New Rules for HR

Ever worry that involving HR makes things more complicated than necessary? Feel like corporate HR “speak” has a tendency to be overdone – to lose its audience.

Time for a reset; at the very least for small businesses.

I recently received an email, from a vendor we are quite happy with, that had all kinds of technical jargon on it. Yikes!  My head hurts. I’m intimidated, frustrated.

Are we paying for something that we aren’t using in full or don’t understand? I guess I’ll let a Software provider sit in the “IT” world of complexities, but I’d really like HR to live in the land of accessibility. So…

Simon Sinek once pointed out that Martin Luther King, Jr. said “I have a dream, not I have a plan. Look at all those politicians with their 10 points plans.  They aren’t inspiring anyone”.

HR DONE DIFFERENTLY!

I’ve fallen in love with our new aspirational Vision statement. We searched, pondered and collaborated on a rallying cry.   Now is the time to put some real meaning behind that with some NEW RULES.

1.     FOCUS ON NEED TO KNOW.

The goal is simpler and shorter, so you don’t compel your audience to avoid or tune out. A laser focus on need to know, instead of all there is to know or consider.

In every situation, challenge or discussion there is so much that could be known. In some cases, there might be a dozen options to consider or potential scenarios to worry about, some of which have a low probability of happening. Stop! When HR provides support and opinion, for a quick resolution, give a credible opinion. Focus on what needs to be known versus all there is to know. Stay relevant and on point so you keep your audience’s attention.

2.     FEAR TACTICS DON’T WORK.

Many business owners and leaders grow to fear two things: 1) government agency audits, like Department of Labor and the IRS, and 2) employee lawsuits.

There is no reason for HR to be adding fuel to the fear fire. If you think about it, it’s is near impossible for a business and leaders within to not have knowledge gaps. No one says “you will have to take an employment law course before you can get that business license or take that job”.

In addition, it’s time to tell leaders to stop being held hostage by the potential of a lawsuit. In reality, anyone can get sued.  It’s how you defend yourself (documentation!) that makes the difference.

When HR recognizes the confusion, misstep or misunderstanding, how we educate should feel empowering. We must get people to a place where leaders want to learn about and apply HR knowledge to their day to day decision making.

As Maya Angelou once said, “when you know better, you do better”. 

3.     DITCH NEGATIVE WORDS.

Compliance. Typing it even gives me the sense of a gut punch.  I feel the same way when reading unnecessary legalese; see Employee Handbook below.  Make sure you are complying with Labor Laws. Famous HR “speak”. Ugh. See above in regards to fear.  Instead, follow labor laws. Let’s do our best to make business owners and leaders aware of and able to follow, to the best of their abilities, the federal-state-local labor laws that affect the businesses.

Audits.  =Who wants that? Audit just sounds like I am about to be fined. Think about opportunities for improvement instead. Evaluate the needs (find), and create a plan to action to solve (fix).

Disciplinary Action. Old school. A business does not employ children and HR certainly isn’t grounding them or putting them in a time out chair. Replace with Corrective Action.

Probationary Period. What a lovely way to scare off a new employee. So, terminating an employee who isn’t working out is leaving a jail to go out on probation?  It’s Introductory Period. Or Trial Period. Choose a phrase and policy that tells new employees that the company wants them to succeed. Speaking of new employees…

4.     STOP OVERWHELMING NEW EMPLOYEES.

Ever been hired by a company that made a really bad impression on day 1? HR needs to self-reflect, regularly! Put yourself in the shoes of incoming new employees and say “if that was me, would this be a way to win me over and keep me motivated?”.  If the answer is no, change course and consider this:

  • Before Day 1. What can you take care of before day 1? Paperwork, work space, equipment, supplies?
  • Accountability Checklist. Who is responsible for what on day 1 or week 1? Follow a checklist that identifies who will lead or take care of what. This should include time of arrival and who greets the new employee.
  • Memorable Training. That means reflecting on the messaging, content and length. Why does a mass amount of information have to be shared all in one day? Majority won’t be remembered so stop wasting time. Break it up – think Nano Training. Messaging and content should be interesting and impactful. Games should create engagement.  As with any training, the best form of includes fun (games!), pictures and stories.
  • Employee Handbook highlights. Don’t ever mandate or expect a full read. Just tell them who to talk to if there are questions, and where they can find an electronic copy. Point out the good stuff! Vision, Mission, Core Values.  Speaking of Employee Handbook…

5.     MINIMIZE OR ELIMINATE LEGALESE IN EMPLOYEE HANDBOOKS.

HR professionals work with some small business owners that believe handbooks are contracts with guarantees and therefore the don’t want them. They sure look like contracts if written by an attorney. But handbooks are actually an invaluable communication, accountability and risk minimizing tool. But good luck getting employees to clearly understand them if legal language and terms is contained within. It’s time to rewrite handbooks in a way that standards and processes are easy to locate within, and easy to follow.  Some signs that an Employee handbook needs a redo: 1) Missing mention of company Vision/Mission/Values. 2) Employees or leaders roll their eyes when asked if they looked in the handbook.  3) Handbook is not provided during new employee on-boarding because, frankly, everyone hates it.

6.     NEVER UNDERMINE THE LEADER-EMPLOYEE RELATIONSHIP.

This means expectation setting and boundaries. HR is not designed to be a therapy session. Open door and problem resolution means listening and empowering affected parties to take positive steps forward to find a solution. HR’s first question should always be: 1) Have you talked to your manager about this?  If the answer is no, re-direct. Managers and leaders, in every appropriate situation, needs to be the first know what is going on.

Conversely, HR is not there to do the leaders job for them. Will new leaders, or those who like to avoid conflict, not be sure about how to conduct or word a counseling session? Sure! That means HR coaches them ahead of the session.  HR should not, nor should they be expected to, have the hard conversation in place of the leader. That’s no way to win over or repair a fractured leader to employee relationship.

7.     YES, YOU CAN DITCH ANNUAL REVIEWS, IF….

Leaders are committed to regular and recurring one-to-one interactions with their employees, for which there is agreement on advancing growth and they are following a Development Plan, which morphs, changes and updates no less than once per year.

