February 21, 2020
How to Keep HR Risks From Disrupting Your Business
Posted by Shannon Oswald
Getting sued for overtime wages, having a key employee take an unexpected leave of absence, dealing with employee grievances — many employers have learned the hard way how HR problems can disrupt a business. And dealing with these HR risks just keeps getting more and more complicated.
Take payroll rules and taxes, for example. The IRS has completely restructured the W4 and tax tables for 2020, and with that comes changes in processing. Due to the federal changes, one can only expect that states will be redoing their tax rules, creating yet more confusion and potential compliance problems if you don’t apply the new guidelines correctly.
Labor laws also keep evolving, continuing a century of expansion in labor rights and child labor, gender equality, civil rights, working conditions, union membership and other important areas that affect the employee’s experience. Because of the heightened public awareness of these issues and the potential pitfalls associated with noncompliance, employers often need help navigating these murky waters. (California’s new AB 5 “gig economy” law covering the classification of contractors comes to mind…)
With the continued onslaught of new and expanding legislation related to HR and payroll management, many employers are finding it more important than ever to have a specialist they can turn to when they need extra help handling HR risks. Although an in-house HR department can provide this support, the ROI doesn’t make financial sense for a lot of companies, given that the average salary for an HR manager in the United States was $103,511 as of January 2020. This is especially true if you don’t have an everyday need for this type of HR expertise.
In these cases, partnering with a good outsourced HR and payroll team can be a great risk mitigation solution. With this model, you can get expert help on issues like worker classification or IRS changes, or get interim help to replace an employee on leave, while keeping costs down by engaging the team only when needed.
Some employers go so far as to consider this “HR insurance” — meaning that by maintaining a working relationship with a trusted outside advisor they can speak to when the need arises, they can continue to make educated and informed decisions appropriate for their business.
Keep in mind, if you’re going to use an outsourced partner, you want to choose a good one. Opportunities for HR professionals to pursue field-based education and certifications are plentiful, so make sure your consultants are dedicated to their field and keep their industry knowledge current and sharp by completing educational programs, attending annual legal updates and earning professional certifications. You need to feel comfortable with your consultant and know that you can go to them for any sticky situations that might arise.
Need some help? Armanino’s HR Outsourcing group includes a range of qualified professionals who hold certifications and/or advanced degrees in their field. Our team is always available to talk to you about your HR risks or payroll needs.
Shannon Oswald works in the HR Solutions Group at Armanino LLP. She holds a Master’s Degree in Human Resources Management and a Senior HR Professional (SPHR) certification. She has a broad background in HR consulting, having worked in many different industries, including tech companies and start-ups. She spends her free time thinking about work and writing posts for Armanino newsletters.
Co Authors :
Jenn has more than 25 years of outsourced accounting and finance experience, with a particular expertise in startups and the advertising and creative production industries. She is passionate about seeing companies utilize the latest accounting technology to maximize their efficiency, productivity, and ultimately, success.
Before joining Armanino, Jenn founded and led Team Jenn Corp., a firm dedicated to the strategic financial management of startups and small businesses, offering a comprehensive back office solution with accounting, finance and HR solutions. Previous roles include stints at advertising giant Ogilvy and Mather, and in the cash management industry.
Jenn has a bachelor’s degree in economics from Pepperdine University and is a member of several professional associations including the National Society of Accountants, ProVisors and the Women’s Business Enterprise Network.