Who said starting a small business was easy? In this day and age, there are so many p’s and q’s, dotting the i’s and lower-case j’s and crossing the t’s, that could make your mind explode. Small businesses are no exception and one headache facing business owners is human resources.
Without a doubt, you’re looking at a big undertaking to ensure the human resources for your business are properly managed. Think about it. If your employees aren’t regularly getting their paychecks, or your benefits aren’t received correctly, or your employees don’t have the proper training to do their job, your company isn’t going to last very long.
The key to successfully managing HR is to keep in mind these common mistakes — and do your best to avoid them.
1. Your employee handbook isn’t complete
Most companies have one in some form or another, but employee handbooks are infamous for being incomplete and outdated. This one book can be considered a corporate bible. If your book is not written plainly and does not cover all the policies and procedures you want your employees to follow, then your employees will struggle.
Their struggle will become yours as you try to establish your company culture and manage your employees.
2. You aren’t managing your tax obligations correctly
Who doesn’t stress over dealing with taxes? There’s a reason Benjamin Franklin labeled it next to death.
So as a small business owner, you have to make sure you classify your employees correctly. Improperly registering your employees with the IRS could result in serious consequences for you and your worker. In addition, make sure to keep a copy of every employee’s W-4 and I-9 form with updated social security numbers, names and addresses with your records. It will ensure smooth sailing and reduce the time spent wading around old documents in the event of an audit.
3. Labor laws - they change, they come from everywhere, they are important
Honestly, labor laws can make taxes look like a cakewalk. It’s no surprise that small businesses out there can mismanage the issue of ensuring their business is operating legally – municipally, statewide and federally.
You might have a business where you can hire individuals below the age of 16. Be sure you don’t schedule those kids during school sessions, because federal law prohibits that. That’s just one example of how you need to monitor the laws and ensure that you adhere to them. Specifically, there are three aspects of labor laws you need to keep watch over:
Child Labor Laws
Non-Resident Labor Regulations
Equal Rights and Americans with Disabilities Legislation
These aspects of legal issues for your business can cause you and your company grief. If you have any doubt at all about whether what you are doing is legal - ask a professional.
4. Overtime can be plenty confusing
Even large corporations can have trouble with this. Why? Because even employees may end up not paying attention to just how many hours they work per week. It requires a lot of math. Who here hated math back in school?
Here’s an example of how overtime can be utterly painful. California, specifically, requires time and a half payments for hours worked over 40 as well as hours worked over an 8-hour shift per day. Additionally, double time is allowed for employees working over 12 hours in one day. So, let’s say you have an employee who worked 46.5 hours in one week, working one shift of 10.5 hours, and another on another day for 13 hours.
You do the math.
And to make it more of a headache, this labor law of overtime not only applies to hourly employees —but could also apply to independent contractors. Be sure you know the legal description of independent contractor and that all the parameters are met.
5. “This was not in my job description”
It is, of course, a given that an employer would naturally assume that the job should be done correctly. But how can your employees do their job correctly if they don’t know what their jobs are? Vague job descriptions can heavily penalize business operations. You have everyone stepping on everyone else’s feet, criss-crossing, looking confused. And in the midst of that chaos, nothing in your company is getting done, and before you know it, you fold completely. Remember, if it’s nobody’s job, it doesn’t get done.
Before you get those new job postings up, sit down with your HR team and write succinct, clear and defined roles. Make sure your potential candidates know exactly what it is they’ll be doing in your office so that there’s no confusion whatsoever.
Common details include:
They’re simple; and that’s what makes them so dangerous. Give yourself and your business a boost by staying current with the rules and regulations. Give us a call. We’re happy to help. More importantly, just make sure you dot that ‘i’.
Consider outsourcing those costly back-office responsibilities
Business owners are always looking for ways to maximize their investment. One area that they sometimes over look is outsourcing human resources. For most businesses, that isn’t your core competency, and it has a potential for big and costly mistakes, so why not turn it over to an expert and get that headache out of your hair?
