Small business owners have the difficult task of wearing many hats. A recent blog post at the Huffington Post by Margaret Jacoby highlights the five HR mistakes commonly make by small businesses.
1- Not Hiring the Right People for the Job
This happens often and can lead to even more problems down the road. Take your time and find someone with the skills necessary that will also fit well with your existing employees. Conduct background checks, reference checks and pre-employment drug tests to prevent future issues. You may also consider a personality assessment to make sure they would be a good fit for the position. A Plus Benefits can help with each of these pre-hire tests.
2- Not Creating Clear Job Definitions
This doesn’t mean simply having a written job description, although that is a great place to start. Having a clear idea of what is expected allows employees to perform to expectations. Also, having a clear job description allows you to attract the best potential employees for the position and make secreting easier.
3- Not Addressing or Documenting Performance Issues
Ignoring problems and hoping they will go away on their own never works. A clear progressive discipline process outlines expectations for employees and gives them a chance to perform to those expectations. Documenting this process in writing protects you in case of future litigation.
4- Not Understanding basic Employment Laws
The laws surrounding employees are complicated and vary state to state. A Plus Benefits has the expertise to help you with these laws. Your best bet is to contact an HR Advisor with any questions that arise, even if you think you understand the law. Ignorance of the laws does not excuse the company from penalties should a legal situation arise.
5- Misclassifying Your Employees
This is another issue we find a companies of all sizes and all industries. Sometimes a company will classify a worker as an independent contractor rather than an employee, to avoid payroll taxes and tax withholdings as well as workers’ compensation. But there are strict IRS rules for what type of work can be done by an independent contractor vs. an employee. Additionally, even with years of experience, businesses often misclassify their employees as exempt from overtime. Just because an employee is being paid a salary, it does not mean that they are not entitled to overtime of they work over 40 hours in a week. Contact an HR Advisor if you have questions or concerns about the classifications of your employees.
Each of these mistakes comes with a cost, many of them a direct monetary cost in employee replacement or legal fees. But also consider the value of your time as a business owner and what other tasks you could focus on if your HR was better managed.
We have seen these errors happen among companies of all sizes and all industries. Let A Plus Benefits help you correct these and other common HR mistakes that could be getting in the way of your business reaching its maximum potential. Contact an HR Advisor or leave a comment below.