Please join us for a free webinar: "Discover What Small Businesses Must Know BEFORE Hiring"

Have you ever done the math in regards to your hiring practices? How many times have you thought you made the right hiring decision … only to find out that your new employee doesn’t know half as much as you thought?

The whole process of expanding your business can be daunting if you don’t have a plan. Since we know that hiring employees can be a valid option to help grow a company, why do so many business owners procrastinate? Could it be that it’s simply because you see hours, even days of effort ahead of you before any relief comes your way?

Of course, there’s also the fear involved in making a bad hire. And, yes, you can count of many more hours of effort managing that bad hire. Even worse, though, are those of you who spend an inordinate amount of time trying to salvage that bad hire because you just don’t want to go through the recruiting process again.

It’s best to do things right … right from the beginning. You'll save time and money once you discover how to plan and prepare for a new hire. Developing an easy-to-follow system will take away the headaches and worry about growing your business with employees. As you may have already found out, it’s better to spend a little more time before hiring than a lot of time later on trying to fix a hiring mistake!

This webinar will cover:

• Determining the right solution to help your business grow
  
• Justifying the business need for additional employees and the options available to handle that need
  
• Creating a job description that makes it easy to determine which candidate is the best candidate and protects your company
  
• Pre-employment testing … when, why, and how
  

Register NOW!

HR Jungle's monthly webinars each cover a specific HR topic directed toward the small business owner, with C.J. Westrick SPHR presenting.

Title:  DISCOVER WHAT SMALL BUSINESSES MUST KNOW BEFORE HIRING
Date:  Tuesday, August 19, 2008
Time:  8:00 AM - 9:00 AM PDT

The huge number of California employment laws can leave business owners with the feeling that they aren't actually in charge. While it is true that there are plenty of laws dictating your behavior in the workplace, you need to remember there are even more areas where you need to take charge and set the rules.

Recently I was asked a similar question by people from two companies. The issue was really quite simple (personal cell phones at work) but it was the thought process that really interested me. One company merely asked if they could tell employees not to bring their cell phones to work. Assuming your company allows employees to receive emergency phone calls so they don't need another method for someone to reach them in an emergency, then the employee doesn't need their cell phone while working.

Having an employee give up their cell phone isn't as easy as you might think. The other company I mentioned tried to have employees leave their cell phones at the front desk while working. At least one employee loudly raised the issue that the cell phone was personal property and, therefore, the company had no right to take it away from him.

As the business owner, you do have the right to make your facility a cell-phone-free zone. How you go about creating that zone is something you need to think about. First, you need a policy that specifically states the rule, what employees can do with their phones, and the potential penalities for not following the policy.

I dislike the idea of collecting cell phones because you then become responsible for them and have to create a secure check-in, check-out system. That leaves you a few other obvious choices: tell employees they can leave their cell phones at home, leave them in their car, leave them in a company-provided personal locker, or to turn off the phone while working and leave it in their pocket or bag. The employee does have the right to use their cell phone during meal and rest breaks but you can designate where they can use them, such as the lunch room and outside the facility.

As a side note, some companies now prohibit camera cell phones in certain areas of the company where there is access to confidential information. It's just too easy to take a quick picture with the phone of information in paper form or on a monitor. However, if you plan to use this reason for your policy be sure you can show that it's a security issue or you could lose that battle in court.

Probably the biggest part of this whole subject is what happens when an employee doesn't follow your new policy. While you can't do a strip search to find out if they brought their cell phone into the workplace, you may see them on their cell phone or hear the phone ringing or notice it vibrating when it should be out of sight and/or turned off. Something will probably eventually give them away. So do you take their phone away and stomp on it? That may make you feel a little better at that moment but it's not the best way to handle the situation.

You treat this like you do any other action or behavior that breaks a policy. It's treated as a performance issue and you follow your disciplinary policy. When creating your cell phone policy, your management team needs to decide how serious of an issue this is and how far you're willing to take the discipline. If all you ever do is shake your head and have yet another conversation with the employee, your employees will soon realize you aren't serious about the policy because there aren't any serious consequences.

Avoid discrimination when creating a new policy by remembering you have to take the same disciplinary action against every employee who doesn't follow the policy … that means your best employee and your worst employee must be disciplined in the same way. Never put a policy in place if you aren't prepared to enforce it. Your practices and policies must be in synch to be of any use to you … and protection for you.

Homeland Security has once again revised the Immigration & Naturalization Service's I-9 form. As usual, you can get immediate access to the latest I-9 form on my website.

Just so you know what to look for, the newest version has an 06/30/09 expiration date in the upper right corner of page one. Although this doesn't affect any of the I-9 forms you've already completed and have on file, you should discard any blank copies of other versions and start using this latest version immediately.

