Small Business HR Issues Today
Whether you are starting a small business or running one, Human Resources impacts everything your company does. Sadly, Small Business Owners tend to ignore Human Resources matters when things go well. However, doing so is unwise, with serious consequences for your small business. You must master the Small Business HR issues to be a successful Small Business Owner.
Today, more than ever, you as a Small Business Owner must recognize the fact that your employees have rights and requirements. Failing to address these can result in hefty fines and/or legal fees. Furthermore, not addressing Small Business HR issues lowers productivity, reduce profit margins and can even force you to close down your business altogether. Some of the worst Small Business HR pitfalls that you as a Small Business Owner face today are discussed below.
1. Workplace Sexual Harassment
Workplace Sexual Harassment is one of the most important Small Business HR issues facing business owners today. According to the U.S. Equal Opportunity Employment Commission (EEOC), workplace sexual harassment deals with unwelcome sexual advances or conduct of a sexual nature in the workplace. There are two types of sexual harassment: “Quid Pro Quo” and “Hostile Work Environment”. The Quid Pro Quo form of harassment occurs when a Small Business Owner (or a person in authority) makes tangible employment decisions based upon the employee’s acceptance or rejection of unwelcome sexual advances or requests for sexual favors. Hostile Work Environment harassment occurs when unwelcome conduct renders the workplace atmosphere intimidating, hostile, or offensive. Read more. Sexual harassment examples that contribute to a Hostile Work Environment can be persistent offensive sexual jokes, making obscene gestures, inappropriate touching, commenting on physical attributes, using crude language or displaying offensive material.
Small Businesses must have a formal sexual harassment policy to prevent and/or litigate sexual harassment claims. Additional measures to prevent sexual harassment can include sexual harassment training, complaint filing procedures, proper investigation of complaints any corrective measures.
2. Wrongful Termination of Employees in North Carolina
North Carolina is an at-will employment state, meaning employers can generally hire and fire employees for any reason. However, you as a Small Business Owner can be sued for wrongful termination if the employee termination violates a specific law or the terms of your employment contract is breached. Reasons for wrongful termination/dismissal are employer discrimination, employer retaliation or an employee refusing to commit an illegal act. In these cases, you may be forced to reinstate the dismissed employee. Additionally, you as a Small Business owner may have to pay compensation such as punitive damages, back/front pay, attorney fees and other types of damage claims.
It is always good practice for you as a Small Business Owner to follow a fair dismissal/termination process, and document warnings and opportunities given for an employee to change their behavior.
3. Inadequate Workplace Safety
Another one of the most important Small Business HR issues is workplace safety. One of your primary responsibilities and legal obligations as a Small Business Owner is to provide a safe workplace place for your employees. Workplace safety in small businesses is a concern, and according to the Department of Labor, workers in small businesses have much higher rates of deaths or serious injuries. Visit the DOL website. Under Occupational Safety and Health Administration (OSHA) you are obligated to create and maintain a safe workplace without serious hazards and follow all OSHA safety and health standards. OSHA is a federal law, with some states having their own OSHA laws. All small businesses should read and follow the guidelines in the OSHA Small Business Handbook.
Violations of OSHA guidelines are subject to citations and penalties of up to $70,000 per violation. In addition, willful violations resulting in death can result in imprisonment for the Small Business Owner. Furthermore, you can potentially be sued by an employment lawyer or personal injury lawyer for any negligent and irresponsible behavior to cover the cost of medical bills, emotional trauma, lost wages, etc.
4. Violation of Labor Laws and Regulations
Small Business Owners need to understand and adhere to Labor Laws in order to operate their businesses legally. However, these laws are complex, change frequently and are issued on multiple governmental levels (including federal, state and municipal). Furthermore, the reporting requirements of these labor laws change from time to time. It is wise for Small Business Owners to seek legal advice from an attorney as needed. There are also many sources of low cost or free legal advice online.
Specifically, there are three labor law violations that cost Small Business Owners millions of dollars each year, as follows.
- North Carolina Child Labor Laws: The North Carolina Child Labor Laws prohibit teenagers under 18 from working in particularly hazardous industries, with further restrictions on children below 16. Furthermore, these laws also regulate breaks, when (time of day) they can work and the number hours a day. This also depends on the age of the employee, and whether it is a school day or summer vacation.
- North Carolina Non-Resident Labor Regulations: North Carolina law requires Small Business Owners to withhold state income taxes from the wages of nonresidents for work done within the state. Nonresident employees are therefore subject to North Carolina withholding tax on any part of wages paid for services performed in North Carolina.
- North Carolina Equal Rights Legislation: The North Carolina Equal Employment Practices Act makes it illegal for Small Business Owners to discriminate based on race, religion, color, national origin, age, sex, or disability.
Small Business Owners can easily avoid these three violations and can find lots of information available online, see North Carolina Department of Labor website.
5. Lack of Social Media Policy
Today more than ever, a lack of Social Media Policy is another one of the Small Business HR issues that threaten small business’ survival. Small Business Owners need a Social Media Policy to prevent embarrassment or avoid legal issues due to what your employees may say (post) on Social Media. A clear policy will prevent employees from criticizing/misrepresenting your business, divulging confidential information or harassing other employees. In fact, social media employee issues are more common than you may think, and many employers have had to discipline employees because of this issue.
It just makes sense for you as a Small Business Owner to have a clear Social Media Policy, so that your employees are aware of what they can and can’t do on social media.
6. Unhealthy Workplace “Friendships”
Relationships between Small Business Owners/Managers and employees/subordinates can easily go awry and damage your business. Remember, all employee relationships primarily exist to accomplish work and should enable you to run a successful and profitable small business. If employees consider you as a friend first and not the “boss”, lines between what is appropriate in the workplace can become blurred. Employee relationships should be professional, open, caring and positive; but some lines should never be crossed. If you are friends with your employees, you could be placed in situations where you must choose between maintaining the friendship or achieving the best results possible for your small business. In addition, at some point you as Small a Business Owner might have to discipline, demote or fire one of your “friends”.
You as a Small Business Owner should always maintain a professional distance between you and your employees, and act as the leader, earning respect from your employees.