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Top 3 Small Business HR Issues – And How To Deal With Them

For some business owners, things can go wrong when it comes to employees, and for others things can go really wrong!

We’ve pulled together the top 3 HR issues that a small business may have to deal with, but don’t panic – it’s not all doom and gloom – we’ll look at how you can resolve these giving you a positive outcome.

1. Discrimination

So, we’ve started big! You get accused of discrimination on the basis of gender, disability or race, or an employee makes a complaint about sexual harassment.

You’ll instantly think – this will never happen to me. We hope so too, but we know that every employer we work with who has been subject to such claims also thought the same.

It’s all about prevention rather than cure. Small businesses can’t afford to throw cash at someone and make them go away, or fight their case in an Employment Tribunal – it will cost you at least £15k to do so.

First steps – get yourself a robust policy, communicate well with your employees then back this up with your actions. Generate an inclusive culture and demonstrate that you take complaints seriously – thoroughly investigate them. ACAS provide some really great tools and guidance for creating a fair workplace – http://www.acas.org.uk/index.aspx?articleid=1363

2. Firing on the spot!

In the well-known Lord Alan Sugar style, pointing the finger and saying ‘you’re fired’ might get you into a whole load of trouble.

Although employees don’t have protection until 2 full years employment service (this might actually come as a surprise to you), they have other forms of protection such as discrimination as outlined above.

Irrespective of their length of service, it is always recommended that you follow statutory procedures to minimise risk and is certainly the safest way to do so.

Follow this 3 step process: let them know you are considering terminating their employment (invite letter to a meeting). Conduct the meeting, allow them to respond before delivering the outcome to dismiss and reasons. Then finally give them the right to appeal.

3. Hiring mistakes

You’ll either be super excited about your growth plans and want your next hire to be quick so you can tell the world, or you’ve got a contract to fill and you need someone in pronto to ensure you meet your clients needs. A quick hire often fills a role, but you’ll soon realise they don’t fit your culture. 

It is estimated that hiring the wrong person can cost a company up to £8,000, some report even higher.

At first – write down the main duties. A clear job description will identify what you are looking for and helps the candidate decide if the role is for them. Broaden your search – utilising online job boards and LinkedIn are fantastic ways to find people. Ask around your contacts or a faster and easier way is to hire a recruiter. 

If you’ve already hired the wrong person and need to get rid of them, make sure you follow the correct termination process. 

We’ve covered a very small list of HR issues that small businesses might face, some are pretty serious stuff! But the good news is, there are solutions to them all. Hopefully this has given you some food for thought, but if you have a specific scenario you’d like to discuss in depth you can give our HR specialists a call.

Our small business issues and how to deal with them guide isn’t finished yet. We’ll be publishing the next instalment soon.

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