We often use the term "team player" to describe an employee who gets along with others, works well on team projects, and/or is willing to contribute discretionary effort toward the organization's goals. It's important for every organization to recognize the true importance of team skills as a success factor and a selection criteria for job candidates. Here's two examples to demonstrate the subtle difference:
Jane is a commissioned outside sales rep with a defined territory. She's a hunter and spends most of her time seeking out new sales opportunities as opposed to taking orders from existing clients. She has the technical knowledge to make the sale on her own without the assistance of technical support staff and she's not dependent on marketing or back office people to prepare proposal documents or support the sales process. When she makes the sale, she turns the order over to operations personnel and moves on to the next prospect.
Sally is a sales/marketing rep and earns a straight salary. Her primary job is to get appointments with decision makers in order to bring in a technical expert to wow the client with the company's capabilities. After the sale is made, Sally works with a team of people to pull together the solution for the prospect and she remains the primary point of contact for both implementation and customer questions or concerns going forward. She is also responsible for identifying potential future sales with that same client.
If either Jane or Sally should leave their respective organizations, which company should be more concerned with whether or not potential replacements are "team players." Obviously Sally's role requires much more interaction with co-workers and the successful candidate to replace her needs to be someone who plays well in the sandbox with others. In reality, Jane could be perceived as difficult to work with and uncooperative from the perspective of her co-workers and still be a rock-star when it comes to her core job duties - making rain! Over-weighting team skills during the selection process for Jane's replacement could result in overlooking the candidate who might have delivered the strongest results.
You can apply the same logic to multiple roles in your organization - how important is it that this individual be able to work well with other people? If the role is really designed for an individual contributor, someone who sits in a back office and cranks out work without need to interact with others, the organization should look for someone who scores high for traits such as Commanding, Resourceful and Intentional. If the role is really designed for someone whose work frequently interacts with other team members, the organization should look for someone who scores high for traits like Collaborative, Selfless and Harmonious.
How do you identify those traits during the selection process? A) You ask behavioral interview questions targeted at those motivators and B) you give them a pre-employment assessment that measures those internal motivators. Don't currently use a motivators assessment? Contact me and I'll show you a great one that will help your organization make better hiring decisions.
Sunday, July 9, 2017
Sunday, June 18, 2017
Handling Final Pay
Many owners or managers get angry when an employee unexpectedly quits or when they are forced to fire an employee for misconduct, so they take it out on the employee by deducting as much as they can from that final paycheck. This behavior is rife with risk, so keep the following in mind before you start tallying those deductions:
First, former employees are alumni of your organization, for good or bad, so sometimes it may serve you better to let little things go and take the high road. This could reduce the chances they'll do damage to your employment brand by telling all their friends how horribly they were treated while working at your organization; and might minimize the chances that they'll file a complaint with the Department of Labor if you get too aggressive.
Second, make sure you're on solid footing when making those deductions:
1. Don't hold their check! Some employers will hold the employee's final paycheck until all their "stuff" is returned. In most states (including NC, SC and VA) employers are required to pay the employee for time-worked by the next regular pay day. But know the laws in your state, as some require final pay as quickly as immediately for terminated employees, and the rules may be different for employees who voluntarily leave versus those who are terminated or laid-off). While you can't hold their entire paycheck, it is legal to withhold any preauthorized amounts from that final check so long as they don't run afoul of certain rules.
2. Have a signed document on file allowing the deductions. The employee must authorize deductions for damaged or lost equipment and uniforms, so make sure you have a signed document on file that gives you permission to take those deductions. It is best to specify the deduction amounts in the original document that the employee signed (Cell phone deduction = $150, for example). If there is no document on-file authorizing the deductions, you can't just arbitrarily hold $50 out of their check because their truck was returned dirty.
3. Understand who benefits from the deduction. The state of NC, for example, differentiates the rules for deductions that benefit the employee (savings plans, parking fees, employee loans, uniforms that are not required, etc.) and deductions for the benefit of the employer (lost or damaged equipment, keys, uniforms which are required, etc.).
