Tag Archives: Human Resources

Say What? Strange HR Laws Across the U.S.

As a business owner, you’re probably aware of just how confusing HR laws can be. New laws are continually emerging, and existing laws are often changing. While federal laws can be tricky enough, state laws can be even more perplexing.

Some are a little odd, while others are downright bizarre. There are three states in particular that have some of the most strange HR laws.

 

Michigan Discrimination Law

Section 202 (1a) in the Michigan Legislature reads as follows:

“An employer shall not do any of the following: Fail or refuse to hire or recruit, discharge, or otherwise discriminate against an individual with respect to employment, compensation, or a term, condition, or privilege of employment, because of religion, race, color, national origin, age, sex, height, weight, or marital status.”

Notice toward the end where it specifically states that employers can’t discriminate based on height or weight. While the other factors pretty much apply to employers across the board, it’s crazy to think that a Michigan business owner could potentially get in legal trouble for referencing an employee’s height or weight.

 

Drug Testing in Minnesota

In most states, when an employee fails a drug test, they’ll be terminated. But this isn’t the case in Minnesota. The 2015 Minnesota Statues explicitly states, “An employer may not discharge an employee for whom a positive test result on a confirmatory test was the first such result for the employee on a drug or alcohol test without first giving the employee the chance to participate in a drug or alcohol counseling/rehabilitation program.”

The law continues to read that the cost of participation must be at “The employee’s own expense or pursuant to coverage under an employee benefit plan.” If you’re an employer in Minnesota, you can’t fire an employee who tests positive for drugs or alcohol without first giving them a chance to join a recovery program where you cover the cost.

The law makes you wonder how practical it would be from a financial standpoint for most small to mid-sized businesses to implement drug testing.

 

Florida Gun Laws

As you may already know, there’s been a significant push in America to increase regulations on gun possession. Gun control is arguably a hot topic.

In Florida, it’s quite evident that the right to bear arms is still very much alive in well. In fact, it’s completely legal for employees to bring guns to work as long as they keep them in their vehicles. In the 2016 Florida Statutes, it references the, “Preservation and Protection of the Right to Keep and Bear Arms in Motor Vehicles Act of 2008.”

Under this law, an employee is totally free to store his gun in his vehicle while at work as long as he has a valid license to carry a concealed weapon or firearm and the vehicle remains locked.

If you’ve ever thought that your state had some strange HR laws, these laws in Michigan, Minnesota and Florida may make you think twice.

How HR Can Increase Profitability

All too often human resources is viewed as a necessary evil. Many business leaders regard it as a department designed to provide new employee orientation and take care of laborious paperwork — nothing more.

In reality, HR plays a bigger role than most people think. In fact, HR can increase profitability and improve a company’s bottom line in several ways.

 

Insightful HR Statistics

Research from a business and legal resources webinar from HR Hero indicates that, “60 percent of executives are beginning to see that HR can partner with other departments to increase the profitability and value of a business.” The outdated notion that HR is just there for processing paperwork has given way to an understanding that it actually plays a vital role in the strategic development of a business as well as its company culture.

Another extensive study conducted over the course of two years entitled, People and the Bottom Line, by the Work Foundation and the Institute for Employment Studies found that, “If an organization increased its investment in HR by just 10% it would boost gross profits by nearly $2,000 per employee per year.”

Because HR can be aligned with other areas of operations, there’s the potential for it to have an immense impact. Here are some specific ways that HR can increase profitability.

 

A Better Employee Onboarding Process

When employees are given adequate training and equipped with the right tools, they can perform their jobs more effectively and become more productive. HR plays a key role in the onboarding process and can take measures to ensure that new hires get the training they need and are ready to perform their jobs at the highest level possible.

 

Reduced Turnover

HR is also responsible for selecting the best candidates who possess both the hard and soft skills needed for the job. In turn, they’re likely to find individuals who are genuinely enthusiastic about their careers, which increases the odds that employees will stick around for the long haul.

Reducing turnover is incredibly important because of the costly nature of replacing employees. A study from the Center for American Progress found that the average cost to replace an employee is, “16 percent of annual salary for high-turnover, low-paying jobs earning under $30,000 a year and 20 percent of annual salary for mid-range positions earning $30,000 to $50,000 a year.”

