One reason why owning a small business is so attractive is because it involves less of the kind of red tape associated with larger organizations. Yet, if you have employees, you need to have policies in a number of areas, no matter the size of your business.
Case in point: a colleague of mine who runs a small business recently terminated an employee who had stolen from the company. On the Record of Employment – the document that must be prepared when someone's employment ends for any reason – she indicated "For Cause."
A few weeks later, that same business owner received a call from Service Canada (the administrative body adjudicating claims for Employment Insurance). Apparently, the ex-employee had applied for benefits and disclosed he had been fired for theft. The Service Canada representative confirmed that individual had been terminated for cause. However, the call was not over. Next came the question: did the company have policies in place expressly stating that theft from the business was grounds for termination for cause? Fortunately, it did. Their employment agreements and employee manual clearly stated that theft was cause for immediate termination. But do all small businesses have enough human-resource prowess to address that eventuality?
It might seem self-evident that stealing from the business is a bad thing, and will almost certainly result in someone getting fired. Not in the eyes of the law.
It requires small- and medium-sized businesses – just like any other – to have explicit policies relating to termination and employee fraud. Other areas that require explicit policies include:
Health and safety. Each province defines obligations to ensure workplace safety. The Ontario Health and Safety Act, for example, establishes processes and obligations to ensure safe workplaces. Depending on the size of the business, the requirements could involve forming a Health and Safety Committee, scheduling regular workplace inspections and training staff on safe work practices.
Workplace violence and bullying. Provincial Health and Safety Acts, such as a 2010 amendment to the Ontario Health and Safety Act, Bill 168, typically impose obligations on employers to establish policies concerning workplace violence and bullying.
Discrimination and harassment. Employment policies must comply with human rights laws, such as the Ontario Human Rights Code, to ensure businesses operate in a discrimination-free environment.
Accessibility. The Charter of Rights and Freedoms, as well as provincial legislation, impose different obligations and requirements for businesses depending on the province and the number of employees.
In addition to legislative compliance, comprehensive policy documents clearly communicated to all employees also have significant productivity benefits. To achieve them, business owners need to make sure their employment terms address the following areas, among others:
- Hours of work, overtime entitlement and paid time off, including vacation.
- Performance management, promotions and compensation structure.
- Benefits and perks.
- General employee expectations concerning confidentiality and appropriate conduct.
Finally, special consideration should be given to technology in the workplace. Telephones, computers and smartphones, as well as social media and Internet access that companies provide to their employees represent potential business risks. Therefore, the terms of their use should be clearly defined. For example, businesses of all sizes should have a social media policy drawing the line between proper and improper use of social media channels. While employees certainly have the right to their private use of these properties, they should sensitive to what's professionally appropriate, in the context of their business, and what's not.
A mentor of mine likes to say: "You are too busy digging the ditch with a spoon to go and get yourself a shovel." Small business owners and managers often fall into this trap. They are so busy building and running their businesses that they just don't invest the time and resources required to ensure legislative compliance and operational efficiency.
Putting some structures in place needn't be arduous. Neither should it negate all that makes small- or medium-sized businesses so attractive. Good HR practices make businesses stronger and workplaces better.
Susan Hodkinson is the chief operating officer for Crowe Soberman LLP