Do I Need HR?

Question:

As a business owner, how do I know when I should engage someone to help me with our human resources needs?

Answer:

The quick answer is the typical rule of thumb is to have one HR professional for every 100 employees. However, depending on the scope of the role and how proactive your organization is, this number may be more like 1.5 HR professionals per every 100 employees (Bloomberg Report).

But not all businesses have over 100 employees, and you can’t wait until you are at 100 employees to address human resources in your business. When you hire one new employee beyond yourself, your journey down the human resources lane begins.  It doesn’t necessarily mean you are ready to hire a full-time HR person; but rather, you need to do some basics to get your business in shape to have employees such as:

  • Setting up workers compensation
  • Obtaining a payroll solution
  • Posting mandated posters
  • Creating employee files
  • Developing a recruiting process
  • Creating an onboarding program and required forms
  • Setting up how an employee will be paid in compliance with various laws
  • Identifying benefits–not just health, but also holidays, PTO, and programs
  • Setting expectations for employees through policies in an employee handbook

Once you have your HR function setup, you may be comfortable handling your human resources function internally yourself, through your management team, or even an office manager. But, be sure you have a lifeline to an HR consultant and/or attorney to help you, should an issue arise.

As your business grows, you will also see other triggers that may tell you it’s time to get more formalized help with your HR function such as:

  • Business growth
  • Employee turnover
  • The need for more formal policies and procedures
  • Gaining or maintaining a competitive edge
  • Change that is impacting your employees
  • Conflict with responsibilities
  • Compliance

Compliance with federal, state, and local laws is critical for you to stay on top of as your business grows, which again is why it’s important to at least have a lifeline to an HR consultant and/or attorney.  Check out this general list of the federal labor laws by the number of employees you have on your team. This list links to details on the actual law.  But, there are also many unique state and local laws that may apply to your business too.

Too often, we see businesses wait until a problem occurs: if it isn’t broken, why fix it?  When it comes to HR, you are better to be proactive than reactive to avoid losing key employees, receiving penalties for violating a law, or litigation.

strategic HR inc. can help you with your human resources needs, whether you are hiring your first employee or your 1,000th.  We can conduct an analysis of your HR function, establish your HR function, become your HR function, or help with key components of HR.  To discuss your needs, please contact us at info@strategicHRinc.com