Where HR and Legal Software Ends and Consulting Begins

Automation affords small businesses great power when addressing HR and legal issues. We know, because we run software for our clients that in turn makes our lives easier.

However, these useful tools have their limits when solving many out-of-the-box problems that small businesses face. We've thus dedicated this post to point out the price that many clients pay when using software solutions for HR and legal issues.

1. Software might not provide the security you need.

With many well designed software solutions, we are often shocked at the lack of security afforded to employee and company information. When walking through software with our tech clients--who are admittedly more knowledgeable on the technical aspects of data security--we often notice gaping holes.

For example, do you know that some of the links that software products create to store your employee and company information are simply not secure? In several instances, we've demonstrated software workarounds where sensitive information--financials, SSNs, salary, immigration compliance, tax filings, and employee identification--is only a click away with an open URL?

Moreover, software does not have the professional responsibilities that professionals, particularly attorneys, follow to protect their clients' confidential data? For example, a software program does not afford attorney-client privilege for compliance issues. An attorney does.

2. Software can leave you high and dry when it does not give you adequate insurance

We are fully supportive of the recent advances in technology that are disrupting the outdated insurance brokerage model. However, it rarely makes sense to leave insurance decisions up to an office manager or overburdened CEO. As cheap as most insurance policies are, we almost always find instances where businesses have spared a dime on insurance when better human guidance would provide them needed protection.

3. Employee agreements are often insufficient when an employer uses boilerplate offer letters

From an attorney and HR manager perspective, we are shocked at the gaping risks that employers leave on the table when they cut and paste an employee's name or contractor's name into an existing offer letter or independent contractor agreement. Yes, you're saving a few hundred dollars on lawyer fees by not drafting a unique agreement for each hire. But, you'd be wise to have an HR manager or attorney spend 20 minutes verifying that the agreement fits the proposed role.

This is just one example of a boilerplate document or process that creates risks for employers. We'll save things like employee handbooks, noncompetes, non-disclosures, compensation policies, and non-discrimination polices for another day. Suffice it to say that there is a middle ground between automated materials and partner-level legal drafting. 

4. A missing human touch leaves employees feeling cold

As much as we all think that we can rely solely on digital contact, the human touch still has a big role in the workplace. For instance, how do you bring your employees into your business? Do you simply have them log into your payroll software, fill out some forms, and start working?

While we don't recommend arduous intake processes, we do advocate for a personal touch in some practices. We find that a human approach up front goes a long way for communicating things like workplace culture, expectations, promotion policies, and an explanation of benefits.

We are constantly evaluating our use of technology with a keen eye on what software does best and what where we need to add a human face.