HR Compliance in Design

HR & Employment Law for Entrepreneurs

By Adrienne B. Haynes, Esq.

Managing Partner, SEED Law

Once you’ve formalized your business, it’s exciting to consider the team you can build. Whether you have a team now or anticipate building a team soon, it’s never too early to consider the key building blocks in building your human resources department and remaining in compliance with your state’s employment laws.

Start with the goals of your HR department. The key roles of building an effective team is to help a company accomplish its goals and strategies, satisfy its customers, and help with business continuity. To that end, the primary questions should be:

• What team members will you need to help your business reach its desired outcomes, and how can you best support them?

• What social, cultural, legal, financial, and other factors come into play as you develop your human resources department?

• What business planning is needed to incentivize team members and manage costs for benefits and compensation amid the federal, state, and local laws that regulate these areas?

Know the authorities. To grow your team well, you have to be in compliance with local, state, and federal rule-making authorities. On a local level, this authority is usually your human relations department. Here in Kansas City, the City of Kansas City, Missouri Human Relations department is responsible for service, compliance and enforcement in the areas of affirmative action , civil rights , contract compliance , construction workforce and compliance with the Missouri Prevailing Wage Laws, MWDBE Ordinances and HUD laws.

On a state level, the key authority is the Department of Labor and the Commission on Human Rights. The purpose of the Department of Labor is to promote industry and labor and protect the rights and safety of the state’s workforce. Certain businesses also need to register with their states’ Department of Revenue. The state’s DOR is responsible for the administration of business tax laws, sales and use tax, corporation income tax, and franchise taxes. Please contact your local Department of Revenue to determine if you need to register.

On a Federal level, the rule making agencies that apply to building a team include the Internal Revenue Service, the U.S. Department of Labor, and the Equal Employment Opportunity Commission. Understanding your obligations as an employer will help you provide a competitive employment package.

Strategy to Build the team: Expanding the team requires strategy so that it’s a good match for company fit, culture and work environment, and position needs. To consider the strategy of your HR department, regularly ask yourself:

• Will you self-perform or outsource your labor?

• Where will you recruit your ideal talent from?

• How will you develop an attractive and competitive employment package?

• What does an ideal organizational chart look like?

• How will you support ongoing continuing education and professional development?

• How will you communicate position goals, metrics, and deliverables?

Plan for Clear Expectations: Bringing employees and independent contractors onboard is an exciting time in your business (make sure you classify them correctly!). From orientation to regular evaluations, expectation setting is key. In order to ensure that team relationships have clear expectations, we encourage SEED Law clients to get everything in writing- from job descriptions, to onboarding agreements, handbooks, and company manuals. As an owner, you have to be diligent about transitioning your expectations from your head onto paper. As your business grows, you may also want to consider co-developing and documenting standards for a prospective or existing team member’s most frequent tasks, including checklists and standard forms.

Lastly, engage professional service providers who have experience and that you trust can give you wise counsel. Errors in employment tax and withholdings can result in personal liability, and it’s better to consult with a professional so that you can focus on growing and developing the team.

This article is an overview of employment law considerations and does not cover every legal right or obligation, consideration, exception, or restriction. Every business decision should be well researched and discussed with a professional before being made.

To schedule a consultation with a SEED Law attorney, you can give us a call at (816)945–4249 or schedule your consultation today here.