4 reasons why every small business needs Human Resources.

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As the owner of a small company, you may be tempted to reduce expenses and choose to handle the HR functions solo. After all, funds are limited. And, if you have a small staff, or if you are fortunate enough to have a manager, can probably hire, train, coach, reprimand, and eventually terminate employees without the assistance of HR. Right?

No, not exactly. Human resources is much more than just hiring and terminating. HR practices, when done well, help to protect you and your company from the risks associated with not complying with Federal, State, and Local laws. Be it payroll, fair hiring processes benefits management, or performance evaluations, HR helps to ensure that everything is done in a manner that balances the needs of the employees and the needs of your business viability. 

So, does your small company truly require human resources? Absolutely. Here are a few reasons why – and some ways to do so without breaking the bank:

Reason 1: Recruiting and Firing

Hiring a new employee might take a lot of time, which you may not have as a small business owner. If you have open roles (which growing businesses frequently do), you need someone who can devote their time to hiring and everything that entails. This includes recruiting, going through resumes, reviewing applications, scheduling interviews, selecting individuals, and other tasks. 

Hiring new staff is critical since you want to uncover the best talent and fit the first time so you don’t waste time or money. And for that, you’ll need HR.

Reason 2: Employment Law

Another reason you may require the services of a human resources professional? They are well-versed in employment law. All it takes is one error when employing or firing a staff member to land you in legal trouble. If you don’t understand employment law, you could endanger yourself, your company, and your reputation. Hire an HR specialist who understands how to stay in compliance with state and federal laws to avoid lawsuits and internal issues.

HR specialists also understand what signs and posters must be displayed in the workplace. Many businesses are required to post FMLA, OSHA, and USERRA laws. You should also provide information about the state minimum wage, unemployment insurance, workers’ compensation, and other topics. HR pros will know what you need to exhibit, where you need to display it, and when you need to update it.

Reason 3: Employee Files

Did you know that you must retain separate files on each of your employees? Each member of your team must have an I-9, a medical file, and an employment file; just for starters. You could risk fines of up to several thousand dollars if you do not complete and keep certain forms, papers, and store information securely and within the retention of the proper records. HR professionals will know what files to store, when to update them, and where to store them, as well as how to keep them structured and conveniently available.

Reason 4: Handbooks & Manuals

Do you have a handbook for your employees? If you haven’t already, you should. Even if you only have a few employees, a manual or handbook is still required to lay out the rules, regulations, and expectations you have for your staff. Handbooks help employees understand exactly what is expected of them, but they can also be utilized to protect you in the event of employee conflicts. 

A qualified HR Professional will strive to prepare your handbook for Counsel review. Even if an HR expert creates and enforces your employee manual, the employment lawyer will review it to ensure that you are in compliance with the law.

Human Resource Consulting

So what is the bottom line? Even small firms require some form of human resources presence. Human resources experts can accomplish a variety of things for a company that other internal employees cannot. Using HR from the start will save you time – and possibly money – in the long term.

Keep in mind that you do not need to recruit an entire HR staff. A small business’s HR functions may be handled by one person. You might also hire a part-time HR, compliance, or recruiting expert, or outsource your HR functions to a third party. 

Stone Soup Performance Consulting partners with businesses to help ensure your human resources function is well-equipped with the staples—solid, legally compliant, and culturally matched human resources policies and practices that govern the inner workings of your organization. Stone Soup Performance Consulting is here to help you with your HR needs.