For many HR professionals at small businesses, the past few months have been like trudging through a hurricane with a leaky umbrella.

Early on, while trying to make sense of ever-changing health guidance, state closure orders and federal assistance programs related to the coronavirus pandemic, these pros were also called on to provide expert advice on topics they'd likely never thought about before, such as quarantine rules and disinfection procedures. 

They also had to manage the workforce of a fast-shrinking or—rarely during the pandemic—growing business. Often, in-house teams were understaffed and under-resourced.
 

In a series of interviews, HR consultants to small businesses thought back on an exhausting period that has only recently begun to taper off, remembered as a blur of acronyms: FFCRA, PPP, EIDL. Several told of pulling all-nighters, trying to make sense of some new regulation or guidance before a morning briefing with executives, knowing that the consequences of a mistake were high.

"The first four weeks of COVID, I was cramming my brain with all this information, and it kept changing. I'd be on a webinar, and another piece of legislation would pass Congress right in the middle of it," said Kimberly Prescott, SHRM-SCP, president of Prescott HR in Columbia, Md., which consults with a variety of small and midsize businesses in Maryland.

"For an HR nerd, it was an amazing time. It was unfortunate, of course, why it was happening. But for people who really love to work through challenges and problem-solve, it was amazing."

Every day was an adventure, which isn't always true in the HR field.

"There was actual excitement when the DOL [Department of Labor], the IRS and other agencies would post guidance on leave statutes," said Sheri L. Mooney, president of Mind Squad HR in Buffalo, N.Y. "A flurry of e-mails would be circulated, and I would be asked to weigh in on a host of questions."

Mooney, who consults with small businesses throughout New York state, said there was "an incredible amount of pressure" on HR managers to quickly translate emerging guidance into action plans. That process helped HR forge new relationships with executives and operational leaders that may serve to elevate the HR function in the long run, she said.

"Looking back, I can tell you that I have no memory of a time when human resources professionals were more integral to the business than during COVID-19."

Fast Decisions and Limited Information

Hit hard by coronavirus-related shutdowns, many small businesses didn't have the means to delay a headcount reduction or send employees home with full pay, as some larger corporations were doing.

Indeed, a survey of small businesses conducted in late June by the Society for Human Resource Management (SHRM) found that the majority lost revenue, with 7 percent reporting a total loss. More than 1 in 4 were unable to offer work-from-home options to staff because of the kinds of work their employees did. 

About 44 percent of the small businesses resorted to laying off at least some employees, and 13 percent terminated half to all employees.

Prescott said she spent a lot of time early on dealing with these issues, explaining to her small-business clients the difference between layoffs and furloughs and the implications of cutting pay for salaried employees.

A temporary boost of unemployment insurance payments by $600 a week eased some of the pain and guilt of letting employees go, Prescott said. Also, employees' concerns over safety generally overshadowed their distress about a lost job.

Still, there were complications. Terminating employees often required paying out unused vacation time, and many struggling small businesses didn't have the cash on hand. "We were looking for creative ways" to make employees whole, Prescott said. "We were trying to figure out based on state law if we could pay it out over time."

Meanwhile, HR specialists had to sort through federal programs that sometimes appeared to be in conflict and offer advice on which way to go.

The Families First Coronavirus Response Act required businesses to pay workers to stay home if they were sick or had children out of school, with pay levels set depending on the reason the employee needed to stay at home. At the same time, the Paycheck Protection Program was passed to encourage businesses to retain employees, subsidizing pay through tax credits.

"None of us had done this before, even legislators, and you could see it in a lot of the regulations that passed. There were so many questions, and it probably took 30 days to get guidance," Prescott recalled. "In the meantime, we were trying to make sure we didn't become the case study of what not to do."

Every time the rules began to make sense, they changed, she said. "And then it was like, 'We've got to bring people back to work.' But who comes back? Is it the same job? Is it full time? What if they refuse? For small employers without a dedicated [HR] resource, it was overwhelming. I got a lot of new clients who said, 'I don't know what to do.' This did help a lot of employers understand that they needed policies. I've gotten a lot of handbook requests lately."

An Elevated Role for HR

Out of that madness, many HR professionals have emerged as essential members of the executive team, working on the top questions of the day: Are the facilities safe? Are employees engaged? Do the rules make sense, and are they being followed?

"It's like there's been three years' worth of changes in a three-month period," said Jonathan Gallagher, chief executive officer of San Diego-based Coastal Payroll, which provides HR services to 65 small businesses in California. "HR used to be the place of last resort. People would come when they couldn't find answers anywhere else. Now there's a new understanding that 'you seem to be the most knowledgeable person or department as it pertains to this crappy situation we're dealing with, so we're going to turn to you.' "

That stature was reinforced when protests erupted in the wake of George Floyd's death while in police custody in Minneapolis, Gallagher said. "You now have a tremendous diversity challenge and a level of anger that is channeling through your organization on top of everything else. There's probably never been a more critical time for HR."

Like other HR consultants, Tara Bethell, founder and chief executive at Copper Quail Consulting in Arizona, said demand for her services has never been greater. Now, she said, small-business owners "understand that HR cannot be another duty assigned to a staff person already handling other business functions."

She is working with several employers to bring on in-house HR support for the first time. "My next hope is that as small businesses bring HR inside, they will structure this function to report to the CEO or executive director, and [HR will] have the strategic seat at the table they deserve when overseeing the talent of the business."

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