​​8 Essential HR Skills for Every Small Business Owner

High employee turnover is often preventable. Focusing on human resource development is one of the best investments you can make to lower employee turnover and grow your small business.

Developing strong HR competencies can help you attract top talent, retain employees, and create a positive work environment. Let's break down the eight essential HR skills that every small business employer should master to effectively manage their team and build a thriving workplace.

8 Essential HR Skills for Professionals

Building a successful workplace begins with mastering the essential HR skills that foster trust and drive growth. The following eight HR skills help cultivate a workplace built on trust, productivity, growth, and employee satisfaction:

1. Effective Communication

Clear communication is essential for engaging with employees at every stage, from recruitment and onboarding to performance management and even offboarding. It's about ensuring that your policies, expectations, and feedback are conveyed to employees in a way that is transparent and consistent.

Employees who feel heard and well-informed are more likely to be engaged, productive, and satisfied in their roles. Effective communication is the foundation of HR. Mastering this skill allows you to execute the other seven skills on this list successfully, from conflict resolution to employee motivation and beyond.

Tip: Consider implementing regular one-on-one check-ins to maintain open and consistent communication.

2. Recruitment and Acquisition

Attracting and hiring the right candidates for your small business is fundamental to building and growing a successful company. You need to be able to source, interview, and select top talent that fits your specific needs.

Recruitment and acquisition skills go beyond filling positions. They focus on identifying individuals who will drive long-term growth and align with your company’s mission. A well-structured hiring process can also reduce turnover, saving time and resources while boosting employee retention.

Tip: Include interview questions that evaluate soft skills to ensure candidates are not only qualified but also a strong cultural fit for your team.

3. Onboarding and Offboarding

Onboarding and offboarding are two critical HR functions that have a direct impact on employee experience, engagement, and retention. A strong onboarding program should outline job responsibilities and expectations while also providing a multi-day orientation to help new hires establish positive connections with the company and their coworkers.

Similarly, a thoughtful offboarding process helps maintain professionalism and valuable relationships even as employees exit. A thorough offboarding plan should ensure compliance with legal and HR policies while keeping an open door for potential rehires or positive referrals. It’s also an opportunity to gather valuable feedback to help reduce turnover in the future.

Tip: Create step-by-step onboarding and offboarding guides to streamline the process and make it smoother for all parties.

4. Legal and Payroll Compliance

Failing to stay compliant with labor laws and regulations can result in costly fines, employee disputes, and even legal action. A strong understanding of employment laws, workplace rights, and payroll compliance is crucial to safeguard your business against potential financial risks and legal disputes.

Some examples of wage laws include state-specific minimum wage and overtime pay regulations, anti-discrimination and harassment policies, as well as health and safety regulations. When it comes to payroll compliance, you’ll need to ensure accurate payroll tax calculations, keep track of benefit deductions, and stay on top of tax filing deadlines.

Tip: If you’re unsure about state laws, check out Justworks’ State Labor Laws for Employers information page.

5. Conflict Resolution

Workplace conflicts can arise from various sources, including miscommunication, internal competition, and unmet expectations. In other words, workplace conflicts are inevitable, but how they’re handled can make or break company culture. HR professionals must be skilled in managing and resolving disputes between employees or between employees and management to promote fair outcomes while fostering a positive and productive work environment.

Tip: Develop a standard conflict resolution strategy that can be tailored for specific scenarios.

6. Office Management

Efficient office management involves overseeing administrative tasks, organizing workflows, and utilizing technology to streamline processes. A well-managed HR office reduces administrative bottlenecks, enhances workflow, improves employee experience, and helps maintain accurate records for compliance and auditing purposes.

As an employer, you should master your HR software to manage payroll and benefits efficiently, as well as utilize project management tools to coordinate tasks and keep on top of deadlines.

Tip: Attend HR workshops and training sessions to stay current on industry best practices and new software that can help streamline your HR processes.

7. Employee Wellbeing Experience

HR professionals play a crucial role in developing programs and benefits that support employees’ physical, mental, and emotional well-being. This includes seeking Employee Assistance Programs (EAPs) or additional benefits that can help the well-being of your employees.

Prioritizing well-being leads to higher job satisfaction, increased productivity, and lower turnover rates. Employees who feel satisfied with their work-life balance are more engaged, productive, and likely to remain with their current organization.

Tip: Offer perks such as gym memberships, mental health resources, or in-office mindfulness sessions to promote a healthy work-life balance.

8. Empathy and Emotional Intelligence

Empathy is one of the most potent soft skills in the workplace. Understanding how to respond to employees’ emotional needs is crucial for building trust, fostering engagement, and maintaining a positive company culture. A culture of empathy also leads to higher employee satisfaction and retention, stronger team collaboration and morale, and reduced workplace conflict. When developing this skill, learn to actively listen by giving employees your full attention and validating their concerns.

Tip: Establish an honest feedback cycle by holding regular check-ins where employees can openly discuss any issues they may have.

How Justworks Can Help Streamline Essential HR Skills

If you're a small business owner looking to strengthen your HR skills, Justworks is here to help. Its all-in-one platform offers the HR tools, integrations, and resources you need to manage your team efficiently, giving you more time to focus on developing your HR expertise. With 24/7 customer support, expert advice is always just a click away.

Ready to learn more about how Justworks can help you free up time to spend on supporting your people and growing your business? Contact Justworks today to get started.