People Matters – Three big HR challenges for small businesses and how to deal with them

HR issues are hitting the headlines right now. Staff recruitment, skills shortages and the end of the Furlough Scheme are hugely concerning for some industries. Business owners have to wear several hats but the good news is that with small business HR support you can avoid pitfalls in these areas and more.


At Better Business at Hand, we provide small business HR support though our network of trusted fully qualified advisors. We love helping small business owners navigate tricky issues and solve problems. So, this blog focuses on these three key areas of concern and the steps you can take to ease your business HR pains!


Steps to mitigate three key HR issues for small businesses


  1. Staff Recruitment


Job vacancies in the UK are at an all time high with not enough workers to fill them. Various reasons have been cited for the shortfall with Brexit and the reopening of society after Covid-19 lockdowns given as the most likely causes.


An article in the Guardian quoting Office For National Statistics data lays bare the recruitment crisis:


… the number of job vacancies soared to more than 1m in August for the first time since official records began in 2001, rising by 35% in the space of three months across all sectors of the British economy.” (


There are well-publicised recruitment shortages for HGV drivers with daily news stories about freight building up at ports and empty supermarket shelves. But other sectors including Finance, Technology and Hospitality are also experiencing difficulty recruiting. Lack of staff in the hospitality sector has resulted in venues closing temporarily.


The industries where there are shortages are looking to make changes to attract new recruits, with better salaries, more flexible working hours and training schemes on the table. But this takes time to implement and requires a level of financial investment. Small businesses, however, need to act now to get staff.


The first step is to make sure you have a clear job description detailing what is expected of the role. Sounds obvious but you need to make sure that you get your job ad in front of the right people – the people who want the job and can do it! Perhaps try a new online jobs site to spread the net wider to attract the right candidates.


An HR consultant for small businesses is invaluable and can help businesses without a dedicated HR department find staff to fill jobs and so much more. They can manage the whole recruitment process including employment contracts.


At the moment in some industries it’s a job candidate’s market with people demanding higher salaries or more flexible working hours. Businesses are also seeing a candidate’s current employer matching an offer to retain their staff. So it certainly pays to have a qualified expert by your side to navigate any demanding HR issues.


It’s not just about finding staff but the right staff – dedicated and engaged workers will help you grow your business. To arrange a review with an HR consultant for small businesses send us a message. At Better Business at Hand, we have a network of fully qualified specialists ready to support your business.


  1. Furlough ending


During the pandemic, the Government took unprecedented action to support employees through the introduction of the Furlough Scheme. This involved staff being put on temporary leave or going on ‘flexible furlough.’ There was a temporary contractual agreement between the employer and the employee.


Employers must ensure that they:


  • Keep the agreement for five years
  • Keep a written record of how many hours someone worked and how many hours they were on furlough (For more information see )
  • Keep records of any 20% contributions made to top up the salaries (this information is also needed for the purposes of the ongoing business interruption claims after the findings of the Supreme Court judgment in FCA’s business interruption insurance test case)


Now that Furlough has ended the majority of employees have returned to their desks as before. However some staff have been placed on shorter working hours while others unfortunately had to take redundancy.


Any employees returning to work on reduced hours will need their contracts revised. It is important that this is done by an HR professional to avoid any legal issues further down the line. Small businesses may also need advice on how to work out annual leave entitlement or calculate holiday pay, notice pay or redundancy pay. Check that you have done everything you need to do further to an employee being on the Furlough Scheme.


There are also potential issues around working from home. It might help to set up clear policies, and if your business offers employees hybrid working, be clear about how many hours they are expected to be in the office.


As a business owner you have to perform lots of tasks but it could pay to hire an expert HR consultant for small businesses. They can help with:


  • Advice further to the ending of Furlough: contracts, working from home etc.
  • Employment contracts
  • Health and safety procedures
  • Staff handbook
  • HR policies including equal opportunities, sickness, flexible working, social media policy and more
  • Employment law changes such as IR35


To arrange an appointment with an HR specialist send us a message. At Better Business at Hand, we have a team of experts ready to provide advice on common business issues. All our consultants run their own businesses so they understand your business pains!


  1. Skills shortage


The UK is currently facing a skills shortage at every level from entry roles to more experienced positions. This is reflected in the recruitment crisis with more qualified lorry drivers needed and gaps in the hospitality and IT industries.


An article on earlier this year opens with the words: “The UK is heading towards a “catastrophic” digital skills shortage “disaster”, a think tank has warned.


The Learning & Work Institute says the number of people taking IT subjects at GCSE has dropped 40% since 2015.” (


Digital skills are cited as vital to our economic recovery from the pandemic.


Educational institutions are working with businesses to offer industry appropriate training and apprenticeships. If you are concerned about skills shortages in your business contact your local training provider.


Skilled workers help you grow your business. Rather than hiring staff you might want to consider upskilling or diversifying the skills of your current employees to bridge the skills gap. Your employees know your business and you know your employees. Training and development can benefit businesses and also result in increased employee motivation. You can get advice from an HR consultant for small businesses, who will source training solutions tailored to your needs.


Key takeaway


Growth is essential for the longevity of your business – the right staff can help you grow your business. An expert HR professional can help you find staff for your business and ensure that you stay on top of any employment law.


Acquiring, managing and retaining the right people requires planning and financial investment, if you need help with planning in these areas you can book an appointment with business planning expert Maria here.


You don’t need a full HR department but small businesses do need to make sure that all the policies and procedures are followed to the letter. If you are experiencing any HR issues it’s important that you seek advice as soon as possible.


Send us a message via the form at the bottom of this page to arrange an appointment with a fully qualified and experienced HR consultant for small businesses. We’re here to help your business thrive!

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