Ideally, small businesses would include a Human Resources (HR) manager from the first day they open their doors. In a more realistic world, small businesses work on a bare-bones budget and may not have the resources for more than absolutely essential staff. As your business grows, though, you may wonder when it’s time to look for an HR professional. Still don’t know if you need HR for your small business? Here are signs an HR manager will help your business flourish.
Signs That You Need HR for Your Small Business
You’re Hiring More Frequently
Hiring employees is an expensive and time-consuming process. A single hire can cost the business $1,000-$5,000, depending on your industry and the combination of costs you incur:
- Recruiting agency fees
- Advertising agency fees
- Employee referral bonuses
- Travel costs for applicants
- Hours spent reviewing applications and conducting interviews
- New hire sign-on bonuses
Hire the right HR fit, and you can see amazing improvements in your hiring process. If you’re planning to scale up, an HR rep can connect to the best recruiting agencies and pre-screen applicants so you only sit down with the best candidates.
If you’re hiring frequently due to rapid employee turnover, it may be a sign that employee engagement could be an area to improve. An HR rep can assess strengths and weaknesses in company culture and offer ideas to improve employee retention.
Employee Requests Eat Up Your Time
You’ve got a stack of documents on your desk and a long list of calls to make. But it seems like whenever you start to find a good working rhythm, an employee knocks on the door.
One employee wants to discuss a raise. Another needs mental health accommodations, which entails restructuring some deadlines and work hours. Another is planning a Paris vacation (lucky dog) and wanted to “drop in” and tell you the dates. So much for your to-do list.
An HR rep’s daily task list includes managing employee requests, communicating benefits or employee handbook information, and resolving conduct issues. Empower your HR hire with the right training and communication, and you can outsource most lower-level requests and minor disciplinary issues. This can open your schedule to focus on projects that drive your business strategy forward.
You Have Legal and Finance Concerns
HR managers handle the responsibility of making sure the business complies with safety regulations, such as providing handbooks or required posters. They understand the worker’s comp rules and determine how to secure sensitive information, such as employee medical files. They’re involved (with your accounting professional) in overseeing employee timekeeping, paydays, and any deductions.
If you hire contractors, an HR rep can help make sure you’re not overstepping classification rules. Freelance and contract workers use different documentation and have strict boundaries separating them from employees. Mistakes can put you on the hook for more tax liability than you bargained for.
All of these concerns apply, whether you have an HR rep for your small business or not. If you don’t, though, no prizes for guessing whose desk these responsibilities will fall on. That’s right. Managing safety, legal concerns, and more are another part of how HR reps make it possible for business owners to be more productive with their time in the office.
Healthcare Regulations Cause Headaches
Healthcare is one of the most challenging areas for small business owners to manage. Changing laws and costly insurance plans are just the tip of the iceberg.
An HR professional’s first responsibility is to ensure that the business is compliant with any applicable Affordable Care Act requirements or other laws regarding health insurance. Delegating the responsibility of researching insurance options, understanding legal obligations, and performing administrative duties regarding healthcare is a huge timesaver for business owners.
HR reps can also help navigate conversations about healthcare. Health is a deeply personal issue. Employees experiencing physical or mental health conditions may be entitled to certain workplace accommodations, but they may also feel vulnerable discussing their health. The HR rep’s role is to protect the business, both by following required guidelines and determining what accommodations satisfy the employee’s needs but still keep the employee as productive as possible.
Still not sure if it’s time to start the search for an HR manager? Here’s your cheat sheet:
- You’re planning to hire multiple additional employees this year
- You’re struggling to make time for your projects in between handling employee matters
- You’re worried about staying on top of healthcare and safety issues
If one or more of these statement are true for you, write up a job listing. An HR manager can be a major asset for your business.
Do you think that you need HR for your small business? Share your thoughts below or on Facebook and Twitter.