4. Watch for minimum wage and overtime. It is not permissible to take deductions to the employer's benefit that drop the employee's final pay down below minimum wage for actual time worked. Plus, you can't deduct anything to the employer's benefit from overtime wages. This makes it difficult to recover virtually any costs from minimum-wage workers, even with signed authorization forms.
5. Be reasonable. If you issue an employee a new laptop in 2017 and they quit in 2020, deducting the full purchase price of that laptop (if not returned) is not going to seem reasonable to the investigator. The state of NC allows the deduction authorization to be non-specific in the case of depreciable assets like laptops, but the company must notify the employee, in-writing, the calculated value of the deduction per their authorization. (Here's a link to a document that spells that out in more detail).
6. Vacation or PTO. Your employee who just quit had taken 5 vacation days this year but only accrued 3 per your policy, putting them 2 days in arrears. Those 2 days are considered pre-payment of wages in NC and not a deduction from wages. Therefore those two days of vacation or PTO can be adjusted on their final paycheck without regard to the minimum wage or pre-authorization limitations (at least in NC).
Final thoughts: if you are a small to mid-sized employer who makes his or her living leveraging the efforts of lower paid hourly workers, you're going to experience a certain amount of lost and damaged equipment. Some of the time you'll be able to recover the costs of an employee's negligence, but other times you won't. But don't make the mistake of going overboard in looking for ways to decrease that departing employee's final pay. When that $25 deduction for a lost tool or uniform shirt ends up costing you hundreds or even thousands because a regulator determined you were out of compliance in the way you handled it, you've really only outsmarted yourself.
First, former employees are alumni of your organization, for good or bad, so sometimes it may serve you better to let little things go and take the high road. This could reduce the chances they'll do damage to your employment brand by telling all their friends how horribly they were treated while working at your organization; and might minimize the chances that they'll file a complaint with the Department of Labor if you get too aggressive.
Second, make sure you're on solid footing when making those deductions:
1. Don't hold their check! Some employers will hold the employee's final paycheck until all their "stuff" is returned. In most states (including NC, SC and VA) employers are required to pay the employee for time-worked by the next regular pay day. But know the laws in your state, as some require final pay as quickly as immediately for terminated employees, and the rules may be different for employees who voluntarily leave versus those who are terminated or laid-off). While you can't hold their entire paycheck, it is legal to withhold any preauthorized amounts from that final check so long as they don't run afoul of certain rules.
2. Have a signed document on file allowing the deductions. The employee must authorize deductions for damaged or lost equipment and uniforms, so make sure you have a signed document on file that gives you permission to take those deductions. It is best to specify the deduction amounts in the original document that the employee signed (Cell phone deduction = $150, for example). If there is no document on-file authorizing the deductions, you can't just arbitrarily hold $50 out of their check because their truck was returned dirty.
3. Understand who benefits from the deduction. The state of NC, for example, differentiates the rules for deductions that benefit the employee (savings plans, parking fees, employee loans, uniforms that are not required, etc.) and deductions for the benefit of the employer (lost or damaged equipment, keys, uniforms which are required, etc.).
4. Watch for minimum wage and overtime. It is not permissible to take deductions to the employer's benefit that drop the employee's final pay down below minimum wage for actual time worked. Plus, you can't deduct anything to the employer's benefit from overtime wages. This makes it difficult to recover virtually any costs from minimum-wage workers, even with signed authorization forms.
5. Be reasonable. If you issue an employee a new laptop in 2017 and they quit in 2020, deducting the full purchase price of that laptop (if not returned) is not going to seem reasonable to the investigator. The state of NC allows the deduction authorization to be non-specific in the case of depreciable assets like laptops, but the company must notify the employee, in-writing, the calculated value of the deduction per their authorization. (Here's a link to a document that spells that out in more detail).
6. Vacation or PTO. Your employee who just quit had taken 5 vacation days this year but only accrued 3 per your policy, putting them 2 days in arrears. Those 2 days are considered pre-payment of wages in NC and not a deduction from wages. Therefore those two days of vacation or PTO can be adjusted on their final paycheck without regard to the minimum wage or pre-authorization limitations (at least in NC).
