By David Moff, CEO, The HR Group, Inc.

As companies look for ways to trim Costs and navigate their companies through tough
economic times, they often begin by trimming the HR department. And when they do, they will be putting the company at an even greater risk of failure---- HERE ARE SEVEN REASONS WHY!! AND THERE ARE MANY MORE.

1. With the increase in layoffs, the number of suits being filed by terminated employees is also rising.
2. You may be liable to give back pay, if you did not classify exempt/non-exempt employees properly.
3. Outplacement services for terminated employees are very important.
4. Continued training for supervisors and managers can prevent law suits.
5. Avoid WARN Act surprises by maintaining proper flowcharts.
6. Employee Handbooks should be reviewed and updated annually.
7. Employment Practices Liability insurance policies should be reviewed annually.

Read more about these reasons below...

1. When employees get laid off, unemployment runs out and jobs are scarce, your former employees may look for ways to SUE you to help get them through. If you have recently terminated or laid off employees, their age, gender or possible disabilities can be a means by which they can file suit. The EEOC had 82,792 charges filed in 2007, up from 75,768 in 2006 and that number is going up. It is very important that you make decisions about releasing employees in a business-like and methodical way and not a knee-jerk fashion, in order to protect yourself from lawsuits. And once they get a lawyer, you lose whether you were in compliance or not.

2. Are you paying employees correctly for overtime? The Department of Labor reports that seven of 10 employers are still out of compliance with the wage and hours laws. You must make sure you know the difference between exempt and nonexempt so that you pay people appropriately. Your former employee may come back to you to get paid for time you failed to pay.

3. Do you offer your employees Outplacement or do you just hand over the pink slip, say "I hate to do this" and send them on their unhappy way. The approach you take to releasing employees in hard economic times, says volumes about how you care about them and what they will say about your company to all their friends. Make this as easy a transition as you can. Your employees will not be happy but at least they can say you treated them well and provided some help. And those employees left behind will be more likely to stick with you. If you cannot afford a professional firm to help you with this, services are available for no charge from your local Workforce Development Board.

4. Cutting out training - BIG MISTAKE. Now is all the more reason to make sure your supervisors and managers are up-to-speed on your organization's polices and have a refresher on the latest employment laws. It is your first line supervisors that are the first line of defense for unwanted and unnecessary law suits.

5. Avoid WARN Act surprises: Special attention is needed regarding federal and state statues. Because reductions are somewhat hidden and in smaller groups, HR professionals must maintain flowcharts showing the number impacted during the rolling 90-day periods. Don't screw this one up.

6. Outdated employee handbook: You should have a review at least annually to make sure you are current and in compliance. Rarely does a year go by when a new law does not require a new written policy be implemented and added to your handbook. Don't get caught short.

7. Be sure your Employment Practices Liability insurance policy is in place and is broad enough to cover your risk areas.

And consider this one. Congress is poised to pass the Employee Free Choice Act in 2009. This will open the door for Labor Unions to organize your employees before you ever know what hit you. This legislation will take away the right of employees to have a secret ballot election to decide if they want union representation or not. All the Unions will have to do is produce enough signed cards (50% + 1) and you will be obligated to begin bargaining. THIS IS NOT A GOOD THING FOR EMPLOYERS. The Unions have made this their Number 1 goal in the 222nd Congress and President-Elect Obama has promised to sign the bill.

So, now is not the time to ignore the value that your Human Resource professional brings to your organization. If you are not large enough to have the internal expertise, find a trusted outside professional that you can call on to help you navigate all these tricky waters and more especially in tough economic times.