There’s an old curse “may you have many employees. ” For many business owners, handling employee matters is the top of their list for problems. So, what’s a small business owner, who is already wearing too many hats, supposed to do to avoid employee problems?
Employees are supposed to help you get more accomplished, not drain your energy. In fact, employee innovations (inventions and process improvements) are the source of competitive advantage and profitability – your success depends on leveraging them.
How you handle new hires sets the stage for employees to become high performers and contribute to the success of your business.
The first step is to select the right person for the job. It’s almost always better to “hire for attitude” and “train for skills. ” You can’t fix a bad attitude, but you can fix a skill deficiency. You want to hire the person with the good attitude.
Don't hire in haste. It's much better to spend time on the front end and hire carefully, than have to spend time and money dealing with an employee who wasn't a good fit. Termination and/or turnover are draining for all involved.
- Communicate clearly what is expected in the job.
- Strive to have the candidate talk 80% of the time.
- Ask open-ended questions.
For example: What was your most/least successful assignment? What kind of obstacles did you encounter and how did you overcome them? Can you give me an example?
- Listen carefully. Is there a ‘Good Fit'? Is there a match between the company's job expectations and work environment, and the candidate's interests and abilities?
- Don't ask questions about age, gender, family status, race, religion, ancestry or health.
The next step is to make an offer of employment.
The offer of employment should be in writing, specifying the job title, responsibilities and compensation (in hourly or monthly terms). The offer should specify any other requirements (such as background or reference check, physical exam). It should also specify whether you require the employee to sign other documents such as: a confidentiality, non-compete, non-solicitation, invention assignment agreements. The offer letter should state that employment is “at will” and include a date by which the offer must be accepted.
Bringing the new hire into the workplace.
On the new employee’s first day, provide an orientation that includes completing the employment paperwork, setting workplace expectations and outlining job duties.
Covering the legal bases
The legal requirements for handling employees are incredibly complex and the penalties are severe for noncompliance.
To reduce your risks:
- Use a payroll service – a good payroll service and help you stay in compliance with the payroll tax requirements and make sure those withholdings and payroll tax returns are filed on time.
- Have worker's comp insurance – it’s required by law. If an employee is injured on the job, it’s their sole remedy. If you don’t have worker’s comp your liability is open ended.
- Set up an organized file for each employee.
The file should include: Employment Application Offer Letter Reference Check Confidentiality/Non-complete/Non-Solicitation/Assignment of Rights Agreements Orientation checklist Employee Handbook (acknowledgement of receipt) *** Harassment Policy Employment eligibility (Form I-9 and copy of documentation) Federal and State tax withholding forms Job Description Benefit information (medial information should be filed in a separate confidential file)
Eventually, the file should also include Performance Reviews and any other relevant documents related to the employee such as promotions, transfer, discipline, resignation or termination.
The paperwork is only the beginning of successfully bringing a new employee on-board. The informal dynamics of the work place are extremely important - you’ll want to make sure the new person quickly grasps what’s appropriate and not appropriate in your workplace.
It’s important to explain the “unwritten rules” or “norms” of your business. Don’t assume that anything is “obvious. ” If it’s important that employees arrive “on time” and “dressed appropriately” specify what that means.
Training, both formal and informal, helps the new hire become productive quickly. Don’t just send the person to their work station. Assign a mentor, someone who will show the new person around, introduce the person around and take him or her to lunch.
Many companies rely on informal “on the job” training. This doesn’t just happen, it has to be planned and scheduled.
Performance Feedback The sooner you give a new hire feedback on their performance, the better. Constructive feedback is critical. Is the person catching on quickly? Are there any problems?
What if the new hire isn’t working out?
Many times, it’s apparent quickly that the employee is having problems. It’s better to deal with the situation sooner rather than later.
If the problem is a skill deficiency, figure out what training is needed. For example, if the person needs to improve their writing skills, encourage the person to take a class. If the deficiencies are severe, you have to deal the situation promptly. Allowing unproductive or disruptive employee behavior will poison the atmosphere of the workplace and drain everyone’s productivity.
In conclusion, many problems can be avoided if employers are clear and consistent about what is expected. Remember than being “overly generous” can backfire. For example, when an employee asks for time off “on the fly” – it’s easy to say yes and then find yourself with a problem on your hands because you gave time off to one employee and then refused another employee’s time off request. The same kind of problem can arise when one employee wants to “work form home” and you agree – what’s the precedent that you’re setting? If your Employee Handbook spells out your policy for “time off” and “work from home, ” it’s much easier to be consistent.
To avoid the old curse, “may you have many employees” you need to have a systematic approach. Start by covering the bases with new hires – both the “legal bases” and the “workplace bases. ” Of course, you’ll need to weed out the weak performers and recognize and reward the high performers if your company is going to leverage the creative talents of your employees.
Jean Sifleet is a practical and experienced business attorney. Jean has extensive experience in dealing with employment matters in the large and small companies and as a small business owner. She has authored numerous books and publications on avoiding legal pitfalls in doing business. This article is excerpted from her new book, Advantage IP – Profit from Your Great Ideas (Infinity 2005). For more information, Jean's website is http://www.smartfast.com .