The HR Issues Quietly Costing SMEs Money

As your accountant, we often see the financial impact of people-related problems long before business owners do. Sick leave patterns, poorly managed restructuring, AI/privacy risks, they all hit the bottom line faster than you might think.

Key insights shared recently by Bernie from King & Co, experts in practical operational HR support for SMEs.

 

  1. Sick Leave & the “Monday Flu”

Summer often brings a spike in sick days, especially the suspicious Friday/Monday combo. Genuine illness is expected, but repeat patterns are costly and manageable.

King & Co recommend the WARM method:

  • Welcome back with care
  • Address the pattern factually
  • Reinforce Responsibility around being fit for work
  • Monitor expectations clearly and in writing

A simple, structured conversation can save thousands in lost productivity.

 

  1. AI & Biometrics: New Tech, New Risks

AI is already in many workplaces, often without owners realising it. And with New Zealand’s new biometric privacy rules now active, tools using fingerprints, facial recognition, or digital time-clocks may carry extra obligations.

The takeaway: – Use tech as a tool, not a decision-maker, and protect the data you collect.

 

  1. Business Change Often Costs More Than It Should

Shareholder changes, restructures, new entities, every business change is also a people change. When HR processes are missed, the cost can be significant.

Real examples shared included:

A shareholder buyout that led to a $30,000 PG settlement, simply because advice wasn’t sought early enough.

A business transfer that created unexpected financial and legal headaches due to missed employee obligations.

The solution? – Get HR guidance before the paperwork starts, not after.

 

Final Thought

Most HR issues are avoidable, but only if you catch them early. Whether you’re noticing attendance trends, planning structural changes, or adopting new workplace tech, the right advice upfront protects your people, your culture, and your profitability.

If you’d like an introduction to King & Co. or want guidance on any of the topics above, call us to get you connected.

They offer a friendly, practical approach designed specifically for SMEs with a free discovery call and no locked in contracts.

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