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This article was published on Wagepoint’s blog and is authored by Laura A. Barton, Wagepoint's Content Specialist.
Whether you’re just starting your small business and looking ahead to your future needs or at the cusp of growth where you’re considering a human resources solution, you probably have questions. HR gets a bad rap, but realistically, it’s people management and something you’ll want to consider as you grow your team.
So, let’s get down to dispelling and demystifying some small business HR myths that might be holding you up in your journey. Director of People by Wagepoint, Melissa Benzo, recently went over these myths and busted them wide open.
Myth 1: We’re Too Small for HR
Fact: No business is too small for HR. Although no rule says you need to have an HR department, when you have employees, labour laws and regulations come into effect. Melissa points out how much of the work you’re already doing with daily employee management likely falls under the HR umbrella anyway.
You might find yourself organizing new hire paperwork, ensuring everyone’s compensation and personal info is up to date and conducting performance reviews. All the while fielding questions about time off and where to go to log into things like payroll and benefits portals.
It can be helpful to store all that information in one place, like People by Wagepoint, our human resources information system. That way, it’s easily accessible for you and your employees and can also optimize workflows (who doesn’t love a good workflow optimization?)!
Myth 2: I Can Just Use Spreadsheets
Fact: Okay, so we can’t stop you from using spreadsheets, but here are a few reasons you should consider upgrading from them to software.
Spreadsheets may get lost in the digital melee, be forgotten or don’t get updated as often as they should because of the time it takes to fill them out manually. Speaking of manual work, that also means they’re error-prone, and how you interpret a spreadsheet could be different from how a colleague who works on it does. That’s not even touching on privacy concerns with employee information.
It’s not scalable if you plan on growing your team. Tracking time off in a spreadsheet can come with headaches, generally producing a lot of discrepancies and data errors. Plus, there’s a lot of manual work needed to reconcile information.
Myth 3: I Don’t Need to Track Time Off
Fact: Apart from the issue of not knowing who’s using their time off if you don’t track it, Melissa outlines a few ways to skip this task can impact your small business.
Productivity and Financial Impacts
The first impact is a double whammy: productivity and financial.
Employees who use their time off are more productive, motivated, healthier, have a better work-life balance, and so many other benefits. This translates directly into employees staying with your company longer, reducing the time and money spent onboarding, training, and recruiting new hires.
Workplace Culture Impacts
The second impact is your workplace culture. Your workplace's culture and overall vibes go far beyond time off, but there are some key messages you convey to your employees when you pay attention to time off.
Leaders who understand the importance of time off, and actively encourage employees to use it, are seen as trusted and caring, once again helping employees understand that they’re not just a cog in a machine.
Legal Impacts
The third impact is legal. For instance, if someone leaves your company, there may be rules around paying for their unused time off. If you haven’t been tracking time off along the way, it can lead to disagreements and discrepancies about how much time is owed.
Myth 4: We Don’t Need Goals
Fact: Goals and objectives help your team stay on track, understand what they’re contributing to the business and help keep your small business on track, too.
There’s a saying that says if it’s not written down, it won’t happen. So, using that, it’s really easy to stray from what you’re trying to accomplish as a company when there’s so much going on, both in and out of work.
Having goals and objectives also mitigates burnout. If there aren’t clear-cut markers an employee (or even you as the employer!) should be working toward, it can lead to taking on too much and burning out. Nobody wants that.
Setting, recording and tracking goals is also helpful for employee reviews so everyone is on the same page with expectations.
Myth 5: We Only Need Annual Reviews
Fact: Annual reviews are a great way to look back on the year and gauge accomplishments, but the reality is that more frequent reviews are beneficial for everyone.
Having quarterly or briefer monthly reviews gives you and your employees the chance to effectively share feedback, discuss challenges and take actionable steps to improve now, not a year later when it might not even be relevant anymore.
The solution here is smaller-scale reviews on a more frequent basis. You can conduct informal check-ins, monthly formal and documented quarterly reviews to update things like objectives and deliver feedback. And then one big annual review to discuss things like future objectives, salary increases and overall performance.
What other HR misconceptions about its role and importance in small businesses? Tell us in the comments section below.
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5 Comments
HR is often seen as an expense rather than an investment in small businesses. Another misconception is that HR is only about recruitment, neglecting its vital role in employee development, engagement, and compliance. This mindset can hinder growth and lead to legal issues.
1 year agoI totally agree. The last organization I worked at, HR was just incorporated into the Finance Department and seemed to be an after thought. There was an obvious lack of expertise and focus, and it was reflected in the negative work culture.
12 months ago@Harman, I could not agree more!
1 year agoHR is the behind the scenes work that, when it’s working, goes unnoticed, but when it’s not working, is very apparent. I agree with Harman, and it should be seen as an investment because everything will run smoother if there is a better, consistent system to handle the HR needs of the organization, no matter how small.
1 year agoI love this phrase “When it’s working, goes unnoticed, but when it’s not working, is very apparent.” Thanks, Denise!
1 year ago