 

Minimize the Threat of Litigation

Sometimes disgruntled employees think nothing of taking legal action against an employer they feel has wronged them. An ugly legal battle can be costly even if you win and can quickly tarnish your brand’s reputation.

Solid HR can greatly diminish your odds of ever getting hit with a lawsuit by emphasizing employee relations and ensuring compliance with relevant laws and regulations at all times. HR can even develop a program to resolve employee issues before they escalate and become a serious problem. This often translates into a big profitability boost.

It’s important to recognize all of the different ways HR can contribute to your business. When functions are carried out effectively, HR can increase profitability and be the catalyst that fuels long-term growth.

 

Is Your Business Too Small for Human Resources? Think Again.

 

As a small business owner, intelligent resource allocation is essential to the long-term health and success of your company. Unlike larger entities who may have disposable funds, you need to distribute finances correctly and every penny counts.

It can be tempting to cut corners and skimp on certain areas like HR, especially when you only have a small workforce. In reality, a business is seldom too small for human resources — and slacking in this department poses some significant problems.

 

Lack of Formal Policies

Developing standardized polices for your business serves three main purposes:

  1. It sets clear expectations of employee behavior and performance.
  2. It holds all employees to the same standards.
  3. It regulates your workplace and minimizes disruptions.

Without some sort of HR department, you’re probably less likely to establish formal polices and create materials like an employee handbook, manuals and so on. In turn, this is just inviting chaos, complications and headaches.

 

Insufficient Documentation

Maintaining a paper trail on employees and documenting things like finances, employee performance and behavioral issues is incredibly important. Otherwise, you can quickly find yourself in a jam if you are unable to produce key information.

For example, if an employee needs to be terminated, you need to be able to provide documentation that includes specific examples of poor performance and problem behavior. Without adequate documentation, you could be accused of wrongful termination with legal consequences. An HR department ensures you have a specific termination procedure in place.

 

Employee Misclassification

Human Resources typically takes care of classifying employees when they are hired. It’s important to understand the differences between traditional employees and independent contractors to ensure your yearly reports to the IRS are accurate. Sometimes positions are filled with urgency, businesses want to minimize tax obligations, or managers just don’t understand how to classify employees correctly. If the IRS catches wind of this, it can lead to ugly penalties. A dedicated HR professional reduces your odds of employee misclassification because they’ll understand the ins and outs of the process.

 

Increased Litigation Risk

Lawsuits have become increasingly common in recent years. Startling information on the Huffington Post’s website reports that “Over 40 percent of all business lawsuits are filed against smaller employers — and the median compensatory award for employment practices liability insurance cases is $218,000.”

If you’re not taking HR seriously, your odds of facing a lawsuit at some point are raised considerably. In the event that you are actually sued, it can wreck your business financially and take a major toll on your reputation.

 

When you break it all down, HR isn’t just for megalithic corporations with thousands of employees. It’s for everyone — even small businesses with only a handful of workers. If you think your business is too small for human resources, consider investing the necessary time and energy into establishing a system that works for your business.

Fortunately, we’re living in a day and age where you can have a professional handle the bulk of HR administrative tasks for a reasonable cost.

 

How to Keep Your Employee Handbook Useful and Current

An employee handbook is a great way to streamline communication between employers and employees and serves as an effective reference point. Not only does it set clear expectations and define company policies, it also provides comprehensive information that employees can reflect on whenever questions arise. When written correctly, an employee handbook will keep everyone on the same page and dramatically reduce your liabilities.

 

What Is an Employee Handbook?

The formal definition is “A manual that explains a company’s major human resources and employee policies and procedures and describes employee benefits. It is a toll that communicates that firm’s policies efficiently and effectively and helps to ensure that office procedures comply with employment laws.” Simply put, it’s a resource where employees can find information on topics like:

  • Company policies and rules
  • Employee rights and benefits
  • Your expectations of employees
  • Your legal obligations as an employer

 

What Should Be In an Employee Handbook?

