Most Common HR Mistakes that Impact Business Operations

August 3, 20158:10 am1427 views

It is difficult to keep a business operating at higher profit margins without keeping a check on HR issues and regulations that impact operations. Many at times, growing businesses give least importance to HR issues that affect their growth and progress.

“Often small and mid-sized business owners and managers don’t really know what they don’t know — and may unwittingly make mistakes in overtime, wage and hour regulations, discipline and discriminatory practices,” says Christine Pahl, human resources client consultant at FrankCrum.

“Unfortunately, these mistakes can be costly as well as create distractions that keep the company from performing at its best.”

FrankCrum, a national Professional Employer Organization, offers tips for HR professionals to ease their hiring worries and avoid some common HR “land mines.” Some of the most common HR mistakes that impact business operations are:

Improperly classifying employees as exempt: This may result in non-exempt employees not receiving overtime pay they are entitled to. Paying someone a “salary” does not automatically mean they are exempt and a misclassification can violate laws regarding recordkeeping, minimum wage and overtime.

Any of these violations may result in a lawsuit, with employers frequently unable to justify the reasons for their actions, which leaves them without a defense to the lawsuit.

Family Medical Leave Policy: Many employers are not aware if they are a covered employer under the Family Medical Leave Act or what their obligations are to the employees who qualify for protection under this law.

Hiring practices: Although most employers know not to ask an applicant’s age, other questions to avoid include those about medical history, prior workers’ compensation injuries, criminal record, marital status, sexual orientation, and political or religious affiliations.

It’s important to remember that position descriptions and interview questions should focus on necessary position requirements.

See: 6 Hiring Mistakes Most HR Professionals Do

Discriminatory practices: Review all aspects of employment, including hiring, promotion, pay, discipline, termination, training opportunities and more. It’s not enough to focus on intentional or obvious discriminatory practices.

A proactive review of trends in these areas and the impact on employees may reveal unintentional practices that should be corrected. In addition, employers should post an EEO statement and distribute a written anti-discrimination policy to be signed by employees and management, outlining the policy as well as redress and complaint procedures.

Corrective actions: FrankCrum uses the term “corrective action” rather than “progressive discipline,” because it keeps the focus on resolving problems and maintaining a successful relationship with the employee.

Not having an employee handbook: While this may seem as a relatively less harmful oversight, but many workplace problems occurs due to lack of consistent policies and well-document procedures/systems in place.

Without an employee handbook, employees are left clueless of what is expected from them regards service delivery and what the organisation has in store to offer for productivity and best performance.

Regardless of the size of an organisation, companies should have a handbook and provide each employee with a copy of the same for ready reference. Without a well-written handbook, companies will be setting stage for a variety of employee relation issues and potential employment litigation.

It is required for business owners and managers to become HR specialists, Pahl added. “But they should have knowledgeable advisors who can help them avoid HR problems.” HR departments sometimes take on too much work load and hence pay little attention to current situations or problems to tackle; this can impact the long-term growth path of the company.

Integrate HR technology when necessary to allow more time for human resource professionals to focus on productive functions such as talent management and retention, thus avoiding common HR pitfalls in business operations.

Also read: 7 HR Primary Blunders on Employee Retention

Image credits: flickr.com

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