HR Tips for Small Business Owners

Human resources (HR) was once solely the domain of large companies, but much has changed in the last couple of decades. Modern employees want HR services available to them, and the modern small business requires HR practices in place to avoid liabilities that could lead to crippling lawsuits.
Knowledge, Understanding and Adherence to Laws and Regulations

As soon as the first employee is hired, the business faces a wide range of liabilities ranging from payroll to discrimination. Therefore, it’s necessary that the HR department/provider implement the requirements from those laws and regulations into the business practices.

Developing and Maintaining an Employee Manual

The manual serves as a written document of the company’s expectations for its employees. Included within the manual will be the business practices and customs integrated with the HR requirements. Should an employee fail to meet that standard, the document provides the basis to take action that protects the company from liability.

Organization and Confidentiality

For each employee, HR should develop a personnel file and a confidential file. Combined, these separate files make up the full record concerning the employee for the business. The confidential record, however, must be protected and secure and cannot be provided to anyone without the privilege. This type of file includes medical records, leave requests, reference interviews and so forth.


Effective HR isn’t just about protecting the business; it also concerns getting the most out of the company’s human resources. Adequate motivation is one of the biggest hurdles a business faces, and it’s the responsibility of HR to structure positions in a way that makes sense for the business but also provides the necessary sense of motivation, challenge, and worth to the employee.

Ongoing Employee Needs Assessment

The modern small business is constantly adapting to changes in the marketplace and other factors. In order to handle these changes efficiently and productively, it’s also necessary to assess the employees’ skills, training and experience. HR can often help a small business make the most of limited resources by identifying the training needed to put the employees in a position to succeed.