8.     NO MORE EXIT INTERVIEWS!

The absolute worst time to get an employee to express their opinion of “how did we do” is when they have one foot out the door. Instead, conduct surveys throughout the year. Make sure leaders are having regular coaching sessions and interactions with employees that contain an element of a “stay” interview.

9.     DON’T BE A BUZZKILL.  IT’S NOT GOOD TO BE CALLED “THE POLICE” OR THE TERMINATOR.

It’s not good to be called “the police” or the “terminator”, unless you are stuck in the 80s.

Put “love” in your work, as we heard from Robin Anslemi at DisruptHR in Orlando. This means be human.  Find a way to handle it and say it without being cruel, or overly harsh.  Get out from behind the desk and build relationships. Build trust.  It can be done on both sides; with leaders and the employees that want you to advocate for them when they think something is unfair or needs to be solved.

10. FINALLY, DON’T BE SO QUICK TO SAY NO.

Try this: “I can understand why you would think that way or want that, but how about this instead? And let me tell you why.” If you don’t have another option to consider on the spot, and when appropriate, simply ask for a chance to consider the request and then come up with options.

If HR wants to change the perception of how and where they add value, then its time to embrace simple and human. HR that is visible, realistic (business savvy), relatable and credible has the best chance at being viewed as high value and affecting positive outcomes.

Click the link to view the recent blog: Competition and the Candidate Crisis: Overcoming Recruitment Challenges or check back for more on human resources, payroll, insurance and benefits.

This article does not constitute legal advice and there are subtle variations in employment law as it pertains to this topic, depending on where your business operates. It is strongly suggested that you seek consultation or legal counsel before making decisions about policies.

Exit, Stage Left: Why Are Good Employees Leaving?

Joe, six months into his employment, is already contemplating moving on. A co-worker, Kari, notices that he seems to have checked out a bit and invites him to a coffee break to ask about it.  She likes working with Joe, thinks he adds a fresh new perspective to the department, and hopes he stays.

Kari: So how is this job working out so far?

Joe: It’s going okay, but to be honest I’m really getting tired of the after-hours calls.  I’m already putting in around 50-60 hours a week here and now I’m expected to also drop everything and answer a work call at 9pm?  My last company never required that.

Kari: I agree that it’s a pain sometimes. Hopefully it won’t happen for you too often.  It’s just the way they are here – everything seems to be an emergency.

How guilty is your organization of “bad employer” behavior?

Do you pester your employees after- hours or monitor frequency of bathroom breaks?  Are you stingy with praise but heavy on criticism? Do you shut down employee suggestions without consideration?

New employees may come to the table with fresh ideas and a much-needed skillset, but they may take those attributes elsewhere if they are not treated well by managers or the company in general.  A quick spot check on those little things that may help keep them around:

  • Have an Open-Door Policy? Live up to it!  Employee suggestions should be welcomed and considered.  (Who best to bring forward ideas on how to improve the work process than those who are doing it?) Concerns should be taken seriously and dealt with accordingly.  If you have an employee who seems to constantly complain, listen closely for hints of a bigger problem. Is the workload reasonable? Are deadlines realistic?
  • Just say no to micromanaging! Are you letting the professionals you hired do what you hired them to do having to report back on a daily basis? Does the certified project manager actually get to manage projects or only the tasks that you’ve assigned? Learn to take a step back from the day-to-day process and let your employees shine, but be ready to act as a resource if needed.
  • Are they off work for the day? Let them really be off.  Are exempt employees really being paid to be at the constant beck and call of a company, even way after the office has closed for the day? Even the most dedicated employee needs personal time that is his or her own. And don’t forget, employees without immediate family demands also need their space for extended family, friends and their outside interests. If you have your own tendency to compose standard emails or updates after hours, consider saving the communication in draft form for a future release or set your email settings for a future delivery time during normal office hours, so you are not constantly modeling expectations to be working after hours.

And along the same lines…

  • Allow vacation time to be actual vacation time. Is there an unwritten attitude among managers that employees requesting vacation time aren’t dedicated? Or if employees DO take vacation, are they expected to answer emails by the pool or log in to conference calls from a hotel room? Are there negative consequences if work comes in and isn’t immediately addressed during a scheduled vacation? Is someone available to “back-up” your employees so they don’t come back to a mess? Vacation time is time meant to be taken away from the workplace to allow workers to recharge.  Let them.

Also…

  • A little empathy goes a long way. Things DO happen, even when it is inconvenient. Family members and friends – and pets – pass away.  People relocate to a new home. Children get sick and/or hospitalized. Cars break down.  Granting some form of vacation, sick leave, or PTO (even if not mandated by state or local law) and showing patience and understanding of the occasional situation can allow employees to try to deal with life’s curveballs without worrying about losing their jobs or coming back to hostility due to their missing a few days in the process.
  • Only offer perks that can be used. Do you offer discounted or free gym memberships that no one has time to take advantage of due to heavy workload or crazy schedules? A pool table in the break room doesn’t help employees relax if it sits gathering dust because being seen playing on it equates slacking off in management’s view.  Take a hard look at any “fun” extras you offer to see if employees are actually being allowed to use them with no strings attached.
  • Don’t allow ineffective or bullying bosses to linger. If there is a lot of turnover under a particular supervisor, find out why. How is he or she treating employees? Lots of yelling, hovering, controlling? Ineffective coaching techniques allowing a problem employee to stick around much to the chagrin of his/her colleagues? Having a leader is more important to a productive workplace than having a “boss.” A supervisor who outlasts every employee under him/her without some sort of corrective action to help the problem will only make turnover worse.
  • Consistency! Don’t play favorites when it comes to policy.  If a long-time work buddy always comes in late with no consequences but his work neighbor (who you don’t know as well) gets dinged every time she does, you may have consistency issues.  Jane, part of a core group that came over from a shared past company, works from home on occasion but her co-worker (who has the same responsibilities) is not allowed a similar arrangement.  Policies should be applied consistently and fairly – too many discrepancies can cause upset among your employees.

