Managing Human Resource and Legal Risk
Any activity or event relative to the human resources of the farm that is uncertain.
Character, health and behavior of people are unpredictable.
Human resources are an important part of the strategy for dealing with all risks.
Examples
Loosing a key employee at a critical production period.
Sickness or death loss.
Farm accidents and/or disability of operator.
Hiring and managing farm workers.
Intergenerational farm transfer.
Family communications.
Divorce
Stress.
Importance
Providing for the human element on the farm is the most important.
Human resources are the most valuable and irreplaceable, consequently human resource risk can be the most disruptive to the farm operation.
All resources, including human resources should be put to highest and best use. Risk is reduced by adding value to human resources through improved literacy, education, training, and physical and mental health maintenance.
Legal Risk
Any activity or event that threatens the legal standing of the farm or puts the farmer in legal jeopardy.
Laws and governmental programs that reflect society’s changing attitudes create risks for farmers.
Legal issues cut across all other farm areas.
Examples
Environmental protection.
Control on use of feed additives.
Regulations on agricultural chemicals.
Elimination of farm support programs, etc.
Risk of lawsuits stemming from farm accidents.
Performance on a contract.
Estate planning and farm transfer.
Animal odors.
Legal Issues
Appropriate legal business structure and tax and estate planning.
Contractual arrangements.
Statutory compliance including environmental issues.
Tort liability.
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