Small companies have many issues larger companies do not face trying to stay competitive. They have fewer resources to spend on advertising to grow the business. There is another area where small companies are at a disadvantage namely, Liability under Employment Law. Managers in small companies must wear many hats and are not formally trained in Employment Law. Unfortunately, this situation can create extreme liability regarding being able to protect against Employment Law violations.
Most small companies cannot afford to have a person on staff that is formally trained in Employment Law. HR Professionals are highly trained and skilled and because of that they command high levels of compensation. Most small companies cannot afford to pay an HR Professional, so generally the Company Owner or Office Manager will try to fill that role. Large companies have a full staff of Employment Law Professionals on staff to put procedures in place to lessen the potential of Employment Law Claims.
Unfortunately, Employment Law is becoming very complex, with ever changing laws and regulations being passed which put additional strain on companies. It is very easy for even a quality company that tries to comply with all laws, and treat their employees fairly, to unknowingly violate a number of Employment Laws. There is also the possibility that an unhappy employee or unsuccessful candidate for employment can file a charge against the company, claiming discrimination or some other violation of Employment Law. The result can be an EEOC Charge or Law Suit, which can put the company in a liability situation.
The bad part is the Charge does not even have to be true. It is not hard for an employee or unsuccessful candidate to obtain an attorney. Once the Charge is made it does not just go away. It must be defended against. All the work, time and expense to defend fall on the shoulders of the employer. Many small companies just cross their fingers and hope nothing happens. Unfortunately sooner or later their luck often runs out and they are faced with a Law Suit.
The liabilities can be many:
- Many hours of lost time that could be used to grow the business
- Large financial liability
- High Attorney fees
- Possible loss of company reputation
Smart companies realize it makes good business sense to contract with a HR Professional to make sure policies and procedures are in place to lessen the potential of a Law Suit. We at HR FOR HIRE, can provide that Safety Net. Spending a little before something happens can save a lot in the long run.