And finally –

  • Acknowledge, Acknowledge, Acknowledge. Letting employees know you are appreciative of their hard work can make a huge difference. Who wouldn’t like a “thank you” when he/she consistently goes above and beyond, meets and exceeds goals, or stays late on occasion to work on special projects just to ensure you meet deadlines? An employee who is called in to a supervisor’s office for a thank you will feel appreciated and valued, but one who always puts in his/her best work and gets little in return -except criticism on those rare occasions when an error is made – may feel undervalued and start to look elsewhere.

Click the link to view the recent Keeping High Performers Motivated and Working for You or check back for more on human resources, payroll, insurance and benefits.

Keeping High Performers Motivated and Working for You

Madeline has been a stellar employee from day one. She’s extremely productive, professional, and a joy to work with.  After her last – and only – promotion two years ago, she’s received competitive bonuses and consistent raises which has now placed her near the top of her pay scale.  You’re not sure what to do as she is at the top of her field, and no positions above her that she’s qualified for.  You’re afraid to lose her but not sure how to keep her motivated.  What options do you have?

“High Performers” – those employees who are at the top of their game – can be a blessing and a curse. While they can be depended on for consistent great performance, if someone suddenly leaves for greener, more exciting pastures, you can be left with a gaping hole in your team.

Even the most dedicated of employees may find themselves in a bit of a rut.  What started out as a challenging position can just become business-as-usual after a while. Continuing to find ways to keep their jobs interesting, their compensation competitive as well as looking for new kinds of challenges to keep their creative juices flowing may just help them stick around.

Okay, so we have compensation worked out… now what?

Pay isn’t the only thing that makes work rewarding for employees. For example, no employees, no matter how dependable and star-like, should be taken for granted. Employers may be tempted to let stop some interactions – like one-to-one meetings, praise and recognition, or development opportunities – thinking this will demonstrate to their employees the confidence they have in them.  This can be a mistake, though, as “no news” may not be good news for someone who thrives on feedback and collaboration, and he or she might start to feel neglected.

Here are some suggestions on ways to possibly keep those employees who continue to impress from falling through the cracks and give them something new to consider:

Regular Meet and Greets – A superstar employee needs feedback and regular face-to-face time as much as anyone else, and it is a great opportunity to conduct periodic “stay interviews.” Waiting for an exit interview to ask what you could have done to keep an employee is too little, too late. Review their position descriptions together periodically to see if anything has shifted in the last six months or if there is so much bureaucracy that even though performance hasn’t suffered, it is recently been a lot more difficult to get anything done. Find out what roadblocks you can clear and what gets them up in the morning.  You may never know unless you ask.

Flex it! – Today’s technology, which will only get better with each passing day, allows for all kinds of remote meetings and work activities. If a high performer broaches the subject of working from home a couple of days a week, don’t dismiss it out of hand if it typically just hasn’t been done in the past. Employees who are good with deadlines and follow-through, which HPs are, are ideal candidates to test drive a partially remote workforce.  Skipping the commute two days a week may give them just the flexibility they were craving that may have led them elsewhere if a recruiter came calling.

Tap into hidden talents and interests – Did you know that one of your employees speaks Spanish? Or that one has a penchant for photography? Or throws fantastic parties? And imagine your surprise to learn that still another is a fundraising dynamo outside of work. Getting to know the hobbies and passions of your employees can be a great way to allow them to shine in other ways at the office and get excited about the thought of applying their passions in a different type of role or project while still excelling at the one they were hired to do.

Change it up – Has the employee mentioned an interest in learning about a different aspect of the business? An accounting professional may appreciate the chance to tag along on a trade show to see how the marketing team works to bring in new business or rotate into a recently-formed team responsible for solving a unique project. Someone unexpected volunteers to head up – or introduce – a “bring your children to work” event, internship program or company newsletter? Let him or her!  New projects to tackle can create a whole new outlook on the work day.

Outside the box – Some companies shy away from sending their employees to job-related seminars and conferences, citing an expense on which they may see little return. These sorts of activities, though, can re-energize employees, allowing them to network with peers and keep up with new advancements and ideas that may well help them do their jobs even better.  To make such an event more meaningful, ask employees who attend to summarize what they have learned – and how it will help them make changes to their current work – in a short presentation to the management team.

And finally…

Mentoring opportunities – An employee with 25 years of experience who heads up a thriving department may welcome an opportunity to act as a guide or mentor to someone who is closer to the beginning of a career. Either through a formal program or just a lunch date every month, employees can pass on their expertise to someone who is ready and willing to learn. Is there a program that allows them to volunteer as a consultant in their field to a local school or organization? It’s a great way to let them lend their expertise outside of the office.

Yes, one of your superstars may still leave. Sometimes an opportunity arises they simply cannot pass up. It might be a job that moves them closer to extended family, a position in a company they’ve had their eye on for some time, or a place that gives them the opportunity to apply their skill set to a different industry all together. But remember that:

Employees who feel appreciated and rewarded for their hard work and who are ALSO offered interesting growth and work opportunities are employees who may find it much harder to move on.

Click the link to view the recent Seven Ways to Minimize Employee Termination Risks or check back for more on human resources, payroll, insurance and benefits.

Seven Ways to Minimize Employee Termination Risks

Ideally, every employee termination – voluntary and involuntary – would go smoothly. Employees would hopefully either give notice and exit gracefully or, in the case of an involuntary termination, a handshake and a “best wishes in your future endeavors” conversation would take place before the handing over of office keys and a name badge.

Of course, this is not always the case, especially when it comes to an involuntary termination. Voluntary terminations can appear to straightforward, but even those can have unintended or unpleasant issues afterward.

