WASHINGTON — While it’s not the reason they went into business, dry cleaners who don’t set up proper human resources policies could find themselves facing problems and messy situations that could have been avoided with planning and awareness.

During a recent National Federation of Independent Business webinar, Beth Milito, vice president of the NFIB’s Small Business Legal Center, outlined the five most frequent HR mistakes business owners make. 

In Part 1 of this series, we examined the high cost of getting these matters wrong, as well as the importance of being fair and consistent. Today, we’ll continue by looking at two other possible mistakes that are easy to make but can be difficult to recover from. 

“As a manager, supervisor or owner, you are charged legally with ensuring the safety and security of your workplace,” says Milito. This responsibility extends beyond physical safety — it also includes creating an environment free from discrimination and harassment.

The challenge for small-business owners especially, she says, is that workplace dynamics can shift quickly when employees work closely together. What starts as friendly conversation can cross lines into inappropriate territory.

“This is about making the workplace a safe place — a place that people want to come to — and making sure that individuals are comfortable there.”

Federal and state employment laws, Milito says, create a web of anti-discrimination protections that apply to virtually all workplaces.

Title VII of the Civil Rights Act, which addresses race, religion, sex and national origin, along with the Age Discrimination in Employment Act (ADEA), the Americans with Disabilities Act (ADA) and the Pregnancy Discrimination Act (PDA) all prohibit workplace discrimination. Harassment represents a form of discrimination that violates equal employment opportunity laws.

“There are a lot of laws that prohibit workplace discrimination, and harassment is a form of discrimination,” Milito says. She’s found that the complexity also increases because employees can file complaints through multiple channels: federal agencies, state departments of labor and even municipal equal employment offices.

A crucial step for legal protection is having written anti-harassment and anti-discrimination policies that clearly communicate company expectations, Milito says.

“These policies must answer four critical questions: What constitutes harassment? What conduct is prohibited? What are the potential penalties? What is the complaint procedure?”

These policies, she says, give the owner a defense against liability.

“The key is to have the written policy, to have shared it with employees, and then to make sure that you have a mechanism for employees to report any behavior that they believe is discriminatory.”

For smaller operations, such as those of most drycleaning companies, Milito recommends identifying at least two individuals who can receive complaints. This way, if the primary contact person is accused of inappropriate behavior, the employees have another reporting option. 

But Milito says that having written policies alone isn’t sufficient. Owners must take action when they observe potential problems.

“If you see something, or an employee reports something that is offensive in some way, take action and stop it,” she says. “This is not just all about avoiding legal liability. It’s about making the workplace a place that individuals want to come to.”

Even seemingly minor incidents require attention. Off-hand comments, sexual innuendo and inappropriate emails all fall into the “danger zones” that can escalate into larger problems. The key, according to Milito, is addressing issues immediately, whether or not an employee has formally complained.

When employees do come forward with concerns, the response process is crucial. Milito recommends listening intently without multitasking (looking at your phone or paperwork, for example), remaining neutral, and explaining the next steps clearly. If the employee agrees to it, having a third-party witness present can be helpful.

A growing concern, Milito says, involves employees requesting to record meetings or secretly recording conversations themselves.

“You need to be prepared for employees not asking for permission and recording a meeting nonetheless,” she says. The best prevention involves promoting an open, honest and supportive culture where employees feel comfortable without needing recordings.

This HR mistake involves failing to provide regular employee feedback. This oversight not only hurts performance improvement but can also contribute to employee turnover — a costly problem for drycleaning businesses fighting a tight labor market.

“Employee feedback is so important because you want to make sure you are rewarding the high-performing employees,” Milito says. “You also want to make sure that, for employees who are struggling with performance, it’s possible to educate and coach them, and that you are providing them with that opportunity to improve.”

Research consistently shows that employees leave businesses not primarily because of pay, Milito says, but because of other factors, such as lack of feedback, absence of new challenges, limited training opportunities and no promotion potential. “Better pay” accounts for only about 50% of employee departures.

When performance problems arise, Milito recommends starting with conversation rather than criticism. If an employee is consistently late, for example, owners should sit down with them and attempt to understand the underlying cause. Are they dealing with family issues or transportation difficulties? 

“Have a conversation with the employee,” she says. “Is there something you can do as the employer to address the situation to make it so that the employee is meeting the expectations?”

When conversations don’t resolve issues, employers should establish clear deadlines for improvement and schedule follow-up meetings, Milito says. The goal should be helping employees succeed rather than building termination cases.

Come back Tuesday for the conclusion, where we’ll examine the final two common HR mistakes cleaners can make: payroll and I-9 compliance. For Part 1, click HERE.