Working With Numbers in HR

In speaking with business owners and executives on a regular basis, I often ask if they have an idea of what potential HR liabilities exist in their businesses, and what they cost. Very few have strong answers. Some give the question a bit of thought and say basically "I guess you're right, a lawsuit could be expensive". Others claim not to think much about it. Some are scared to death because they don't know if they're doing something wrong inadvertently, putting them into a potentially costly non-compliance situation. They don't know what they don't know.

Given the increasing number of federal & state labor laws out there today, a company with as few as one employee could be at risk for non-compliance (I'll provide the complete list in the next entry).

For now, sink your teeth (or your brain) into these numbers:

• Federal regulation compliance costs small businesses $7,647 annually per employee.
• The average direct and indirect cost of losing an employee can be up to 125% of that employee’s annual salary.
• During 2006, the EEOC received a total of 75,768 discrimination charges against private sector employers, with over 53%of the allegations based on either race(20%), sex (17%) or retaliation (16.5%).
• The average sexual harassment settlement is $250-$500k (and you still pay something win or lose)
• Workforce Management reports an expected shortfall of 10-million workers bythe year 2010.
• The number of U.S. laws and regulations regarding employment policies andpractices has grown by more than 60%since 1998.

Are you sure you want to leave the employer/employee relationship to non-experts?