how they are more innately inclined to react. For example, certain personalities are more inclined for sales roles etc. This also helps to see how a potential employee may fit into your company culture.
5. Employers are legally required to establish processes designed to safeguard employee information so if you’re going to handle HR in-house, it’s imperative that you take the appropriate steps. More than 200 million confidential files have been released improperly by companies according to Privacy Rights Clearinghouse, a San Diego-based advocacy firm, and you don’t want to be one like Boeing was when an employee unknowingly sent his spouse a spreadsheet with private data. Professional HR practitioners are well versed in the ins and outs of safeguarding employee data and if you’re going to oversee HR efforts in-house, you’ll need to take precautions to ensure that your team members’ sensitive information remains safe. Gone are the days of locked filing cabinets and manila folders, these days protecting employee data including Social Security numbers, health-related information, performance reviews, and pay levels is complex and multi-layered, and should extend beyond a folder on your desktop.
6. Document, Document, Document. Sometimes you can see the red flag flying from a mile away, other times it’s a little harder to see, maybe even buried. That’s why, when dealing with personnel matters, documentation is king. If something has even the slightest potential to come back around, be sure to log all conversations, the date and time, as well as what was discussed and who else was present for the conversation. Consistent record keeping in human resource issues can assist you should you need to terminate an employee or if something should ever escalate to a law suit or Virginia Employment Commission hearing regarding unemployment benefits.