At what point should a small business look for HR help?
I'm looking to hire for my small business. However, I've had a bit of difficulty in assessing potential hires, and finding quality applicants. Do you have any tips for hiring for a small business? At what point should I look to outsource HR help?
There is no magic number when looking at hiring HR. You will experience pressure points that will let you know when it is needed. Some of these pressure points might be that you need employee manuals or handbooks that define the companies policies and procedures. Other pressure points might be a wrongful termination suit, pay inequity, harrassment claims. If you are in a growth mode you will want something or a process that is scalable.
I have several clients that have hired my services prior to even opening for business as they wanted to be able to offer benefits and have that HR (systems, processes) in place. They also wanted to be able to attract a better quality of people.
Once an employer has 15 full-time employees it is covered by Title VII of the Civil Rights Act, the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA). Add five more employees and the Age Discrimination in Employment Act (ADEA) and COBRA protections come into play.
You will need to do some cost analysis in regards to this. You will need to look at the pros/cons of using a PEO or hiring an HR person. And there are pros and cons...it all depends on your business and your goals in regards to your business.
Also, according to your size, you will need to make sure you are compliant.
Lot's of factors to mull over.
Hiring the right people for your business is not an easy task, but I have found in my many years of hiring staff, the key element, after looking at qualifications, is the attitude of the applicant. In the interview, it is best to ask probing questions to determine how they would deal with different business situations. What you would be looking for in the answers is the body language. Are they enthusiastic, do they like to learn, are they helpful, do they have a passion for business, do you get a good sense they are a team player?
You can teach a new hire about your business but what you can't teach is a great attitude. A small business needs people who are adaptable, team players and enjoy working with customers. This is built into a person's personality no matter what their resume says! Don't hire people that aren't the right fit for your business.
If you are still having difficulty with the hiring process, then reach out to a knowledgeable professional HR consultant that can help you through this process.
Do you have a workforce in your area that partners with businesses to help employers/employees find each other? In my area, there is Pacific Gateway workforce that partners with the state and allows businesses to post job openings at no cost, and helps find applicants that meet requirements. Many times they weed out applicants for you so that only qualified people are able to apply. If you don't have that in your area, something else I do is ask those I know if they know anyone looking for work as referrals most often work out for me.
If you feel you don't do a good job when hiring, there are plenty of HR consultants/businesses who can help you with this task. It may seem a bit expensive to you, but it is much more expensive to hire an employee who won't work out for whatever reason. You'll have additional training costs as well as potentially paying an unemployment claim and having higher payroll taxes. Get the support you need to make the best hiring decisions. You'll be glad you did.
You have received some great advice here. I can tell you from my experience with working with small business owners especially when hiring their first employees it usually comes down to one of these factors:
1. Focus more on skills than attitude
2. Focus more on attitude than skills
3. Unclear on what they need the person to
I walk business owners through a process where the last thing there are doing is interviewing people. Be sure you know what qualities you want the person to possess and how will you determine if they possess them. Only once you have that can you create an ad or tell people you are hiring.
When to look for outside HR help? As soon as you feel you need a consultant. Again, be clear on what you want from them and then start talking.
I would be happy to discuss further if you have more questions.
At this point in your business it appears that the only person who will able to effectively hire new people is you.
Having said that you are not an expert in HR and there are a variety of nuances in the HR world of which you are not aware.
I would plan do most of the implementation yourself, but consider hiring an HR consultant to get you on the right path, I would work with them on a fairly regular basis so that you stay on the right course.
Hi Colette, there are some great HR experts here that will assist you fantastically, although some might not do so independently. What I can tell you from experience is that as a small business, if your staff don't feel valued, retention will become an issue, if you can't retain your staff, you're going to need to invest more in training new staff. I have found that those new to the workplace, graduates for example, show a lot more commitment to the role as you can shape them into what you want a lot more than someone older who might be more set in their ways might find it harder to adapt the the natural fluidity of small business.
The "jobs vs. candidate war is over and the candidates won". you are certainly not alone. The truth is that we are retiring more skilled workers every day than we can replace with new hires. Attracting quality employees is becoming more and more difficult. So, the short answer to your question depends on how urgent your need is. If you have the time to wait out the market you may get lucky and find a great person on your own. If not get help soon.
