To ensure the overall success of any small business, creating a comprehensive and effective human resources management plan is a critical component. The human resources department oversees many key functions of a business including recruitment and employee selection, training and development, benefits, employee relations and more. By creating an effective human resources management plan, you can better handle any issue or concern that may arise in the future for your company and its employees.

How to Create an HR Plan

When it comes time to create your HR management plan, there are several factors to consider. These include the type of company you operate, the size and culture of your small business, your financial resources and budget, market competition, current turnover rates and more. Your plan should address a multitude of areas including workforce planning, recruitment and training, performance management, compensation and benefits, workers’ compensation, employee relations and management, etc. Before creating your plan, assess your small business and formulate answers to the following questions:

  • Whom do we employ and what are their needs?
  • What is our company’s mission?
  • How can everyone within the company be safe?
  • Where do we stand regarding risk management?
  • What are our benefit plan needs?
  • What policies need to be implemented?
  • Do we need to update (or create) our employee handbook?
  • In which areas of HR are we lacking?
  • What is required by our company regarding federal, state or local employment laws?
    • What are our policies regarding employee incentives, pay increases and evaluations?

In addition to these questions, a comprehensive HR management plan will also address the following areas:

  1. Hiring and Termination Policies – This area will focus on your company’s practices regarding hiring and terminating potential and current employees. To streamline the hiring and termination process, create templates that will be used for full-time, part-time and temporary employees.One template could discuss employment practices and company expectations, while another template can speak to a specific job description and compensation package. These documents should have an employee signature area and be stored within a personnel file once signed. Regarding termination procedures, a specific process should be created for terminating employees as well as those who quit voluntarily. Reasons for employee discharge, in addition to notes detailing any situations leading up to a discharge, should be thoroughly documented and kept in the employee’s personnel file.
  2. Benefits – Having a strong benefits plan is crucial to attracting quality employees and increasing employee retention. In fact, a recent Towers Watson survey found that 68% of employees look for and stay with an employer who provides a solid defined benefits plan.  With that being said, it’s important to review benefits on a regular basis to ensure services and products remain competitive and are offered at a fair cost. A skilled HR department will weigh benefit options from a variety of vendors, and also take into account benefits not currently being utilized at your company and possibly replacing them with more popular benefits.
  3. Payroll – For your business to run smoothly, you must have a solid payroll plan in place. Consider utilizing payroll software or outsourcing your payroll responsibilities. With the average employer spending 10 hours per month on payroll, choosing one of the previously mentioned alternatives can free up more time to concentrate on revenue generating tasks in addition to offering employees precise and on-time payroll.
  4. Recruitment – Successful operation requires the ability to source the right talent that has the capability of wearing multiple hats often required by small businesses. Your plan should outline how you will recruit potential employees. If you do not currently employ in-house recruitment personnel, consider collaborating with a professional HR firm knowledgeable in recruiting, vetting and assessing the skills of the people you need.

After you have created your human resources management plan, be sure you keep employees up to date on your strategic initiatives. A great management plan cannot work if employees do not have access to or understand it. In addition, be sure each employee comprehends his or her duties and job expectations, and signs an acknowledgment form, which will be stored in his or her personnel file. Also, if applicable, make a plan for employees to gain critical training and/or certifications necessary to grow in each job position.

At UniqueHR, we look forward to helping you create a comprehensive human resources management plan that can ensure the success and growth of your small business.Contact us today and let us help you get started. For more tips on creating an effective human resources management plan, download our eGuide.