Final thoughts: if you are a small to mid-sized employer who makes his or her living leveraging the efforts of lower paid hourly workers, you're going to experience a certain amount of lost and damaged equipment. Some of the time you'll be able to recover the costs of an employee's negligence, but other times you won't. But don't make the mistake of going overboard in looking for ways to decrease that departing employee's final pay. When that $25 deduction for a lost tool or uniform shirt ends up costing you hundreds or even thousands because a regulator determined you were out of compliance in the way you handled it, you've really only outsmarted yourself.
Essentials of a Strong Culture
Organizational culture is defined by former MIT professor Ed Schein as the set of shared, taken-for-granted implicit assumptions that a group holds that determines how it perceives, thinks about and reacts to its environment. In other words, it determines how we dress, speak, act, interact and perform our jobs. It is often the glue that holds employees to the mission and the goals of the organization.
Peter Drucker has been attributed with saying, "culture eats strategy for breakfast," but it was Mark Fields, CEO at Ford who made the slogan popular in 2006.
There are 3 levels of organizational culture:
1. Visible Artifacts - these are the acronyms and vocabulary your organization uses, the uniforms or manner of dress that is allowed/required, your org chart, the layout and vibe of the office, the myths and stories about the organization that are repeated formally and informally, and observable rituals and ceremonies, both formal and informal.
2. Espoused vs. Enacted Values - these are the values we say are important. Words and phrases like integrity, trust, do it right the first time, always good ships, etc. Unfortunately, sometimes the espoused values conflict with enacted values or actual behavior. It's fine to have integrity on a plaque or on the first page of the employee handbook, but if the owner or a manager frequently acts in observable ways that conflict with that (such as frequently lying to customers, suppliers or employees), then the culture is going to be defined by the enacted values, not the espoused values. Enacted values are essentially defined by what managers choose to reward, condone and condemn.
3. Basic Underlying Assumptions - these are values that are taken for granted over time. These are more deeply held beliefs that employees have about their company and are the most resistant to change.
Is your culture helping you achieve your goals or is it hindering it? Can you define your culture and do your employees agree with your assumptions about what your culture really is? Is the culture that got you where you are the same culture that's going to get you where you want to go?
I once worked with a company that reached a stage where it determined it needed to significantly change its culture to achieve its next growth phase. It had grown from 4 employees to 400 as basically an adhocracy (adaptable, creative, agile, decentralized, externally focused and flexible). Many of its managers were quite entrepreneurial and had been hired because they were. But executives felt that in order to grow the company to the next level it needed to become more of a hierarchy (internally focused with more formalized and rigid systems and controls). This culture shift resulted in more than a little turbulence over several years and cost the company quite a few of its long-term, loyal employees, but the shift did position the company to achieve remarkable growth and reach the goals of the owners, which ultimately included selling the company at the right time.
There's a lot more involved in culture change than buying some tee shirts and adopting a new slogan. So if you decide you want to investigate your organization's culture, how it is helping and/or hurting, contact a professional who understands organizational behavior and how to change not only artifacts, but systematically resetting those basic underlying assumptions.
Peter Drucker has been attributed with saying, "culture eats strategy for breakfast," but it was Mark Fields, CEO at Ford who made the slogan popular in 2006.
There are 3 levels of organizational culture:
1. Visible Artifacts - these are the acronyms and vocabulary your organization uses, the uniforms or manner of dress that is allowed/required, your org chart, the layout and vibe of the office, the myths and stories about the organization that are repeated formally and informally, and observable rituals and ceremonies, both formal and informal.
2. Espoused vs. Enacted Values - these are the values we say are important. Words and phrases like integrity, trust, do it right the first time, always good ships, etc. Unfortunately, sometimes the espoused values conflict with enacted values or actual behavior. It's fine to have integrity on a plaque or on the first page of the employee handbook, but if the owner or a manager frequently acts in observable ways that conflict with that (such as frequently lying to customers, suppliers or employees), then the culture is going to be defined by the enacted values, not the espoused values. Enacted values are essentially defined by what managers choose to reward, condone and condemn.
3. Basic Underlying Assumptions - these are values that are taken for granted over time. These are more deeply held beliefs that employees have about their company and are the most resistant to change.