As you've probably noticed, California is always leading the way for new employment laws. However, within California, that leader is San Francisco and it's often scary to realize what local laws San Francisco has enacted. Let's just say that, while it's tough doing business in California, it's tough and expensive in San Francisco.

The latest bill to hit California proposed by a San Francisco Assemblyman concerns sick leave. This bill, AB 2716, has already made it past the Senate Labor and Industrial Relations Committee and is lined up for the Appropriations Committee. So what's so bad about AB 2716? It forces every business in California to provide a specific minimum amount of paid sick leave to every employee.

Here's the actual language:

This bill would provide that an employee who works in California for 7 or more days in a calendar year is entitled to paid sick days, which shall be accrued at a rate of no less than one hour for every 30 hours worked. An employee would be entitled to use accrued sick days beginning on the 90th calendar day of employment. The bill would require employers to provide paid sick days, upon the request of the employee, for diagnosis, care, or treatment of health conditions of the employee or an employee's family member, or for leave related to domestic violence or sexual assault.

Now for those of you who are running the math through your head, let me help. A full time employee working 40 hours per week would accrue 66.67 hours of sick leave over a year if the employee worked 50 weeks (assuming a 2-week vacation). That's 8 1/3 days of paid sick leave per year you will be required to provide if this law is enacted. However, there is a clause that says small businesses only have to allow 5 paid days per calendar year. But it neglects to define "small businesses."

Let's not forget all those part-time employees! Yes, the law specifies EVERY employee. So even those part-timers who you haven't been giving any benefits would be accruing sick leave based on hours worked.

The unused sick leave would carry over from year to year but, as now, does not get paid out upon termination of employment. This means the way you give and track sick leave would need to be a true accrual method (normally maintained through your payroll system).

While I believe a certain amount of paid sick leave is normal for full-time employees of small businesses, few small businesses offer more than a week of sick leave. And even fewer companies offer any sick leave to part-time employees. So, you've been warned. Now all we can do is wait and watch to see what happens with this bill.

It's mid-year and there are a few changes that have come into effect now.

Hands-Free Cell Phones While Driving

I've discussed this before, but now it's actual law in California that you cannot hold onto your cell phone while driving. It's time to make sure you have a policy about this and that all your employees understand your policy.

I'm watching for the next stage of this law, which will probably be amendments about how to dial without using your hands. Early studies have already shown that it's talking on the cell phone that distracts drivers much more than holding the phone. We've probably all experienced that problem … passing our freeway exit or turn because we're deep into a conversation. I guess the advantage of this new law is that at least we'll have both hands on the steering wheel when we make those sudden turns!

IRS Mileage Reimbursement

We've all been complaining about gas prices so it should come as no surprise that IRS has been listening. IRS has increased their mileage reimbursement rate from $0.505 to $0.585, effective July 1, 2008.

Now here's a little food for thought about mileage reimbursement for your employees. Most small businesses that I know seem to dislike using the IRS reimbursement rate when it comes to reimbursing employees for business travel. Yes, I know you want to save money but let's think this through. The IRS rate is the generic, approved rate you know you can claim for your business taxes (otherwise, you have to track actual costs of using the vehicles). The rate is meant to include the wear and tear on the vehicle itself (oil, tires, depreciation, etc.) plus the cost of fuel.

Okay, so if your business can claim the IRS rate as an expense, why are you failing to fully compensate your employees for the business use of their personal vehicles? You do realize that the employees are doing you a favor by adding miles and wear and tear on their personal vehicles so you can avoid purchasing company vehicles, don't you? Yet, you actually make them pay for the "honor" of providing you with a vehicle for your business purposes. If you're not paying the IRS reimbursement rate, your employees are probably losing money. Yes, they can actually apply for the "lost money" on their personal taxes if they think of it … but why should they have to go to the extra trouble while doing you a favor?

New Minimum Wage

On July 24, 2008, the new federal minimum wage of $6.55 per hour takes effect. Now, my California readers won't need to worry about this because our state minimum wage is already much higher at $8.00 per hour. The rest of you, however, need to be prepared.

Have you ever watched your employees when they are getting coffee in the morning, taking breaks, or having lunch? Unless they've been around awhile, they are probably searching through any cupboards and drawers in the area to see what the company has provided.

Does an employee have any right to expect you to provide condiments, coffee, etc.? No. Providing things for employees is a benefit offered by the company, not a right or entitlement of the employee. However, you might want to consider the advantages of providing basic kitchen supplies … even if you don't actually have a kitchen available.

Nearly every office space has some sort of wet bar or a full-blown kitchenette. I've seen a lot of them in every configuration possible. The first recommendation I need to make is to keep it clean. It's amazing how employees can ignore spills, open cupboard doors, and trash sitting around when it's not in their own home.