Good luck in your business. You are smart to think ahead and to be concerned about the HR needs.
1). finding people is always a challenge, depending on what type of job you are trying to fill can make a difference. Having a good questionnaire is important so you ask all candidates the same questions, the same way.
2). it is important to lay the groundwork for good policies and procedures etc.
3). eventually it would probably make sense to have some outside HR help.
in the meantime check out my website, which you can find on my mosaicHUB profile. There may be some information that can help you there. In full disclosure we are in the HR/Payroll Outsourcing business here in MA so i would be happy to talk to you and help if i could.
Sounds like you are in the position to hire an outside consultant to help you determine your needs (and you do not/should not pay a lot for assistance...) But would be a good idea before you get too far into a process, is develop a plan... so you know what you are looking for BEFORE you buy something you later find out wasnt what you really needed. Understanding there are different ares of HR (Recruitment, compliance, compensation/benefits) and different levels of expertise and help (Administrative vs strategic - most that work in the small business arena tend to be administrative only - doesn't solve the issue with hiring and retaining the RIGHT people - most will get you a warm body and paperwork complete).. to be able all that together and find the correct vendor(s) can be very challenging for a small business...
That being said and to answer your question, - if you are asking the questions, it probably time to start - find a consultant that will help you define what/where your needs are and build a plan..
Thank you for your question. There are quite a few ways to answer this, however my first question to you would be what is the vision and plan for your business?
Are you able to manage HR for a business of 2, the answer to that question is probably yes. However once you feel comfortable that you would like to expand and grow your company, then I would suggest that you consider adding either internal or external expertise to assist in setting the foundation.
However to provide wise counsel, it all stems from your vision. A good HR consultant will want to know your goals and then help you set the right foundation to achieve your goals as opposed to just providing solutions and/or people.
My suggestion would be to interview a few individuals or companies to determine your next step. A 30 minute consultation with a good consultant can be extremely valuable to assisting you determining the right path.
I hope this helps
A part-time contractor or service to do legally necessary things is appropriate at about 20-25 employees. A full-time HR person around 50 employees.
Hiring the right people is an art that takes many years to develop and getting help from somoen with expertise in hiring that type of skill set is critical. Bad managemetn hires cost over $150,000 according to some research in lost and hidden costs.
They can even kill a small company.
I am a CEO coach and help with this stuff to fill gaps in the management team. We also install an HR System, a framework not software, to help companies.
We have a complete model for hiring call The Skill Set Matrix to add in logic and science and not be swayed too much by how much you might like the person etc.
There are also simple and cheap tests avaialble to increase your odds dramactially. Feel free to call me for a short consultation, as many factors could alter these recommendations (508) 381-8013.
Collette, how many people are you looking to hire? If you need to find quality candidates, or if you need to hire several people quickly--the best way is through asynchronous video-interviewing. I can either help you with that hiring process, or you can look at the platform and make the decision yourself to use the service. My partner provider is www.vidcruiter.com. They are the first and only provider of video interviewing that allows you to review incoming applicants at the time of your choosing. This allows you to interview more people faster, or make faster decisions about the best people to hire from your current applicant pool.
The entire interviewing and hiring process is cloud-based, online, and super easy to use.
Let me know if you'd like to talk.
Here is how I would suggest you go about it, no matter what size of business.
• Have a business plan in place, for the next few years..
• Based on the above identify the critical areas to effect the plan.
• Understand how many people would you require to man critical areas.
• Prepare the roles and responsibilities for each of the roles envisaged.
• Hire an HR consultant, to discuss each role, iterate and take it forward.
• Hire the resources who best fit the skill set and the culture you aim to create.
• Grow and add as per need
Best of luck
You are describing two different roles, both of which get lumped into HR:
1. Setting up your employee systems so that you are in compliance with all the myriad regulations, and to assure a productive workplace. For this you need a top-level HR consultant, but not for a lot of hours. Doing this properly from the beginning saves you so much grief later.
