Common HR Risk Sources and How to Manage Them

If you ask a business owner what poses the greatest risk to their company, you may get a wide variety of answers. And all of them could be spot on.

Even among the highest functioning teams, the potential for risk is always there. After all, businesses are made up of humans – and nobody’s perfect.

But there are some common risk sources related to your employees and your HR function. It helps to be aware of them, so you can identify them early and take a proactive approach to manage them.

Safety First

Especially if yours is a working environment with heavy machinery, vehicles, chemicals, or other more obvious on-site hazards, safety should always be top of mind. But regardless of your industry, there’s a potential risk for some type of injury, illness, or other mishaps that may not even typically cross your mind. You need to have a robust safety plan and procedures in place.

Compliance is an Ongoing Challenge

Every workplace is a melting pot of liability. Local, state, and federal laws are highly complex and can change on a dime. It’s important to keep up with them all and be sure your organization is complying with them, communicating them to all stakeholders, and auditing your processes on an ongoing basis. This includes reporting your finances in a timely manner.

Ethics and Leadership Should Go Hand in Hand

It’s not just a cliché: In many cases, people don’t quit their jobs, they quit their bosses. Ensuring that your managers are consistently fair and ethical not only keeps employees engaged and loyal, but also avoids lawsuits filed by those who feel they’ve been unfairly treated.  Be sure to help people develop their leadership and ethics skills.

Compensation Considerations

Along with good leadership, pay and benefits are major reasons employees stay at their companies – or not. Keep your compensation packages competitive and tailor them to each individual employee. As you do so, make sure all your employment contracts are current and legally sound.

Keep All Your Pillars Strong

Your company’s HR initiatives are tied to four key pillars of business profitability:

  1. Safety and risk management
  2. Compliance
  3. Benefits
  4. Payroll and tax administration

And when you stop and think about it, they’re all intertwined.


If your company doesn’t have the staff to manage all four pillars in house, it may be time to think about outsourcing some or all of them to a professional employer organization (PEO). To learn more, contact Lyons HR today. As an Employer Services Assurance Corporation (ESAC) accredited and Internal Revenue Service (IRS) certified PEO with an excellent track record of success for clients nationwide, we are HR. We look forward to discussing possible partnership opportunities with you.