Understanding HR – Basics for Managers
As a manager, unless you are working in a very tiny company you will most likely have access to an HR department to handle some of the back-end paperwork for your team. You might not know it, but being an employer is a complex process in terms of government regulations and laws, taxes, etc. There are many laws, both state and federal, that govern how employers treat their employees, what they can and can’t ask in interviews, and how employees are classified for tax and overtime purposes, and every other topic you can imagine.
If you had to know all about HR in order to be a manager, in addition to everything you need to know about your industry and your team’s function, it would be overwhelming. But it’s a good idea to at least have a basic understanding of the HR function so you know what questions to ask and when to seek guidance and additional information. Here are just a few of the primary functions of the HR department in most companies:
Benefits – In order to attract and retain employees, many companies offer benefit packages ranging from health insurance and paid time off all the way up to funded pension plans, company cars and travel allowances. Because of privacy laws, HR is required to restrict access to specific information, and as a manager you won’t be allowed to see or be aware of those details. Even small companies have access to an incredible range of choices in terms of how benefits are structured and delivered. While you might feel like you know all about your company’s benefit packages, you probably want to refer your team members to the HR department if they want more information about eligibility, availability and cost of various programs.
Compensation – While getting paid might seem like the most basic part of the HR job, it can actually be incredibly complicated. Each person has a unique set of deductions depending on the number and type of benefits they receive, their tax status, etc. Online payroll services have streamlined this process for small businesses, and many larger businesses outsource payroll to service providers rather than handling it in house. As a manager it’s important to make sure that new hires carefully review their first paycheck to be sure everything is correct. It can be hard to correct things like social security number errors later in the process.
Performance Management Framework – Many companies have a defined structure for reviews and performance management that managers are responsible for implementing. Be sure to understand when you are expected to provide structured feedback, and what form that feedback should take. In addition to a framework, if you have challenges with an employee, you will definitely want to bring in HR to help you manage the situation efficiently. For much more on that, feel free to read my post on handling terminations.
Compliance – As I mentioned in the first paragraph, there are all sorts of laws that apply to companies the employ and pay workers. From OSHA safety regulations to the Fair Labor Standards Act to the Affordable Care Act, the regulatory environment of running and managing a company can be extremely complex. One aspect of the HR function is to understand and provide guidance or consult legal counsel around these many regulations. As a manager there is no way you can keep up on them all, and you are far better off asking your HR team if you have questions or concerns about how to handle a specific situation.
HR and managers are a team working together to define and foster a strong culture that supports employees as they do their best work. Having a good relationship with the HR department will make you a better manager and keep you from making mistakes with big consequences!