Are Employee Handbooks Necessary for Small Businesses?

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Have you ever worked at a large company? On your first day you probably received a large stack of important company information, documents, policies and more – maybe even in the form of an employee handbook.

Employee handbooks are usually provided by employers and contain employment and job-related information that employees need to know such as recognized holidays (days off), company rules, grievance procedures, important resources and contacts, policies, and more. But is all of this information really necessary at a small business?

Employee handbooks are extremely important for small businesses and large businesses alike. Here are just a few reasons why:

Handbooks Protect Employers: Handbooks provide clear expectations to employees and create a culture where issues are dealt with fairly and consistently. If an employee has a dispute, but has previously received and signed a handbook that clearly stated the policy, the company will often be protected from a liability standpoint. For small businesses especially, a claim against the business can completely destroy your cash flow – it’s much better to be safe than sorry!

Handbooks Save HR Professionals Time: You may not have an HR professional on staff – perhaps the office manager or even you, the business owner, is in charge of managing the employees. When there’s a handbook to conveniently outline paid time off, holidays, vacation time, etc., you don’t need to explain (or email) the same information over and over again each time an employee inquires. Remind them to refer to their handbook!

While the employee handbook’s main purpose is to establish a convenient and clear line of communication, don’t forget the following disclaimers: the handbook can be updated at any time and it is not an actual contract. Employee handbooks should be reviewed and revised each year at a minimum, or whenever the company undergoes significant changes.

Do you work with a Professional Employer Organization (PEO) or an Administrative Services Organization (ASO)? If so, be sure to ask them if their services include complimentary employee handbook creation and updating. If they do not, or you don’t currently work with a PEO/ASO, contact Employer Solutions Plus for additional information and support: 727-698-6207.

I-9 Audits on Restaurants

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It’s no secret that the hospitality industry experiences high turnover. Restaurants don’t often keep waiters or waitresses on staff for long periods of time (in comparison to other industries), because fact of the matter is that for many employees it’s just a part time job, a transitional period of their life, or a way to temporarily make a little extra money on the weekends.

It is for this reason among a few others that the hospitality industry has become an easy target for I-9 audits. With employees coming and going all of the time, keeping up with the paperwork can be a fulltime job in itself. Every restaurant owner knows that the I9 form needs to be completed (ensuring that their new employee is eligible to work in the US), but they may not be completing this form in a timely manner, or they may be waiting a few weeks to see if a particular employee will stick around.

This is a BIG mistake! Avoiding a minor administrative headache today or placing this task on the backburner can result in a big compliance violation in the event that you’re audited by the government. If your business is randomly selected for an audit, you could have as little as three days’ notice before documents have to be surrendered. If your restaurant is in violation, hefty (and sometimes debilitating) fines will follow.

So, what can you do? The first option is to always ensure your restaurant is operating in compliance. Although, for busy business owners, sometimes mistakes are entirely innocent and unavoidable; we make them by accident or we’re just not educated enough within one particular area of employee management.

The alternative chosen by many restaurant owners is to work with a PEO. If you visit the “HR Solutions for the Restaurant Industry” section of our blog you’ll see that PEOs come with many benefits beyond their help and expertise surrounding compliance and new hire paperwork. They’re able to bundle nearly all HR and compliance responsibilities under one cost effective umbrella to ensure that your business is run as effectively and efficiently as possible.

To learn more about PEOs operating within the restaurant industry, click here. If you have any specific questions, feel free to contact us at Employer Solutions Plus: 727-698-6207.

The Importance of Background Checks When Hiring at Law Firms

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Earlier in the year we spoke about ways to recruit and retain top performing attorneys. Perhaps you just recently interviewed the attorney of your dreams and can’t wait to make them an offer for joining your practice! But wait just one moment; don’t jump the gun!

Do you know the importance of performing a background check on your new employee? This quick and easy step could save the “face” of your firm. As attorneys, we know that reputation is everything. Therefore, it’s important to know everything and anything about the person who’s ready to represent your law firm.

An investigative check will reveal whether or not this attorney has been disciplined, is in the process of losing law licenses and the related right to practice law, his/her history with the state bar and associations, whether they’re highly rated in their area of expertise, surveys conducted in the local community, quality of work, ethics and more!!

If the candidate is a new attorney straight out of school, a background check to confirm the candidate’s degree, GPA, academic track record, associations, and more is equally important. As we learned in an earlier entry, 50 percent of all resumes and applications contain false or overstated information (according to the Society for Human Resource Management). Guess what? This includes attorneys!

Reputation is everything when it comes to practicing law. Conducting a background check will ensure that you’re hiring a reputable and well respected attorney, and save you from the costs (and headaches) associated with termination at a later date.