Accept this as a fact of life. Pay your cleaning people to scrub it down any time they are cleaning the offices. This isn't just for the benefit of the employees … keep in mind that you have guests walking through the building that can see this area. I don't care how much stuff you stock that area with, if it's filthy you'll have lost most of the value of providing it.

So, what do you provide? The starter stock should include the following:

• Salt and pepper: Buy an actual salt and pepper shaker and the big cannisters to refill the shakers. Don't buy those individual packets because it's too easy for people to grab a handful to keep in their car, etc.
• Plastic forks, spoons, and knives: Buy big boxes of these and designate drawers to put them in.
• Paper dishes: You really only need paper plates. Anything else (like paper bowls) is catering to a specific employee's need, not a general need.
• Condiments: If you have a refrigerator you should consider catsup and mustard, maybe mayonnaise. Again, full bottles rather than individual packets.
• Trays: Pick up 2-3 large, inexpensive trays that can hold sandwiches, cookies, cakes, etc. when you either have a big meeting or party at work. Check places that provide catering supplies.
• Coffee: Provide a coffee maker of a size that works for the number of coffee drinkers you have. Consider using a decent brand of coffee so it's not a bad joke and you're not embarassed to offer it to guests. Personally, I hate the powdered creamer but it's easier to maintain than the dairy versions. Don't forget both real sugar and fake sugar.
• Napkins or paper towels: Paper towels are fine until you have guests and want to have things look a little nicer.
• Styrofoam cups: Although not eco-friendly, these at least are clean. If you don't have a dishwasher to ensure glass items are properly cleaned, the throwaway variety might be better.

Anything else you provide should be because you can afford to keep it in stock and you believe employees will be appreciative. Many companies also keep a locked cabinet filled with special supplies that are used strictly for guests or special meetings. The cabinet might include nicer dishes, doilies for the trays, napkins, sugar cubes, bottled water, sodas, etc. Anything you might want to "put on a show."

If you have a refrigerator that employees can use, make it clear that everything ends up in the trash on Friday night. This eliminates the mystery food left in the refrigerator or freezer. Don't allow exceptions or you'll lose control of the situation. I've seen refrigerators too full to add your lunch but with no one claiming ownership of anything in there.

As I said, providing these things aren't a requirement. However, your employees will enjoy having the basics available and may end up more productive because they're bringing their lunch rather than taking longer going out.

As a California employer you may have thought at some time or another that the state politicians are just out to get you. Making things difficult for employers isn't just a complaint, it's a fact.

However, once in a while you hear things that are behind the new legislation. The law that goes into effect on July 1st requires the use of hands-free devices if cell phones are being used while driving. This isn't an employment law but employers need to pay special attention. Why? Because you have deeper pockets than the average individual out there driving.

I didn't say it was fair but it is your responsibility to keep others safe while your employees are on the road. We've all been talking on the phone while driving and missed an exit or made some other driving mistake that wouldn't have occurred if our full attention was on the road. Talking while driving is a distraction … whether you're talking with a passenger or on the phone.

Those distractions can be costly, both in human life and the bank balance. A few examples (from Powell Goldstein LLP) include:

• An insurance company's employee dropped his cell phone while driving. As he bent down to pick it up, he ran a red light and killed a father of three. The insurance company was included in the family's lawsuit even though the employee wasn't driving on company business or using a company phone. The company settled for $500,000.
   
• While talking about business on her cell phone, an attorney struck and killed a 15-year-old girl. The law firm settled for an unknown amount but the attorney was ordered to pay $2 million herself.
   
• A lumber wholesaler sales rep struck and severely injured a woman while driving and talking. The company settled for $16.2 million.

What's the safest route to take? Prohibit use of cell phones while driving. Inform your staff that drivers will return calls when they are no longer driving. Inform drivers not to answer or place calls while driving. Put it in writing. Drivers can pull over as soon as possible or return/place calls once they reach their destination.

It'll take time to get used to waiting to talk to people, but it could save lives and your company.

Have you ever used a consultant, or started to, then decided to hire someone instead? How did you make the decision that the person you were hiring was good enough? What did you gain or lose in that decision?

As an HR consultant, I run across companies that decide it's more cost effective to hire an employee to manage their HR rather than hire a consultant. It usually turns out that the employee is a "combo" person … someone who wears several different hats because the company is too small to have enough need in any of the areas covered. The combo person may have several titles depending upon what they happen to be doing at that moment, such as Office Manager-Executive Assistant-HR Manager. I'm all for the combo person. In fact, it's often a necessity in a small business to have multi-talented, multi-tasking people.

