Resource Management Inc. New Business Owner s Guide to Human Resources

Transcription

1 New Business Owner s

2 Table of Contents New Business Owner s 3 The Role that HR Plays in the Workplace 4 HR Administration 5 Benefits Management 7 Payroll Processing 8 Worker s Compensation 9 Checklist for Getting Set Up 10 How RMI Can Help 11 Sources Used for Benefits All rights reserved.

3 New Business Owner s Being a new business owner can be incredibly rewarding and offers the type of lifestyle that s desirable to many people. Unfortunately, it can also be overwhelming when first starting out. This is especially true if you have little to no experience and haven t undergone any formal training. Whether you re starting a business from scratch, bought a company or are taking over a family business, there are numerous areas to address before it becomes a success. Human Resources: The department or support systems responsible for personnel sourcing and hiring, applicant tracking, skills development and tracking, benefits administration and compliance with associated government regulations. - Entrepreneur One element that requires plenty of attention is human resources (HR), which is a broad term that s used to describe everything concerning your employees or manpower. According to Entrepreneur, the definition of human resources is the department or support systems responsible for personnel sourcing and hiring, applicant tracking, skills development and tracking, benefits administration and compliance with associated government regulations. While other aspects of business like sales and marketing are fairly straightforward, HR can be a bit more difficult to wrap your head around. With multiple components and ever changing regulations, it can take some time to get fully acclimated. In this guide, we will provide an overview of everything HR related that you need to think about in your new role. This should streamline your transition into being a business owner and help you get a grasp on HR. 3

4 The Role that HR Plays in the Workplace Having HR in place is crucial for building a solid foundation for your business. Whether it s creating policies for hiring talented employees, assessing performance or deciding how to deal with conflicts, HR ultimately contributes to your overall company culture. From the time that a new employee is hired, your policies and systems will influence their training and the criteria used to evaluate their performance. This should inevitably optimize the productivity of your workforce so that you can get the most out of employee resources. Because you re likely to experience disputes among workers at some point, HR is designed to manage these disputes and provide a means of efficient conflict resolution. Taking this proactive approach to problems usually ensures a positive outcome in a timely manner and prevents further complications from arising. It also keeps your business on the right side of the law. With a plethora of regulations in place concerning employee safety, equal rights, insurance, fair payment, etc., it s important that you understand and adhere to the law. Because regulations can be complex and have subtle differences depending upon your location and industry, HR keeps you compliant and helps avoid unnecessary problems. At its core, HR improves workplace communication and helps you maintain a favorable atmosphere. It also streamlines employee development and puts your business in a position to thrive long-term. Now, here are some specific areas of HR that will need to be on your radar as you make the shift into being a new business owner All rights reserved. 4

5 HR Administration While there are a multitude of polices you Perhaps the biggest part of administration can implement, here are some of the most is developing customized policies for your important to think about business. These will dictate the way you want right out of the gate: to run things, employee behavior, what s acceptable and not acceptable, etc. Time off Holidays There s a lot of wiggle room when it comes to time off and holidays, so it s smart to work with your employees to ensure that their needs are met. Some options include paid time off, unpaid time off, administrative leave and paid holidays. When it comes to Breaks Maternity leave Harassment Hiring youth Injury and illness prevention breaks, federal law doesn t require lunch or coffee breaks. If you do choose to offer these shorter breaks ranging between 5 to 20 minutes, they are considered to be compensable work and should be included in the total number of hours worked within a workweek. For meal breaks lasting 30 minutes or more, this isn t considered work time and you re not required to compensate employees for this time. In terms of meal period requirements, it varies from state to state, and this table provides an overview for adult employees in the private sector. Ensuring equal rights employment is a big issue, and the Civil Rights Act of 1964 holds employers accountable for creating a workplace atmosphere where employees are protected from harassment involving gender, race, sexual orientation, religion and national origin. Going to great lengths to prevent harassment is important for preventing lawsuits and creating a favorable company culture All rights reserved. 5