Although the specifics will differ from company to company, there are some core topics that should almost always be covered. These include:

  • Policies regarding equal employment, anti-discrimination and harassment
  • A guide that explains how employees should go about reporting discrimination or harassment
  • Compensation
  • Benefits
  • Scheduling
  • Safety procedures
  • Polices regarding leave (e.g. maternity leave, military leave and jury duty)

In addition, you may want to include an at-will statement, which means that you can terminate an employee at any time for any reason as long as it’s within the confines of the law. Although businesses in every state besides Montana operate on an at-will premise, it’s better to be safe than sorry.

 

Why It’s Important

Having a comprehensive employee handbook is important for three main reasons. First, it should minimize misunderstandings between you and your staff. By having everything clearly outlined, it should eliminate a lot of confusion and help operations run smoother with less friction.

Second, it prevents you from creating obligations for yourself that could come back to bite you in the future. For example, employees will know that there are no promises of continued employment and that you have the right to terminate them.

Third and perhaps most importantly, you can keep yourself and your company out of legal hot water and avoid unnecessary lawsuits. When there’s a formal handbook in place, this can be used in your defense in the event that you’re ever sued.

 

How to Keep It Updated

Due to the fact that there are consistent changes to laws and regulations, you’ll want to periodically update your employee handbook. To do so, you’ll need to keep an eye on new laws and regulations or changes to existing ones that will impact your company and make the appropriate edits.

In order to stay in the loop, it’s helpful to use resources like the Summary of the Major Laws of the Department of Labor and the Learn about Business Laws and Regulations guide. If you find it difficult staying abreast of changes, you may also want to consult a human resources outsourcing firm for help to ensure that you cover all of the bases.

Creating and maintaining an employee handbook is important on many levels. Besides keeping your company in the clear from a legal standpoint, it can improve the quality of your relationships with employees and create a more cohesive workforce.

 

3 Ways HR Outsourcing Can Benefit Your Business

With all of the demands of running a company, handling human resources related tasks can be a burden, especially for small to mid-sized businesses. That’s why many companies are going the HR outsourcing route. In fact, studies have shown that “almost all of the nation’s fastest-growing private companies, 83 percent, are outsourcing HR functions, and plan to continue doing so over at least the next two years.” Here are three ways that HR outsourcing can benefit your business and make your life easier.

 

1) It Means Better Recruiting

For almost any company to thrive and succeed in the long run, it requires a team of knowledgeable and dedicated employees. The problem with many businesses that lack formal HR departments is that they don’t understand the art and science behind effective recruiting. On the other hand, a human resources outsourcing (HRO) firm knows the ins and outs of recruiting and can ensure that you acquire A+ employees.

Not only will these workers possess the necessary hard skills like specific industry knowledge and educational background, but they will have the right soft skills like work ethic and communication to create an outstanding workplace environment.

 

2) It Keeps Your Business Compliant

In this day and age, there are a plethora of rules and regulations that govern the workplace. This includes everything from meeting OSHA requirements and maintaining a safe working environment to EEOC laws and preventing discrimination. If you’re unfamiliar with federal and state laws or don’t keep up with relevant changes, it can be a recipe for disaster, and you could wind up with a lawsuit or a host of other headaches.

HR outsourcing is ideal because an HRO will understand the rules and regulations of your industry and take the right precautions to keep your business compliant at all times. This means that you can operate without constantly having to worry about breaking a law, and you’ll have more peace of mind.

 

3) You Can Better Manage Payroll

Payroll is obviously a key part of business operations. Unfortunately, it’s not always easy to handle payroll processing and keep track of taxes. If you make mistakes, you may find yourself faced with IRS penalties, which can be quite costly. If you make mistakes on employee earnings or fail to pay your workers on time, it can create even more problems.

Going through an HRO is beneficial because they can handle nearly every aspect of payroll processing for you. Whether it’s tracking time and attendance, direct deposit or W-2 preparation, you know you’re in good hands. Everything gets taken care of for you, and you can be assured that payroll is accurate. In many cases, you and your employees will also have access to an online payroll database to check on reporting whenever you need to.

HR outsourcing offers a wide variety of benefits, and these are just a few of many. The bottom line is that it can make your business operate more efficiently and effectively, while still maintaining your desired level of control.