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10 Common HR Problems (& How to Solve Them)

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Whether you’re a human resources professional or someone managing a team or company, I know there are several problems that keep you up at night and leave you frustrated.

I’m going to show you how to solve them — from finding the right people and keeping up with regulations, to dealing with bad bosses and delivering hard news.

Consider this guide your mentor, and let’s conquer these 10 common Human Resources problems together.

1. Find the right talent within budget (and on time).

A company is only as good as its people, but finding good people can be costly and time-consuming.

Your company can expect to spend as much as $7,645 — and search up to 52 days — for each new hire. On top of that, the cost per hire can balloon to as much as 60% of a former employee’s annual salary, if you’re replacing someone.

You might be tempted to chalk these numbers up to "the cost of doing business," but there's no reason why your company can't save time and money on hiring top talent.

Here are five tips to set your company up for success and stability without pushing the envelope.

Stockpile resumes.

Use your website, career sites, and social media channels to attract candidates year-round.

Post regular reminders that you are always up for meeting talented applicants who might be a great fit for your company. Even if you don’t currently have open positions, you can still encourage job seekers to send emails, submit resumes, fill out applications, and complete online forms for future openings.

Engage with past applicants.

Just because an applicant wasn’t a fit for your company in the past doesn’t mean he or she won’t be in the future. Regularly send past applicants news about your company and top employees, as well as current and upcoming job openings. Review this potential talent pool occasionally, and approach specific people who may be solid candidates for specific positions.

Encourage employee referrals.

Since your current employees already know your company’s culture, processes, and needs — and typically know other talented industry professionals — they can be great sources for referrals. They can also drop your cost-per-hire to $1,000 or less!

People want to work with people they know and like. This is a good opportunity to make that happen, especially if you offer creative incentives like concert tickets.

PC: Ere

Consider recruiting software.

Depending on your company size and the scope of hiring needs, you may want to consider recruiting software to help you attract talent. Check out our handy site-by-site review of these platforms to choose the right one for you.

Outsource your HR tasks.

Small business owners can spend upwards of 40% of their time on recruiting talent and similar tasks that don’t generate revenue. Depending on your size and budget, it might make sense to outsource your HR responsibilities.

There are thousands of professional employer organizations. They will cost you, but they'll also give you 40% more time to focus on other challenges in your company.

2. Get employees engaged with your benefits package.

Workplace benefits are used to attract new employees and show existing employees how much you value them. But fewer than three in 10 feel confident they’re using all their benefits. Since workplace benefits account for an average of 32% of employee compensation, workers are leaving an enormous amount of money on the table!

So how do you get employees using everything you’re offering them?

Follow these three steps:

1. Identify benefits your employees are underutilizing, and ask them why they aren’t using them.

2. Work with your design department or communications team to create clear and concise content — infographics, videos, webinars, handbooks, email reminders, etc. — that will help your employees better understand the value you're offering them.

3. Offer Q&A sessions and individual meetings to provide additional information and address any lingering questions or concerns.

Employee Benefits Counseling

PC: BenefitsPro

3. Create a diverse, inclusive workforce.

Diversity is a huge and important topic, impacting everything from laws to relationships to careers. But building a diverse and welcoming workforce isn’t a PR move. It’s something that will reap serious rewards for your business.

Diversity-minded companies are:

  • 2x as likely to meet or exceed their financial goals
  • More likely to be innovative
  • Better at handling change
  • And generate 30% more revenue per employee

PC: TalentLyft

While diversity in terms of gender, ethnicity, and age is healthy for any workplace, cognitive diversity — differences in people’s perspectives or the ways they process information — can play an even bigger role in your team’s success.

People with different backgrounds and experiences think differently, and bring different values to the table that help companies do a better job of coming up with ideas, solving problems, creating products, and driving overall success. Despite these benefits, only 57% of recruiters say they focus on attracting diverse candidates.

If your company could be doing more for inclusivity and diversity, share these strategies with your team:

For HR

Make your recruiting and hiring processes transparent. Encourage current employees to recommend diverse applicants, and make sure all applicants know that your company places a premium on specific skills and experience.

The selection process is the same for every candidate, regardless of any hiring quotas.

For Managers

Train your managers on the importance of viewing inclusivity and diversity as a core competency, and hold them accountable to your standards.

Form a group of managers and other leaders who meet regularly to set goals for hiring, retaining, and promoting a diverse workforce, and who address any engagement barriers among underrepresented employees.

Note: diversity should not come at the expense of needed skills or experience.

Deloitte Inclusion Survey

PC: Deloitte

For Employees

Nearly one-third of workers say they’ve left jobs because they didn’t feel comfortable being themselves. When employees who are different from their colleagues are allowed to flourish, your company will benefit from their input, talent, and engagement.

