If staying compliant has been a struggle for your small business, there could be ways to make it easier.
Running a small business comes with a lot of long hours and uncertainty, especially when it comes to compliance. A 2017 National Small Business Association survey found 44% of small business owners spend 40 hours or more per year on federal compliance, and 12% report not knowing the source of many of the regulations (local, state, and federal) affecting their business.
Use these simple tips to shore up your small business’s compliance efforts.
Have an employment policy handbook
Whether you have 1 employee or 100, you need an employee handbook. A handbook helps ensure your company policies are clearly articulated, communicated, and agreed upon.
Here you can outline everything from acceptable computer use and workplace conduct to the storage and treatment of employee data. You also get to introduce employees to your company culture, mission, and operating policies.
Prevent harassment before it becomes a problem
The best defense is a good offense. While it’s easy to assume responsible adults understand what’s appropriate workplace behavior and what isn’t, that’s not always the case.
… 44% of small business owners spend 40 hours or more per year on federal compliance, and 12% report not knowing the source of many of the regulations (local, state, and federal) affecting their business.
Proactively reign in harassment at your company by mandating training and a signed acknowledgement of said training. Even if your state isn’t one of the 6 that require harassment training (California, Connecticut, Delaware, Massachusetts, Maine, and New York) offer it anyway as a preventative measure.
Keep current on compliance changes
What’s the best way to avoid compliance issues, penalties, and fines? Remain compliant. Easier said than done.
Compliance spans a number of legislative bodies on the local, state, federal, and international levels. Use compliance calendars to keep track of deadlines, and HR tech to receive automatic updates relevant to your business. Hire HR professionals well-versed in compliance and foster a culture of compliance at your small business.
Centralize company communication
Keep office communication to one medium, like an intra-office messenger or email, to minimize the confusion and risk that comes with multiple communication channels. It’s hard to maintain the integrity of the information shared when employees are using different communication channels to talk to each other like social media, texting, email, and more.
With data protection and privacy measures like GDPR and the CCPA now in place, companies are wise to mandate one medium for all office communication.
Use HR tech to automate tasks and help ensure compliance
When employers complete required documents by hand, boxes can go unchecked and people can misplace paperwork. By using a HR tech, you ensure you have all the necessary information on employment verification forms like I-9s or tax forms like W2s. HR tech can also help with compliance through features that ensure employees have up-to-date certifications to keep the team safe and compliant.
Adopt a small business compliance checklist
Compliance checklists will help you develop your HR and compliance policies or update existing ones. The best ones will cover general HR tasks: recruiting and hiring, compensation, benefits, payroll, and company compliance.
While compliance requirements vary across businesses, a well-developed compliance checklist is a good place to start.
Correctly classify employees
It can be tempting to simplify payroll by classifying your employees as exempt and paying them all a salary, but it also could be illegal. Exempt employees are exempt from overtime pay and meal and rest breaks, but not everyone qualifies.
Misclassifying employees comes with big risks and back pay requirements, so make sure you understand which employees are eligible. Employers face risks misclassifying employees as contract or freelance workers as well. Especially in California post-AB5, employers in the state must be careful to meet all of the new requirements for classifying freelance or contract workers.
Find a trusted source online
Look for sites that focus specifically on small and medium-sized businesses. There is plenty of information out there for enterprises, but SMBs face a different set of challenges and have unique operating models.
You want simple, accurate answers and easy to find information. Workest provides the best content, tools, and community for SBOs and their teams.