The Most Common HR Mistakes Made By Small Businesses

Not Hiring the Right People for the Job

This happens often and can lead to even more problems down the road. Take your time and find someone with the

skills necessary that will also fit well with your existing employees. Conduct background checks, reference checks

and pre-employment drug tests to prevent future issues. You may also consider a personality assessment to make

sure they would be a good fit for the position. PriorityHR can help with each of these pre-hire tests.

Not Creating Clear Job Definitions

This doesn’t mean simply having a written job description, although that is a great place to start. Having a clear idea

of what is expected allows employees to perform to expectations. Also, having a clear job description allows you to

attract the best potential employees for the position and make documented performance issues mean something.

Not Addressing or Documenting Performance Issues

Ignoring problems and hoping they will go away on their own never works. A clear progressive discipline process

outlines expectations for employees and gives them a chance to perform to those expectations. Documenting this

process in writing protects you in case of future litigation.

Not Understanding basic Employment Laws

The laws surrounding employees are complicated and vary state to state. PriorityHR has the expertise to help you

with these laws. Your best bet is to contact an HR Advisor with any questions that arise, even if you think you

understand the law. Ignorance of the laws does not excuse the company from penalties should a legal situation arise.

Classifying Your Employees as 1099 Independent Contractors

This is another issue we find at companies of all sizes and all industries. Sometimes a company will classify a

worker as an (1099) independent contractor rather than an employee, to avoid payroll taxes and tax withholdings as

well as workers’ compensation. But there are strict IRS rules for what type of work can be done by an independent

contractor vs. an employee. Additionally, even with years of experience, businesses often misclassify their

employees as exempt from overtime. Just because an employee is being paid a salary, it does not mean that they are

not entitled to overtime of they work over 40 hours in a week. Contact an HR Advisor if you have questions or

concerns about the classifications of your employees.

Each of these mistakes comes with a cost, many of them a direct monetary cost in employee replacement or legal

fees. But also consider the value of your time as a business owner and what other tasks you could focus on if your

HR was better managed.

We have seen these errors happen among companies of all sizes and all industries. PriorityHR can help you correct

these and other common HR mistakes that could be getting in the way of your business success.