The days when the personnel department spent much of their day counseling employees on personal problems and organizing company parties are long gone. Early HR managers arose from the administrative ranks for the most part and often doubled up as secretaries, receptionists and office managers. The thinking then? It was just a “paperwork function.”
Today, trained HR managers do everything from raising employee retention via training and career path programs to ensuring the company’s risk is reduced through proactive compliance with the law, says Peggy Pargoff, senior vice president at ManagEase Inc.
“The best HR professionals today play a much broader role,” says Pargoff. “The body of knowledge that an HR manager needs to have is significant because they need to represent the business owner on important issues. You need to have someone who understands that their foremost responsibilities are to protect the employer from financial and other losses, and to promote productivity, retention and growth through appropriate employee management practices. In some companies, the scope of HR extends into a broader compliance role (ISO, FDIC, Non-Profit Accountability Act, Sarbanes-Oxley) and may include a role in auditing and reporting on the human components of prospective acquisitions (talent, risk, cultural compatibility).”
Smart Business spoke with Pargoff about how hiring a qualified HR manager can transform and protect your business.
What are some of the pitfalls of ‘old-fashioned’ HR?
Business owners who do not overly value this function often get themselves into serious problems. Foremost among these is confidentiality breaches. Many employees when thrust into an HR role find it impossible not to misuse the information they become privy to. When these ‘informal’ HR administrators start learning about areas in which the business is noncompliant, they often bring a claim or incite friends at the company to do so. Maybe this doesn’t happen at first, but it can happen if the employee feels maltreated or passed over for promotion.
Also, untrained and uncertified HR staff simply has insufficient background to ensure compliance with the law, not only in the areas of forms and paperwork, but also in responding to complex employee issues and sensitive communication.