Employee Benefits Financial Wellness Employment Law

Managing Your Growing Business: Tips from 5 Experts

By Experts Blog on October, 22 2019

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Your business is starting to grow. No longer a start-up, you’ve got your business model, found a market for your product, and hired people to join your business. Growing involves growing pains: new opportunities and new problems. 

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You need to hire talented people to work for you, how do you entice them to join? And once they’ve joined, how do you keep them happy? There’s more incoming revenue than before, how do you manage it? What policies and procedures do you need to put in place?  And is the business properly insured? 

These are questions every owner of a growing business should be asking themselves as they oversee their expansion. These are questions we’ve answered. 

We reached out to several business experts and asked them a simple question: When working with growing businesses, what do you feel is one of the most important items in your area of expertise that is frequently overlooked? Below are their answers. You can either read through the article or skip to the section of most interest.  

 

Invest in People Management

Install A Financial Management System

Develop Benefits Policies & Procedures

Establish An Employee Framework

Protect Against Cybercrime

 

Learn how to successfully launch your business in Canada >>

 

Invest in People Management

By Ryan Anderson

Mathews Dinsdale & Clark LLP

 

Growing a business requires people.  Sometimes few, sometimes many. Rarely none.  And, in every case, when a business hires a person for work, that creates a contractual relationship along with a host of obligations and liabilities for the employer.

The challenge is that in the growth phase of any business, its leaders are consumed by opportunities and challenges that require their focus. And in the war for attention, human resources is often an early casualty.

Left unattended, people appear to take care of themselves. They come to work and interact with one another.  They do their job and collect their paycheques. Sometimes it’s easy for a business owner to assume all is well with their employees as long as there are no active fires or live disputes. However, inattention to the fundamentals of people management can be a costly mistake.

To prevent making such a mistake, you should identify the most important elements of your employment relationships and treat them as a priority. Seeking expert advice can help identify the “must do” items that will mitigate or eliminate common employment-related liabilities and help develop an engaged workforce.  

For example:

  • Put simple employment agreements in place. 
  • Ensure your core employment practices are compliant with minimum statutory requirements.
  • Make sure at least one person is primarily responsible for monitoring and managing employee relations.

It’s never a good idea to treat the people management part of your growing business as an afterthought.  Making human resource fundamentals a priority needn’t be complicated or time consuming. And it pays off.

 

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Install A Financial Management System

By Dan Roberts

Baker Tilly WM LLP

 

A growing business needs confidence to focus on the key drivers of your business. Financial management systems provide that confidence. 

For a growing business, there are an ever evolving number of financial interactions that need to be addressed in order to operate effectively. A financial management system captures items such as: 

  • Raising funds from investors. 
  • Collecting revenue from customers. 
  • Paying expenses. 
  • Paying employees. 
  • Filing taxes. 

The key is to start with a financial management system that collects the necessary information. As the business grows, people can begin managing specific aspects of the system.

A strong financial management system will ensure that the business's financial risks can be appropriately addressed. It will: 

  • Enable financial information to be available as needed to make appropriate business decisions.
  • Ensure all statutory requirements (such a tax returns) are filed on time.
  • Provide for the financial security of the business.

A financial management system will also be key in attracting key employees and business partners and will be integral should there be an objective to sell the business in the future. Potential buyers place value on an effective financial management system.

 

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Develop Benefits Policies & Procedures

By Kandy Cantwell

Montridge Advisory Group Ltd.

 

Many employers have not implemented benefits-related policies or procedures. Though they often want to have these policies in place, they simply don’t know where to begin.  Asking a benefits advisor is an important first start, as they know the insurer and legal limitations that you need to be aware of. Let them be your guide. 

To start, I recommend clear, written, and communicated policies for the following situations:

 

Maternity and Paternity Leave

Maternity and paternity leave are protected leaves. 

Your province’s Employment Standards legislation will be your guide on specific details. There are, however, two broad details worth considering.

Employers who pay 100% of benefit costs must continue benefits for the employee’s leave.  If there is a premium share with the employee – and the employee chooses to continue paying their share (commonly via post-dated cheques), then benefits must also continue.  Only when an employee chooses not to pay their share during the leave do employers have the right to terminate benefits.

Some employers will top-up Employment Insurance (EI) benefits during a leave.  With some employees choosing to take 18 months instead of 12 (with the corresponding 33% benefit vs. the standard 55% benefit), it’s important for employers to have a top-up policy for each option.