Is your culture helping you achieve your goals or is it hindering it? Can you define your culture and do your employees agree with your assumptions about what your culture really is? Is the culture that got you where you are the same culture that's going to get you where you want to go?
I once worked with a company that reached a stage where it determined it needed to significantly change its culture to achieve its next growth phase. It had grown from 4 employees to 400 as basically an adhocracy (adaptable, creative, agile, decentralized, externally focused and flexible). Many of its managers were quite entrepreneurial and had been hired because they were. But executives felt that in order to grow the company to the next level it needed to become more of a hierarchy (internally focused with more formalized and rigid systems and controls). This culture shift resulted in more than a little turbulence over several years and cost the company quite a few of its long-term, loyal employees, but the shift did position the company to achieve remarkable growth and reach the goals of the owners, which ultimately included selling the company at the right time.
There's a lot more involved in culture change than buying some tee shirts and adopting a new slogan. So if you decide you want to investigate your organization's culture, how it is helping and/or hurting, contact a professional who understands organizational behavior and how to change not only artifacts, but systematically resetting those basic underlying assumptions.
Thursday, May 4, 2017
Changes in Comp Time Rules Coming?
Jim is a technician with XYZ Corp. He's non-exempt (hourly) and worked 42 hours last week. Jim's supervisor has asked Jim if he'd like to take 3 hours off next Friday as comp time instead of being paid cash for his overtime last week. Is this OK? Does it matter if Jim would prefer the comp time to cash?
The answer to both questions as of today is "no." Only government workers are allowed to take comp time in lieu of overtime pay.
The Good News: The U.S. House of Representatives passed HR 1180, sponsored by Virginia Foxx of NC and dubbed The Working Families Flexibility Act, on May 2. This bill, if approved by the Senate, would allow private sector employers similar rights to those enjoyed by public sector folks to decide if they'd prefer cash or time off. The Society for Human Resource Management (SHRM) has been an advocate for this bill.
The Bad News #1: HR 1180 had zero support from Democrats in the House and none is expected from Senate Democrats either, who are anticipated to filibuster the bill. So its passage is iffy at this point.
The Bad News #2: If you are a private employer and you are granting comp time to your non-exempt employees who work overtime rather than paying them time plus 1/2, you are likely running afoul of the Fair Labor Standards Act. It doesn't matter whether it's being imposed by management or requested by the employee, either scenario is illegal.
This doesn't apply to shifting schedules around during the same workweek. If XYZ's official workweek is Sunday through Saturday and Jim worked 10 hours on Monday then 8 hours each on Tuesday, Wednesday and Thursday, then worked only 6 hours on Friday for a total of 40 for the week - that's fine (in most states other than California). But Jim is not allowed to work 10 hours on Monday, 8 hours each day from Tuesday through Friday and carry-over comp time earned this workweek into a future workweek, even if the comp time is calculated at time + 1/2.
And finally, avoid using the term "comp time" in emails or in formal policy language when referring to exempt workers. This can compromise those employees' exempt status in the eyes of the DOL and IRS. If you have an exempt employee who put in a lot of hours in week 1 and knocks off early on Friday of week 2 - don't call that comp time - they're simply exempt.
The answer to both questions as of today is "no." Only government workers are allowed to take comp time in lieu of overtime pay.
The Good News: The U.S. House of Representatives passed HR 1180, sponsored by Virginia Foxx of NC and dubbed The Working Families Flexibility Act, on May 2. This bill, if approved by the Senate, would allow private sector employers similar rights to those enjoyed by public sector folks to decide if they'd prefer cash or time off. The Society for Human Resource Management (SHRM) has been an advocate for this bill.
The Bad News #1: HR 1180 had zero support from Democrats in the House and none is expected from Senate Democrats either, who are anticipated to filibuster the bill. So its passage is iffy at this point.
The Bad News #2: If you are a private employer and you are granting comp time to your non-exempt employees who work overtime rather than paying them time plus 1/2, you are likely running afoul of the Fair Labor Standards Act. It doesn't matter whether it's being imposed by management or requested by the employee, either scenario is illegal.
