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5 Key HR Tips for Small Businesses

More than 5 million businesses have between one and 19 employees. Many of these small businesses are too small to have dedicated HR staff, so it’s up to the business owner or manager to oversee the employees.

It’s a challenge for already overworked owners and managers to manage staff and understand everything that goes into HR.

That can leave you with a very high turnover rate. You could also end up in legal trouble.

Don’t worry, we have you covered. Take a look at these small business HR tips that will help you manage employees.

1. Have Written Policies and Procedures

If you want to scale your business by hiring more employees, you’ll need to have standards for all employees to adhere to.

That includes management and performance policies, standard operating procedures, and employee expectations. Having these standards in writing keeps your staff on the same page.

2. Learn About Labor Laws

Do you know that there are interview questions you legally cannot ask prospective employees? Do you know that you have to correctly classify your employees?

These are only some of the labor laws that you have to comply with. There are state and federal laws that you need to know. Not doing so can result in fines and penalties for your business.

3. Update Your Insurance Policies

As soon as you hire an employee, you need to update your insurance policies. You’ll need to update your health insurance policy to include employees, and you need workers’ compensation insurance.

Make sure you review your existing policies, so your business is covered. You may need to find an insurance company that handles workers’ compensation and business policies.

4. Be a Great Coach

An employee that quits their job costs your business about a third of their annual salary. Your main job is to make sure they are happy and engaged.

You can keep a low turnover rate by being a good coach. You want to challenge your employees so they perform, and encourage them to take risks at the same time.

The key to being a great coach is empowerment. You show your employees that you trust them when you let them make big decisions. That trust will keep them at your company.

5. Keep Good Records

You never know when you’ll make a mistake with payroll. An employee could claim that they were underpaid. If you do nothing about it, they can file a complaint with the labor board.

The only way you can protect your business is to have records.

You’re also required by the IRS and federal Department of Labor to maintain payroll records.

Manage Your Employees With These HR Tips

Employee turnover is a hidden business killer. It can cost your business thousands of dollars to replace and retrain employees.

These HR tips show you how to protect your business from legal issues and manage your employees effectively. You’ll keep your employees engaged, and they’ll remain loyal to your company.

Do you need business documentation for your employees? Check out the Forms and Templates on this site for interview questions, performance review templates, and payroll forms.