Avoid These 5 Small-Business HR Mistakes

To become a successful small-business owner, you need to master the art of juggling. Owning and owning a small business means needing to undertake multiple roles, from accounting to marketing to recruiting. Unfortunately, needing to juggle the tasks of varied roles increases the probability of making mistakes.

It’s possible for small-business owners to sometimes disregard the recruiting side of business when things are running well. However, doing so can result in costly mistakes (think litigation and employee turnover) — mistakes that could have serious consequences for smaller businesses.

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How do small-business owners avoid dropping the ball in terms of HR? Listed below are five of the very most common HR management pitfalls smaller businesses face today (and how to prevent them):

In terms of hiring workers for your small business, mistakes are too common. From poor job descriptions that attract less-than-stellar candidates to a hurried interview process that results in hiring “warm bodies,” hiring mistakes could be detrimental to business. Actually, 27 percent greater than 6,000 HR professionals reported an individual bad hire costing a lot more than $50,000, according to a 2013 CareerBuilder survey.

These hiring faux pas often stem from having an overly hasty hiring process. The answer? Create a consistent interview process and stay with it. Start with a precise, clear job description that aims to attract quality talent. Like the right information (must-have/bonus qualifications, job duties, company info, etc.), in a conversational tone may be the key to weeding out unqualified candidates from the get-go.

A very important factor employers have a tendency to overlook when hiring is interviewing for cultural fit. Ensuring an applicant is a good addition to the business culture is simply as important as getting the right skills for the work — especially for smaller businesses. Additionally, get more folks mixed up in interview process. The very best hiring decisions are created as a team.

THE INNER Revenue Service (IRS) has been recognized to target small businesses in order to find employers who misclassify employees as “contractors.” In order to avoid the penalties that derive from misclassifying employees for tax reasons, get acquainted with what differentiates a worker from a contractor. Generally, one is only considered an unbiased contractor if indeed they fit the next categories:

  • Behavioral: The business doesn’t have control or the proper to regulate what the worker does or how they do their job.
  • Financial: The business will not control the financial areas of the worker’s job, such as for example the way the worker is paid, whether expenses are reimbursed, who provides work materials, etc.
  • Relationship: The business doesn’t have written contracts describing the business enterprise relationship between both parties, will not supply the worker with employee benefits, etc.

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To lessen employee violations, employers will need to have, update and communicate work-related policies. Businesses of most sizes have to have some form of a worker handbook. Devoid of company policies on paper is just requesting trouble.

Having a worker handbook isn’t enough, however. The policies outlined in the handbook have to be updated regularly and communicated often. What’s more, employees should sign an acknowledgment form stating they have read and understand everything in the handbook.

When employers spend money on their employees, they subsequently invest in the business. This investment is most clearly demonstrated by giving various training opportunities for employees. These opportunities must start with an intensive onboarding process for new hires and continue with professional development programs and events for current staff.

By giving new hires with the various tools they have to hit the bottom running and current employees with opportunities to grow, employers can be confident that employees at all stages are performing at peak performance.

Messy fires can result in unwanted lawsuits. While no termination is a positive one, it could be easier when properly prepared for. That preparation starts by addressing and documenting performance-related issues. When performance problems arise, try to nip them in the bud by addressing them during performance check-ins. Thus giving employees a chance to correct the problem.

What goes on when that feedback doesn’t solve the problem? Sometimes terminations are unavoidable, but going about them the correct way can avoid any unwanted issues. The main element is to thoroughly document employee performance problems. It may look time-consuming, nonetheless it can serve as valuable evidence should a termination be necessary.

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