How many of you actually know what the term, “HR” really means?
Most small businesses are actively working in the realm of Human Resources on a daily basis without even realizing it. Human Resources Awareness month may be in October but now feels like a great time to take a deeper dive into the main functions of business that make up this particular specialty. Over the next few weeks, we’ll be rolling out a series of blogs to help business owners better understand the world of Human Resources and the ways in which it can make or break your business.
In this edition of, “What the Heck is Human Resources?”, we are going to get down to the basics. If you look up the definition of Human Resources (HR), you will find something that goes like this: the area of a business that deals with hiring, administration and training of a business’s human capital. Simply put, the focus of an HR department is to maintain the employee-employer relationship, becoming the hub for keeping employees informed, paid and safe. In smaller businesses, it is common to find this role split between multiple people, whose main area of focus is not HR.
Here are the areas of HR that every company should be regularly focused on.
From attracting and selecting candidates to onboarding a new hire, recruitment is the first and most important step of the employee life cycle. It is not easy finding people with the skills you need, the flexibly to adapt and an attitude that compliments your business culture. Even experienced HR representatives struggle with this from time to time. Making the wrong hiring choice not only impacts your wallet, but it can also completely throw off the rhythm of a well-functioning workforce. Creating and advertising job postings, reviewing and recommending candidates for management selection, while communicating with applicants are integral parts of the recruitment process and can be very time consuming, especially if you have high turnover.
- Employee Relations
Being able to create and maintain positive relationships between employees, management and the employer is the goal of all employee relations efforts. Specifically, we are talking about creating fair workplace policies and consistently enforcing those policies. We also want to make sure that employees are valued and respected by managers and the employer, in the same way that customers would be, cultivating loyalty and increasing engagement throughout the workforce. An example of employee relations done right might look like a manager taking the time to talk with an employee when they see behavior that violates company policy or standard operating procedures instead of ignoring it, hoping it will change and becoming frustrated when it doesn’t. By addressing the issue right away, the manager is able to communicate constructively without emotion and establishes open lines of communication with the employee. This conversation would also be the first step in moving the employee through the employee life cycle toward separation if the behavior does not improve.
- Compensation & Benefits
In smaller businesses the compensation and benefits roles are often handled by a team including the business owner, HR representative and benefit brokers. In addition to working with managers and business owners to develop job descriptions, HR will often be tasked with researching national and local compensation trends and helping to establish a compensation structure that remains competitive while maintaining organizational budget requirements.
Whether it is employee enrollment, updating payroll deductions, managing open enrollment efforts or coordinating with providers to deliver resources and answers to employees when they need them, HR acts as the in-house point person for all things benefits related. Additionally, they will often be tasked with responding to unemployment claims and representing the employer at unemployment hearings.
- Training & Development
A thriving and engaged employee is good for business. From day one employers are focused on ensuring employees have the tools and skills needed to feel confident in their role while maintaining productivity. HR plays a big part in assessing, tracking, developing, coordinating and documenting these training efforts.
- Safety in the Workplace
By law, every employer is responsible for providing a safe workplace for their employees (Occupational Safety and Health Act of 1970). Depending on industry and size of the business, it may make sense to hire a dedicated safety manager to maintain workplace safety, working with HR to document incidents and maintain consistency when enforcing applicable safety policies. When it comes to Worker’s Compensation, HR is often an integral part of filing claims and maintaining documented associated with workplace injuries and insurance claims.
- Labor Law Compliance
For every category listed above, there are a set of laws and rules that must be followed in order for your organization to remain compliant. Part of HR’s job is to ensure that the organization is aware of and following all applicable laws as non-compliance can lead to employee complaints, legal battles, penalties and fees.
At this point, you should have a good understanding of all things Human Resources. If it seems like a lot, that’s because it is a lot. As your organization grows, plan to devote more resources for hiring the dedicated staff needed to properly support this role or consider outsourcing to professionals trained in these specialties. As a small business owner planning to tackle this on your own, it’s always a good idea to spend some time and money working with a professional of Human Resources in order to establish solid systems and policies that will properly support your growing business. Just as important as working with a lawyer and an accountant when getting your business started, a little Human Resources now can save a lot later. Stay tuned for the next installment of “What the Heck is HR?” and if you can’t wait, reach out!
Do you have specific questions about Human Resources and your business? Consult today with one of our Attorneys and let us help guide you through your employee related concerns.
Law 4 Small Business, P.C. (L4SB). A little law now can save a lot later. A Slingshot company.