Updated: Feb 6
Human Resources is extensive as a topic but is an area where we find many of our clients struggle with and require help in their business. Below are a set of tips focused on Organizational and Management Structure
Organizational and Management Structure
Once there are employees in an organization, it is essential to have an organizational chart showing the organization's hierarchy, responsibilities, and reporting structure. Every employee needs to have one boss from whom they get direction and guidance. It is not that others cannot prove input, but an employee cannot be pulled in twenty different directions by multiple people, as this will affect their productivity.
Every manager who has employees reporting to them needs an understanding of the responsibilities of being a manager. A manager is responsible for hiring employees and ensuring they have clearly defined roles and responsibilities. It is a manager's responsibility to ensure employees receive the proper orientation and training for their position. A manager must provide clear and attainable objectives that coincide with company goals and objectives each year. Managers must provide direction and guidance and openly communicate with their employees. It is up to the manager to have regular meetings with their staff. Performance evaluations need to be given at a minimum on an annual basis. The manager's responsibility is to document any issues with an employee and be part of the termination process if an employee is not performing to company standards.
Hiring An Employee
Before hiring employees, you should develop a hiring process that you expect all managers to follow. Here are some of the critical components of the hiring process:
Have a well-defined job description for the role in which you are hiring.
Place the job description on your website or job sites, or utilize an employment agency to help find candidates.
Determine how many candidates you want to interview and who will be involved in the interview process.
Have questions defined in advance and determine the criteria for hiring.
Once you narrow the number of candidates down to 2-3, you will want to perform a background check, check references for the top candidates, and then determine to whom you wish to provide a written offer.
If your first candidate does not accept, you now have an alternate or 2 to choose from without starting the interview process again.
Provide a written offer to the employee and give them a set time (usually 48-72 hours) to respond.
If you have employees that are working for your business, it is imperative that you provide an employment contract as this not only protects the employee but you as well down the road. If you do not have an employment contract that outlines rules and policies regarding their employment, do not be surprised when they leave and you find they are working for your competitor and are calling on your clients; you do not have a leg to stand on. Make sure you have a lawyer review your contract, as there is nothing worse than having an agreement that will not protect your business.
As an employer, it is up to you to understand the requirements regarding employees, labour laws, and human rights as they relate to your business and industry. There are many general requirements, such as health and safety training, written policies around health and safety, workplace violence and harassment, and accessibility, to name a few. Some additional ones are required that are specific to industries or business types that will need to be understood.
As a business, it is up to you to file and pay payroll taxes (employee and company) and know how much WSIB or equivalent is required for your industry/business type. Failure to submit payroll or WSIB (in Ontario) can result in harsh fines and interest and jeopardize your business.
Employers must understand the rules concerning part-time, full-time, and contract employees. If you are not sure, check with your accountant or corporate lawyer. You cannot hire a contract employee to avoid paying payroll taxes. There are a set of tests that the government checks for, and if you have a contractor that is an employee, you will be responsible for all back payroll taxes. In one case, we saw CRA make the employer pay for the employee's portion as well.
This article is not an inclusive list of Human Resources Organizational and Management Structure Tips, but are the ones we find are the areas where many small businesses have issues and need help. If you have any questions, do not hesitate to ask us. We provide a free 30-minute with no obligation consultation.