Getting your small business HR right can be a tough task to master. Especially when, unlike larger organisations, you don’t have a HR department to do it all for you. But it’s absolutely essential that you stay up to date and compliant with employment laws to ensure your legal and financial obligations are met at all times.
If you miss the mark you may leave yourself at risk of large fines or lawsuits that will undoubtedly put a strain on your brand and business – a risk not worth taking. So what can you do? Lucky for you, we have put together a guide with our advice to help you get started. This is everything you need to know about HR for small businesses.
The law:
All matters of HR, including payroll, contracts, maternity or paternity leave, and employee benefits, are an essential element of your business to get right, every time. And as a business owner, you have a responsibility to ensure all of these legal and financial duties are met without fault.
To ensure meticulous compliance, it’s no surprise a lot of SMEs choose to save time and money by handing the reigns to these responsibilities to the experts for the job. With over 17 years of experience in the payroll industry, let us take some of this work off your plate. By outsourcing your payroll you can earn back your precious time to focus on other important areas of your business – including your HR.
Since the pandemic the need for staying on top of your HR has become a lot greater. Big policy changes have required lots of additional time and support to ensure no mistake is made. New immigration laws, the end of the furlough scheme, the return of gender pay gap reporting, new IR35 requirements and increases to the minimum wage are all changes that have affected businesses in the last nine months alone. And with many changes proposed for the very near future, keeping up to date with forthcoming legislation is a task to be prioritised.
As a small business owner, you might not have the ability, understanding, or time to stay on top of this just yet. But by outsourcing your payroll to us, you will not only lessen the load, but you’ll also have access to our CIPD accredited employees who have vast HR experience and are able to advise you on your HR qualms and queries.
But more on this later. First, let’s take a closer look at your HR responsibilities as a small business owner.
Recruitment and Employment Contracts:
It’s probably no surprise that employment contracts and the recruitment process is dominated by employments laws, including some of the legislations we mentioned earlier. In fact, these legalities come into play the moment you hit publish on a job advert and the hiring process begins.
Job descriptions must be accurate and inclusive, and these rules apply in the interview room too. Your interview process should be thorough enough to ensure you get the right person for the job, but not so much that people feel offended or discriminated against.
Bad interviews will impact your brand and reputation. And this is a common complaint often seen within the hospitality sector with many restaurants, pubs and hotels expecting a trial shift as part of their hiring practice.
Trial shifts have left many potential employees wondering if these unpaid hours will land them in the role or if they will be merely exploited for free labour. Therefore, this grey area of the law may be a change you wish to consider if you want to uphold employee satisfaction and brand reputation – just something to keep in mind.
Once your interview process is complete, and you have offered the lucky candidate the job, the next step is to provide a contract of employment. This document is the foundation of your employee and employer agreement, and it must include a few essential elements:
- An offer of employment
- Job title and responsibilities
- Start date and contract length
- Salary, perks and holiday entitlement
- Information on parental leave
- Length of the probationary period
- Hours worked weekly/monthly
- Disciplinary and grievance procedures
- Additional policies and procedures tailored to your business
Legally, a contract doesn't have to be written down but we recommend that you draw up your document so it can be signed by both yourself and your employee. But remember - as an employer you must provide every employee with a contract if they have worked with you for more than a month.
Having a clear contract of employment is essential in ensuring employees are not only aware of their duties and expectations, but they feel safe and secure in the workplace if an issue or dispute was to arise.
Performance, development and progression:
Pretty much what it says on the tin, as part of your HR duties, you are responsible for effective management of your employee’s performance, development and progression whilst they are employed by your business. This means that you will need to ensure you are conducting performance-related tasks efficiently and that team members are receiving and completing appropriate training in their role with specialist guidance. Failure to keep on top of these basics may result in your workforce looking for better opportunities elsewhere.
Rewards and perks:
As times change and your business progresses, it is essential that you ensure salaries, perks, and other benefits are suited to both the needs of your business and those of your team members at all times. You can’t change or increase someone’s responsibilities without the discussion of what they will get in return, and we also recommend reviewing your workforce's salary and reward packs regularly – avoid our advice and you risk sabotaging employee satisfaction.