The benefits of outsourcing HR
For starters, outsourcing HR will likely save you money as it helps reduce the cost of maintaining non-revenue-generating back-office expenses. A fully-functional human resources department requires additional office space and highly-trained and experienced HR staff.
You need to ask yourself if you can afford an experienced enough HR professional (salary, benefits, and perks) who not only can handle the day-to-day but can also stay on top of increasingly complicated federal, state, local employment laws and compliance-related issues, such as:
If you’re ready to make this transition, give EBR Consulting a call. We can help make it painless for you.
It sometimes seems as if we spend more time looking down at our phones than we do looking up at what’s going on in the world. Mobile phones have become a very emotionally charged issue in the work place. Employees want access to their phones. Employers fear that mobile phones distract employees from what they are there for – to work. So, what’s the right answer?
There’s no doubt that phones can be useful for many things. We’ve turned the word Google into a verb, and it seems like anytime we are unsure about something we just “Google it.” Of course, we use our phones for a calculator, a notepad, a calendar, and may other tools.
So, if mobile phones are so useful in the workplace, then why do some employers still insist on banning them? Well, maybe it’s because there is a fair bit of research suggesting that phones act as nothing but a distraction.
But taking it away can be even more harmful
So, what does happen when you separate a person from their own personal mobile phone? The result is something called ‘nomophobia’ – which is simply short for ‘no mobile phobia’. And yes, it sounds like a little bit of a joke – but it’s an actual thing, and it’s been measured by scientists.
According to Dr Kim Ji Joon, when people are separated from their mobile phones, they often experience a range of the effects:
Dr. Joon explains that this is because more people now feel as if their phones are an extension of themselves, especially now that Generation Z will be arriving soon to a workplace near you.
Hire the right people, then give them freedom
What if you focused less on whether or not you restricted mobile phone usage and more on whether you hired responsible people. Do you really care what employees do with their mobile phones? If an employee is unable to use their mobile phone in the workplace, do you think they will be more distracted because they are thinking about the ‘forbidden fruit.’ Not having access to a mobile phone could be more of a distraction than having access to it. And if you are hiring responsible employees, wouldn’t they have the common sense to recognize when their performance is being impacted by their mobile phone?
Confidentiality, risk management, and data security
Of course, the argument isn’t entirely about whether mobile phones distract employees from their work. You also need to consider whether a mobile phone can introduce a risk to the workplace. For example, if you’re dealing with sensitive data, do mobile phones increase the risk of a data breach?
It is possible to manage an open mobile device policy, even in heavily regulated industries. Many companies have found ways to implement strict protocols regarding passwords and viewing and sharing restricted content. It does take more oversight on the company’s part, but the result is happier, more engaged employees.
Work and life overlap too much to outright ban mobile phones at work
In many industries, work and life overlap. Employees are sometimes expected to respond to emails and messages from home during off-hours, so it seems only fair to let them address personal matters on their personal devices during work. Perhaps consider approaching a mobile phone policy like other company policies such as flextime.
Give employees specific goals and performance metrics that they need to achieve and have less concern about how they accomplish their work. Excellent, high-performing employees should not need to be micromanaged.
Creating a mobile phone policy that works for everyone
I feel like the benefits of allowing mobile phones in the workplace probably, in most circumstances, outweigh the risks. Especially as we move into an age where mobile communication is an integral part of our lives. But how do we create a mobile phone policy that considers the people who are maybe not so tolerant of the noise and distraction these devices create?
Some companies only allow sound when it’s a call – just in case there’s an emergency. All other sounds and vibrations must be turned off. The reason for these two rules is because one person’s mobile phone could be a distraction or an interruption for somebody else.
Like it or not, mobile phones are becoming an increasingly important part of our lives. Rather than trying to ban them, it might be time to develop a policy that applies common sense and courtesy for everyone in the workplace.
One question I often get is how formal or relaxed should your company culture be? How strict should you be on employee behavior? I always encourage business owners to think about and be deliberate in determining what they want their company culture to be. One thing to consider is how do employees work best.