This doesn't apply to shifting schedules around during the same workweek. If XYZ's official workweek is Sunday through Saturday and Jim worked 10 hours on Monday then 8 hours each on Tuesday, Wednesday and Thursday, then worked only 6 hours on Friday for a total of 40 for the week - that's fine (in most states other than California). But Jim is not allowed to work 10 hours on Monday, 8 hours each day from Tuesday through Friday and carry-over comp time earned this workweek into a future workweek, even if the comp time is calculated at time + 1/2.
And finally, avoid using the term "comp time" in emails or in formal policy language when referring to exempt workers. This can compromise those employees' exempt status in the eyes of the DOL and IRS. If you have an exempt employee who put in a lot of hours in week 1 and knocks off early on Friday of week 2 - don't call that comp time - they're simply exempt.
5 Dumb Things Managers Say
Being a manager is tough. Every employee is different and the same words coming out of your mouth can be motivating to one worker and demotivating to another. But here's a handful of things managers either say directly or indirectly through their actions that are always demotivating (and, I confess, I may have said or done these myself at one time or another):
1. "Customer is always right" A customer calls and accuses an employee of something heinous (theft, rudeness, etc.). Manager confronts the employee and starts ripping into him or her based on the call. Guilty by accusation. Unfortunately, sometimes when the manager gets around to conducting an investigation, it turns out the customer was mistaken (or had a hidden agenda). Managers should give their employee the benefit of the doubt. The employee will understand that you must follow-up on customer complaints, but they'll appreciate being treated as innocent until proven guilty - so ask about the situation, speak to all those who might be in the know about what happened, and listen before passing judgement. If the employee is guilty of poor communication, use the incident as a development opportunity. If they're guilty of theft, violence or threats of bodily harm - get them out of your organization. If the customer intentionally mislead you - fire the customer.
2. "I'm too busy" A retired banking exec once told me the best piece of feedback he received from his employees was that he tended to continue to hold his pen over his notepad when people came to his door, and they interpreted that posture to mean they were interrupting him from his important work and they needed to hurry up. Modern variations of this you're less important than other stuff I have going includes keeping your hands on your keyboard when someone stops to ask you a question, or peeking at your monitor or phone while one of your workers is speaking with you. If you are a manager, there is little that is more important than your team members, so when they come to see you, put your pen down, close your laptop, put your phone to the side and listen. If you do have a time-sensitive deadline, politely negotiate an alternative time for them to return when you can give them your full attention.
3. "...but..." Managers were promoted into management roles because they know how to add value to an organization. They leverage the work of others so that the team is greater than the sum of its parts. But this positive can become a negative when giving performance feedback or responding to employees when they offer suggestions or have ideas. Great idea, Bob, but have you considered... or Nice job on the Jones account, but you should have... Remember, everything after the "but" is generally demotivating. Learn to finish your statements with a period, not a comma and a but, except in those few situations where it is really warranted. You don't have to add value to everything!
4. "I don't give 5s" Early in my career I had the I don't give 5s manager. We had a review form where we were rated on a scale of 1-5, but my manager made it clear that no one was a 5. My thoughts are the same now as they were then: 6, 7, and 8 are unachievable scores because they're not on the form - if 5 is also not achievable, let's go to a 4 point scale!
First of all, if you're still rating employees' behaviors or attributes on a performance review form, you're performance management system is probably broken. My meaningful behavior and performance changes occurred when I was coached in the moment by someone I trusted, not in an annual meeting.
But that aside, if you're evaluating them against an unachievable standard, it's going to be tough to motivate. Can you imagine Bill Belichik (head coach of the Super Bowl champion Patriots) telling Tom Brady (the quarterback who engineered one of the great comeback wins in history) that he was giving him a 4 on his performance for that game because he threw an interception during the 1st half? Unfortunately, managers do that kind of stuff all the time.
5. "You'll gain valuable experience" The manager thinks he/she is being motivational - holding out a carrot. What the employee hears is, we want you to do extra work for no additional pay. Unfortunately, managers often forget about how the employee bailed them out once the work is done and the experience never translates into a reward. Make sure rewards are timely - if you ask someone to do extra work, make sure they get some kind of reinforcement for their discretionary effort soon after they gave it. The promise that their discretionary effort has not gone unnoticed may not be enough to ensure they continue to give it.
