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What do I need to know about Human Resources (HR) before I buy a business?

How your franchisor can help. Brilliant advice on handling HR.

Buying your first business or franchise is an exciting time. And whether you are looking at a well-established business or a greenfield opportunity, there are many different things to consider, including employing staff members if that’s the business model.

WHAT SHOULD I KNOW ABOUT HR?

The first months of your new business will be frenetic, so avoid the temptation to bring on staff without a formal agreement. Yes, it might work out okay and you might save yourself time at the outset. However, the risk to the future of the business (see box) is too great to make the reward worthwhile.

You should ensure from the start that there are clear terms and conditions in place which outline the obligations and expectations between you and your workers. You should also define the expectations of the role by creating a job description. This should outline the duties, responsibilities and objectives by which the employee’s performance will be measured.

The National Employment Standards (NES) are the 10 minimum employment entitlements that must be provided to all employees. Essentially, they stipulate

The HR Dept

that you must not pay less than the national minimum wage or provide conditions which do not meet the NES. They cannot be excluded, even by agreement with an employee.

Once you have your first employee you must record all their payroll information – such as salaries and wages, pay as you go (PAYG) withholding tax and super – then send it electronically to the Australian Tax Office (ATO) each time you pay them. Single Touch Payroll (STP) is the way of reporting tax and superannuation to the ATO and it requires that you put in place an STP-enabled payroll system.