Remember, before conducting a background check you must always obtain an applicant’s written authorization. Be wary of the attorney that “forgets” or declines to sign an application permitting you to move forward with the screening. If you, as the employer, make a decision based on information found in the background check, you must provide the applicant with written notification. This is called an adverse action notice and it must be accompanied by a copy of the report.

Most attorneys specialize within one or two areas of law. If employment law and compliance is not your particular area, be sure to contact Employer Solutions Plus, your Professional Employer Organization, or a compliance specialist that can assist you with background checks, and the hiring process.

For additional resources specific to law firms, visit our HR Solutions for Law Firms section.

The Importance of Background Checks in the Healthcare Industry

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If you’re the owner of a medical practice, you probably have an occasional nightmare of compliance violations and liability lawsuits. Protecting your business is important so it’s only natural to worry about the Department of Labor (DOL) showing up to administer and enforce its 180+ federal laws.

But, as far as protecting your business is concerned, patient protection, compliance and the DOL aren’t the only components you need to worry about. You need to start (if you haven’t already) concerning yourself with your very own personnel: the people YOU hire. We’re talking about the office manager, accountant, nurses, doctors, technicians and more; what you don’t know about them can absolutely hurt your practice!

Here’s a statistic that may alarm you: the Society for Human Resource Management reports that 50 percent of all resumes and applications contain false or overstated information. As a medical practice, how can this affect you?

Well, let’s start with education. Education is a lot more important in the healthcare industry than it is in some other industries. A nurse or doctor lying about their education most likely means that they are inexperienced and unqualified to be treating your patients! This situation could easily present itself with a damaging lawsuit regarding negligent hiring if anything were to go wrong at your practice.

A candidate or employee’s alcohol and drug history is another especially important aspect you should concern yourself with as the practice owner– especially if the person is treating or interacting with patients.

What about office managers, accountants, and others within your office? Should you be that concerned with them? In short, yes. The U.S. Department of Commerce found that employee theft is the cause of 33 percent of all business failures. As a business that likely has access to expensive equipment, various medications, prescriptions and more, the likelihood of theft within your workplace is greater than ever.

It is for the aforementioned reasons that all businesses (whether you’re in the healthcare industry or not) should always conduct a background check before hiring a new employee. It’s a quick, inexpensive step that could potentially save your practice. Extensive background checks will uncover criminal history, education confirmations, credentials, licensing, drug and alcohol history, credit reports, motor vehicle records, reference checks, court records, and much more.

For the sake of your patients, but also for the sake of your practice, you need to conduct background checks! If you’re currently working with a PEO or outsourcing to a Company that provides HR and administrative functions, be sure to take advantage of background screening services. If you’re currently in need of a background screening service company to support your practice, contact our team. Employer Solutions Plus works with numerous companies within the industry and we’re happy to point you in the right direction!

For additional resources specific to the healthcare industry, visit our HR Solutions for the Healthcare Industry section.

5 Reminders for Avoiding Wrongful Termination

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Terminating an employee can be an awkward (and stressful) task. But, as a business owner you’ve got more important things to worry about: compliance.

As if the need to terminate someone wasn’t a difficult enough situation in itself, a wrongful termination claim can quickly take things from bad to worse…a lot worse!

We remind all employers to run down the following checklist before pursuing termination:

  1. Documentation: Do you have the proper documentation to support your credibility and the need for termination? All past incidents, behavioral issues, and performance issues should be documented within the employee’s file.
  2. Warnings: So, you’ve documented incidents – does your employee know that these incidents were documented? Were they given a verbal or written warning prior to termination? Even if it was a verbal warning, the details of the verbal warning need to be documented.
  3. Private Room: The termination meeting should be scheduled in a room or private area separate from other employees. This will help avoid drawing the attention of other employees and will reduce the likelihood of interruption, but more importantly it will not risk creating a situation where the employee leaves feeling ashamed, mistreated, or embarrassed in front of co-workers. In addition to securing a private location, scheduling a termination meeting at the end of the day will ensure that the employee does not need to pack up their things and exit in front of others.
  4. Witness: Never terminate someone on your own. Always have another person from HR or management accompany you. This will eliminate any issues that may arise concerning his or her word against yours.
  5. Consistency: Have you fired someone in the past for this particular reason? Have you been consistent in enforcing the “rules” outlined within your employee handbook? You cannot fire one employee and keep another one on staff that has violated the same rule(s).

For more information on hiring and firing, visit our hiring and firing section within this blog. If you have any questions, contact us directly at Employer Solutions Plus!

 

How Much Does A New HR Manager Cost?

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Outsource….hire….no, outsource ….no, hire. Business owners struggle with this dilemma nearly every day of their working lives!

If you’re to the point where HR tasks are piling up, higher than the eye can see, you’re probably ready to bring on an HR Manager…someone you can offload these non-revenue generating activities to. But wait a minute, how much does an HR Manager actually cost?

