October 31, 2023
Over the past few years, small businesses have contended with an array of HR challenges to include a pandemic, workforce recruitment and retention obstacles, and a focus on employee compensation highlighted by the ongoing high inflation rates. To complicate matters, it is uncertain how long these challenges will continue in the coming years. Small organizations may find it overwhelming to tackle the challenges from this year while at the same time preparing for the challenges ahead. Now is the perfect time to perform an evaluation of your organization.
Review the company’s handbook and workplace policies and procedures. This is a great starting point for checking the temperature of the organization to determine whether current policies are aligned with new rules and regulations that will be effective in 2024. A key regulatory proposal of particular interest to small businesses is the proposed rule by the Department of Labor (DOL) which seeks to increase the minimum salary threshold for the exempt employee under the Fair Labor Standards Act (FLSA) from $35,568 to $55,068 annually. Under the proposed rule, to be exempt from overtime pay, employees must be paid a salary of at least $55,068 and must meet certain job duties as executive, administrative or professional employees. Evaluate employee classifications to ensure employees are properly classified, both in terms of job duties and minimum salary thresholds. Even if approved, we don’t expect this increase to take effect until summer 2024. Did the organization struggle to recruit or retain top talent in the tight labor market of 2023? Conduct an assessment of the company’s current employee benefits and compensation to aid in determining whether you are competitive in your industry. In addition, has your organization experienced significant growth over the past few years? If so, ensure your mission statement, policies and workplace culture are aligned with how you want to position the organization for 2024.
Examine whether there were opportunities for workforce development or reorganization. One of the top workforce strategies highlighted during the pandemic encouraged organizations to think outside of the box when it came to how to continue business operations while understaffed. Many organizations adopted crosstraining where current employees were equipped with the skills and resources to wear different hats and organizations were able to pivot when necessary in the event of staffing shortages. As we approach 2024, look back over the past year and assess whether any job vacancies could be filled by cross-training current employees, optimizing your processes or even outsourcing some tasks that may no longer be cost effective to maintain in-house. Consider whether there were opportunities for employee development. This not only instills in the workforce that the company is committed to their professional growth, but their growth contributes to the growth of the organization and it’s a win-win situation for all.
Plan for effective and transparent communications to promote positive employee relations. With all the talk around the economic uncertainty as we head into 2024, organizations are challenged with not losing sight of the more important factor — the long-term health of your organization. The resilience of the company’s employees and workplace culture cannot be measured in dollars or profits, nevertheless engaging your workforce through transparent communications to manage employee expectations will impact the organization’s bottom line. The key to moving forward as a cohesive organization is building a foundation and workplace culture focused on trust and communication which helps employees feel valued and protected. Does your organization have an open door policy or dedicated opportunities for regular employee feedback? Do you check in with your employees on how they are doing on a personal level? A workplace culture that fosters a sense of community will be better positioned to navigate economic uncertainty with an engaged workforce committed to the success of the organization. The key takeaway is for organizations to resist the temptation to adopt a nearsighted approach by focusing on the current economic climate. Instead, be calculated, proactive and transparent to ensure employees are well-suited to support the organization and conquer whatever challenges lie ahead in 2024.
This column is provided by Ogletree Deakins, Atlanta, as part of a partnership with the American Rental Association (ARA) for ARA’s Human Resources Assistance Program. ARA members can receive a single sign on from the ARA webpage to a microsite specific to ARA on the Ogletree Deakins platform; get access to two 30-minute calls with an HR professional per year; access to an FAQ section as well as to Ogletree Deakins’ library of webinars; and access to Ogletree Deakins’ ARA-specific webinars. To learn more, visit ARArental.org/Manage-Business/HR.
