If you are like many entrepreneurs, human resources is low on your priority list – especially if you are just starting out. You may not even have any employees in the early days, but if your startup is successful, the day will come when you do. Having your hiring processes and human resources policies in place before you look for staff can make a huge difference in the talent you can attract and the effectiveness of your future team.
This article will provide an overview of the key areas you should consider when it comes to human resources. It will go over what is involved in the hiring process and general human resources requirements to make sure you are not only retaining all of these good people, but also remaining compliant with labor laws.
Hiring the right employees offers your business the greatest chance of success, so ensuring your hires are the best possible fit is vitally important. Whether you do it yourself or use a recruitment agency to help you find suitable candidates, you will still be responsible for defining the role, determining what you are looking for in a candidate, and ultimately making the hiring decision. This is the case whether you are hiring full-time employees or contractors, so be prepared for this investment of your time – at least until you have a fully-fledged HR department.
Ideally, you’ll create a hiring strategy as part of your business plan. This will allow you to anticipate staffing needs, hire in a timely fashion, and budget for employment costs associated with new hires.
When it comes time to recruit, you will need to write a job advertisement or provide a thorough brief on your business and the position for the recruitment agency. This will take some careful thought before you even sit down to write the job posting. Some of the things you should consider include:
- The function of the role today and how it may evolve in the future
- What skills and/or experience are required for the position
- If you want the role to be permanent full-time, part time or contract-based
- How much you can pay
You’ll also need to research market rates to provide a competitive offer. Additionally, you’ll need a clear picture of your organization’s culture. Candidates are looking for the right fit as much as you are, so understanding your company culture as it stands today and where you see it going in the future is important. After all, if you are a small business looking to scale, the people you hire now will be helping to shape your company in the future. For more information on how to write a job post, check out this article by Betterteam, which includes a template and samples.
Once you have a good selection of candidates, you should narrow down your choices to avoid wasting time in the interview stage. Sometimes the top candidates are not the ones that look best on paper, so screening applicants with a short phone call can be an effective way to prioritize your top picks.
There are a number of ways to get the most out of the interview process and ensure you select the right candidate. Here are some tips to get you started:
- Come prepared with a list of questions. You might not use them all, but you’ll avoid missing important items. If needed, also include notes covering the position, expectations, and room for growth to help you properly explain the role.
- Make it clear to the interviewee that you are there to answer any questions they have. Sometimes you learn more about people from the questions they ask than the answers they give.
- Include other team members in the interview, especially those who will be working directly with the new employee.
- Ask about the candidate’s career aspirations so that you can see how their goals line up with the planned growth of the role and/or your company.
- Be prepared to answer questions about company culture, benefits and remuneration. Although many companies choose not to disclose salary until the offer stage, it can help both you and the candidate better gauge suitability if expectations are discussed.
- Second or third interviews, informal meetings or skills-based assessments are secondary evaluation stages to consider including in your hiring process. Although you may decide to hire a candidate based on a single interview, having more than one interaction in different environments will allow you to get to know the applicant better – this can be particularly useful if you have multiple strong candidates.
Before you make an offer, you must vet references. Once you are satisfied with your choice, you can present your offer – just make sure it is competitive.
While recruitment is an important aspect of human resources, it is only one component. Once you have employees on board, there are a number of functions managed by HR, such as onboarding, payroll and benefits, training and development, compliance, performance evaluations, company communications, workplace safety, morale building and employee retention. There are many areas in which a dedicated human resources manager or department can help keep your business running successfully, but regardless of your resources for human resources, you should at least have the following:
An employee handbook is essential for all companies. It sets out the organization’s expectations, outlines protocols, and provides information around company benefits. Workable.com offers a comprehensive outline of the information that your employee handbook should include. The main sections are: employment basics, workplace policies, code of conduct, compensation and development, benefits and perks, working hours, PTO and vacation, employee resignation and termination.
All businesses must collect and maintain certain paperwork in an employee file. This paperwork usually includes I-9 and W-4 forms, employee resume, letter of offer, personal information including emergency contact details, payroll information, enrolled benefits, training and performance review documentation, and if applicable, employee contracts and non-disclosure agreements.
In addition to keeping the right documentation, you or your HR department will need to be well versed in anti-discrimination, immigration, wage, benefits, leave, and safety laws to keep your company in compliance with workplace rules and regulations.
The bottom line? Don’t underestimate the importance of human resources and either educate yourself or hire an HR professional before your business starts to grow. A good place to start is with the Small Business Association (SBA). The SBA offers a lot of detailed information to get you up to speed, including a free online Introduction to Human Resources course. They also provide a Guide to Hiring and Managing Employees, and a host of helpful materials for all stages of your business, from planning to launch management and growth.