Salary.com states that the median expected salary for a typical Human Resources Manager in the United States is $88,408. Glassdoor.com puts that number at around $80,000. Either way, it is important to note that many factors directly affect an HR Manager’s responsibilities and workload – therefore affecting what the appropriate salary at your organization will be. How many employees will the HR Manager oversee? Will they work on their own or will they work alongside another employee such as the office manager? What type of education or training will be necessary to adequately serve your business?

Here’s something to consider: While bringing on an HR Manager will keep things in-house and certainly decrease the amount of time you personally waste each day on tasks that do not generate revenue, you are probably STILL going to need to outsource certain aspects of your business that fall under “HR” including payroll, benefits, and workers compensation.

An HR Manager will absolutely assist your business, but will he or she cost more than what their services are worth? Don’t forget that fulltime employees typically come with the added expense of employee benefits.

Most large companies that are in “employee management overload” will argue yes, an HR Manager is absolutely necessary and the cost of hiring is justifiable; management can generate a lot more sales (totaling more than that HR Manager’s salary) if they themselves aren’t focusing on non-revenue generating tasks. But, for the small to medium sized business owner, the expense of hiring fulltime, knowing that you’ll still need to outsource various aspects of HR, is quite daunting. Many choose to stay put in their frustrations, wearing their HR hat along with many other hats.

Are you that person? Wearing too many hats but not in a position to hire? If so, have you ever considered a PEO? Through the co-employment relationship a PEO will become the legal employer of your staff and handle all the payroll, benefits and HR functions. Outsourcing, well yes, but it’s all through one convenient relationship!

Like all professional services, PEO prices vary depending on the company. But, in most instances, a PEO relationship will cost you less than a fulltime HR Manager, and, you won’t have to deal with the headache of managing multiple vendors anymore. All of your HR functions are under one roof. PEO prices range between 2 and 10 percent of wages. For very small companies (less than 5 employees) some PEOs may charge a flat fee per month.

What option is best for you? You won’t know until you’ve got a side by side comparison based on your wants, needs, and budget! Contact Employer Solutions Plus if you’re interested in learning more about the PEO relationship and its costs!

Transitioning from 1099 to Employee – Employer Checklist

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Do you have a worker that has been a 1099 to date but it’s now time to classify them as a W2 employee? In an ideal world, this would happen right around the end of the year so that the switch could be made on the 1st of the year, simplifying your business’s and employee’s taxes.

But, sometimes the switch needs to occur prior to that; misclassification is punishable by tax penalties so it is not recommended that you delay the transition to W2 employment if it is in fact necessary.

The misclassification of employees as independent contractors presents a serious problem for affected employees,employers, and the entire economy. The Department of Labor has countless initiatives in place to identify misclassifications and get workers the benefits they are entitled to such as family and medical leave, overtime, minimum wage and unemployment insurance.

When you employ a 1099 worker, the only forms necessary for the worker to complete each year is a W9, which is a request for the taxpayer identification number and certification. The worker is responsible for paying their own taxes as an independent contractor.

When the worker becomes an employee, much more responsibility falls on you as the employer. Below is a “hiring” checklist for transitioning into a W2 position. We strongly recommend consulting with a professional such as Employer Solutions Plus that can assist you in any of the areas below; each has its own complexities. Essentially, switching a 1099 worker to a W-2 employee should be handled just like a new hire would be.

  • Form W-4 for Federal Income Tax Withholding
  • State Income Tax Withholding Form
  • Form I-9
  • E-Verify (Even if your worker has already worked with you as a 1099, E-Verify is very important. It confirms the eligibility of the employee to work in the U.S.)
  • Register with State Employment Notification System
  • Review and Issue Employee Handbook (This helps ensure compliance)
  • Enroll in Benefits

It is also recommended that you consider the assistance of a payroll service provider if you are not using one already. A payroll service provider will handle all of the above-mentioned forms and verification processes for you, and help streamline your payroll each month.

For more information on hiring or transitioning an employee from 1099 to W2, contact our team.

Cover Your Bases: HR’s Lay-Off Checklist

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Over the past several years many of us have been directly affected by downsizing. As an employer, laying-off a dedicated employee is one of the most difficult HR tasks. We often feel as if we don’t have a choice, which makes it all the more difficult.

The only thing worse than laying-off an employee you care about, is finding out that you weren’t in compliance when doing so.

This HR Checklist is brought to you by Employer Solutions Plus.

DO:

Review protected classes. Before determining which employees need to be let go, look at your group as a whole. Laying-off an employee that is part of a protected class can unfortunately be grounds for a lawsuit. Protected classes are typically defined based on age, sex, or race. If you are laying-off multiple employees, do they all have common characteristics (for example, they are all women). If so, be careful; number 2 on this list is going to be really important.

