Your business is growing! Yay! But wait.....
The growth phase of a small business can be both exciting and scary. It’s exciting because your business is growing. This is awesome! Except that you’re so busy you have to turn down new work and clients. You’re not able to do it all by yourself or with the current team you have. Sure, you could take on more business if you had more help. It seems logical to grow your team so you can grow your business.
You know deep down you need help but you start second guessing if it’s really the right thing to do. You think to yourself…
- How do I find the right person?
- Do I even have time to look for someone and go through the hiring process?
- Will it be easier if I just do it myself than have to hire and train someone?
Relax. Everyone goes through this when their business grows, so how do overcome the fear of hiring?
#1 Keep It Simple
Don’t overcomplicate the process. Put together a few check points in place of how you’re going to tackle taking on a new person and then just do it.
#2 Prepare a Job Description
Write a brief job description and make sure you’re working on it over a period of time so you have a clear understanding of what you want and need this new person to do. It doesn’t have to be a complex description. Bullet points are fine.
#3 Check References
Checking references is critical in making the final decision between candidates. Reference checks can reveal information that not only can help you determine your top choice but also can help you better understand how the new employee might transition in to the new role and your company
#4 Learn to Delegate
Develop your skills so you’re able to delegate. You need to be able to trust this new person so you don’t end up micro managing.
#5 Leverage the Probation Period
Many employers wait until the end of a probation period to assess if they’re ready to take someone on long term. The problem is, by that time it’s too late, use this time to your advantage by being proactive. Schedule regular “check ins” so you can gauge their progression. Again, keep it simple. Keep it short and sweet. Check that they know what they’re supposed to be doing and have an opportunity to ask questions. Create an environment where they’re comfortable asking questions and pay attention to the questions they ask.
By using the probation period to assess your new employee regularly, you’ll be able to tell if it’s going in the right direction for you and for them. Monitor changes in yourself during their probation period as well. Are you able to work better because they take more responsibilities off your hands? Are you still maintaining the same level of service? If the answer is yes, you know you’re in the right direction. It’s also helpful to set goals or targets for this person during their trial period. See how they’re able to adapt and reach these targets throughout their probation, instead of at the end when it’s too late.
Today the U.S. Department of Labor (DOL) released new rules dramatically increasing the new minimum salary level for the executive, administrative, and professional employee exemptions (salaried employees) under the Fair Labor Standards Act (FLSA) to $913 per week, or $47,476 per year. This new salary threshold—which will become effective on December 1, 2016—more than doubles the current minimum salary level of $455 per week, or $23,660 per year, and will have a dramatic impact on employers.
The new salary requirements will apply to the salaried employees you have in executive, administrative, and professional exemptions. Employees who do not meet the new salary requirements (those who do not make at least $913 weekly) when the final regulations become effective will no longer qualify for one of these exemptions, which means they will have to be paid overtime compensation when they work more than 40 hours in a workweek.
Other major highlights from the final regulations include the following:
- Increase to the total annual compensation requirement for highly compensated employees from $100,000 to $134,004 per year.
- Future automatic updates to the above thresholds will occur every three years, beginning January 1, 2020.
- The salary basis test is amended to allow the use of nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level.
The final regulations will become effective on Thursday, December 1, 2016.
How Can Organizations Prepare?
Determine Who Needs to Be Reclassified
Employees who are currently classified as overtime-exempt (salaried) may need to be reclassified as nonexempt under the new regulations, especially if they:
- Earn less than $50,000 a year
- Hold the same position occupied by many other employees in the company; or
- Work in jobs as accountants, assistant managers, sales and sales support workers, help desk employees, customer service representatives, technicians and business analysts.
Develop a New Compensation Plan for Reclassified Employees
Employers should compare the cost of giving raises to employees who are currently exempt but make less than $50,000 per year against the cost of reclassifying those employees as nonexempt and paying them overtime, given the number of hours those employees are currently working. Another option is a cost-neutral solution under which hourly pay is set at a rate will result in the same weekly compensation as the formerly exempt employee’s salary. This only works if an employer can accurately estimate how many hours per week a reclassified employee will work.
Review Wage and Hour Policies and Processes
If exempt employees are reclassified as nonexempt, it is crucial to implement timekeeping processes. The time worked by nonexempt employees must be accurately tracked and documented. Employers should also adopt policies on unauthorized overtime work, meal and rest breaks, travel time and mobile device usage.
Employers should develop a strategy for communicating any changes in classifications, policies or procedures to employees. Identify who will deliver the news, when the news will be delivered, and the format in which the news will be delivered.
Train the Reclassified Employees and Their Managers
You might have employees who have been exempt forever, and all of a sudden you have to start tracking their time, or managers who never managed hourly employees. Supervisors and managers need to know what constitutes "working time", and employees need to know what the company’s policy is regarding overtime.
Fact sheets and other materials to help employers and workers understand how the rule will affect them and the broader economy are available dol.gov/overtime.
Employee absences can cost employers up to one-third of their payroll costs, according to some estimates. Ensuring that your employees stay at work, or return to work quickly and easily after a simple illness, therefore directly affects your company’s bottom line. Here are five quick tips for managing absenteeism at work:
- Be sure attendance expectations are clearly set. Some absences and tardiness can be attributed to simple misunderstandings about the time work should begin. The solution may be as simple as creating a clear attendance policy if one does not already exist. Setting expectations also requires clear communications about the policy and the repercussions of absences.
