10 HR Basics Every Business Owner Should Know

January 23, 2023
minute read

Running a business includes a slew of factors such as marketing, sales, product development, and more alongside trying to make a profit. With so many things happening at once, human resources tend to be the least of your priorities.

With that said, human resources are a huge part of every business, big or small. In fact, there are a few important HR basics small businesses should prioritize. Here are some questions you should ask yourself as a business owner:  

  • Are you ensuring the safety of your staff and resolving conflicts as effectively as possible?
  • Are you doing everything you can to create a diverse and inclusive workplace for your staff?
  • Are you familiar enough with the current employment laws?


A whopping 21% of business owners stated they weren’t confident in managing their HR branch. Additionally, most were unaware of the employment laws that could affect their business.  

With this in mind, there are several HR basics that every business owner should know.  

Recruit the Best Candidates  

Your employees are the engine to your company’s ship. If you don’t have the right team working behind the scenes, your business is bound to crumble.  

In many cases, recruiters will fill a position with the wrong person, costing them nearly $17,000 in lost productivity by the end of the year. To hire effectively, employers must develop a crystal-clear job description that successfully promotes the position.

In addition, employers need to prepare for the interview process accordingly. In other words, they should know exactly what they’ll be asking candidates, and the questions they should avoid.

They should offer a competitive salary along with promising benefits for the candidate.  

Why Employers Should Offer a Competitive Salary and Benefits  

Through compensation benchmarking, it’s possible to convince talented, hardworking individuals to join your team.  

Compensation benchmarking is a term similar to salary benchmarking, where employers will compare the salaries and benefits between organizations within the same industry.  

Benefits like parental leave and health insurance can help to attract exceptional candidates to your company. Better yet, they’re likely to stay longer when they receive attractive benefits.  

Prioritize Your Employee’s Safety  

If you’re running an office-based company, there are a few risks you need to be aware of, especially for the sake of your employees. In 2015, a total of 4,836 employees lost their lives due to injuries they sustained in the workplace.

As a business owner, your team’s safety is an important responsibility that requires you to:

  • Formulate a set of rules that keeps your team safe
  • Be aware of potential risks  
  • Ensure every employee is following the safety rules

Frequently Measure Employee Performance  

When you’ve reached the point where you’ve hired the right candidates, they’re being paid fairly, and their safety has been assessed, it’s time to evaluate their performance.  

This process can also be helpful to employees, as you’re clarifying your expectations and objectives.  

Communicate Clearly and Effectively

Good communication influences the success of any business. With that said, poor communication can have a negative impact. Workplace failures are most often triggered by poor communication and a lack of collaboration.  

Maintaining effective communication within the workplace will prevent serious problems from arising.  

Keep Your Team Happy  

When your employees are happy, they’re going to produce better work and stay with your company longer. After all, you want to avoid a high turnover rate, as it can be fairly costly to your business.  

When employees leave a company, they’re taking their knowledge and experience with them, which causes a rift in its operations.  

Be Mindful of Labor Laws  

To run a business successfully, familiarize yourself with the current labor laws. There are various regulations, most of them applying to small businesses. In short, follow the rules:

  • Comply with equal opportunity laws.
  • Handle payroll effectively.
  • Give your employees the right they are entitled to under your country’s legal code.
  • Maintain every record you are legally required to keep.

Resolve Conflicts in the Workplace

In larger companies, managers often handle conflicts between employees. If the issues become more severe, they pass them on to the HR department. Small companies experience conflicts as well.  

If they don’t have an HR team, then the company’s owner is responsible for resolving them. From the standpoint of human resources, there are several things you must do to resolve conflicts successfully, including:

  • Allow your employees to express their feelings.
  • Identify the problem.
  • Always acknowledge a conflict, never avoid it.
  • Identify points of agreement between employees to find a common ground.  
  • Find effective solutions.
  • Determine the best thing to do if the conflict goes unresolved.  

Ensure Diversity in Your Company’s Workplace

Think of it this way: your workplace should be just as diverse as the company you live in. If this isn’t the case, take a moment to figure out why.  

Then, take the right steps to solve this issue. It’s possible that you could be unconsciously excluding people based on age, gender, race, religion, or sexuality. This could be hurting your business significantly. In the near future, be more mindful of your company’s level of diversity.  

Take Action and Get the Right Help

Human resources involve a lot of avenues that can be difficult to navigate on your own. Hiring the right help can make this ride a lot smoother, and beneficial. In fact, there are online tools that will help you do it.  

FRIDAY Helps Small Business Manage and Pay Their Team  

When it comes to managing, tracking, and paying your employees, additional help goes a long way. FRIDAY is the simplest software created to help small businesses manage, track, and pay their team without any paperwork involved.  


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