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Five HR Basics for Any Small Business

March 4th, 2014 by Mindy Flanigan, Inspiring HR

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We often hear about the Department of Labor trying to combat “catch me if you can”. All those small business owners that, according to them, just love to ignore or avoid employment laws. While there may be some out there, the vast majority just don’t know these laws exist. And if they do know they exist, we can thank our government regulators for making these laws way too complicated for the average business owner to even understand.

If federal or state labor law agencies want to minimize the amount of business owners who are violating employment laws, it is time to simplify! Many business owners really do want to do the right thing and need to be educated in a manner that is sensible. Education starts with basics. A basic understanding of labor law compliance will help a business create sensible and compliant employee management systems and processes.

So, where do the basics start? Here at the top five:

1. Employment law posters. Put them up! They must be displayed in a common employee area  such as a break room. Make sure they are current. Yes you can print them from various web pages. But why would you do that when there are a ton of vendors out there that will put all your federal and state required postings on one single laminated sheet from $30 or less plus shipping?

2. Fair Labor Standards Act. This is a federal law that most small businesses get wrong. It regulates minimum wage, OVERTIME and child labor. Here is the thing about overtime. Unless a position is clearly exempt, according to defined Fair Labor Standards Act exemption categories, it is non-exempt and all hours physically worked over 40 MUST be paid at one and 1/2 times the employee’s hourly rate. Just because a job has supervisor or manager in the title, or just because you choose to pay someone a salary DOES not make them exempt from overtime.

3. Wage and Hour laws. There are federal and there are state. If state law is more generous than federal law, the business should follow the state law that is applicable to where the employee works, not necessarily where the business is located. If a business operates in Virginia, but also has Maryland based employees, then the business must comply with both sets of state laws.Wage and hour laws include regulations on when you are permitted to take deductions from an employee’s pay, meal and break periods and when final wages must be paid. When you are trying to determine your state’s wage and hour laws a simple Google search will usually land you right to the FAQ page of your state Department of Labor web page.

4. Immigration Law Compliance. In other words, form I9. A new one was just released. It expires in 2016 – refer to top right corner. Start using it ASAP and do not use old forms past May 1, 2014. This form verifies the employees you have hired are legally authorized to work in the United States, not that they are a citizen. This form should be filled out in full, identifications should be witnessed and noted in section two, and section two must be signed. If immigration chooses to audit your files and finds missing or incomplete I9s, there is a high likelihood you will be fined. An I9 is required for every employee hired (put on payroll). A new employee legally has up to three business days to produce the documentation required for this form. After three days, if no identification is presented, suspend them from work until they do. Continuing to allow them to work past the three days is a willful violation of the law.

5. Anti-Harassment and Non-Discrimination. Get a policy in place immediately. It would normally be found in your employee handbook and should clearly state zero tolerance for harassment in the workplace and clearly outlines for your employees how to report potential violations of the policy. Going without an anti-harassment policy in your business carries significant risk as the company will likely be without an effective means to defend itself if accused of not responding appropriately to a claim.

There is no need to fear or run from HR. Look for simplicity and start with the basics.

Click the link to view our recent blog: We Have an Employee Handbook, Now What? or check back next week for more on human resources, payroll, insurance and benefits.

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Five HR Basics for Any Small Business
A basic understanding of labor law compliance will help a business create sensible and compliant employee management systems and processes.
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