Human resources management can be a challenge for small businesses — and this is especially true for those without a dedicated human resources department. But recruiting the right talent and letting go of underperformers can be crucial to your business success.

Building the best team involves clearly defining and communicating your culture and roles, properly screening candidates, hiring for diverse opinions, having ongoing conversations with employees and knowing how to properly let someone go.

Diversity brings new perspectives

“There is substantial research to show that diversity brings many advantages to an organization: increased profitability and creativity, stronger governance and better problem-solving abilities,” according to the World Economic Forum.

And yet, “the majority of people hire in their likeness or hire in the likeness of the person that succeeded in that role most previously,” says Luke Giblin, talent acquisition partner at ATB. He encourages hiring leaders to “check their bias” and hire people who fit the culture of the organization but still bring an entirely new perspective.

“Ask yourself: ‘What is my organization about and how is this person going to add to the culture that I’m trying to build,’” says Susy Ko, talent acquisition lead at ATB. Rather than cultural fit, look for “cultural add,” she says. The aim is to find candidates who round out and build team expertise.

Hire for the role

Start with the job description and “take away the person,” says Ko. Concisely describe what needs to be executed, accomplished and delivered. “If you start that way, you can already start to remove some of the ingrained biases,” she says.

When screening résumés, consider the skills a candidate brings to the table. Look for three to five tangible, non-negotiable items such as industry experience or working knowledge of a certain software program. Give experience more weight than education, says Ko. There may be a base level of education required for the position, but focusing on it too much can introduce bias toward certain schools, such as the recruiter’s Alma Mater.

The interview — soft skills and auditions

“More interviews are better than less,” says Ko, because you want time to get to know a candidate. Ask open-ended questions and avoid a strict Q&A. “Interviews are conversations, and if you don’t make it so, you’ll never get to know the person behind those answers.”

If you vary interview settings, you can observe the candidate in different situations and get a sense of how they present themselves. Move beyond having candidates tell you what they’ve done in the past; instead, have them “audition” for the job. Ko suggests presenting candidates with a problem facing their business to see how they work through to a solution as part of the interview process. This also helps remove tendencies for bias by the interviewer, by being able to focus on the skills, knowledge and attributes required for the work.

Be clear about the role and your culture

Throughout the recruitment process it’s important to be clear about the role, your culture and your work environment. Present candidates with some of the downsides, constraints and challenges — some candidates may come to realize early in the process that the role isn’t what they’re looking for. Similarly, employees are often called upon to wear different hats. Being clear about this can help gauge how the person will fit into your corporate culture.

Address expected compensation early on. “We have hiring leaders from time to time who might know that the candidate is looking for higher compensation than what they have to offer. And the hiring leaders trick themselves into thinking that the more they sell the opportunity to the candidate that the more flexible the candidate will be — when rarely that’s the case,” says Giblin.

Trust but verify

Check references to make sure candidates haven’t misrepresented themselves on their résumé or in an interview. Speak to a professional reference who had a supervisory role over the candidate rather than someone they worked with on a project, says Ko.

Background checks, including credit, criminal record and vulnerable sector screenings may be required, depending on your industry. But if something shows up, you may want to give the candidate a chance to explain before automatically ruling them out.

Approach social media with caution, says Ko. Keep in mind which platform you’re looking at and how recent the posts are. Facebook, for example, will have personal posts — and we all change over time. If there’s something that concerns you, ask the candidate about it in an appropriate manner.

Be clear about expectations

During the onboarding process, communicate expectations for performance and how it will be assessed. Even small businesses should have an employee handbook that, among other things, will include a code of conduct and causes for termination. This can be paper or digital, but it creates a written, consistent set of rules that are applicable to all employees.

Sometimes things won’t work out

Some employees will be fired for cause, such as violating the workplace code of conduct or illegal activity. Even in these “clear-cut cases” you should investigate and give them an opportunity to tell their side of the story.

Other employees will be fired for poor performance — which should never come as a surprise to an employee. “It’s always about having those conversations along the way,” says Monica Sanders, every day advisor, People and Culture at ATB. If they’re underperforming, they should be made aware that they’re not meeting expectations; offer guidance and coaching sessions, document the conversations and share the documentation with the employee.

You should have a solid process in place for termination to protect your company — and to make it a humane process for the employee. Get familiar with labour codes and laws to avoid being sued for wrongful termination or defamation. Many law firms offer free resources and webinars for small businesses, where you can learn the basics.

It’s best not to terminate someone on a Friday because they may not have access to supports, such as counsellors or lawyers, over the weekend. You may want to call the person in early or meet at a location outside the office. You want to consider your safety, and therefore you may not want to be alone when you terminate an employee. If you have someone else join the meeting, ensure the other person isn’t one of their peers, as that could be a breach of privacy.

Keep the meeting formal. Tell them it’s their last day, why they’re being terminated and that the decision is final. Don’t apologize.

“You don’t want to defend your decision because it’s a final decision and you’ve already put that thought into it,” says Sanders. Be prepared to answer questions on unemployment benefits and severance.

You’ll need to provide a termination letter, but you should do this at the end of the meeting, she says, because it’s human nature for an employee to turn their attention away from the conversation and focus on the letter. The termination letter should outline why they’re being dismissed and provide details of their severance package, how long they’ll continue to receive certain benefits and when they’ll receive forms such as a T-4 and record of employment.

If the employee is in possession of company assets such as a laptop or smartphone, you want to make sure to get these back. If you can’t collect them immediately, then state in the letter that severance will not be paid until these assets are returned.

But the process doesn’t end there. Once you’ve fired someone, you then have to notify the team. Again, keep it simple. Tell them that the employee is no longer with your company, but don’t give specifics — that can violate privacy laws — and don’t apologize.

The team might want to know who will take over the employee’s responsibilities, so have this worked out beforehand so you can rearrange duties as seamlessly as possible. Tell them your door is open if they want to talk and ask them to refer any suitable candidates for the position — so that you can start the recruiting process once again.

If you’re looking for a deep dive on everything you need to know around how to grow your business, our ATB X Accelerator program might be just the place for you. Alternatively, feel free to reach out to one of our entrepreneur strategists to explore where you are with your business, where you want to be, and how to get there!