Small Business Owners: Overlooking These 5 Things Can Cost Millions

At PSM, we understand that as a small business owner, your money and your time are your most valuable assets. We’ve created a list of items that you might not realize could be costing you.

1. Have an Employee Handbook
Without an Employee Handbook that explains your company’s policies, you have no defense when dealing with unemployment claims, lawsuits and Department of Labor audits. Ensure that your handbook includes attendance expectations, outside employment, conflicts of interest and compliance statements for important federal laws and regulations.

2. Classify Exempt and Non-Exempt Employees Appropriately
Make sure your “exempt” employees are really exempt, and that overtime rules do not apply. For example, some employers make the mistake of paying non-hourly employees  without tracking hours and calculating overtime wages. While fines vary, average settlements increased from $4.6 million in 2011 to $4.8 million in 2012. If you are unsure whether your employee classifications are correct or not, contact us.

3. Create Job Descriptions
Job descriptions outline essential job functions and physical requirements of a position. They help you avoid discrimination claims by identifying areas that may need reasonable accommodation if an employee has a disability. Keep in mind that the average disability discrimination suit settlement in 2012 was $125,000. At PSM we help clients create job descriptions.

4. Stay on Top of Employment Law to Avoid Fines
Don’t let your knowledge of the latest employment law developments slip – fines vary from hundreds to thousands each violation! From internships to I-9 forms, from appropriate interview questions to the latest priorities of the EEOC, there’s a lot to keep track of. A PSM Human Resources Consultant can help ensure your company stays compliant with the latest in employment laws. Contact PSM to discuss  any specific questions you have about your workforce.

5. Pay Workers Accurately: Employees versus “Independent Contractors”
Many companies misclassify their workers as independent contractors instead of employees. Fines, penalties and back-taxes assessed vary from thousands to millions in each misclassification settlement. If you currently pay workers as independent contractors, contact us to discuss accurately classifying your workers and building the appropriate files.
Posted in: Hot Topics, HRvest
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