Seven tips to help minimize risk when it comes to terminations:

  1. Get it in writing. An employee may leave you on the best of terms, but be sure to get the intended final work date in writing. It will clear up any possible confusion as to final pay, benefit end date, and any future inquiries from outside sources into their employment history.  If the employee gives two weeks’ notice and you opt for an earlier release, be sure to document this information as well. For involuntary terminations, a factual, written account of the reason for the termination (including dates and timeline of all counseling sessions, policy violations, and performance management documents) is essential along with a record of the last date the employee worked and was paid for.
  1. Agree on Transition and Communication. The transition plan and internal communication will be important. With an employee leaving, those remaining on the team will have questions about the work that will still need to be done if no one has been hired to fill the role, and more than likely will also be speculating on why the employee left. If circumstances allow it, be sure that you work with your soon-to-be-ex employee on when and what will be told to co-workers, vendors and others he or she works with on a regular basis.

If the termination is involuntary, less is more in terms of letting others know under what circumstances your employee has left the company. The details should only be shared on a need-to-know basis.

  1. Check state requirements. Many states have requirements as to the timing and method of final checks and what can and cannot be deducted. Does the state require final payment of any accrued, unused PTO or vacation time? There also may be required final paperwork and notices that must be given to all exiting employees, regardless of the reason for the termination. If employees don’t stick around long enough to collect what they need to, sending it via certified and/or overnight post to stay in compliance with any state or local laws is recommended.
  1. Settle all IOUs. Is the employee still owed any commissions, guaranteed bonus payments, or due an expense reimbursement? Does the employee owe you a balance on a loan or tuition reimbursement? If so, hammer out a plan for payment with the employee prior to the last day (if possible) so expectations are clear. (Caution: Some states do not allow a deduction of balances owed to a company by an employee on a final check.)

If the termination is unexpected, make sure you know what is still owed to the employee – or to you, the employer – and try to get it resolved as soon as possible. Communicate any pending payments with the employee to ensure that you are both on the same page.

  1. Get paperwork in order. Go through the personnel file to ensure it is in order and can be closed out with all documents within once the termination takes place. Applications, offer letters, notices of increases, signed policy acknowledgements, performance review documents, counseling session documentation and final termination information – among other items – should all be in the personnel file. If there are multiple copies of the file, such as a “desk file” as well as a personnel file, paperwork should be consolidated and duplicates should be removed and discarded. Many states have requirements as to how long to keep personnel files and what they should contain.
  1. Keep Final Conversations Short – and Civil. For involuntary terminations, the final meeting should be a short one and in a private area away from other employees. Ideally, the employee’s direct manager should handle the conversation and have an HR professional or another neutral party in the room as a witness. The primary goal of the meeting is to let the employee know that the employment relationship has ended and what he or she can expect as a result.  In doing so,  be sure to use language and tone that is professional and respectful. If possible, prior to the meeting, arrange for someone to turn off the employee’s computer access during the meeting; any personal computer files can be sent via thumb drive to the employee at a later date.
  1. References – to share or not to share. Many employers have an internal policy addressing what can be shared in regard to former employees if called for a reference. Even if the employee leaves on a voluntary basis, it is important to be cautious when discussing past employee performance with another company who is looking to hire him or her. If an employee was terminated for cause (theft, gross policy violations, negligence) you may want to consult with an employment attorney to determine if not sharing this information with a prospective future employer would put you at risk

While a smooth termination process is never guaranteed, there are a lot of factors that can affect how much scrambling a company might have to do long after an employee leaves. A bit of preparation in advance can go a long way toward minimizing possible risk when the employment relationship ends.

Click the link to view the recent INFINITI HR blog Minimizing Unemployment Claim Costs or check back for more on human resources, payroll, insurance and benefits.

Minimizing Unemployment Claim Costs

If unnecessarily high unemployment tax costs are eating away at your profits — you may be mishandling it.

Many employers view unemployment taxes and related claims as an operational cost that cannot be controlled. This is where they are wrong. First, you must understand the basics behind where your unemployment tax dollars go.

Who is eligible for unemployment benefits?

The Federal-State Unemployment Insurance Program provides unemployment benefits to eligible workers who are unemployed through no fault of their own (as determined by state law), and meet other eligibility requirements of state laws.

It’s the No Fault of Their Own part that tends to trip up companies, resulting in a rising state unemployment tax rate. Why? Because the burden of proving No Fault of Their Own rests on the employer, and state agencies tend to have different definitions (often a moving target) of No Fault of Their Own.

Unemployment taxes paid to your state are traced back to your company. New businesses are typically given a new business rate, which will go up or down each year, depending on how many former employees are able to successfully claim benefits after leaving your company. If your company has a high claims rate, you are likely to see the SUTA rate increase, perhaps to a point where SUTA tax becomes excessively costly to the business.

Say you have 10 employees on payroll. You started out with a 2.7% SUTA rate. If your state maximum is the first $8,000 in wages per employee, that means you will pay about $2,160 in SUTA tax. After a few years, five of those employees have been terminated and have collected unemployment benefits. Now your rate is 6.5%. Which results in a tax of $5,200; a $3,040 increase. OUCH!

How can I keep my state unemployment tax costs down?

Eight Tips to Minimize Unemployment Claim Costs:

