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The Business of Managing Employees

By Hunter Street Email By Hunter Street
May 2015
The Business of Managing Employees

Running a successful business isn’t just about profits and losses—it’s often about managing people, especially employees. But employee troubles plague many small to mid-size businesses. Some problems can be attributed to bad employees, but most can be avoided by following good employment practices.

Implement and Apply Fair Hiring Practices
Develop a strong, written Equal Employment Opportunity (EEO) policy and train all employees on EEO laws. This means that you, the owner or manager, must first educate yourself. Consult websites, such as that of the Equal Employment Opportunity Commission, for information on EEO laws and policies.

Remember, preventing race, color, and culture discrimination is not about ignoring differences—it’s about embracing what people of different backgrounds offer. Promote an inclusive and professional culture, and demand all employees to respect personal differences. Establish neutral, objective criteria to avoid subjective employment decisions. A workplace environment that not only acknowledges, but embraces, cultural distinctions is far better than one that ignores them.

Develop Thoughtful and Thorough Interview Strategies
Interviewing candidates can be a daunting task. Frankly, you have other time-pressing issues demanding your attention. But developing effective interview strategies is an investment that can pay substantial dividends. The problem: most interviewers don’t ask the right questions. The solution: don’t work off of a script, have a conversation that correlates to your company’s culture. Follow the 80/20 rule. The candidate should talk roughly 80% of the interview, and you, about 20%. Ask open-ended questions and ask for examples of how the candidate progressed into his/her current position. Look for compatibility, not likeability. Most relationships fail not because we dislike someone, but because we are incompatible with them. How sensitive is she to criticism? How well does he work under pressure? Tight deadlines? Understanding a position’s demands and bringing those issues up in the interview can prevent major catastrophes later on.

Conduct Background Checks
Consider some of the following: credit checks, contacting past employers, administering drug tests. However, snapshots of the past are not always the best indicators of the future. Credit checks may provide insight into an individual’s integrity, but, with the recent recession, placing too much emphasis on a bad credit history may not be the best policy. On the other hand, a positive credit history in such troubled times may suggest an ability to adapt to hard times. Overall, background checks should be just one of several factors used to assess a candidate.

Use Probation Periods
It’s important that you assess employee performance. Use effective probationary periods to assess employees before making a long-term commitment. These commonly run six months to one year and are often used for new employees, existing employees with performance issues, and existing employees who are promoted to new positions.

If you use probationary periods, make sure they are effective. For a new employee, make sure he or she is aware of the probationary period and how long it will last. For an existing employee, discuss why he or she is being placed on probationary status. Is it because of being promoted and now having more responsibility, or because of not meeting expectations? If the reason is performance-based, develop a plan to address the issue. It’s a mistake to assume that just because an employee isn’t meeting expectations, that he is a dud. Have periodic reviews, provide feedback, and give the employee an opportunity to give feedback of his own. View your employer-employee relationship as a partnership, not a dictatorship.

Exit interviews
This is your opportunity to focus on your concerns. During the course of employment, the focus is, mostly, on the employee. Even if your company emphasizes constructive feedback from employees, most may be reluctant to divulge their most severe criticisms—as the old adage goes, “Don’t bite the hand that feeds you.” But a departing employee may be more willing to be frank about why she is leaving or how he feels about his experience with the company. However, you must decipher what criticism is constructive and what is simply a shot at you or your company.

Implementing good employment practices is not only good for business, it’s also the right thing to do.

[Business Insights is hosted by the Law Firm of Kumar, Prabhu, Patel & Banerjee, LLC (KPPB).

Hunter Street is an attorney of counsel at KPPB, primarily working on commercial real estate and business law transactions.

Disclaimer: This article is for general information purposes only, and does not constitute legal, tax, or other professional advice.]

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