Tips for managing employee risks | Work It, Richmond

Business consultant Rush Paul says failing to put plans in place for managing employee problems is a recipe for trouble.

By Eleanor Kennedy

Work It, Richmond

Every time a business owner opens his doors, he risks a government audit or a lawsuit, says consultant Rush Paul. The key to survival is managing that risk.

Paul delivered that message last week at a training session sponsored by the Greater Richmond Small Business Development Council. Richmond professionals and business owners gathered at the Hanover Department of Economic Development in Mechanicsville to hear Paul?s advice on avoiding employment risks that can ?sink? a small business.

Mike Leonard, executive director of the council, said the goal of the seminar and others like it is to help local small businesses grow and bolster the economy.

?We want to see you be successful; we want to see you create jobs,? he said.

In order to do that, Paul said, business owners need to be aware of the major areas of risk. Lawyers and government agencies are always on the lookout for businesses to sue or audit, he said.

?You?re not paranoid if they?re really after you,? he said.

Paul touched on five main areas where small-business owners are at risk: wage issues, harassment claims, turnover, employee theft and workplace safety.

In dealing will all of these, he said, it?s important to be able to prove that even if there has been a violation, a process is established to deal with it and prevent future incidents.

For example, employees must be paid time and a half for overtime work, even if those hours weren?t approved first. But that doesn?t mean nothing can be done to stop employees from working more hours than they should.

?You can discipline them, but you?ve got to pay them,? Paul said. ?You can even terminate them if they do it again.?

Several of the business owners at the seminar raised concerns about employee theft. According to data Paul presented from the Association of Certified Fraud Examiners, one-third of new businesses fail due to employee theft.

That?s why businesses need to hire honest people and put in place policies that keep them honest, Paul said. He recommended swapping duties between employees so no one can establish a pattern, making sure the books are settled every night and having one-on-one conversations with employees when something seems suspicious.

Many of the business owners at the seminar said they were dealing with the issues Paul covered.

Robert Sparks, who opened Sparky?s Ice Sculptures out of his home a few years ago and recently moved into a storefront, came to hear Paul speak because he wants to be prepared when he expands his business.

?I want to get smart before I hire somebody and make the mistakes,? Sparks said.

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