  1. Hire people who are qualified and can do the job. This starts with clear job descriptions and effective candidate screening processes. Hiring someone who you hope will work out, who lacks the necessary skills out of the gate, and isn’t trained well, will only create a successful candidate for future unemployment claim collection.  The state agency will look past their inability to do the job and focus on your unsuccessful training and management to retain them.
  2. Set clear expectations. Back to the job descriptions: Set clear expectations for the employee so they start with the possibility of succeeding. This is compounded by having employee handbooks and written policies in place that clearly define standards of conduct and what can constitute termination. Employees who knowingly violate policies are less like to win when you have their signed acknowledgement of receipt of the handbook and policies in hand, and you can show their own poor choices led to their termination.
  3. Document, document, document.  Ensure you retain employee-signed, written counseling documents related to policy violations or escalating performance concerns with clear guidelines and expectations on how to improve. You want to be able to prove that the employee was provided with counseling and guidance, over a reasonable period of time, and simply chose not to improve. Why?  Because it helps to eliminate the validity of No Fault of Their Own. You should also document dates, times, and subject matter of job training provided to help an employee improve.
  4. Resigned or constructively discharged? If you think you can beat the system by getting the employee to quit by making it too hard for them to stay, think again. Discriminatory practices under the laws that the Equal Employment Opportunity Commission enforces include forcing an employee to resign by making the work environment so intolerable a reasonable person would not be able to stay. Not only do you risk a lawsuit, the state agency may see through you and find for the employee despite the resignation. It’s one thing to hold an employee accountable and when they understand that they are failing, they choose to separate themselves from the situation. It’s a very different thing to strip an employee from feeling safe enough to stay. Keep your integrity and confront your performance issues head on. Don’t sit back and hope that passive aggressiveness or intimidation will solve your problems for you.
  5. Minimize unemployment costs related to a lack of work. If you must let a good employee go because the workload can’t support the position, reach into your network to help them find another job quickly. Word of mouth can be a powerful asset in getting hired, and your referral may expedite finding a new job. If you have mass lay-offs, the assistance of a recruiter, or placement service might also help to place displaced workers. While the latter might be a cost at first, the long-term unemployment cost mitigation will be worth it. If you have seasonal workloads, find alternative services that complement your down time and keeps the workforce active. Example: If your window installation and cleaning services wane in the winter, use your cranes and workforce to hang and take down holiday lights for a few months. You can pay at different pay rates for the change in profit-margin, and the staff stability will help you minimize new-hire training each new season.   
  6. Reasonable and timely action.  If you need to terminate an employee for poor performance, policy infractions, or misconduct, don’t stall! Assuming there is sufficient prior documentation and this was the last straw, or the behavior was so egregious that it is a terminable offense, terminate the employment on the day of, or close to, the final infraction. It’s okay to take a few days to get your documentation in place, produce a final paycheck, and consult with HR or other internal stakeholders, but if you terminate an employee for a policy violation on March 1st and your documentation indicates the event took place or was assessed on February 1st, your own inefficiency and poor performance will ruin your credibility with state agencies.  They were so bad that you could wait 30 days to act? This does not look reasonable.
  7. Respond to your state’s notice of an unemployment claim in full and on time.  Missing deadlines means you may lose by default. Failing to provide the back-up documentation related to your decision also works against you. Building documentation is to build your case against potential legal action. If you have it, use it to defend your decisions accordingly when it’s requested as part of a state unemployment agency case review.
  8. NEVER be late to a scheduled hearing; in person or via phone. In some states you should be early for a call. If you are late you lose credibility.

There is no need for unnecessarily high unemployment tax costs to eat away at your profits. Simply put your organization in a position to keep the rates down through sound HR and business practices.

Click the link to view the recent INFINITI HR blog Employee Holiday Incentives For Any Budget or check back for more on human resources, payroll, insurance and benefits.

Employee Holiday Incentives For Any Budget

Small business owners may feel at a competitive disadvantage when it comes to extending gestures of appreciation to their employees. Budgets are tight and employee productivity genuinely matters to their bottom lines.

Thankfully, employees of small companies tend to understand all of this. Their professional experiences often keep expectations in check, even during the holiday season. This understanding is not, however, a reason or excuse for business owners to embrace the attitude of that most infamous of small business owner, Ebenezer Scrooge.

When a holiday falls on a business day, consider adding another lump of coal to the stove and, when possible, letting your employees leave early.

Paid Time Off – The Gift That Keeps Giving

Small or nascent businesses are often left scrambling for inexpensive ways to build employee morale and engagement. Therefore, it is important for these businesses to understand what employees value.

Generally, employees value paid time off more than every other benefit, with the exception of healthcare. Not every small business can afford a full paid time off program, but even a limited gesture can go a long way toward creating goodwill.

Rewarding Behavior That is Nice… on a Budget

For those in the retail industry, closing the business early may not be a viable option, so consider:

  • Paying a premium rate for hourly employees working on holidays. You may actually get some volunteers.
  • Creating a rotating schedule of employees who work holidays so it doesn’t always fall to the same staff members with the least tenure. Remember that employees without spouses and/or children still want to spend holidays with their families.
  • Keeping an eye on customer traffic so you can send employees home as business slows toward the end of the day.

When the holiday schedule isn’t something you can adjust, and you have little time or budget to work with, creative stocking stuffers might be the perfect alternative incentive:

  • A Gift That Gives Back: Consider paying for a class or certification as part of a wrap up of the prior year’s performance and the upcoming year’s goals / professional development for your promising employees.
  • Privileged for a Day: VIP parking, a future date with a flexible work schedule, a choice of job duties, or their pick of a lunch menu can start the day off right.
  • Social Experiences: Tickets to big game, the theater, that new art exhibit, the zoo, or amusement park, as an individual reward or as a company gathering – these are all fun activities that can also relieve stress and build social connections.
  • Recognition: A plaque on the way of the company hall of fame, a story on the company website, a luncheon in their honor, or being the big award winner at a meeting can build esteem.
  • A Small Gesture: For employees who shy away from the limelight and don’t like a big fuss, a simple, genuine handwritten thank you note or email acknowledging their good work is welcome praise.
  • Philanthropist at Large: Being able to choose a charity for the company to donate to, or being given time to volunteer, can create a sense of pride and deeper involvement in the company.
  • Something Personal: Sometimes just asking what an employee enjoys or collects is an easy way to find a small reward that really means something to them which can be fully appreciated.

At the end of the day, the best incentives are those that show your employees how much they mean to you and the business, that can be as simple as consistent, open communication and expressions of gratitude and acknowledgment when they help the company succeed. After all, a 2017 survey found that respectful treatment of all employees at all levels is a very important contributor to job satisfaction, proving that some job rewards are created just by cultivating a great company culture.

This means that the “rewarding spirit” doesn’t have to be restricted to a particular time of year or holiday, nor should it be if you want to keep morale and productivity high.

But if we’re being honest…

Nobody really enjoys working for the Grinch during the crunch and grind of the holidays, making this an opportune time to find ways to make everything a little merrier for your employees (without blowing the budget), so what’s stopping you?

Click the link to view the recent INFINITI HR blog Compensation That Motivates or check back for more on human resources, payroll, insurance and benefits.