1. "Customer is always right" A customer calls and accuses an employee of something heinous (theft, rudeness, etc.). Manager confronts the employee and starts ripping into him or her based on the call. Guilty by accusation. Unfortunately, sometimes when the manager gets around to conducting an investigation, it turns out the customer was mistaken (or had a hidden agenda). Managers should give their employee the benefit of the doubt. The employee will understand that you must follow-up on customer complaints, but they'll appreciate being treated as innocent until proven guilty - so ask about the situation, speak to all those who might be in the know about what happened, and listen before passing judgement. If the employee is guilty of poor communication, use the incident as a development opportunity. If they're guilty of theft, violence or threats of bodily harm - get them out of your organization. If the customer intentionally mislead you - fire the customer.
2. "I'm too busy" A retired banking exec once told me the best piece of feedback he received from his employees was that he tended to continue to hold his pen over his notepad when people came to his door, and they interpreted that posture to mean they were interrupting him from his important work and they needed to hurry up. Modern variations of this you're less important than other stuff I have going includes keeping your hands on your keyboard when someone stops to ask you a question, or peeking at your monitor or phone while one of your workers is speaking with you. If you are a manager, there is little that is more important than your team members, so when they come to see you, put your pen down, close your laptop, put your phone to the side and listen. If you do have a time-sensitive deadline, politely negotiate an alternative time for them to return when you can give them your full attention.
3. "...but..." Managers were promoted into management roles because they know how to add value to an organization. They leverage the work of others so that the team is greater than the sum of its parts. But this positive can become a negative when giving performance feedback or responding to employees when they offer suggestions or have ideas. Great idea, Bob, but have you considered... or Nice job on the Jones account, but you should have... Remember, everything after the "but" is generally demotivating. Learn to finish your statements with a period, not a comma and a but, except in those few situations where it is really warranted. You don't have to add value to everything!
4. "I don't give 5s" Early in my career I had the I don't give 5s manager. We had a review form where we were rated on a scale of 1-5, but my manager made it clear that no one was a 5. My thoughts are the same now as they were then: 6, 7, and 8 are unachievable scores because they're not on the form - if 5 is also not achievable, let's go to a 4 point scale!
First of all, if you're still rating employees' behaviors or attributes on a performance review form, you're performance management system is probably broken. My meaningful behavior and performance changes occurred when I was coached in the moment by someone I trusted, not in an annual meeting.
But that aside, if you're evaluating them against an unachievable standard, it's going to be tough to motivate. Can you imagine Bill Belichik (head coach of the Super Bowl champion Patriots) telling Tom Brady (the quarterback who engineered one of the great comeback wins in history) that he was giving him a 4 on his performance for that game because he threw an interception during the 1st half? Unfortunately, managers do that kind of stuff all the time.
5. "You'll gain valuable experience" The manager thinks he/she is being motivational - holding out a carrot. What the employee hears is, we want you to do extra work for no additional pay. Unfortunately, managers often forget about how the employee bailed them out once the work is done and the experience never translates into a reward. Make sure rewards are timely - if you ask someone to do extra work, make sure they get some kind of reinforcement for their discretionary effort soon after they gave it. The promise that their discretionary effort has not gone unnoticed may not be enough to ensure they continue to give it.
Monday, April 10, 2017
Common HR Audit Fails
One of the pleasures of my job is conducting HR audits for small and mid-sized companies. No, I don't derive pleasure from saying, gotcha. I derive pleasure from helping small and mid-sized business owners have a realistic assessment of any employment risks they are facing and how their management practices stack up against best practices.
Most small business owners want to do things correctly. But it's difficult to create momentum for their business through sales and marketing, manage operations so they deliver on their promises, and keep track of things like labor laws, tax laws, and other government rules and regulations. The smart owners surround themselves with specialists who can help keep an eye on those things so that they can keep their eyes on their customers.