Have a justifiable business reason for laying-off. Your reason needs to be based on a legitimate business reason that stands up in a court of law. It needs to be based on downsizing, eliminating certain functions within your Company, relocating or closing certain office locations… NOT reasons having to do with characteristics, or that can accidentally appear as having to do with characteristics.

Have a witness. It is always recommended that you involve a third person in the room. This provides you with someone who can testify on your behalf in the event that the employee or employees feel you have violated their rights. Your witness should be another HR professional so that they can intervene and correct you in the event that something is accidently misstated.

Work with an attorney, or your PEO. Are you up to speed on all of the countless employment laws? An attorney or Professional Employer Organization will be up to speed. They can help you navigate the complex issues surrounding lay-offs, hiring, and firing.

Be honest, compassionate and QUICK! Losing your job stinks. Although you may simply be seen as a co-worker or manager to the individual, don’t forget to be human, and don’t lengthen an already difficult process. Be sure to provide recommendations to future employers to help the person re-enter the workforce as quickly as possible following termination.

DO NOT:

Give false hope. As we mentioned above, be honest, compassionate and quick!

Play favorites with severance. Pay out severance according to a worker’s title and length of service at your Company. Make sure your severance packages are fair and distribution standards are consistent across the board.

Blame the employee. If the Company is going through some hard times, again, be honest. NEVER lay-off anyone based on their performance, and reinsure them of the real reason for lay-offs, letting them know it has nothing to do with their performance.

For more information on lay-offs, or the advantages of hiring and firing with the help of a Professional Employer Organization, contact Employer Solutions Plus.

What are Source of Hire Metrics?

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One of the attractive benefits of working with a Professional Employer Organization (PEO) is recruitment assistance and new hire support. PEOs assist employers with job descriptions, employment postings, resume screening, applicant interviews and compensation structures… and when a new employee is brought on; I-9 verification, new hire forms, orientation programs and more!

PEOs certainly make the hiring process less stressful and less time consuming for the employer, but did you know that it’s technology that actually tends to be one of the greatest strengths PEOs bring forth? Technology, particularly Source of Hire Metrics, provide employers with the data they need to identify bottlenecks in the application/recruitment process and fix any existing problems that may be hindering opportunity with great candidates.

Many PEOs utilize Source of Hire Metrics as a powerful tool in the recruitment process. Source of Hire Metrics accurately capture important recruiting metrics, such as the number of candidates that click on a particular job link or advertisement, the number of applications, the source of the lead, keywords that drive candidates to your landing pages, how candidates navigate your website, and more.

Source of Hire Metrics provide employers with insight into the recruitment funnel and measure how well they are doing at converting candidates from one stage to the next. They also identify which channels aren’t working, so that employers can stop wasting recruitment or marketing dollars on particular platforms.

For an individual employer without a large HR department, or strategic PEO partnership, the cost of this specialized technology cannot often be justified. It’s too large of a financial burden, and requires time and resources to be able to review on a consistent basis. When working with a PEO though, it’s just one of the many benefits the employer can take advantage of!

To learn more about Source of Hire Metrics, and the recruitment and new hire support of a Professional Employer Organization, contact Employer Solutions Plus.

Adding Attorneys to Your Practice in Various States

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Does your law firm operate in multiple states? If so, you’re well aware of the strict guidelines that come alongside practicing law in each particular court system. Each US state has its own court system and sets its own rules for bar admission, which can lead to different admission standards among states. For the owner of a law firm trying to grow his/her business and add employees in multiple states, this process can quickly become a headache.

You may be thinking “I should simply hire an attorney that is already admitted to the bar in whatever state I’m looking to do business in.”  That will certainly save you some time from having to ensure an existing employee can pass the bar in the new state, and then relocate to serve the clients of that state.

But, bar admissions aside, adding an employee in a new state comes with its own laundry list of HR and compliance-related tasks. Each state has its own reporting requirements surrounding new hires.

Did you know that PEOs can eliminate half of the burden?  Through the co-employment relationship, the owner of a law firm focuses on growing his/her business, and the PEO manages all compliance and HR administration.

PEOs provide integrated services to effectively manage employer risks for law firms. PEOs help offset certain risks to their clients’ businesses by contractually assuming certain employer rights, responsibilities, and risk.

A PEO will provide guidance on employment regulations and reporting requirements in addition to answering any questions regarding hiring, firing, compliance and recruitment. They will also put together employee handbooks and employment procedure manuals for your new employees.

If your practice is interested in expanding and operating in multiple states, contact Employer Solutions Plus first. You may be able to eliminate an HR headache before it ever exists!  Employer Solutions Plus provides critical information to business owners regarding new hires and PEO support.