Small business is big . In fact, it has never been bigger. Since the recession on 2008, small businesses and entrepreneurs have grown at an unprecedented rate. Recent statistics show that businesses under 500 employees now account for 99% of all employment firms.
As even more people prepare to go out on their own, having an understanding about compliance issues will be greater than it has ever been. Because managers have to deal with so many facets of the business, HR compliance tends to get overlooked , and because it can be such a complex issue, many managers get overwhelmed and ignore it altogether. But knowing what to look out for and preparing yourself for the main challenges of compliance will go a long ways towards protecting and growing your business for the future.
So let’s take a look at the main compliance concerns and what can be done to about them.
1) Poor documentation
Not having adequate employee records makes you vulnerable to litigation and inspection by state and federal regulators. A simple solution is to digitize your employee documents. Storing records digitally saves physical space, makes it easier to view, sort and track documents, and makes it harder to lose vital information. Make sure you backup all data as a further failsafe.
2) Failing to stay informed of Federal and State laws and benefits regulations
Make sure that you stay on top of the most recent updates to compliance laws and benefits regulations. The Small Business Administration website, as well as federal and state agency websites and other compliance-related online resources can be helpful in this matter, as can attorneys that specialize in HR issues.
3) Ignoring potential workplace litigation issues
Harassment, discrimination, and wrongful termination lawsuits can be some of the most expensive for a small business. But even with that fact, less that 25% of small business adequately train employees on these issues. Having an educated workforce will significantly reduce your level of risk and will enforce the sense of a secure workplace.
4) Keeping your employee handbook up to date
As your company grows, make sure your Employee Handbook, Policies & Procedures, and Benefits & Payroll grow as well. As more people are added to a company, make sure that there is a clear and focused communication plan that can adapt with those changes. This will help prevent policy inconsistencies and reduce overall risk.
5) Don’t be afraid to ask for help
Don’t get into the trap of thinking that these issues could never happen to you, or that this is too complex and costly to handle. There are a number of resources out there, including local SBA chapters, HR Compliance Consultants, and HR Attorneys that can effectively and efficiently prepare and protect you from compliance issues. Be proactive and educate yourself on these issues, and your business will continue to thrive.
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