Why HR For Small Business?

First in a series of five ‘HR challenges’ facing small businesses, we take a look at why, especially now, HR is so important to small and midsize (SMB) companies.

Every company has its own culture and set of rules which impact how well a team can work together toward their common goal. Often large companies have individuals – indeed teams of individuals, who have expertise in employment law, specializing in company compliance and protocol as it relates to federal/state regulations, laws, rules and employee benefits, code of conduct, payroll etc. They are the communicators who protect employers and employees alike from what they may not know or completely understand.Row Team

However, while small and midsize businesses are subject to the same regulations and laws, having a HR expert on staff can be unfeasible. Many business owners may ask themselves, how important is HR to small business anyway? The answer, it’s critical.

HR Human Resource Compliancy

Regardless of the size of employer, with ever changing ‘HR and employment laws, rules and regulations’ all are at risk and “vulnerable to fines and penalties for non-compliance.” Expensive and potentially crippling for a small business owner, understanding and having a plan how to manage common HR pitfalls is imperative. Here are some things to consider:

  • Multiple location policies and respective state/local jurisdictions
  • Employee handbook explaining rules/training
  • FLSA (Fair Labor Standards Act) exempt/nonexempt rules
  • Payroll rules
  • Time off rules
  • ERISA (Employment Retirement Income Security Act)
  • Employee Benefits
  • Healthcare
  • Industry specific rules, reporting and posting obligations
  • Worker’s compensation insurance
  • Tax
  • Safety

A good path forward is to create a thoughtful employee handbook (think policies, rules and training), a compliancy calendar complete with filing deadlines and a reliable way to track benefits and payroll (hours worked etc.).

To learn more about the additional HR challenges facing small businesses, click here.

Disclaimer: This information does not replace specific employment laws, rules or regulatory policy but is rather a general guideline business owners can use when considering a HR policy. Always consult the advice of a HR professional prior to implementing company policies.

Over the course of the past 35 years Group Benefits Northwest is proud to have established a network of relationships with many senior advisors in and around Seattle, WA and the Pacific Northwest region. If you need a (Human Resource) specialist, please feel free to give us a call at (360) 419-9999. We’ll connect you with a reliable business resource.

(Source: “HR Insights for Small Business” by PrimePay, LLC)


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