Compensation That Motivates

Getting the Most Motivation from Those Precious Payroll Dollars

When HR professionals peer inside the crystal ball, some see a time when the annual salary increase is no more. c. A 2% to 4% increase range may represent a significant investment of company resources, but it’s simply not enough to wow any individual employee. Additionally, over time the annual increase becomes expected rather than appreciated, an acknowledgement of tenure and not hard work. Money should be the ultimate motivator, but after a year on the job, a 3.0% increase can feel more deflating than motivational.

And the word is out. Simply put, any organization that doesn’t offer something more than base salary risks losing its motivational – and competitive – edge.

But what if money is tight and the addition of a bonus pay program is simply out of reach? Can these organizations still compete and motivate their employees? The answer is a resounding… yes!

The Keys to Motivation and the Small Employer Advantage

In 2013, Lindsay McGregor and Neel Doshi surveyed thousands of US-based employees for a study on motivation. Their results mirrored several earlier studies in showing that the factors which most influence employee motivation are 1) role design and 2) organizational identity.

Simply put, employees want to know what they must do to be successful, then they want the company to empower them to do it. They also want to feel pride in the mission of their employing organization.

This is great news for owners of small and medium-sized businesses, who lack the deep pockets of their larger competition and often feel at a disadvantage when it comes to financially motivating employees. These studies show the opposite can be true. Small business owners are in a unique position because they can shape an employee’s role and share the mission of their organizations in a personal and powerful way.

Connecting the Dots: Motivation Through Empowerment

The first step toward empowering employees can be as simple as a well-designed job description. But even the best-defined role can stagnate after a while, and there is nothing particularly motivating about feeling stuck.  Although the three-day seminar at the expensive hotel that your most promising employee just requested may be financially out of reach, there are other ways to help her obtain those training and development goals:

  • Webinars or on-site group trainings on requested topics;
  • Formal or informal mentorship programs such as one-on-one monthly lunches with a senior management member of her choice or including the CEO in department meetings to provide the “view from the top” from which many employees feel disconnected;
  • Sponsorship or cost-sharing of industry certifications and test-preparation programs.

There are endless possibilities, but the only ones that matter are those that matter to your employee. So, don’t forget to ask him/her!

Connecting the Dots:  Motivation Through Inspiration

Every business owner will eventually ask themselves about the type of company culture they want to create. Thanks to McGregor and Doshi, we know when it comes to employee motivation, there has never been a more important time to ask that question than right now.

What matters here is connecting that decision to the mission of the organization. If the company’s mission is to make the world’s best running shoes and encourage healthy lifestyles, an aligned company culture might provide an extra-long lunch break for employees who want to exercise and a place for them to shower before returning to their desk. If the mission is to be an exemplary world and social citizen, consider closing the office one day a month so employees can volunteer at a charitable organization of their choice. Put company muscle behind the mission, or that carefully crafted mission statement will fall flat and won’t inspire or motivate the people who matter most – your employees.

Non-Monetary Motivation

It may seem like an oxymoron, but evidence for the effectiveness of non-monetary rewards keeps building. And for many employees, non-monetary rewards are just as motivating as monetary ones. According to a report from Mercer, respect and work-life balance hold court at the top of the list. After all, cash may be king, but it won’t get you to your daughter’s softball game on time. Only a flexible work schedule can do that.

What else?

  • Starting every staff meeting with time for employee acknowledgements and appreciation;
  • Handwritten thank you notes for closing a big deal or diffusing a tricky customer situation;
  • Sleep-in Mondays, where an employee can arrive to work late one Monday morning;
  • Giving star performers first dibs on the most requested vacation days or the prime parking spot;
  • The list goes on!

Just like the annual salary increase, a compensation program built around strictly monetary rewards is becoming a thing of the past. A total rewards program must be designed in a careful and thoughtful way to fulfill its goals of reflecting company culture, and inspiring and motivating employees. Once the right mix of compensation and non-monetary rewards are in place, employers may find it’s not only the key to motivating staff, but also to recruiting and retaining them.

How’s that for a bonus?

Click the link to view the recent INFINITI HR blog The Joy of Holidays and Employment or check back for more on human resources, payroll, insurance and benefits.

The Joy of Holidays and Employment

The concept of “holidays” conjures different associations for people… gatherings of family and friends, abundant food and BBQs, travel or a day to simply sleep in and find something “fun” to do.

For employers, it can be a confusing myriad of questions on what their obligations are to their employees on holidays:

  1. Do we have to give employees time and a half on holidays?
  2. What if we close on holidays – do we owe holiday pay to all employees?
  3. Do we have to let employees have their religious holidays off if they’re different from company-observed holidays?

The short answer is:  It depends entirely on you and your company.

There is no law that requires a certain set of holidays be observed by a private-sector company (non-government) or that employees working a holiday be paid at a premium.   Employers also do not have to offer “holiday pay” if the company is closed to those employees who are not working, though this differs for exempt employees. (More on exempt employees in a moment.)

So what does that mean? Basically, a private sector employer has free reign over the whole concept of holidays. As a company owner, you can choose which holidays you would like to close or stay open, open late or early, and whether employees will be staffed on those days or not.

So, if I don’t have to treat holidays any differently, why would I want to?

  • Offering incentives (such as pay at 1.5x the regular rate or double-time) on holidays when you are open may make it easier to schedule staff and lets employees know that you are aware of, and appreciative, that they are giving up time with family and friends.
  • Offering holiday pay (regular pay for holidays when you are closed) is a great way to offer your employees some paid time off that is scheduled… by you.
  • It may keep you competitive in the workforce when candidates are considering different companies to work for as many organizations do offer paid holidays or premium pay for working holidays.

According to Entrepreneur magazine, only 1% of companies in the U.S. don’t offer paid holidays.  28% of U.S. companies offer 10 paid holidays a year. 

In a 2016 survey conducted by the Society of Human Resource Management, “More than half (57%) of respondents indicated their organizations pay a premium for employees working on a holiday when the organization would normally be closed. Of these organizations, 40% pay double-time and 21% pay one-and-a-half-time, while 19% pay overtime and 21% pay some other type of premium.”