6 The Occupational Health and Safety Act is a federal law that heavily impacts policies like hiring minors and precautions to prevent injury and illness. Adhering to this law is very important from a legal standpoint and is something you should familiarize yourself with, especially if there are inherent hazards involved with your industry. You can use this resource as a starting point. When it comes to performing an employee evaluation, here are some key criteria to keep in mind: The amount of progress that an individual has made since first being hired Their overall level of productivity Their behavior and attitude toward their job The individual s ability to meet the goals you have set for them Their overall aptitude Another major part of HR administration involves how you decide to go about hiring and firing employees. You obviously want a knowledgeable and capable staff, so it s necessary to figure out what criteria you re looking for in new hires and develop a process for bringing employees on board. Due to Equal Employment Opportunity (EEO) laws, you need to be aware of what constitutes employment discrimination. This link to the United States Department of Labor should provide you with all the information you need. In terms of firing, you will want to have an employee termination plan in place that s also legally compliant. Properly training your employees is another area of importance. That s why it s smart to develop some type of training materials to equip workers with everything needed to thrive. This might be something as simple as a brief handbook or something as complex as a sophisticated, online training portal. Also, performance evaluations are necessary for identifying both positive and negative trends in employee output. Making routine evaluations points out employee strengths so they can be capitalized on and helps curb small problems before they get out of hand. Luckily, technology has drastically improved the way in which business owners can keep tabs on employees and there are a variety of software platforms available to accommodate nearly any industry All rights reserved. 6

7 Benefits Management Employee benefits play a big part in attracting top tier talent, retaining workers and creating a positive company culture. In terms of specific benefits, there is a smorgasbord of options available, and it s up to you how many or how little you want to offer. For starters, you will need to understand what benefits are required to avoid breaking any laws. The U.S. Small Business Administration highlights some focal points, which are as follows: Beyond the required benefits, some additional options include: Health insurance Average of $4,266 for annual employer contribution Vision - Varies, but one nationwide vision insurance provider offered these rates for New York residents in $ for singles and $ for families Dental - $240 - $650 Life insurance - $150 Social Security taxes at the same rate paid Retirement - Varies by employees. Investment planning - Varies Certain states and territories require businesses to provide disability insurance coverage to their eligible employees for non-work related sickness or injury. This includes California, Hawaii, New Jersey, New York, Puerto Rico and Rhode Island. Some states must pay unemployment insurance taxes. You can find more information here. According to Joseph Hadzima Jr., a senior lecturer at MIT Sloan School of Management, the costs for basic salary, employment taxes and benefits, he says, are typically in the 1.25 to 1.4 times base salary range. This means that a $50,000 employee salary might really cost the company $62,500 to $70,000. It s smart to spend some time brainstorming to decide what benefits you want to offer. Along with this, it s necessary to figure out who is eligible and who isn t. For example, you may require individuals to be employed by your business for at least one year before being eligible for benefits All rights reserved. 7

8 Payroll Processing Having a payroll system serves three main purposes. First, it provides you with a streamlined approach for tracking what employees earn and ensures they receive their paychecks on time. Second, it helps you uphold your responsibilities from a financial and regulatory standpoint. This simplifies the tax filing process and reduces your likelihood of receiving penalties from the IRS. Third, it generates detailed reporting so you can get a clear picture of how much employees are earning. If you re unfamiliar with payroll processing, it can be pretty complicated at first. One of the biggest challenges that new business owners face is keeping everything compliant with accounting legislation. All of the details and specificities can differ from state to state, so it s necessary to be aware of your state tax information. Another obstacle is the accuracy of reporting. Without the right system in place and a means of counteracting human error, you can end up with inaccurate data that leads to a host of problems. There is also the issue of security and keeping financial information out of the wrong hands. This has become a bigger concern in recent times because of how much technology is now intertwined with payroll processing. This quick guide from the SBA goes over the 10 steps to setting up a payroll system and should make it more manageable. This resource breaks down state tax research so you can familiarize yourself with your state s requirement All rights reserved. 8

