The importance of setting up HR processes early

Starting a business is an extremely exciting time but there is a great deal to get in order, much of which is often completely new to the business owner. For starters, there is the financial quagmire – you’ll need a good accountant and the protection of insurances to give you peace of mind if something goes badly wrong.

Next you might work on getting those precious first clients through the door, hopefully to give you some dollars left over at the end of the month. Then, after some months, maybe years of hard yakka…. your first employees! It’s great having some extra hands on board so that you can focus on building the dream.

You’ve invested hugely in these people but, without the right support and processes around them, they may become disengaged, start to leave, or worse yet cause you trouble and heartache. So it’s vital to invest in solid HR practices and processes right from the very start. They will keep your fledgling business free from the worries of people problems, as well as saving you time and money in the long run.

It doesn’t have to be hard or too time-consuming. Just a few key steps and processes can make all the difference.

Firstly, your hiring process. You must know what you want in an employee and you should tailor your advertising to that audience. The best advice we can give to business owners during the recruitment process? Hire the person with the right qualities and attitude. You can always teach them the skills they need.

Second, your employment terms. Once you’ve found someone, make sure you use an employment agreement/contract that is compliant and that you understand the Modern Awards applicable to your workplace along with the current pay rates.

Next, induction and performance review. We often hear of business owners who were excited by the attitude, skills, energy and enthusiasm of their new hire, then confused that three months later their new person just didn’t seem to “get it” when they hit the ground and they were looking at parting ways. Give them every opportunity to succeed and they may become one of your best assets. Check in with people regularly, to minimise surprises and let you tackle issues straight away.

If, despite all good intentions, you do find yourself having to discipline an employee, be careful that you do it fairly. Know the rules – understand the Small Business Fair Dismissal Code or contract HR professionals to do this for you. Have processes and policies in place and ensure everyone in the business knows and understands them. You should refer to them before embarking on any performance management or disciplinary procedure.

Don’t let issues fester. Have difficult conversations early before they become a major issue. And do it privately – take an employee aside and talk to them, really talk to them (and remember to listen).

Lastly, meet your obligations fairly. Ending someone’s employment is never an easy decision and can be particularly hard in a small business. But it can be best for all parties and you should do it fairly, by paying notice and entitlements promptly and treating the departing employee with respect.

Your employees can make or break your business. Even the best need direction and ongoing encouragement. Just like your accountant saves you dollars, getting your HR in order can save you time, headaches and money. It’s your best investment in your business dream.

Tegan Rose and Lee-Anne Hunt, The HR Dept Ringwood