So, in doing these audits, I find many organizations make the same errors. Here's a few:
1. Exempt/Non-exempt - in the second half of last year everyone was scrambling to make sure they had a plan for the new overtime rules. Unfortunately for many, the procrastinators were the winners as a judge put a halt on the rules at the 11th hour. Furthermore, the election results cast doubt on the rules' future. However, the audits I performed during that time revealed that many employers were misclassifying employees based on the duties test (not the salary test) and many remain misclassified today. The courts put the new salary test on hold, but the duties tests still apply. Just because you're paying that employee more than $24k doesn't mean he or she is legally exempt.
2. Use of 1099 Contractor Status - I have many clients and receive 1099s from quite a few of them. I invoice those clients through a corporate entity that maintains its own insurance. No auditor from the departments of labor or revenue is going to question the legitimacy of those 1099s - I meet the standard. But that guy you have working for you 40 hours per week, driving your truck, wearing your uniform, using your tools and working when you tell him to...not so much. That same agency representative is going to have heartburn over that guy and it could turn out to be very expensive for you. And you're probably shifting a lot less risk than you think you are.
3. Forms I-9 and e-verify - I'm still surprised at how many small companies are not using e-verify. The penalties for hiring unauthorized workers or failing to properly document work authorization through an I-9 are significant (see here). E-verify is required for all employers in NC with 25+ employees (see FAQ here), and is required for all employers in SC, but is only required for certain government agencies and contractors in VA. However, even though it is not always required in VA, the system is free and is a useful supplement to form I-9 - I recommend that my VA clients use it voluntarily.
If you haven't had a fresh set of eyes on your HR compliance platform recently, contact The Davidson Group for a free consultation.
2. Use of 1099 Contractor Status - I have many clients and receive 1099s from quite a few of them. I invoice those clients through a corporate entity that maintains its own insurance. No auditor from the departments of labor or revenue is going to question the legitimacy of those 1099s - I meet the standard. But that guy you have working for you 40 hours per week, driving your truck, wearing your uniform, using your tools and working when you tell him to...not so much. That same agency representative is going to have heartburn over that guy and it could turn out to be very expensive for you. And you're probably shifting a lot less risk than you think you are.
3. Forms I-9 and e-verify - I'm still surprised at how many small companies are not using e-verify. The penalties for hiring unauthorized workers or failing to properly document work authorization through an I-9 are significant (see here). E-verify is required for all employers in NC with 25+ employees (see FAQ here), and is required for all employers in SC, but is only required for certain government agencies and contractors in VA. However, even though it is not always required in VA, the system is free and is a useful supplement to form I-9 - I recommend that my VA clients use it voluntarily.
If you haven't had a fresh set of eyes on your HR compliance platform recently, contact The Davidson Group for a free consultation.
On-boarding - The Secret Sauce
Buyer's remorse is real. Think back to your last major purchase. If, after you got the new "thing" home, you had little pangs of doubt as to whether you made the right choice, you're not alone - many people experience this. And many people feel the same emotion a few days (or even hours) into a new job. That new employee who just quit a job to come work for you or took themselves off the job market to accept a position with your organization may be wondering if they might have been better off staying where they were or waiting on the next offer instead of taking yours.
The primary, number one purpose of an on-boarding program is to combat buyer's remorse. Once a new hire starts to regret their decision to join your team, it's easy to lose them. A 2014 study by a division of Equifax found that 40% of employees who voluntarily leave a job do so in the first six months. Another 16% quit before their one-year anniversary. So more than half of all voluntary terminations occur during the first year.
Here are some tips to make your new hires' experience one that resists buyer's remorse:
1. Realistic Job Preview - if your description of the job duties and the job environment is all rainbows and unicorns during the interview phase, but the reality of the day-to-day is much different, your candidate is likely to experience buyer's remorse. Show the candidate the actual office they'll be in or the actual vehicle they'll be driving, not your best-in-show office or van. If they're gonna be on-call - tell them. If they're gonna get dirty - tell them. If they're gonna frequently talk with disgruntled customers - tell them. If the sales department and the operations department are often in conflict - tell them. You will be much better off if you sound almost like you're trying to talk them out of taking the job rather then into it.
