See Part 1: Small Business HR Responsibilities
HR Implementation Options
Deciding how to implement HR in a small business depends on resources, revenue, size, and workplace culture. While there are many HR software tools to assist you in managing your payroll, benefits, some admin activities, Human Resources requires a knowledgeable person to properly ensure compliance, manage recruiting, address payroll and benefits questions, and conduct employee communications.
Many small business owners will attempt to manage HR responsibilities directly or delegate tasks to employees when first starting a business. However, around hiring employees number 6-10 this option becomes less productive as HR tasks and responsibilities grow and become more complex. Between 15 to 40 employees most businesses find that HR responsibilities become a more full-time activity and require someone with HR knowledge and experience. Small business owners have two options to implement HR at this point: outsource or In-house HR.
For companies in the 10 to 40 range, outsourcing can be an economical choice. Outsourcing offers small businesses access to different human resource professionals that specialize in specific HR tasks without the burden or cost of hiring an HR team to take over and help grow and regulate your small business while you as the owner and your employees can focus on the goal and core values of your small business. While outsourcing is a cost, the less time that business owners or other employees spend on human resource-related tasks is less costly than hiring a new employee for HR alone. When outsourcing HR to a third-party, it is of the utmost importance that whoever you outsource your HR operations to fits in with the workplace culture and aligns with the values of your small business.
When a small business reaches the 40 employee range ups want to consider hiring a full-time HR generalist. 75-100 employee range, a small business should hire a fun-time HR specialist who can do everything with 1 or 2 support staff.
When you first started your small business, the biggest HR concerns would be hiring and payroll, which are simple tasks for one person. However, as your small business grows, so do the tasks surrounding administration and managing employees. Because human resources is such a broad and complex range of skills and tasks, it’s nearly impossible for one person to take on without negatively affecting the success and prosperity of the small business.
HR can truly make or break a small business so it’s important to find the right fit as soon as possible. Implementing a strong HR department can seem daunting, but there are so many resources and outsourcing solutions readily available to a small business owner. Society for Human Resources Management (SHRM.org) and the Department of Labor (dol.gov) are great resources for answering any HR questions and ensuring that small businesses are compliant with the business world’s ever-changing laws.