Bridging the Gaps in Business

 Business owners must comply with federal, state, and local employment laws, which may include:

- Minimum wage and overtime requirements

- Anti-discrimination and equal opportunity employment laws

- Family and medical leave requirements 

- Proper classification of employees (exempt vs. non-exempt, contractors vs. employees).

- Payroll tax withholding and benefits administration (e.g., health insurance, retirement).

- Worker’s compensation and unemployment insurance

- Workplace safety regulations (e.g., OSHA in the U.S.)

These are critical to avoid legal liabilities from potential lawsuits or fines, which could affect investor confidence.

  Clear, detailed job descriptions are critical for several reasons:

- They define the responsibilities, skills, and qualifications needed for a role.

- They set expectations for performance.

- They provide legal protection if there are disputes over job duties.

- They help guide the recruitment and training process.

Investors and banks value structured HR processes, which reduce risks of misunderstandings or disputes.

Recruiting involves finding and attracting qualified candidates for open positions. Some best practices include:

- Writing clear and compelling job ads

- Using diverse channels to advertise positions (job boards, social media, industry-specific platforms)

- Screening resumes carefully and conducting structured interviews

- Checking references and conducting background checks (if necessary)

- Ensuring your hiring process is free from bias and compliant with anti-discrimination laws

A well-planned hiring approach attracts top talent and reflects positively on investors and banks, showing you can scale effectively. Use a data-driven approach to evaluate candidates, ensuring the right skill sets are brought on board. 

Onboarding refers to the process of integrating new employees into your business. A strong onboarding program:

- Helps new employees understand company culture, policies, and expectations.

- Provides necessary training for their role.

- Improves employee engagement and retention by making them feel welcomed and supported.

- Reduces time to productivity.

For a growth company, proper onboarding reduces turnover, a key factor investors and banks assess when evaluating operational stability.

The length of onboarding can vary depending on the role and the complexity of the company, but for a growth company, onboarding should typically take anywhere from 30 to 90 days. Here's a breakdown of the timeline:

1. First Week: Focus on introducing the new employee to the company's culture, values, team, and immediate job responsibilities. Cover administrative tasks like setting up payroll, benefits, and company accounts. Provide an overview of key projects and expectations.

2. First Month: The employee should start gaining hands-on experience with their job responsibilities, gradually increasing in complexity. They should also be fully integrated into team meetings and ongoing projects. Offer training specific to their role during this period.

3. First 90 Days: This is the typical period where an employee should be fully operational. By the end of this phase, they should understand company workflows, have built relationships with colleagues, and contribute meaningfully to the business. This period often concludes with a formal performance review or a check-in to assess how well they have adapted.

For a growth company, speeding up the onboarding process while ensuring effectiveness is key to getting new hires productive quickly, which is important for investors and banks looking at operational efficiency.

 An employee handbook outlines your company’s policies, procedures, and expectations. It can cover:

- Code of conduct and workplace behavior

- Benefits and compensation

- Attendance, leave, and time-off policies

- Disciplinary actions and grievance procedures

- Safety guidelines and protocols

The handbook should be clear, easy to understand, and legally reviewed to ensure compliance with labor laws.  A well-prepared handbook demonstrates professionalism and helps reduce legal risks, which is important to both investors and banks. 

Please find a template available for free download HERE: Employee Handbook 

A healthy workplace culture promotes employee satisfaction, engagement, and productivity. Owners can:

- Encourage open communication and feedback.

- Foster respect and inclusivity.

- Promote work-life balance.

- Promoting transparency and collaboration

- Offer professional development opportunities

- Recognize and reward employee achievements.

- Align company values with employee behavior and decision-making.

A strong culture attracts and retains talent, and investors or banks will see it as a foundation for sustained growth.

As noted in our article Maximizing Enterprise Value: Strategic Role of a Fractional CFO, a fractional CFO can help identify key cultural fits and address frictions through workshops and cross-cultural teams. For example, a fractional CFO working with a manufacturing firm developed a management office as a culture lab, which included in-person visits and workshops to smooth over cultural friction points and increase innovation. This proactive approach helped the company maintain a cohesive and motivated workforce.

To gain a pulse on your business, please find a template for an Employee Satisfaction Survey available for free download in our People Resources tool

Managing employee performance involves setting clear goals, providing regular feedback, and addressing underperformance. Key aspects include:

- Performance reviews: Conduct regular (e.g., quarterly or annually) reviews to discuss achievements, areas for improvement, and future goals.

- Training and development: Offer opportunities for employees to improve their skills and advance their careers (e.g., workshops, courses, mentorship).

- Disciplinary action: If necessary, use a clear process for handling poor performance or misconduct, ensuring fairness and consistency.

Also, we recommend implementing a performance management system that:

- Sets clear goals and KPIs for employees.

- Provides regular feedback and performance reviews.

- Encourages ongoing learning and development through training, mentorship, or coaching.

Effective performance management ensures productivity and supports long-term growth, key to convincing investors that the company is well-managed.

