Many small business owners start hiring staff the same way. A friend, a relative, or someone who walks in asking for a job. A quick chat about salary, a mention of what the job is, then they are told to start tomorrow morning.
At first everything seems fine. Three months later, problems start to appear.
“Boss, I thought my job was just manning the counter. Why do I have to arrange stock as well?”
“How many days of leave do I actually get?”
“You said there would be an allowance.”
The owner is left with a headache. They cannot remember what was promised either. The staff member remembers one thing, the boss another. No one is entirely at fault, because nothing was written down from the start.
The problem isn't the staff. The problem is that nothing is in writing.
When every work arrangement exists only in people's heads, every misunderstanding turns into a dispute. The boss feels the staff are being defiant. The staff feel the boss is being unfair. In reality, both sides are simply relying on their own memories.
It gets even more serious when you reach the point of having to take disciplinary action or terminate a staff member. Without documents, it is hard for the employer to prove what was actually agreed from day one.
Three basic documents every small business should have
1. Employment contract or offer letter
This is the most basic document. State the position, start date, salary, working hours, rest days, probation period and notice period. Both parties sign and each keeps a copy.
2. Job scope
List the main duties of the position clearly. It does not need to be long. Five to ten items is enough. Most importantly, add a line stating that the employee must also perform other reasonable duties as instructed by the employer. That one sentence can prevent many “that's not my job” disputes.
3. Basic company policies
Start with the issues that come up most often: attendance and lateness, how to apply for leave, overtime, and disciplinary rules. Once these policies are written down and given to all staff, you no longer need to repeat the same things every week.
SHORT COURSES · SEKOLAH BISNESWant to learn to prepare your own offer letters and employment contracts according to the Employment Act? Sekolah Bisnes has short courses (in Bahasa Melayu) for employers, from interviews to contracts, each focused on one problem. View the HR & Employment Act courses →
Make sure documents comply with the law
Documents written without proper reference sometimes contain terms that conflict with the Employment Act 1955. For example, working hours that exceed the permitted limit, or leave below the minimum entitlement. Terms that conflict with the law cannot be enforced, even if the employee has signed.
That is why HR documents should be reviewed by someone who understands the Act and its latest amendments, not just copied from a template on the internet.
Start now, even if you only have two staff
Many owners wait until the business is big before organising documents. In fact, the easiest time to start is while you still have few staff. Once you have ten or twenty staff, reorganising everything is far harder.
ABS HR Capital helps micro businesses and SMEs prepare clear, practical and legally compliant contracts, job scopes and HR policies. If you want to start organising your employee documents, contact us to discuss your business needs.