So what exactly IS holiday pay?  What is the difference between a regular holiday and a “floating holiday?” A brief summary below:

  • Paid Holiday – Payment at regular rate of pay for any holidays in which the company is closed to compensate employees who would lose wages if they would normally be scheduled to work on that day. (Paid holidays do not have to be included in weekly hours for purposes of calculating overtime.) Employers can require that employees work the day prior and day after the holiday to be eligible (unless on previously scheduled time off.)
  • Holiday Premium Pay – A premium rate, such as one and a half times the regular rate of pay, that a company may offer for hours worked on holidays.
  • Unassigned Paid Floating Holiday – In the same category as PTO or vacation time, this is a “free” holiday that employees can choose individually. (A nice incentive for any employees who may celebrate different holidays than those designated by the company.) Requests for taking a floating holiday should be submitted and approved in advance, paid at the regular rate of pay, and do not have to be included in weekly hours for purposes of calculating overtime.
  • Assigned Paid Floating Holiday – Companies may offer a standard nine holidays, but every year add on an extra “floating holiday” depending on when the holidays fall. If Christmas falls on a Tuesday, a company may opt to assign the annual floating holiday for the day before.  These also do not have to be included in weekly hours for purposes of calculating overtime.
  • Holiday Closure – Any days where the company is closed and employees are not expected to report to work. Holiday pay is not assumed unless specified.
  • Early Holiday Closure – The day before or on a holiday where the company formally dismisses employees at an earlier hour than when a shift normally ends.

Holiday Decision Making – next steps:

Once you have decided as an organization how you would like to treat holidays, it is important to put the details in writing. What holidays are closed?  What holidays are open? Will you offer “floating holidays” and if so, will they be assigned or left up to the employee to choose?

A thorough policy will include:

  1. Which holidays the company is closed and which of those, if any, will be paid. Do the holiday closures apply to all employees?
  2. Eligibility for holiday pay on days company is closed (Do employees need to complete their introductory period? Do they need to work the day before and after the holiday unless previous PTO/vacation time was approved?)
  3. On which federal or state-recognized holidays, if any, that you will pay a premium rate to employees scheduled to work those days?
  4. The procedure to request any holidays off that you will be open and how multiple requests will be handled.
  5. A statement that that holiday pay on closed holidays (if applicable) will not be counted as hours worked so will not apply when looking at weekly overtime calculations.

Notes of caution:

  • Watch state laws! In California, an employee who is called in to work on a paid holiday when the rest of the company is closed should be offered a premium rate or an alternative paid holiday within a reasonable amount of time.
  • As an unassigned “floating holiday” would be similar to PTO and vacation time, it should be considered in that category when working with state laws as to final pay calculations. Assigned floating holidays normally do not.
  • Exempt employees must be paid their same weekly salary regardless of holiday closures if any work is performed within the week. An exception to this is if a company is shut down for an entire workweek and no work is performed.  (This includes keeping up with emails from home via a mobile device.)

While it is no secret that employees appreciate holidays off, paid holidays, or incentive for having to work on a holiday when they’d rather be spending time with their nearest and dearest people, there is no law dictating how you, the private employer, need to handle holidays for your organization.

The important step of crafting a holiday policy you are comfortable with that will eliminate surprises for your employees should take into consideration the needs of your business, the local market, your annual payroll budget constraints and work-life balance for your staff to be truly successful.

Click the link to view the recent INFINITI HR blog Cautionary Tale of the Unenforceable Non-Compete or check back for more on human resources, payroll, insurance and benefits.

Cautionary Tale of the Unenforceable Non-Compete

Once upon a time there was a Big Bad Wolf who was tired of huffing and puffing for the Three Little Pigs, so he quit his job and took a position with Little Red Riding Hood terrorizing the forest.

Well, as you can imagine, the Three Little Pigs were blindsided and furious.  After years of apprenticeship, marketing efforts, and successfully building The Big Bad Wolf’s image as a terrifying wind wrangler to the reading public, they felt betrayed and more importantly, irrelevant.  As a key figure in their story, the Big Bad Wolf’s departure could have a tremendously negative impact on their future book sales and online subscriptions if not replaced quickly.  What literature class would want to read about two failed architects and another with limited institutional design experience without a moral to learn? They would need to replace the Big Bad Wolf quickly to stay competitive, but wanted consideration for their losses.  They then pulled out a non-compete agreement that the Big Bad Wolf signed when he first accepted the position. It was all encompassing and very broad. Surely it covered all possible situations! So, they sued him for breach of contract.  Long story short (no pun intended)… they lost. But why?

While the Three Little Pigs had a legitimate interest in protecting their story business, they failed on a number of common factors that courts look at to determine if an agreement is reasonable:

1.      THE GEOGRAPHIC SCOPE WAS TOO LARGE.

While a non-compete agreement is established to protect an organization, it shouldn’t attempt to stop a person from making a living anywhere.  In some states, a geographic region of say 15- 20 miles might be considered a reasonable distance to ask that a former employee not open shop and directly compete for the same customers. The Big Bad Wolf was aware of this and when he left the Three Little Pigs back on their farm in England, he went instead to Italy, where Little Red Riding Hood had posted the vacancy left by her prior wolf, who had been in service for 600 years and was about to retire.  The Big Bad Wolf relocated by 1,250 miles.  The courts felt the Three Little Pigs could not be that restrictive on his career opportunities.  Now it might have been possible to state that all of Europe was off limits had the agreement only had a lifespan of, say, one month.  It’s also important to note that in the world of restrictive covenants across international borders, limitations in the US may not hold up elsewhere.

2.      THE LENGTH OF TIME THAT THE NON-COMPETE WAS TO BE ENFORCED WAS FOUND UNREASONABLE.

The Three Little Pigs had failed to establish a specific length of time to restrict the Big Bad Wolf. Asking the Big Bad Wolf to never work as a bad guy again in the story telling field wouldn’t hold up in most states that permit non-compete agreements.  How long is okay? The answer: it depends.  Typically, we see terms of up to two years depending on the scope of the other covenants in the agreement and the state in question.