Please find a template for a Multi-Rater 360 Review available for free download in our People Resources tool

A competitive compensation package can help attract and retain talent. It can include:

- Salary and wages: Market-rate salaries

- Benefits: Health insurance, retirement plans, paid time off, parental leave, and wellness programs are common benefits.

- Bonuses and incentives: Performance-based bonuses, profit-sharing, or stock options can motivate employees.

- Non-monetary perks: Flexible work arrangements, remote work, professional development opportunities, and a positive work environment also contribute to job satisfaction.

A critical milestone in building a strong organizational infrastructure is establishing an effective compensation structure as the company scales. Conducting an annual compensation benchmarking study, segmented by job level, can provide valuable insights into competitive salary ranges and industry standards. Additionally, gathering data from candidates who decline offers is essential to understanding whether compensation played a role in their decision.

It’s important to note that compensation is often a factor, even if candidates claim otherwise. Therefore, it's crucial to obtain details on the total compensation package they were offered to make informed adjustments and remain competitive in the talent market.

  Employee disputes are inevitable, and it’s important to have a clear process for resolving them. Steps may include:

- Encouraging open communication and attempting informal resolution.

- Following a formal grievance process (outlined in the employee handbook).

- Involving HR or third-party mediation, if necessary.

- Ensuring decisions are consistent and legally compliant.

In addition, you can establish a formal grievance policy:

- Provide clear channels for employees to raise concerns confidentially.

- Ensure prompt investigation and resolution.

- Maintain open communication and encourage mediation where possible.

Handling disputes effectively can minimize legal risks, something investors and banks value in assessing your HR risk management.

  Payroll management includes ensuring employees are paid correctly and on time, as well as fulfilling tax obligations. Key considerations include:

- Accurately calculating wages, overtime, and deductions (e.g., taxes, benefits).

- Complying with tax laws, including income tax withholding, Social Security, and Medicare contributions.

- Keeping up with changing payroll regulations and tax rates.

Consider using payroll software or outsourcing to ensure compliance and efficiency, reducing financial risks that concern both investors and banks 

Employee retention refers to the company’s ability to retain its employees over time. To improve retention:

- Foster a positive work culture.

- Offer competitive compensation and professional development.

- Recognize and reward employee achievements.

- Conduct exit interviews to understand why employees leave and identify areas for improvement.  You can use our free download as a start for exit interviews in the tools above.

High retention rates indicate operational stability and lower costs related to turnover, key metrics for investors and banks.

As an employer, you’re responsible for maintaining a safe and healthy work environment. Key considerations include:

- Ensuring compliance with workplace safety regulations (e.g., OSHA in the U.S.).

- Implementing safety protocols and training employees on these procedures.

- Providing necessary protective equipment and maintaining safe working conditions.

- Creating a plan for handling emergencies or accidents in the workplace.

Prioritizing employee well-being helps avoid legal risks and demonstrates responsible leadership to investors

Termination can be difficult but sometimes necessary. Steps to handle termination correctly to reduce legal risks include:

- Following a clear structured and legal process (ensure due process and avoid wrongful termination).

- Documenting performance issues, warnings, and disciplinary actions.

- Conducting exit interviews to gain insights on areas for improvement.

- Offering severance packages or assistance with transitioning, if appropriate.

- Ensuring that final payments, benefits, and paperwork are handled promptly.

A well-managed termination process helps protect your company from legal claims and shows professionalism to investors and banks.

Please find a template for an Exit Interview Questionnaire available for free download in our People Resources tool

  Labor laws change frequently, and staying compliant is essential to avoid legal issues. Owners should:

- Monitoring federal, state, and local labor law changes.

- Regularly consulting with HR professionals or legal counsel.

- Participating in industry HR forums or subscribing to relevant newsletters.

Compliance demonstrates to investors and banks that you are prepared to avoid legal liabilities as you scale.

Depending on the size and complexity of your business, you may consider:

- Outsourcing HR: This can be cost-effective and ensure compliance, especially for small businesses without dedicated HR staff. Outsourced HR providers can handle recruitment, payroll, benefits administration, and more.

- In-house HR: For larger businesses or those with specific cultural needs, having an in-house HR team can be more effective for fostering company culture, employee engagement, and handling day-to-day operations.

As you grow, bringing HR in-house offers greater control and alignment with company culture and growth goals, which investors might favor when considering long-term scaling.

HR software can automate many tasks, such as:

- Payroll processing

- Employee record management

- Recruitment and applicant tracking

- Performance management reviews and employee development tracking

- Employee self-service portals for benefits and leave requests

- Using HR technology improves efficiency and reduces errors.

Leveraging tools like HR software (ADP Workforce Now, BambooHR) increases operational efficiency, appealing to investors looking for scalable solutions.

  Remote and hybrid work arrangements are increasingly common. To manage such employees:

- Set clear expectations for work hours, communication, and productivity.

- Provide the necessary tools and technology for remote work.

- Foster team collaboration and engagement through virtual meetings and check-ins.

- Ensure compliance with wage and hour laws, even for remote employees.

Managing remote work well will be viewed positively by investors and banks, showing you can maintain productivity across different working models.