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How to develop a human resource policy

Small business owners in Colorado must develop a solid human resource policy to ensure workers remain happy and that the business remains in compliance. A lack of a sound policy could land a business in trouble, and may even result in costly lawsuits with lasting effects.

Because human resource issues can be complex, Business.com recommends getting acquainted with the basic principles of human resources when creating a policy. Devising a comprehensive employee handbook is highly important, as this will serve as an informational resource to employees throughout the course of work. An employee handbook must include information on essential policies regarding discrimination/harassment legislation, how the company will handle paid time off and other benefits, and policies governing rightful termination. Upon review of the handbook, employees should provide signed documentation that they read and agree with the provisions contained therein.

Having an understanding of all applicable state and federal regulations is a must when creating any sort of human resource policy. For instance, workers’ compensation insurance is federally mandated in most instances, and failure to implement a suitable insurance policy could result in serious trouble for business owners. Federal laws can also pertain to things like overtime, minimum wage and other requirements.

Entrepreneur lists some of the common human resource mistakes small businesses can run into. Employee designations is one area that proves particularly confusing for small business owners. That’s why it’s important to know the difference between a contractor and regular employee, or a business could face recrimination from the IRS. Regarding employee terminations, having a system in place documenting poor performance can be extremely helpful. Failure to do so could leave a company vulnerable to wrongful termination suits. 

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