2. Deliver on Your Promises - the most common complaint I hear in this area is frustration over training. One guy I know loves to tell the story of how the President of a company he worked for told him all about the great training program his company has. He took the job and was basically shown an office and told to get to work - sink or swim. He's still waiting on that training. If you say you're going to train them, then train them - it's the best investment you'll make. If you say they'll get a review in 90 days or 6 months and their compensation will be reviewed at that time, make sure you do it. No bait and switch maneuvers!
3. Have a Plan and Execute - for many organizations, on-boarding is a two hour administrative process - fill out all the HR forms, issue an employee handbook and a badge, and watch a safety video. You're likely to have better success if you think of on-boarding as a much longer management process - 90 to 180 days for most jobs and as much as a year for higher level positions. Script out what is going to happen on day 1, day 2, etc., then week 3, 4, 5 and 6. Be sure the on-boarding plan accounts for:
- learning the technical skills needed to be successful
- learning the written rules/policies
- learning the unwritten rules, those non-policy things that will get the new employee crossways with the bosses or co-workers (such as: we don't have assigned parking, but Jane always parks in that spot and she's been here 27 years).
- learning what gets you recognized and rewarded and what will get you in the doghouse
- getting socialized - meeting people, making friends
And don't make these mistakes:
- waiting till the employee's first day to order uniforms or business cards. Have their business cards ready on day 1.
- making a new hire spend their first day cleaning up the last person's mess. Issue them an office, cube, workspace or vehicle that is clean, neat and ready to go.
In short - want to improve your employee retention rate? Improve your on-boarding process.
The primary, number one purpose of an on-boarding program is to combat buyer's remorse. Once a new hire starts to regret their decision to join your team, it's easy to lose them. A 2014 study by a division of Equifax found that 40% of employees who voluntarily leave a job do so in the first six months. Another 16% quit before their one-year anniversary. So more than half of all voluntary terminations occur during the first year.
Here are some tips to make your new hires' experience one that resists buyer's remorse:
1. Realistic Job Preview - if your description of the job duties and the job environment is all rainbows and unicorns during the interview phase, but the reality of the day-to-day is much different, your candidate is likely to experience buyer's remorse. Show the candidate the actual office they'll be in or the actual vehicle they'll be driving, not your best-in-show office or van. If they're gonna be on-call - tell them. If they're gonna get dirty - tell them. If they're gonna frequently talk with disgruntled customers - tell them. If the sales department and the operations department are often in conflict - tell them. You will be much better off if you sound almost like you're trying to talk them out of taking the job rather then into it.
2. Deliver on Your Promises - the most common complaint I hear in this area is frustration over training. One guy I know loves to tell the story of how the President of a company he worked for told him all about the great training program his company has. He took the job and was basically shown an office and told to get to work - sink or swim. He's still waiting on that training. If you say you're going to train them, then train them - it's the best investment you'll make. If you say they'll get a review in 90 days or 6 months and their compensation will be reviewed at that time, make sure you do it. No bait and switch maneuvers!
3. Have a Plan and Execute - for many organizations, on-boarding is a two hour administrative process - fill out all the HR forms, issue an employee handbook and a badge, and watch a safety video. You're likely to have better success if you think of on-boarding as a much longer management process - 90 to 180 days for most jobs and as much as a year for higher level positions. Script out what is going to happen on day 1, day 2, etc., then week 3, 4, 5 and 6. Be sure the on-boarding plan accounts for:
- learning the technical skills needed to be successful
- learning the written rules/policies
- learning the unwritten rules, those non-policy things that will get the new employee crossways with the bosses or co-workers (such as: we don't have assigned parking, but Jane always parks in that spot and she's been here 27 years).
- learning what gets you recognized and rewarded and what will get you in the doghouse
- getting socialized - meeting people, making friends
And don't make these mistakes:
- waiting till the employee's first day to order uniforms or business cards. Have their business cards ready on day 1.
- making a new hire spend their first day cleaning up the last person's mess. Issue them an office, cube, workspace or vehicle that is clean, neat and ready to go.
In short - want to improve your employee retention rate? Improve your on-boarding process.
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