Openly promote — via company-wide meetings, internal communications, and other materials — the merits of an office culture where all employees feel safe to voice their ideas and concerns.

Place an emphasis on recruiting candidates with diverse views and different behavior types during the hiring process, and create strategic opportunities for your employees to brainstorm and collaborate with team members with different backgrounds and perspectives.

4. Deal with difficult employees.

If you have a difficult employee whose level of production could easily be replaced by a decidedly less-difficult alternative, it’s probably time to do so.

If you have a difficult employee who also happens to make key contributions to your company, there are a few steps you can take to make your working relationship a bit more workable:

Challenge them. The more you stretch problem employees’ time and talents, the less likely they are to cause trouble, and the more likely you are to maximize their positive contributions to the company.

Find ways for them to work alone. Limiting team interaction can be especially helpful for employees who can be arrogant, verbally abusive, or dismissive of other team members’ ideas.

Create a list of personal goals for their work and conduct. Work with them to create this, and consider offering incentives like special projects, bonuses, and extra paid time off to encourage them to hit these goals.

Read the room. When things are going well, offer positive reinforcement. When conflicts arise, keep your cool and listen to everyone involved. Once all the facts are in, offer corrective guidance, such as the interest-based relational approach outlined in this video:

Document everything. Problem employees deserve an objective record of their achievements and missteps. Plus, it’s difficult to make a case for disciplinary action — including termination — without thorough documentation.

Sometimes, enough really is enough. Gossip, disrespect, and abuse will drag your whole team down.

If you’ve tried to make things work, but the employee continues to be a jerk, it’s probably time to move on. Reflect on what you learned from the experience, and keep a list of red flags handy for when it comes time to interview future employees.

5. Overcome software issues.

Does your company have problems with software? You’re not alone.

Each year, businesses lose an average of $1.55 million and 545 hours of staff productivity due to IT outages.

PC: Small Business Trends

The software systems you started with typically can’t keep up with your company’s needs as it grows, and many a la carte software options require costly add-ons and help from IT specialists to work properly with your other systems.

These (and other) HR roadblocks cost your company time, talent, productivity, and money. The good news?

There are numerous HR software options that can help you streamline your HR processes, and boost your overall business. They'll allow team members on different systems to work together, and provide reliable, actionable data about your organization.

Here are a few:

BambooHR

This industry-leading platform can handle everything from applicant tracking and employee recruitment to employee administration, payroll, and paid leave management.

Gusto

A robust payroll solution, Gusto tackles the complexities of HR management and benefits administration, giving you a handle on payroll tax, compensation insurance, and 401(k) management.

Trakstar

Designed for local governments but perfect for any business, this platform specializes in goal management and employee performance tracking, which is key to generating performance reviews.

6. Develop employees into leaders.

The business world is constantly changing, and businesses need strong leaders to navigate it. But while nearly 90% of HR and business leaders say that it’s important for their companies to develop such leaders, only 6% say they would describe their leadership pipelines as “very ready.”

Identifying your company’s next generation of leaders is crucial, but it’s not enough. You have to develop them. Here are a few ways you can do that.

Model great leadership skills.

Employees learn from their employers. You have to decide which skills and traits you want your employees to have, and portray those so that employees can learn them.

Connect your employees with mentors.

Your future leaders should meet regularly with individual mentors to discuss their goals, ask questions, share ideas, and receive insight and encouragement as they transition into leadership. While mentors are often your employees’ immediate supervisors, they can come from anywhere inside your business (or out of it).

Encourage networking.

Networking helps future leaders develop valuable “soft skills” — skills that 73% of employers say workers are lacking.

Your company’s future leaders should be encouraged to network (with employees they might not know in your own company, and at networking events), so they can practice striking up conversations, navigating potential business opportunities, and gaining positive exposure.

Skills Needed for Leadership

PC: The People Factor

Provide opportunities for growth.

If you want to invest in your company’s future, invest in growth opportunities for your future leaders. Consider paying for formal education or specialized training, and connecting your future leaders with professional development opportunities.

Work with business partners and other organizations to create a range of new leadership experiences, including pro bono and community service projects. Give them the authority to run internal meetings and supervise projects to get practice and experience.

It’s important to keep up with leadership candidates as they prepare to move into their new roles. Meet with them to discuss their individual goals, as well as opportunities for development. Listen to their questions and concerns, and work with them to overcome any gaps in their knowledge or skills.

7. Deal with bad bosses.

You've probably heard the quote: “People don’t leave companies, they leave managers.”

While people do leave jobs because of bad bosses, that saying is a tad misleading.

Roughly 12% of people leave because of their manager, but 28% leave due to overall leadership, and 52% leave because they find better opportunities elsewhere. That said, about 40% of people are leaving because of leadership.

What can you do about it?

PC: Inc.com

Stop problems before they start.

