Essential HR practices for small businesses

Owning a small company comes with no small amount of challenges. If you own, manage or otherwise play a major role in any one of the many small and medium-sized businesses that make up the lion's share of the American economy, you undoubtedly know this.

When it comes to HR issues, you likely don't have all of the resources enterprises often possess: Chances are you're handling human capital management and benefits administration with a tiny crew or entirely on your own. But this doesn't mean you can't manage your benefits and HR obligations with ease and efficiency. You just need to adopt properly scaled best practices – and strongly consider what the right HCM software can offer you. 

HR strategies uniquely designed for small businessesManaging HR responsibilities doesn't have to be a burden for small-business owners.

Use software for efficient records management 

The record-keeping obligations necessary for compliance with various federal and state regulations are slightly less difficult for SMBs to meet due to the smaller scale, but they're no less critical. As Fundera noted, you need to keep W-4s, comprehensive payroll details, I-9s and any certifications of disability essential for ADA compliance on file for every employee. Some of these, like the I-9, must be maintained for a certain period after an employee departs if they leave before hitting the three-year threshold mandated by USCIS. If you're handling all HR tasks by yourself, keeping track of all of these requirements can be hard.

This is where a comprehensive HCM software platform like PeopleStrategy can be a huge help. The solution automates all critical onboarding processes, including I-9 filing and E-Verify completion, and allows easy access to employee documentation as needed on multiple devices, including smartphones and tablets.

Make the most of a smaller team 

Quality should always surpass quantity in terms of importance, but in an SMB environment you can sometimes really feel the pressure that results from having fewer employees available to handle all of your critical operations. That's why you need to make the most of the people you do have.

Fit Small Business recommended SMBs use a mentorship program – having seasoned staff members take new hires into their confidence for at least the first few months of the latter's tenure with the company. Seek out volunteers for this role who have not only considerable experience with your organization's processes but also demonstrate real belief in your mission statement and a genuine desire to share these qualities with others. 

Create a comprehensive (yet digestible) employee handbook 

This task might be something you've already done. But if not, you shouldn't underestimate its importance: Beyond misconduct that's addressed in state and federal laws (sexual harassment, discrimination and so on), if a worker makes a mistake that wasn't outlined as a discouraged or forbidden practice, you lose some latitude in terms of the corrective actions you can reasonably enact. 

According to the Small Business Administration, an effective employee handbook should formally detail all applicable anti-discrimination, work authorization and benefits-related laws, as well as expectations of conduct and clear guidance on how to approach pertinent safety risks. Clear explanations of payroll structure and benefits and how to go about the processes related to those concerns should also be included. Last but not least, if your SMB works as a government contractor or otherwise handles information that can be considered "trade secrets," detail non-disclosure principles in the handbook and be sure to included NDA signing in your onboarding.