2. Helping you interview and hire, so you get the best people and get them started off on the right foot. Somebody with strong interviewing experience can take 80% of the load off your shoulders, while insuring that you make the needed input and choices. This takes a skilled person, but they're not as expensive as the HR consultant.
My wife is an HR consultant. Her clients are those who neglect #1 above. They let these issues slip until the government comes after them, they get sued by a disgruntled employee, or productivity crashes, taking their profit margin along. They pay her a lot of money to correct problems that could have been inexpensively prevented.
Here is a resource that might be useful: http://bit.ly/1pc4EV6
The best way to hire employees is from word of mouth referrals. You can use your social network to get the word out. If you use a staffing company, it's a good deal to consider temp to hire placements so you can try your new hire out without committing to a permanent hire situation. Some businesses offer an online HRIS system so you can manage applicant tracking and offer screening tools. If you feel you cannot assess potential hires, then perhaps you should consider a staffing company and then try to obtain some training in recruiting to help you for future hires.
Collette, there are lots of great comments here for you to follow. One not mentioned is one I found the hard way was that most large company people don't do well in start-ups. They need too much structure for an ever-changing, no job description sort of operation. You need people who can and are willing to wear many hats, move at a fast pace and enjoy the ride. Bring on an HR consultant who has worked with start-ups to help you along the way.
As a small business I would look for attitude, especially the right fit with the team, knowledge in my industry, passion about the business and what they are looking for. I would look for someone who would help me to move the company forward.
If you are having difficulty finding the right candidate then it is time to sought outside help. Small businesses should ensure that they have some guidance from HR professionals to implement hiring and selection guidelines. This sometimes makes the process easier when looking for qualified candidates.
You are already ahead in the game as "everybody" knows that legal and accounting complementary professional services are required,but many overlook HR.
I've been through this a few times and suggest the following priorities as it is critical to ascertain what role you expect HR to play and when.
1) How to hire and fire people without getting yourself into trouble. This will likely result in at least a fledgling employee manual.
2) Employee "care & feeding" such as job descriptions, organizational structure, training, appraisal systems, onboarding, etc. Any manager "worth their salt" should be able t handle this without HR.
3) The finer points of company execution such as "how to delegate" (for example, see my blog on this - http://www.growthroughpeople.com/#!Delegation-Science-not-Art/c15i6/754F3F03-7B92-4F7C-93D7-8D75A27B4A9D) For this I'd be looking for an external resource with more of an Organizational Development focus.
4) HR as a strategic partner.
Hi Colette. I love how you are taking a proactive approach in assessing your needs and whether you can continue to take care of them in house or should look to outsource. I work with a variety of companies and I can tell you as the owner and lead consultant of my own HR and Recruiting firm that I would be honored to work alongside you and help you make some great hires. The short answer, is there is no set company size or event that signals it is time to get outside HR help. It really boils down to how much expertise you feel you or other staff have in that arena and how much time you want to spend on it. I have helped several companies in a variety of ways with this. Some just need a good hire or two. Some have literally nothing built yet in their HR and recruiting programs and we need to build a program from the ground up including candidate assessment, interview guidelines, job descriptions and perhaps performance management, compensation planning, and succession planning from a more traditional HR view. I would encourage you to take a brief cost-benefit analysis view of the situation and then determine where you believe the tipping point is. If you want to have a phone discussion at no cost just to get some outside perspective, I am happy to help a fellow hub member. I can be reached at 405-761-5911.
In a small business it is hard to be the expert in every aspect.. Hiring people the right people can be difficult sometimes. However, plan your approach ensure that you are clear about what you want to role to do. Just as you would anything else in your business write down your job requirements into essential, nice to have and additional skills which may be beneficial. Once you have established the person can demonstrate the necessary skills for the role you need to be aware of how they will fit into your team. Cultural fit is imperative to the success of the candidate.
With regards to outsourcing, HR, consultants can assist you as much or as little as you need. As already pointed out, it is good to have a solid HR framework to work within, and with legislative requirements continuous changing it is a great way to ensure that you are managing your people risk just the same as you would your financial risk.
Hope this helps