When it comes to HR, the combo person is typically who I would train to handle the day-to-day routine things. This includes the hiring paperwork, time off or time card paperwork, and other items that are the black and white areas of HR related to basic compliance with the employment laws and regulations. These things can be taught and systemized so others can repeat it whenever needed.

The problem comes in when the business assumes this combo person knows as much as people who have specialized in that particular field for years. The gray areas of HR, at least in California and probably in most states, need to be managed by someone with the knowledge and experience obtained through practice over the years. Often the gray areas are decided as much by the courts as they are by the laws. Simply following the law may not save you in court. Juries have a different view of the law and you have to recognize that when managing HR issues.

If you have grown enough to need someone to handle your basic HR compliance, go for it. Don't give the person the title of HR Manager, though, because the duties are closer to an HR Representative. Save the manager title until the work and person deserve it. Then also hire an HR consultant to make sure that person knows what they are doing. Also get advice from the consultant whenever you have employee issues beyond the very basics. How things are handled when problems arise can play a large role in how well they end.

Don't think you're saving time or money by letting your combo person handle the non-basic issues. Think, instead, of the thousands of dollars and hours of your time you'll have to spend hiring an attorney to respond to a single complaint by an employee to the EEOC, Labor Board, or an attorney.

No, this isn't just a pitch to hire HR consultants! It's a real concern of mine when I see companies going that route blissfully unaware of the consequences. Remember, you get what you pay for. In the end, you have to weigh the risks and determine whether you want to put your business's future in the hands of a person you're probably paying less than $50K a year.

I recently read a short article that I really liked because it made my mind go in several directions. It was focused on three words: creative, flexible, and imaginative.

Many of my friends were aghast when they discovered I had entered the world of HR years ago. Why? Because they knew me personally and understood that I'm creative at heart. Always a hobbyist, I have numerous craft or DIY projects going on all the time. In addition, I wasn't the typical employee who just followed orders.

People have asked me how I can stand to be in "stodgy old HR" when I'm so creative. My reply is simple. HR takes a lot of creativity, flexibility, and imagination to be successful. After all, we're working for win-win situations. It's much easier to fall back on the old stand-bys and just say "that's how it's going to be done, period."

Here's the part of the article that grabbed me: "If you are creative, you can think of alternative ways to work around problems, ways that align with your own skills and reflect your values. If you are flexible, you are able and willing to change and modify plans; you adjust to new circumstances and needs. If you are imaginative, you envision what is not and what can be - you see in your mind what you haven't yet seen in the material world." (Cynthia Kersey, )

The combination of managing people, in all their varieties, and complying with state and federal employment laws takes a lot of imagination, creativity, and flexibility. Granted, you need to be consistent in how you do things but that only makes it a bigger puzzle to solve.

Okay, so maybe you prefer the "stodgy old HR" way of doing things. It works for those of you who are strictly "by-the-book." But it's a little like your mother responding to a child's questions with "because" just because she was tired and didn't want to bother with a better answer. However, I'll bet your employees really appreciate it when you give enough thought to solving a problem so everyone can win.

Have you ever really thought through how many different systems you have in place to keep your company running smoothly? Are any of those systems documented to ensure proper duplication each time?

I was recently at a seminar on systemizing a business. It's been proven that businesses are worth more money if your "how-to's" are fully written out and maintained. No matter how you look at it, documenting every step in your business takes time … but it also saves you time and money.

Although the seminar I attended was looking at the whole business, I'll take it down to just the HR component for my example. I actually have created for clients a binder that includes:

• Section tabs for the various areas of HR (e.g., recruiting, hiring, performance management, etc.);
   
• Every HR form I've given them for each of those sections;
   
• Each form has blank lines where information must be entered so I have highlighted each of those blank lines and provided information about exactly what needs to be entered there;
   
• In the top right corner of each form I have the name of the computer folder where the form is located and the file name for the form itself;
   
• I then add a text block on the form where I state why that form is used, when it's used, how to use it (or print it), who needs to sign it, and who gets the original and/or copies, and how/where to file it.

Why have I done this? Because many of the forms are used only periodically and if HR isn't your primary responsibility, it's very easy to forget the details. However, the details are important when you want things done correctly. With this reference manual, those clients just have to flip to the appropriate section and follow the directions.

In HR and other areas of your company, you'll find having desk manuals saves training time and money (since time is money). You'll also notice that quality remains high because there's no room for misunderstanding or forgetting steps in a process. I've often used a desktop manual for the reception desk and it's been a lifesaver when a receptionist leaves the company or is just on vacation. With a detailed manual, any replacement can easily figure out how to answer phones, receive packages, deal with visitors, and so on.

And, if you eventually want to sell your business, just remember that the value of your company will be much higher if the buyer realizes he can just walk in, open a manual, and know how to run the business without a huge learning curve.