Human Resources

Almost all of my clients are small businesses. The Human Resources function is typically handled by the office manager, controller, accountant, VP of Finance or whoever was assigned the responsibility for payroll. The idea is generally “well, you’re the one paying people, so you might as well take the rest of the HR responsibility too”.

These appointed managers grimace and bear it, not wanting to learn what the role of HR entails (as it’s not their primary job), but having to do so as to avoid major trouble. However, this is troublesome as well, as there are many spots where something could be overlooked, causing major workplace dramas. For these managers, knowing what to pay attention to is the big dilemma, and one that requires further education.

It’s more complicated than you think

There have been many articles written about the poor opinions managers and CEOs have of human resources as a profession. Few, if any of them, have been in the profession themselves. There are more than 20 laws that deal with HR. Each law has then a much larger set of regulations that are subject to periodic change. There are different laws that apply to nonunion companies than union companies.

There are different laws and regulations that apply to Federal contractors. Numerous regulatory agencies have to be dealt with and different courts decide different things until finally the government renders a final decision. People dedicated to the profession (with degrees and advanced degrees) have a hard time keeping track of this material. Yet still, many CEO and managers expect the step-in office manager or controller with an accounting degree just to somehow ‘know’ this stuff!

What should HR managers know?

The exact resources, rules and regulations for each country will differ from one another according to national laws, so it’s important to do your own research. For example, in the United States there is a basic set of information that every person held responsible with HR should know, including:

1. Fair Labor Standards Act.

It’s big in the news right now because of the December 1st change in the salary requirement to be considered exempt from being paid overtime. This is predicted to cost businesses billions of dollars and it will have significant impact on overtime budgets. This is not just a big company issue,  but may have greater impact on small companies. Lawyers are waiting in the wings to take advantage of employers messing this one up. Check out the Fair Labor Standards Act for more information.

2. Equal Employment Opportunity

Everyone should know that it is illegal to discriminate on the basis of some protected category. What most people miss is how much that list has grown. Religion, national origin and age are big topics, but so is gender identification. Then you also have retaliation, which causes problems all by itself. Check out the Equal Employment Opportunity Commission for more information.

3. Disability

The Americans with Disabilities Act Amendment Act (ADAAA) has brought a whole new level to disability discrimination. With an expanded list of disabilities and a significantly bigger responsibility of documentation and communication, this law is much more difficult to deal with than in the past.

4. Immigration

This is a major topic in the news due to the election the Immigration Reform and Control Act, and has been amended several times to make it more complicated. Homeland Security frequently changes the paperwork required to document workers. The law also requires adherence to accuracy and time frames, which is often ignored. This law requires you to fire a newly hired employee if they cannot produce appropriate documentation by the end of their third day. How many executives know that fact?

Beyond these basic laws there are many more. This leads me to the last thing the non-HR person should do:

Enlist a good HR advisor!

The last thing the CFO, controller, office manager and other non-HR person should know, is the name of a good HR advisor. Unfortunately to many, this is seen as an unnecessary expense. After all, HR is so easy, right? Why should we pay someone to give us easy stuff? Wrong! It is much better to pay someone to straighten you out and be able to answer question than it is to pay an attorney to handle your problems after they have occurred. It can be considered preventative maintenance, much like changing the oil on your car. Periodic check cost much less than burning out your engine.

Last word to CEO and managers

Human Resources, if done correctly, can save the company a great deal of money. Finding people, keeping them, making sure they are treated effectively and legally, as well helping the company wind its way through the myriad laws and regulations is not an easy job. Show your HR people some appreciation, but also expect of them high performance. The way you improve bad HR is by not tolerating it.

About the author: Mike Haberman is an experienced HR consultant, working with organisations large and small to achieve smoother Human Resources functions. He has been blogging about HR-related matters for 10 years, sharing his expertise and passion. 


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