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Compliance is a big, big word. It’s so broad and encompassing that virtually anything in business can be considered a part of its definition. Each aspect of business has to comply with different and ever changing laws, rules and regulations. For HR purposes, companies have to comply with rules passed by different entities, such as the Department of Labor, the State, the IRS and many other subgroups that govern different laws. It’s a hotbed of information that covers hot topics such as discrimination, benefits, pay, record keeping, policies, training and employees. Almost any HR decision made by an employer will raise a question of compliance.
So how do small business owners run an HR compliant business and still have time to do the work they opened their business to do? First and foremost, the business MUST be set up in a compliant manner and HR administration must be streamlined. This means that recordkeeping must be done correctly, files set up, correct and pertinent forms utilized and procedures followed so as not to discriminate in all matters of employment. All supervisors and managers must be trained to work correctly with employees and a current, legal and customized policy manual must be in use. Once all this is done, the business can function legally long term. There are however other strategic issues that must be addressed, including job descriptions, employee categorization, performance reviews, risk management, employment procedures, compensation plans, employee counseling and more.
One way to ensure compliance and reduce the risk is to have a dedicated HR person take care of the issues on behalf of the company. Small businesses usually don’t need and often cannot afford a full time HR Manager, and so the HR consultant, who is experienced in dealing with small to medium sized companies becomes important for both peace of mind and cost control. Work can be completed on a retainer or project based manner, whichever best suits the company and budget.