Preventing HR Compliance Issues that Can Derail Your Business
A crucial step in the development of any successful business is the creation of an HR process. Whether you plan to employ one person or an entire HR department, outsource or keep your services in house, HR issues can be prevented with the correct resources.
HR oversight can be split roughly into the following categories:
- Documentation (employee handbook, individual records, etc.)
- Legal education (standard labor laws including FLSA, OSHA, INA, ADA and Title VII of the Civil Rights Act)
- Crafting company policy
- Recruiting and onboarding
- Industry-specific training
HR issues occur in small and medium business environments for a number of reasons. All nine of the problems listed below pose their own unique challenges, but they all stem from the same source; a paper-based HR department.
HR: What Could Go Wrong?
We’ll go through the common mistakes made by owners and managers, and how to overcome them.
Establishment of Workplace Policies
The first misstep can occur before a single employee walks through your doors.
The employee handbook is a living document filled with timely information for a brand new staffer or for someone who needs an immediate reference. Many business owners don’t bother creating one, however, or put one together and then forgo updating it when policy changes. This oversight can mean that your workers do not understand your basic business philosophy. They may have ongoing unanswered questions regarding attendance or holiday pay, or have an issue with sexual harassment.
Without a handbook for quick reference, those questions prompt long conversation with HR staff and steer them away from higher-level projects. We recommend automating the handbook whenever possible to make searching and updating easier.
Another essential HR resource used to be the big stack of paperwork piled into filing cabinets, detailing everything from benefits to performance reports. Without an organized system in place—or failing to move all of that data online—it’s easy to guess at the number of problems that can appear at any time.
ESS, or employee self service, places the onus back on your staff and typically includes a system of manageable alerts for filing all documents safely and on time.
Sticking to Laws and Regulations
There are deep ramifications for any manager who negatively impacts payroll, or fails to properly account for overtime. Taxes are another minefield; improper deductions and miscalculated garnishments can monopolize HR resources for weeks or months on end.
Understanding each regulation and how it applies to your enterprise is a full-time job. Here is just a sample of the highly granular and specialized laws that currently exist. An automated system that alerts HR when a company is out of compliance is a priceless asset.
Moving from a paper management system to an automated option is a protective move for both leaders and workers. Any allegations of favoritism or of bias can be refuted by cold, hard data. If someone becomes a liability, tracking their HR record becomes much simpler with an ESS searchable database.
It’s not uncommon for businesses to set aside an entire week—or longer—to accommodate employee onboarding. The entire process can cost several thousand dollars—a price that doubles or triples when inefficiencies appear.
Onboarding also does not end when the first forms are filed. It takes an estimated minimum of 90 days for a person to feel comfortable in their new role and develop the confidence to meet every expectation. Automating and standardizing your onboarding procedures can improve retention by as much as 50 percent.
You’ve likely welcomed many new employees into your business with enthusiasm, eager to watch them hit the ground running and take your vision to the next level. The search for the perfect person, or people, likely took a long time. Along with individual skill sets, those qualified candidates also had to be evaluated for company fit.
Whether your hires are salespeople or engineers, correctly identifying and quantifying your expectations for their work is important. An automated system helps to make these expectations crystal clear so that you do not welcome anyone (or say goodbye to anyone) without a clear strategy.
The same concept goes for the employees you already have. A cultural change to create a more engaged and confident workforce begins with the establishment of protocols and expectations. Once your team knows what is expected of them and how to meet those goals, real systemic transformations can begin.
We also see a job-hopping culture accelerating, making it harder than ever to hold onto staffers who are being actively courted and recruited by the competition. Job satisfaction begins at the very top and trickles down—first to the people reporting to you, and then to their customers.
Lack of Leadership
Here is another often-overlooked part of running a successful company: Leadership development. Over a third of organizations surveyed note that their leadership development practices are subpar or nonexistent. At the same time, 41 percent recognized the importance of defining leadership strategy.
Behind the Tech Curve
Staying up to date on current technological advances helps you to recruit and retain better employees. Implement those advances by first streamlining operations, beginning with employee self service. Taking on an HR automation partner is one of the simplest ways to create a technically advanced environment, where you and your staff are notified regarding new software, new regulations, and more.
Protect Your Business From HR Issues
Any of the nine missteps above can derail you from critical objectives. They cost both money and time, neither of which you have to spare. A structured onboarding solution allows leaders to take care of the big picture.
By automating tasks such as medical benefit selection and vacation requests, HR personnel can become more strategic and focus on people. It is the industry standard for a reason—an all-encompassing resource available at any time—including on mobile. Not to mention the newest automation technologies that are changing the game, like artificial intelligence, machine learning, and the Internet of Things.
If you’re not sure where to begin, let a full-service partner be your guide. PC Payroll offers customized solutions for small and medium-sized businesses within a range of industries. Contact us today to rid yourself of HR issues for good.