When bosses cause problems, HR professionals need to run interference, protecting employees from abuse and shielding employers from legal liability.

If HR professionals take a few proactive steps, however, they can stop many of these problems before they start.

Thoroughly train all managers on your company’s anti-harassment and discrimination policies, incident reporting processes, wage and hour rules, employment laws affecting the workplace, and company standards for proper treatment of employees.

You should also provide regular training for managers to make sure they perform above and beyond the rules and laws your company follows.

Lead from the bottom up.

You and other managers may want to adopt the principles of what Inc. Magazine top-30 leadership columnist (and former coworker of mine) Marcel Schwantes calls “servant leadership."

According to this model:

  • You focus on caring about your employees as all-around people.
  • You help your team thrive by putting their needs ahead of your own.
  • You recognize your employees’ successes and accept the blame when something goes wrong.
  • You seek to get results from your team not through top-down delegation, but rather by building your team from the bottom up.

Servant leadership leverages employee empowerment to drive business results. When your team feels a genuine sense of belonging and teamwork, they will take greater responsibility for the work they do.

8. Navigate laws and regulations.

As your company grows, so do the employment regulations you have to follow. And if they’re not growing, they’re usually changing.

Complying with these regulations is a challenge, especially for small to mid-sized companies. While big companies can afford large HR and legal teams, small businesses run the risk of fines and legal action for violations they often didn’t even know they were making.

As challenging as it can be to keep up with the new rules, it’s not impossible. It just takes some planning.

Follow these steps:

1. Make sure you fully understand any and all new or amended legislation. This includes all the fine print, as well as any aspects that may affect your workforce. Reach out to other HR professionals for help if you need.

2. If you are unsure whether a rule applies to you, play it safe and assume it does. You'll avoid costly mistakes, and your employees will be guaranteed to receive the benefits they’re entitled to.

3. Communicate any and all changes to your employees. Explain how and when the changes will take affect, and what that will mean for everyone involved.

4. Create a comprehensive benefits guide. Distribute copies to everyone in your company, and issue updated versions each year.

Compliance affects everything from legal issues and workforce management to technology costs, compensation, benefits, and more. To ensure all the moving parts are working smoothly, review your processes and results on a regular basis. Then look for ways to improve on what you're doing.

9. Deliver bad news.

There are few tasks you dislike more than having to deliver bad news. Whether a facility is closing or someone was passed over for a promotion, it’s never easy to tell people things they don’t want to hear.

It’s easy to feel tempted to soften the blow by talking about something else first or sugarcoating the truth. Unfortunately, that’s the exact opposite of how you should handle the situation.

While recipients know that bad news is sometimes unavoidable, most people prefer to receive it quickly and clearly.

The next time you have to deliver bad news, be strong and prepared. Consider Cameron Morrissey’s suggestions:

1. Deliver the bad news quickly and in person.

2. Clearly communicate the next steps and be ready to answer any questions employees may have.

3. Be transparent. Don’t joke around or use vague language.

4. Make sure you’ve communicated the bad news all at once. Delaying it will only cause added stress and confusion.

Once you’ve delivered the news, try to be sympathetic — no matter how angry or upset the employees might be. Provide room for them to get mad or vent without arguing or debating.

Delivering bad news is never a pleasant experience, but with a little planning and understanding, it can be a respectful one.

10. Retain employees.

Finding quality employees is often a challenge. So is keeping them.

Losing quality employees is not only a drag on your company’s talent pool and time, it can also be a drag on your company’s finances. The average cost of losing an employee can be anywhere from one-third to 400% of the employee’s annual salary!

Employee Turnover Rate

PC: HRresolved

Why Employees Leave (and Why They Stay)

Some employees leave because their bosses fail to properly explain their roles or responsibilities, while others leave because their bosses are just plain bad. Others quit jobs due to bad company culture, lack of open communication, or unhealthy work-life balance.

The biggest reason employees leave jobs, however, is because they feel unappreciated and unfulfilled.

Employees whose good work is regularly recognized by their bosses are 5X more likely to stay with their companies. On the flip side, 24% of workers who felt like their work wasn’t recognized in the past two weeks had recently interviewed for a job elsewhere.

Employees who feel they are growing professionally are 20% more likely to still be working at their current employer a year from now. Those who don’t feel that way — whether due to a lack of training, skill building, proper compensation, or opportunity — are much more likely to seek opportunities for advancement elsewhere.

Workers who believe their company has a higher purpose than just the bottom line are also more likely to stay with their current company. Employees who feel plugged in to such a vision are 59% less likely to look for a job elsewhere in the upcoming calendar year.

The Bottom Line

If you want your employees to stick around, offer them the tools, experience, and encouragement to succeed anywhere.

Then, give them reasons to choose to succeed with you.

Related: 15 Essential Soft Skills Every Successful Leader