9 Worker s Compensation Employee safety is definitely something to take seriously, and taking a proactive approach is better than waiting for an injury to happen before taking action. The Occupational Health and Safety Administration (OSHA) is an agency that was designed to protect workers and ensure that businesses meet certain health and safety standards. Complying with OSHA should be a top priority, so it s smart to visit their website and browse through the Top Links section. Incorporating safety training is a good idea because it lowers the chances of employees getting injured on the job and should keep your business running smoother as a whole. You will also need to decide whether or not you want to hire minors. Because employing workers under the age of 18 comes with limitations, and employing workers under the age of 16 comes with even stricter limitations, you need to be aware of what s expected of you to keep them safe and comply with regulations. In the event that workers are injured, it s important to offer worker s compensation to aid in their recovery and provide them with financial support during the time spent out of work. This resource goes over pretty much everything you need to know about worker s compensation. Although you will be juggling several different tasks as a new business owner, you should devote plenty of time to HR. Because it impacts nearly all aspects of your business, you need to familiarize yourself with these concepts and take the time to get a solid HR system in place. Going over this checklist should help you get started All rights reserved. 9

10 Checklist for Getting Set Up Download New Business Owner s Guide to HR Review HR administration policies - Determine which ones apply to you business - Learn about what constitutes employment discrimination - Go over EEO laws Brainstorm and choose which policies you want to implement - Prioritize by significance - See what similar businesses in your industry offer Develop employee training materials - Come up with an efficient approach - Explore technology to assist in training Find an employee performance evaluation system - Review evaluation criteria - Look into software to streamline the evaluation process Review required employee benefits - See if your state has specific requirements - Learn about the legalities concerning required benefits Pick and choose additional benefits you want to offer - Check average cost of each benefit - Determine which are most important for your business Familiarize yourself with payroll processing - Perform state tax research - Learn how to set up a payroll system Review OSHA regulations - Get familiar with the Occupational Safety and Health Act - Learn how it affects businesses in your industry Develop safety training and create a safety net for covering worker injuries - Address primary safety concerns of your industry - Learn about worker s compensation - Get insured 2014 All rights reserved. 10

11 How RMI Can Help At Resource Management, Inc. (RMI), we provide businesses with HR solutions to help save money and simplify operations. Founded in 1995 by CEO Reinaldo Lopez, RMI has a long track record of success in helping small to mid-sized companies with their HR needs. We simplify HR and help you focus on the day-to-day operations and success of your business. RMI is a privately owned HRO firm founded in Fitchburg, Massachusetts and now has offices in Florida including Orlando, Daytona and Miami, and an office in New York. Some services we offer include: HR Administration Benefits Management Hiring and terminating employees Developing an employee handbook Establishing policies Employee training Employee performance evaluations Health coverage Dental and vision Disability and life insurance Voluntary benefit plan options Investment planning 401K and profit sharing options Payroll Processing Workers Compensation Paycheck preparation Direct deposit W-2 preparation Client accounting and tax filing Time off accruals Reporting OSHA compliance review Safety inspections and manual Online and on site safety training Workers Comp administration Claim administration Return to work programs 2014 All rights reserved. 11

12 Sources Used for Benefits All rights reserved. 12

13 Resource Management Inc (RMI) is an HRO solution that helps businesses simplify and save time. With RMI to handle the necessary Human Resources and compliance programs for your company, you and your staff can concentrate on what you do best. The experts at RMI include certified professionals in HR, Risk Management, IT, Accounting and Payroll. Our breadth of experience in multiple areas of HR business helps us create customized suites of benefits and services to meet your unique needs. Toll Free Number for All Offices: New England 281 Main Street Suite 5 Fitchburg, MA Orlando 8251 Presidents Drive Suite 101 Orlando, FL Doral/Miami 8600 NW 53rd Terrace Suite 101 Doral, FL New York 1221 Avenue of Americas Suite 4200 New York, NY Port Orange/ Daytona 5889 S. Williamson Blvd. Suite 1311 Port Orange, FL 32128