Maternity, paternity and parental leave:
The law covering parental rights is increasingly complicated. In fact, there are multiple elements to think about here. These include:
- · Ante-natal appointments: A pregnant employee is entitled to paid time off during normal working hours for antenatal care. The other parent, spouse or civil partner can also take unpaid leave for two antenatal appointments, up to a maximum of 6.5 hours each.
- · Maternity and paternity leave: Pregnant employees can take up to 52 weeks of maternity leave. Leave can begin up to 11 weeks before the employee's due date. Fathers can take a single period of two weeks paternity leave, starting when the baby is born. Leave must be taken in one chunk of time and must commence within 56 days of birth. This right also applies to non-paternal husbands and partners.
- · Adoption: Employees can take paid time off to attend adoption appointments. The ‘main adopter’ can take five appointments and the ‘secondary adopter’ can take two appointments of up to 6.5 hours per session.
- Parental leave and time off for dependants: Parents are entitled to take up to 18 weeks of unpaid leave before their child's 18th birthday. In addition, employees can take time off work to deal with emergencies involving a dependant.
These entitlements are the rights of parents in any workplace. Compliance here is essential else you will be breaking employment laws that will land you in serious legal trouble.
Absence management:
Absences will never be avoided. Life has a good way of throwing a myriad of illnesses, events and commiserations at us – that’s just how it is. However, absences can be managed with clear policies that support and inform your workforce of the correct procedure when these events occur. These include:
- Contracts that outline justifiable reasons for absence, terms of sick pay, clear policies such as compassionate leave and the consequences for when formal action is necessary.
- Sickness absence records and return to work meetings to ensure smooth transitions back to the workplace.
Health and safety:
The health and safety of your employees during their time of employment with you is a responsibility you must stay on top of to be compliant. From assessing workplaces to ensuring employees are fit for work, a HR manager can guide you to ensure you are meeting your legal obligations as a small business.
Employee conduct and dismissal:
As we mentioned previously, outlined in your employment contract should the expectations and responsibilities of your employees. So when your employees sign your workplace contract, they are ensuring you that they understand what is expected of them, agreeing to our terms of employment.
But what happens when an employee falls short of these expectations and responsibilities? It is essential to create a clear and balanced disciplinary procedure that should be followed closely. The ACAS Code of Practice on Disciplinary and Grievance Procedure is a great place to start to help you inform this. You may also consider creating an employee handbook to give to new recruits outlining conduct expectations which can be discussed as part of an induction process.
HR advice and resources:
And that leads us on to our next point. A HR department or manager is your go-to resource for providing expertise as and when it is needed. If you have a business problem that may affect your workforce, HR is where you would go. In fact, as a business owner, successfully running the day to day without a HR individual or department will be nearly impossible in the long run.
HR for small businesses and payroll go hand in hand:
By now you can probably see what we meant when we said your small business HR right can be a tough task to master. And we’ll say it again – it will take time and important business resources to keep your up to date with your legal and financial responsibilities.
As we mentioned at the start of this blog, there are ways to make your life easier – and this includes outsourcing your payroll. If you’re already struggling to juggle your small businesses HR, this may be the helping hand you need.
Outsourcing your payroll is the most cost-effective way of ensuring efficient delivery of your legal and financial obligations without incurring the extra cost of office space, training, salaries or software. And outsource to us and we will ensure you're left to focus on running your business and thriving in your niche, knowing that your payroll is taken care of seamlessly.
However, outsourcing your HR might also be something you need to consider. And if you think this is what you need, we work with closely with an associate who will be able to help – here’s how:
- Gain greater flexibility with tailored packages to suit your business needs.
- HR advice on hand whenever you need it.
- Did you know the average HR manager costs £42,000 per year on salary alone? Save money by streamlining your spending by only paying for assistance in the types of HR that are essential to your business.
- Improve business processes and procedures.
- If you choose to outsource other aspects of your business, such as your Payroll, then doing the same with HR can help to create a more cohesive approach.
- Free up important business resources and earn back time to spend where it really matters – running your business.
- Stay up to date with legislation changes to ensure compliance at all times.
Want to find out more?
Contact Finesse Resources for a free quote – we’d love to see where we can help. We pride ourselves in providing first-class customer service and a service tailored to the needs of your business. Get in touch today.