5 Reasons Your Startup Needs An HR Department

When you’re just starting out and money is tight, there are a few things your business can go without. But contrary to popular belief, a human resources department is not one of them.

In the first year, you will inevitably encounter unexpected staffing issues. Not all of them will be in your control, but if they aren’t handled properly, these issues have the power to bring your business to its knees.

The question is whether you are equipped to handle whatever personnel problems come your way.

And in most cases, the only answer is to rely on an experienced HR professional. The following are just a few reasons why you should seriously consider a staffing a dedicated HR department:

1. Firing mishaps can land you in hot water.

If you want to avoid a lawsuit, you’ll follow proper procedure when it’s time to let an employee go. For example, you probably know that you can’t discriminate against an employee’s race or gender, but did you know it’s illegal to fire an employee for complaining?

Any experienced human resources employee would be able to advise you on laws and proper firing procedures. Not only will this save you money on any potential lawsuits, but it can also help save your reputation.

2. Substance abuse is a bigger issue than you think.

An average of 8.7% of full-time workers between 18 and 64 years of age drink alcohol heavily and 8.6% use illicit drugs.

What would you do if someone showed up to work intoxicated? Most employers would send that person home for safety reasons, but what happens next? Your course of action would likely depend on your company policies, if you have any in place. You may have a zero-tolerance policy that would result in termination, or you may have a strike-based policy that would allow the employee at least one more chance. In either case, it’s advisable to recommend a drug and/or alcohol detox program.

3. Workplace harassment is a serious problem.

The results of a Cosmopolitan survey suggest that one in three women have been sexually harassed at work. Unfortunately, this is an issue you will face sooner or later.

The best course of action is not to ignore it and hope it goes away. Your human resources team will know how to investigate harassment claims and take the necessary action or discipline.

4. Poor hiring decisions are expensive.

Imagine this: You hire an employee who says all the right things in the interview. She even came highly recommended from her last job. Then you find out that she was prosecuted for stealing from a previous employer. She’s now on your payroll. What do you do?

If you had human resource policies in place before she was hired, this would have never happened. Someone on your team would have implemented a thorough background check and, after learning of her checkered past, you would have moved on to the next candidate.

5. An experienced HR team can save your business money.

HR is about more than just preventing mishaps. It’s also about saving your business money. By trimming overall management costs, negotiating better healthcare rates and setting competitive wages, an HR team can add dollars to your bottom line. In addition, they will do what they can to ensure your other employees are happy, which can boost productivity.

Should you outsource HR?

There are some benefits to outsourcing human resources, especially when your company is small. When you only have a few employees, most issues can be solved with a call or email. And instead of hiring one full-time person, you’ll have access to a group of people with various specialties. But as your company grows, you’ll find that you need a dedicated human resources staff.

Regardless of which option you choose, it’ll pay off in the long run, and possibly help avoid major headaches, to add human resources to your initial plan.