3.      THE THREE LITTLE PIGS WERE TRYING TO STOP THE BIG BAD WOLF FROM DOING DIFFERENT WORK.

It’s not like the Big Bad Wolf took his huffing and puffing training and used that technique to ensnare Grandma or Little Red Riding Hood. Sure, he had an established bad guy image, but with the Three Little Pigs he generated wind and never got to eat. He was starving.  In his new gig, the Big Bad Wolf was filling a generic bad guy vacancy with a very publicly, pre-established technique of devouring storybook characters. He’s using a different skill set and did not carry trade secrets over from one story to another.

Side note: If they had been armed with a strategic recruiting and selection process, the Three Little Pigs could have quickly backfilled with another wolf who likes farm life.

4.      THE THREE LITTLE PIGS DID NOT OFFER ADDITIONAL COMPENSATION OR BENEFITS IN RETURN FOR THE BIG BAD WOLF’S AGREEMENT TO SIGN THE NON-COMPETE.

Lazy and cheap business characters that they were, the first two Little Pigs never bothered to include discussion of any compensation terms to the Big Bad Wolf in his agreement not to compete, and the third Little Pig was too busy laying bricks to notice.  So, they failed on this factor as well.

THE MORAL OF THIS STORY IS…

Not all states permit non-competes, and those that do may have very specific statutes to address restrictive covenants.

If you have employees across state lines, nuances in non-compete agreements such as declaring which state’s laws under which you will primarily operate are important to consider, while also understanding that your agreements might still falter in the courts from state to state.

Other factors might impact enforceability, such as:

  • The employer owes the employee money
  • The employee was wrongfully terminated
  • The agreement was signed under duress

Quite often, employers over-reach and use non-competes to restrict employment in an attempt to shield their customer lists from departing employees, when a simple Non-Solicitation agreement will do.  Non-Solicitation agreements limit an employee’s ability to solicit your active and recent customers and prevents them from actively soliciting your employees for a specific period of time, without impacting a person’s overall ability to work in the industry.

When trying to determine if you need a non-compete, a non-solicitation, confidentiality, or non-recruit agreement, it’s best to seek legal counsel or obtain otherwise properly vetted documents from a reliable source for the situation in question. Every non-compete agreement situation is different and will be viewed case-by-case by the courts if it gets litigious.

If this teaches anything, it is that you should approach employment agreements and contracts with caution and with the support of knowledgeable professionals in HR and labor law to help keep your company’s story in proper order.

The End.

Click the link to view the recent INFINITI HR blog 2018 Update: Unpaid Intern or Employee or check back for more on human resources, payroll, insurance and benefits.

2018 Update: Unpaid Intern or Employee?

Over the past six years, a wake-up call for employers who use unpaid interns had been brewing. Court cases publicized the issue, and in January of 2018, the Department of Labor (DOL) established new classification tests to accommodate court decisions.

Triggered in a 2012 case against Harper’s Bazaar, and further publicized in 2013 by a verdict against Fox Searchlight for the 2010 film ‘Black Swan’, the proper use of unpaid interns had become a matter of close legal scrutiny, and hence increasing importance for employers.

In the ‘Black Swan’ decision it was ruled that Fox Searchlight should have paid two interns on the film because they were essentially regular employees. The judge noted that these internships did not foster an educational environment and that the studio received the benefits of the work.

The matter was further addressed in court decisions and finally addressed by the DOL in January of 2018 with the update of fact sheet #71, in which new test parameters were outlined to assess who does and does not qualify for unpaid intern or student status.

How do employers avoid the risk of finding themselves on the defense in their use of interns?

Reviewing and updating internship programs and policies to comply with federal and state standards is a critical first step. To avoid liability, employers can protect themselves with a clear understanding of the definitions of “interns & students” v. “employees” as set by the U.S. Department of Labor (DOL).

Viewing unpaid internships as a way to accomplish work tasks rather than as educational programs is the wrong approach for employers.  To set the expectations, the DOL now provides a detailed test to examine a position for “intern” status and if it qualifies, minimum wage and overtime exemptions may take place.

How does an employer determine if a student qualifies as an intern versus an employee?

Fact Sheet #71 lays out the following seven factors which allows courts to examine the “economic reality” of the intern-employer relationship and to determine which party is the “primary beneficiary” of the relationship.

  • The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
  • The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
  • The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  • The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  • The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  • The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  • The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

If an employer’s internship program substantially meets the factors listed above, then the intern is not considered an “employee” under the FLSA and the Act’s minimum wage and overtime obligations do not apply to the intern.

Employers should keep in mind that the test is “flexible” and no one single factor is meant to control the classification decision process. This is somewhat of a change from previous versions of the DOL’s classification tests, where all factors in the test had to be met.

What specific practices can I engage in to protect myself from misclassifying positions?

  • Adopt a policy that sets up appropriate supervision and training of interns and assigns a mentor.
  • Train intern supervisors to actively participate with the interns.
  • Document the training, monetary benefits and costs an intern brings to the company.
  • As interns or students are not entitled to a job at the end of the training, draft a written agreement with the intern stating that the intern should have no expectation of employment and should not presume any guarantee of employment after the internship. (That does not mean you cannot, or should not, hire them after an internship is completed if you have openings.)
  • Draft a written agreement stating that payment for the intern’s services is neither intended nor expected during the internship to ensure the student is clear at the beginning of the relationship.
  • All of these steps support your intent to benefit the intern’s learning process and they set clear expectations for all involved.

The risk lies in not accepting that, as an employer, you cannot view internship or training programs as a path to free or inexpensive labor.

Like with any other employment practice, proactive vision, detailed planning, training, documentation, and execution will help to ensure that your organization can give back to your industry’s community by supporting internships. Done well, internships help to build your organization’s reputation, philanthropic efforts, culture & brand, and ultimately, your appeal to candidates in recruiting efforts.

If you wish to develop an internship program, but don’t know where to start, be sure to seek expertise from a qualified HR professional for assistance.

Click the link to view the recent INFINITI HR blog Job Market Report Trend: Interview No Shows or check back for more on human resources, payroll, insurance and benefits.