Traditional working patterns don’t always work
Consider the ‘typical’ office environment for a moment. Traditionally, a typical working day in the office might be split into an 8-hour shift, punctuated by a 30-minute lunch break, and two shorter 15-minute breaks. While this might work well for some environments, it’s not always going to be the most productive work pattern for everyone.
The Harvard Business Review says that employers should consider the Circadian Rhythm when setting schedules. Fortune advises that you should work in 90-minute cycles, making sure you take a break after each cycle. The website Magic Work Cycle advocates a 30-minutes work, 30-minutes play approach.
I’m not saying any of these are the right approach. What I’m pointing out is that what might seem to obviously be the most productive strategy, isn’t always the case. For example, some of the above techniques include far less ‘working’ time than the traditional office environment. But many people report greater employee output when using them.
Three reasons having fun at work could be good for your business
There is some pretty compelling evidence suggesting that letting employees have fun at work is a good thing. For example:
How to help employees have fun at work
There are plenty of ways to encourage a little more fun in the workplace. You don’t have to go as far as writing fun into your employee handbook, but you can create an environment where fun is celebrated, not sniffed at.
Creating office games and leagues can be a good place to start, but you don’t even need to be quite so formal or structured. Simply providing the facilities for having fun – such as a well-equipped recreation room with ping pong tables or a video game console – can help you to get the ball rolling if you’ll pardon the pun. Just don’t make employees feel guilty for actually using them!
Another approach is to simply make sure you’re taking your teams out and spending quality time together, even if it’s just for a relaxed team lunch at a local restaurant. Or maybe you bring in ice cream one afternoon or pay a massage therapist to provide chair massages.
There are lots of things you can do to create a more fun work environment. Why not create a fun committee with a cross-section of employees and see what ideas they come up with?
When you’re the sole employee of your small business, dress codes, absenteeism, and professionalism are not issues. Hiring that first employee brings on a raft of new things you need to consider, communicate, and regulate.
You can access a great deal of information on the internet, from your fellow entrepreneurs in your networking group, or a consultant, but the bottom line is you need to determine and then implement your own employee relations plan.
You should decide from the start how you want your employees to present your company to the public.
That means a dress code:
It also means setting expectations about attendance:
You could get lucky and the first person you hire will be the important right fit - but you can influence your luck with some careful hiring practices:
Hiring your first (and subsequent) employees is a big and exciting step. With a bit of thoughtfulness and planning you can minimize the stumbles and be off to a running start.
Despite your due diligence, your insightful interview, and your fair, firm and consistent counseling, your new hire is just not working out. As this becomes clear, it is important to look at the training you have provided and when the training occurred. Perhaps most importantly, do they have context for what they’re doing. It’s not enough that you just impart your expectations and expertise; make sure they understand why things are done a certain way.
It doesn't take long to become apparent that the employee is not –for whatever reason- managing to fit in. You should not linger in rectifying the problem, and, in fact, they may do it for you! Remember that your company culture is still being established, and this one employee is bending it in a direction you don't want. Unfortunately, no matter what you do, you will not change their basic personality. The more you invest yourself in trying to make a bad hire into a good one, the worse you will feel when the time comes to let them go. Out of fairness to the employees you already have and to the one you need to move along, take your time hiring, don't when you're firing.
When you fire an employee, give them the courtesy that you should extend to any human being. They deserve a face-to-face meeting. Nothing else works. The employee you fired will remember how they were treated and so will your remaining employees. Absolutely never ever fire someone over the internet.
Hopefully, you thought long and hard before scheduling the termination meeting. You have your reasons if you choose to provide them, and a coworker on hand to support you. Your words should be straightforward. Being wishy-washy gains you nothing but grief if the employee believes he has one last chance to affect your decision. Have a termination letter ready to give them when they leave – but don’t just read it to them. Instead, tell the employee up front that you are terminating him. If you choose to, explain why, and then outline the steps of the termination.
After your meeting, the former employee should be escorted from your premises. All company property needs to be returned, and you should act quickly to cancel their email access. In the internet age, the termination will not stay confidential for long. Your former employee can say what they will regarding the termination, you, on the other hand cannot.
