Make HR Work for Your Startup
Our newest cohort of international founders was joined by Carissa Marker of Trinet to learn about one of the trickiest areas for startups new to the US market to navigate: Human Resources. Carissa shared important tips on how well managed Human Resources techniques can be a powerful support tool for startups.
Why HR is important
An understanding of the importance of HR is are a required part of any entrepreneur’s toolkit. Proper HR techniques will help an international CEO understand key U.S. business laws, avoid public pitfalls that can damage the company due to blind spots in culture or compliance, and build a great team with great people.
The United States has “at-will” employment. This means employers can fire an employee for any reason, at any time, and employees can leave a job at any time. At-will employment has limits, a few examples of this are:
Public Policy — Employees cannot be fired if they refuse to perform an act that is prohibited by state law
Implied Contract — An implied contract could be a verbal reassurance from the employer about the duration of a contract. Most courts will disregard language that promises long-term employment, but you can avoid confusion and litigation by having everything in writing.
Avoid these 3 common mistakes startups make
Regulations — Depending on your industry, regulations in the United States may be different from what you’re used to. To name a few US-specific laws you’ll need to read up on the Fair Labor Standards Act, Family Medical Leave Act, and the Americans with Disabilities Act.
Documentation — Another mistake that is common among startups is a failure to document workplace issues. Startups without a well-defined documentation culture will struggle to keep track of workplace problems stemming from poor performance or misconduct. This practice will allow founders to avoid many expensive headaches later if problems persist with a particular employee.
Compliance — To avoid liability, it’s critical that you stay compliant with all operations including job descriptions, overtime pay, tax filing, payroll, and more. To understand what Compliance looks like in the US, here is a summary by the U.S. Department of labor is a good place to start.
Don’t be ‘that company’
Support your employees by creating a work environment that is fair and inclusive to all. Uber, a private company, suffered a hit to their massive valuation last year after reports emerged that the company had a toxic culture and had tolerated sexual harassment. Companies like SoFi and Kleiner Perkins have demonstrated that these issues start from the top down, and how a hostile culture can become ingrained in a company. You can avoid this situation by prioritizing education and inclusivity, adopting clear policies on expectations, and implementing a system to effectively handles workplace grievances.
How to hire (and keep) the best employees
The company and product you’re building will get employees interested, so how do you get them to come on board? In the United States, employers (that’s you!) sponsor their employees’ benefits. This is an opportunity to bring out your entrepreneurial creativity and choose a benefits and compensation package to hire the best employees. This can mean a combination of equity, salary, and benefits including vacation and healthcare. There are lots of solutions, so find one that will make your employees and CFO happy (at the same time).
Remember that the best team is worth it. So whether they’re engineers, sales reps, or VP’s, they will all require an appealing culture and benefit package. Further, it’s typical for employees to receive other job offers when employed, so it’s crucial to keep your key employees motivated and incentivized so they stay onboard.
Need HR, payroll, benefits, compliance and risk mitigation for your small-medium sized business? Get in touch with our friends at TriNet who have experience partnering with startups like yours.
Discover how TriNet unleashes entrepreneurs from the administrative burdens of HR so they have the freedom they need to do the things they do best: make ideas real, grow businesses and make dreams come true. A TriNet HR solution makes your human resource capabilities endlessly scalable.