- Enforce the attendance policy consistently. This is more difficult than it sounds. It can be tempting to allow more absences than the attendance policy outlines when employees are facing difficult situations. While an employer is, of course, free to do so, it’s better to have a policy that has flexibility built into it so that it can be implemented consistently and not incite claims of favoritism or discrimination when it’s applied differently for different individuals.
- Ensure all employees know what to do when they need to be late or miss a day. Workers should know when and who to call and what information needs to be provided. They should also understand what documentation, if any, they will be required to provide to the employer upon return (e.g., a doctor’s note).
- Consider rewarding good attendance. Be sure not to penalize those who have taken protected leave, but consider implementing rewards that encourage good attendance practices, as these can be good motivators. This can even be as simple as providing positive feedback and encouragement to employees with good attendance.
- Consider changing schedules when appropriate to accommodate differing employee needs. Sometimes a small schedule change can eliminate problems.
On the surface, terminating an employee for poor performance seems simple. It’s nothing personal. The employee just isn’t getting it done and would be better off in another job. But even when a termination is 100% justifiable, managers must be extremely careful how they conduct themselves. Terminations, no matter how clear cut, can have legal ramifications.
Most businesses are protected to a certain extent by at-will laws, which allow the firing of employees for no reason. However, at-will employment does not keep an employee from filing a lawsuit for wrongful termination and, even if the courts rule in your favor, your business will be required to pay court costs. It’s best to take a few measures to protect yourself before firing an employee to avoid a costly legal process.
Here are 5 Tips to Termination:
- Document, document, document! Detailed, consistent documentation can defeat many claims of defamation, discrimination and wrongful discharge. Great documentation shows a pattern of clear expectations on your part, and repeated failures on the employee’s part.
- Make your Employee Handbook work for you and not against you. Make sure your employee handbook and policies are clear and concise. If you just downloaded one from the Internet, chances are it needs updating. Review the handbook annually, and get a new acknowledgement from employees every year.
- Make sure your termination process is fair and standardized. It should be delivered consistently no matter who the employee, in fair, non-emotional way. Don’t embellish the reasons for termination, you don’t want a defamation case on your hands!
- Conduct a proper termination meeting. Unless the employee is volatile, do not terminate them via email, phone, or text. If possible conduct a proper termination meeting. Have witnesses, be brief and concise, and document!
- Involve HR! If an employee is in a protected class, has a known medical condition or disability, has taken job protected medical leave, or if there is suspicion of any other legal issue (e.g. harassment, retaliation), be sure to consult with HR or an employment attorney before terminating.
Turn to any HR magazine, blog, or conference, and you are certain to hear the term “HR Metrics” before too long. There are several terms that go along with metrics, so let’s take a moment to define and differentiate each of them:
- Measures (or measurements) are actual numbers and small bits of data used to create the metrics. For example, the number of full time equivalents in your organization and the number of terminations in a year are both measurements. As they say, Garbage In, Garbage Out – so be careful that you are gathering accurate measurements.
- Metrics are the ratios or percentages or numbers that are created using the measures. To continue the example above, if you divide the number of terminations by the number of employees in a given time period, you create the metric of a Turnover Rate for that time period.
- Analytics take metrics and apply them to trends and future-focused events. Analytics… well… analyze the data into useful information that a company can use to make future decisions. Another way to think about it is that analytics turn numbers into a story, often to help pinpoint a need for change in the organization. When used to identify future needs, they are commonly referred to as predictive
- Big Data is a conglomeration of metrics and analytics using a huge (big) pool of data. HR professionals can look to big data numbers to use as benchmarks where relevant.
HR professionals can benefit from employing metrics and analytics into their presentations. Presentations needn’t be formal executive PowerPoint slides; they can be as simple as having a 1-on-1 conversation with your boss and trying to sell him or her on an idea that you have.
I believe that HR Metrics is a hot topic because it provides some sort of measurement to HR’s value to an organization. HR is sometimes viewed as an expense in an organization. Metrics help dispel that viewpoint for effective HR functions. For example, if you can show that this year’s turnover rate is lower than last year, and can tie that to a dollar amount, you can cite the ROI of your new wellness initiative or the cost-benefit analysis of your increase in benefits.
For example, your company is tracking turnover rate, training time, and average time-to-fill for recruiting your talent. In watching the month-to-month metrics on these three items, you notice that the turnover rate has steadily increased over the past year, actual training time has decreased, and the time-to-fill has decreased. What does this tell you?
Using this limited information, we might look at the following options:
- Look at creating a more formal Onboarding program to provide more robust training at the beginning of employment.
- Investigate the recruiting process – are we hiring warm bodies, or are we doing our due diligence to hire the right person? As Jim Collins would say in his book “Good to Great,” are we making sure we are getting the right people on the bus, in the right seats?
- Interview workers and managers in the organization – especially if the turnover is high in one department – to discern if there is a communication error or something more egregious happening. You know the adage: people don’t leave jobs; they leave managers. Taking the time to gather this qualitative data will help you determine if you need to implement manager training, get executive coaching for one particular manager, or look for a way to manage the employee out of the organization.
As you can see, metrics provide the information, which we gather together to tell a story (analytics) to present a business case about WHY we need to change or offer a program. Metrics are a great tool to use to overcome the “because we’ve always done it this way” mentality, because numbers don’t lie.
Jennifer Currence, MBA, SPHR, SHRM-SCP, is president of OnCore Management Solutions. She is an HR consultant, corporate trainer, and business coach based in Tampa, Florida.