Are you required to pay off the terminated employee at the termination meeting? That is something you need to research in advance.
A final step when you terminate is looking carefully at the entire process of bringing on a new hire. The buck stops with you, and it is your responsibility to vet prospective employees.
Look back at the interviews:
Look back at your new hire orientation:
The new hire process provides many opportunities to reveal your company culture. You can never repeat the basics enough. Discuss your goals and how you plan to meet them. How do you treat your customers, your suppliers, and each other? Of course, talk is cheap. What will really make an impression is how you live out these things every day.
After being very critical with your new hire process, determine what could have been better and change it. Establish what works and do more of it. It is your responsibility to learn and do better. That's how you eliminate the dirty job of having to fire someone.
An employee handbook is like the user manual to your company, it will help you and your employees see eye to eye on everything from how much vacation they get to what’s expected of them on the job.
Think about the culture you want to encourage in your company. Look at the size of your company to determine which federal laws affect you. Do you want to be able to terminate unsatisfactory employees in a timely manner? What benefits are you going to provide? Will you need a dress code?
Encouraging a friendly, ethical, and efficient work place for all employees starts with the owner and the Employee Handbook.
To begin; list the expectations you have regarding mutual respect, common courtesy, and consequences for insubordination. Unlawful discrimination or harassment can cause problems you don’t want and your employees should not have to deal with; you can handle this from the start by including wording that prohibits this behavior. Don’t be vague, if you are unsure about the wording, this might be the time to hire a consultant for input.
You should include:
The size of your company dictates the federal laws you are required to follow, and the laws should be included in your handbook. The following are some examples:
Once everyone has understood the new policies, draw a hard line as a business owner. Be firm that this handbook applies to everyone, period. The handbook being in place means no playing favorites. Everyone deserves equal treatment, but you’ll need to make sure of this for the policies within your handbook to be taken seriously by the rest of the team. You as the small business owner and your managers need to uphold the handbook to the highest extent, and that means playing by the rules you set.
Review your handbook at least once a year to make sure that your policies are in alignment with the company’s norms and with your state, local, and federal laws.
You reserve the right to change your policies at any time. When changes are made, your employees should receive an updated handbook or an addendum they can add to their existing book, and they must always sign and return a receipt for it.
Maintaining an Employee Handbook doesn’t need to be a daunting task, but if you are unsure, there is help out there. An Employee Handbook is a critical building block of your new company. It helps set the foundation for your future growth and success. Make sure you put your company on a firm foundation, and if you need help, EBR Consulting is here to make it easy and pain free.
Are you trying to decide whether to hire an employee or not? It’s a big step in owning a small business. Think about how much your time is worth. If you were offered $10.00 to stop what you are doing and sit in a dark room for an hour, would you do it? What about $100.00? $1,000.00? At some point we will cross the threshold of what your time is worth, where sitting in that dark room will profit you more.
Here are just a few reasons you should bite the bullet and hire an employee:
There are things you need consider when making the decision to hire someone:
After you’ve considered all of these things, you’ve interviewed candidates, you’ve done your due diligence and chosen a candidate…You give your candidate an offer letter and they accept.
Life is good, right? Yes, but you haven’t crossed the finish line yet.
Now you need to train your new hire. You can’t expect them to jump in feet first and be totally knowledgeable about your company, your customers, and how you like to do things.
This point is where your company culture really comes in to play. If you are casual - or appear to be casual - about returning calls to clients, your new hire will understand that customer service is not your priority. If your attitude toward your customers, suppliers, and others is less than respectful, it will be apparent and your new employee will eventually mirror your attitudes.
“Set the example,” “walk the talk,” and “begin as you mean to go on” are cliches for a reason. They work and will make you a better boss and your new hire a better employee.
Hiring your first employee should be a fun experience, highlighting your growing and maturing business. If you are unsure about how to take that first step, get some help. EBR Consulting is here to help you take those momentous steps with confidence.
You may think that because your small business currently has one employee - yourself- you don’t need to worry about something like company culture, but that’s exactly when you should start. “Begin as you mean to go on” is a good way to look at it.