Here are 5 common HR mistakes that can trip a small business. Avoiding these mistakes can reduce the risk of disputes, be fined hefty penalties, or even be sued.
1. Poor hiring practices
Even potential employees have access to employment rights under the Fair Labor Act and can sue for adverse actions. In these cases, the companies bear the burden of proof, not the applicant. It’s also a lot easier to hire someone than to fire them, so work hard up front and make sure you have a robust hiring process. Understanding employee rights and anti-discrimination laws is the first step in minimizing these risks. Developing a job description, preparing interview questions, conducting reference checks, and making it clear what expectations are and how you will measure success is also good practice and helps ensure that you employ the right people.
2. Not knowing correctly the status of your employees
Do you need casual, permanent part-time, full-time, fixed-term or fixed project employment arrangements or perhaps a contractor? This also needs to be well understood up front because there are pros and cons associated with all of these. For example, it does not make sense to hire a temporary if you intend to give him a regular, systematic and continuous employment for more than 12 months. Alternatively, paying someone as a Contractor with an ABN when deemed to be an employee can also result in fines and penalties. Review the relevant award requirements in the first instance and understand your options.
3. Not understanding the obligations or rights of the Prize
In addition to the National Employment Standards, there are currently 122 different awards covering most industries and occupations. You need to understand which Award applies to your employees early on so that you don’t have to pay expensive ‘back pay’ to your staff for failing to pay the correct salaries, penalties, or assignments.
4. Poor record keeping
Like the Australian Tax Office, the Fair Labor Ombudsman can issue fines and penalties to Businesses for failing to keep accurate employment records. For example, you must issue payroll to your employees and keep records of hours and wages for at least 7 years.
5. Lack of consultation and cooperation
The first step to achieving a harmonious workplace is developing mutual respect through consultation, communication, and collaboration. Not only does this help minimize errors and disputes, but there are also legal requirements to consult with your employees about changes in the workplace, health and safety. An important tip is to keep records of inquiries, especially when it comes to proposed changes to an employee’s work arrangements, a company restructuring, roster changes, termination of employment, workplace health and safety issues. , etc.
