Informal HR works when a team is small. These are the moments when it usually stops working, and the headcount thresholds that change your obligations.
In a small company, HR is often handled by whoever has time: the owner, an office manager, or the person who runs payroll. That's normal, and it often works fine for years. But there are predictable moments when informal HR starts creating risk.
Several federal employment laws apply only once you reach a certain number of employees. The table below is a general summary of common thresholds. How employees are counted varies by law, and other rules may apply to your business, so confirm the details with an HR professional or employment attorney.
| Employees | Federal law that generally begins to apply |
|---|---|
| 15 | Title VII (discrimination) and the Americans with Disabilities Act |
| 20 | Age Discrimination in Employment Act and federal COBRA continuation coverage |
| 50 | Family and Medical Leave Act (with location requirements) and the ACA employer mandate (full-time equivalents) |
| 100 | EEO-1 reporting for most private employers (federal contractors may be required at lower counts) |
Crossing one of these lines is a good moment to have someone review your policies, even if nothing has gone wrong yet.
HR support does not have to begin with a full-time hire. An HR consultant for a small business helps define the immediate problem and the right scope for project-based or ongoing support. Start by comparing fractional HR with a full-time hire, then prepare a short brief for the firms you contact.
You don't need a full HR department to fix most of these. Many businesses start with an HR audit to see where they stand, then decide whether ongoing fractional HR support makes sense. Write down the two or three issues that worry you most and bring them to your first consultant call.
This guide is general information, not legal advice.
See HR consulting firms that serve Huntsville.
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