 

Disability Leave

Disability leave is not a protected leave. While many employers provide some form of income protection through short-term disability coverage or salary continuation, most rely solely on the EI sickness benefit. EI provides limited protection in the form of payments equal to 55% of earnings up to a maximum of $547 (2019) of taxable income per week. Thus the higher a worker’s salary, the lower the replacement percentage of their pre-disability income.  

The Supplemental Unemployment Benefit (SUB) Program allows employers to provide all, or a specific group of employees with supplementary income. The EI sickness benefit forms the foundation of the employee’s income replacement; employer payments make up any shortfall, up to a maximum of 95% of the employee’s normal pre-disability earnings.

Other questions to answer are:

  • How will you continue to receive medical information from an employee on disability leave?
  • How will you communicate to an employee on disability leave?
  • If benefits terminate, how much notice will you give the employee?

Employment Offer Letter

Think about what you want to include in your employment offer. Many benefit and retirement programs offer coverage to full-time employees, and it’s common for there to be a waiting period before these benefits begin. 

Your offer letter should also note the employee/employer premium split, as well as whether the plan is mandatory or voluntary.  

Other things to consider in your employment offer letter: 

  • Retirement plan, what is the mandatory contribution level?  Optional contribution level?
  • Coverage for spouses / dependent children?
  • Do you have a prepared response for those who don’t qualify for the benefits & retirement programs for their offer letters?

Severance

When severance pay is being offered in lieu of working notice, common-law provisions can far exceed Employment Standards legislation.  Many employers assume that benefits can be included in this agreement; however, insurance contracts do not automatically provide severance-related benefits.

It is advisable to contact your employee benefits advisor prior to contacting the insurance company.  Your benefits advisor can provide advice regarding the format of the request, which benefits may be continued, and what alternative arrangements can be made for benefits the insurer is unable or unwilling to offer. For example, disability benefits are rarely extended past legislative notice periods.

If the insurance carrier allows the terminated employee to continue receiving benefits during their severance period, the health and dental are usually continued, as well as occasionally the life insurance.  

Be aware that, as an employer, you are liable if you don’t follow proper procedures around continuing employee benefits during the severance period.

 

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Establish An Employee Framework

By Debra Walker

Chemistry Consulting Group Inc.

 

Growing businesses often do not provide a solid structure for employee and employer behaviour in the workplace. Companies start out with only one or two employees and find that day-to-day operations envelope them with little time to establish such a structure.  As a result, business plans may be drafted without including a detailed look at the impact of the HR strategy. 

This is a common and costly error. 

A strong employee agreement outlines the expectations and terms for both the employer and employee. It defines a consistent and nurturing workplace and provides the basis for company culture. 

This includes: 

  • An HR strategy interlinked and interwoven with the overall business strategy. 
  • An employee manual aligned with local and national employment legislation, outlining core policies and procedures for all to reference and follow.
  • Detailed job descriptions that inform everything from recruitment strategies and recognition programs to employee development.

Organizations first establish the baseline documents, then regularly review their company policies. A regular review ensures that the existing structure best serves the company and its employees. 

 

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Protect Against Cybercrime

By Linda Simmons

Westland Insurance Group Ltd.

 

The tried and true policies of the past do not protect against all of today’s risks. Back when business policies were first established, computers, cell phones and the internet did not exist. Cybercrime was not considered. Today, your company is at greater risk of a Cyber event than a slip and fall claim. And yet Cyber Risk Insurance is still largely overlooked.

Cybercriminals are not selective. They are opportunists looking for their next victim. They prey on businesses of all industries and sizes. If you have computers, a website, social media accounts, cellular phones, or laptops and transact business over the internet, you’re as likely to be hacked as any other company. 

If tomorrow your data was encrypted, funds were diverted through a social engineering scheme, your reputation was damaged and you had to notify customers that their personal information was compromised all because your data was breached, what would you do?  Who would you call for help? How will you fund those costs? How will you rebuild your reputation and your customer’s trust? 

A Cyber Risk policy is designed to protect companies against the financial consequences of data breaches and other cyber events.  It can also provide valuable incident response support services in the event of a cyber event.

 

IMG_9931 Linda Simmons: Linda is a Senior Account Executive at Westland Insurance Group Ltd. She is a Canadian Accredited Insurance Broker (CAIB) with over 30 years insurance experience, and is committed to client service excellence and helping clients succeed.

 

Key Takeaways

It can be tough to keep track of all the potential pitfalls and hazards when growing your business. If you follow the advice of the experts and: keep your employees happy by investing in them, speak with a benefits advisor to establish benefit-related policies, set-up a financial management system, have strong policies for employee and employer behaviour in the workplace, and protect your company against Cyber Crime, your growing company will stay strong and stable.

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