When you think of your favorite sports team, do you think of everything they put in to win the game? The coach’s strategy, how he or she chose the players, the trainers pushing the athletes to be in top physical shape, the management staff ’s understanding of the rules, regulations and their competition—all of this goes into winning the game.
Now think of your own team. Do your managers have a solid grasp of employment laws? Are you in compliance with legal requirements? How did you choose your team players and what are you doing to develop and retain them? Do you have a contingency plan in place if someone is out unexpectedly?
Employment-related matters are a hot button issue for President Obama and his staff. Bringing jobs back to U.S. shores, creating new jobs particularly in the high-tech manufacturing sector, and implementing tax incentives for employers to keep jobs in the United States were just some of the employer-related initiatives mentioned during his speech in January.
Federal reforms alongside state and local initiatives pose ever-increasing challenges for employers. It’s now more important than ever to ensure your organization is compliant and utilizing best practices to stay competitive.
Compliance: Understand the rules of the game
Think of ADAAA, FMLA, FLSA, USERRA, SOX, OSHA, EEOC, NLRB, DOL, DHS, high unemployment, healthcare reform, a strong push toward labor organization (unions) and a global economy, and it’s enough to make most employers’ heads spin. While most large-scale entities have plenty of bandwidth and expertise in their HR departments to absorb these new issues and take charge of positioning their organizations to weather any compliance-related storms, most small-scale to mid-sized employers do not have such a luxury. They may rely on one or two practitioners or a host of outsourced providers to ensure they’re compliant with government requirements.
Employers have a myriad of mandates to keep up with on a daily basis and several bills in the works in both state and federal legislatures that have a direct effect on employers and their employees. In addition, many municipalities are joining the ranks to require employers to meet specific employment directives.
As we have collectively learned from various other company scandals, it’s vital that your senior managers, in particular, know the employment laws that affect your company and ensure your organization is in compliance, as well as competitive in the market. Employers are constantly under the gaze of federal, state and local agencies, not to mention potential positive or negative social media attention. Compliance is a necessary requirement, but it’s also essential for employers to be world-class leaders and pursue best practices to attract and retain the best and the brightest workforce.
Similar to health checkups, it helps to look at your employment-related functions on a regular basis to ensure your practices are compliant. It’s typically best to have an outside HR consultant or employment attorney work with your staff to conduct a compliance and best practices assessment to ensure you’re covered. Though, once you have the results in hand, you must be prepared to change the things that don’t meet compliance standards and be willing to make adjustments to improve practices.
A hot button for the Department of Labor (DOL) and the IRS is ensuring employees are properly classified. First, employers need to determine if workers are independent contractors or actually W-2 employees. The IRS or the DOL can make you prove that an independent contractor (IC) is in fact an IC, not an employee, and they are cracking down on this issue of misclassification. Employers are further given the task of determining if employees are non-exempt or exempt under the Fair Labor Standards Act (FLSA). This is another issue for the DOL in particular, as a misclassification can mean an employee is owed back wages for overtime and the like.
Have a company playbook and make sure it’s referred to and updated regularly. Employee handbooks can also be a company’s saving grace in litigation, but make sure your HR team or a designated member of the management team works with your employment attorney to ensure policies are up-to-date with laws and regulations. If not, your saving grace can become your biggest hindrance. In addition, make sure your written policies are actually being practiced; otherwise, it can become fodder for further employee complaints and issues.
Hiring practices: Creating your team lineup
Many managers spend more time choosing their fantasy teams than their employees. Each and every player is carefully selected for the role he will play in the organization based on skill, experience, past performance and ability to win. You should make the same effort to choose your hires and create a succession plan for your work team.
On average, it costs an organization 150 percent of an employee’s salary to replace him, so it helps to get it right the first time. Make sure you have the right hiring tools and practices in place to ensure you’re getting the most qualified candidates available in the hiring pool. This may mean taking a little more time during the hiring process or taking a hard look at your practices and retooling some areas.
Where do you find qualified candidates? You may have to be creative to target potential employees for your organization. Utilize social media sites such as LinkedIn, Facebook or Twitter. In addition, maintain a strong website, implement a referral bonus for employees, go to job fairs or search local universities or alumni groups. You can also post openings through local industry associations, on Internet job boards or use your local workforce agency. With a shortage of qualified or skilled workers on the horizon, employers must be resourceful in searching for qualified applicants.
Conduct pre-employment skills tests, background checks and personality assessments. Determine the best interview process for the role to which the candidate has applied. Interviews should be based on applicable competencies required to be successful in the position and should also incorporate past performance-based questions, such as: “Tell me about a time when you encountered a difficult customer. How did you handle the situation, and what was the outcome?” You may want to incorporate a team or panel interview—or even a stress interview—depending upon the actual job duties.
Thoroughly explain the company and the job function to potential employees. It’s important that candidates have a realistic idea of the job, the team, the manager, the company’s core values, vision, mission and goals in order to identify if they are truly a fit for the organization.
If you have any federal contracts to run new hires through, monitor the federal E-Verify system to ensure their identity and authorization to work in the United States. Stay tuned for potential changes to immigration laws and new states joining the ranks of those requiring use of E-Verify.
Similar to your fantasy team, it’s important to understand the candidate’s background, skills and potential contribution to your winning team before making an offer.
Performance management, development, engagement and retention: Know how to coach and keep your team
How are you managing your talent? Now that you’ve hired the best and brightest, have a strategic retention plan in place and ensure your employees are actively engaged in their work and the organization.
According to the 2011 Employee Job Satisfaction and Engagement Report conducted by the Society for Human Resource Management (SHRM), the most important factor to employees is job security (63 percent). This was followed closely by opportunities to use skills and abilities (62 percent); the organization’s financial stability (55 percent); relationship with immediate supervisor (55 percent); compensation/ pay (54 percent); benefits (53 percent); communication between employees and senior management (53 percent); and the work itself (53 percent).
The biggest lesson employers can learn from this survey is that you need to communicate openly with employees about the future of the company and how you see them fitting into the picture. Be honest with them about the future, and although you can’t make promises that their jobs will be safe (this negates a state’s at-will clause), you can address any concerns they may have about the company or their roles within the organization.
It’s also important, particularly in a brutal economy, to recognize and reward the contributions of your employees. Understand that most employees are doing more with less—less money due to lack of raises or lack of staff due to reductions in the force. This is when burnout typically hits its peak, and many employees are watching and waiting for things to turn around so they can seek a better position elsewhere.
Recognition may not necessarily be in the form of a monetary gift but could be as simple as a “thank you” or allowing an employee to leave a little early for his kid’s soccer game or to telecommute one or two days of the week. Find out what matters most to your employees as individuals, then position rewards around that as it fits into your business.
If you haven’t surveyed or discussed your own employees’ satisfaction and engagement, it may be worth a look. If nothing else, you may want to start by openly discussing any issues with your employees.
Unions are making a comeback and using a weak economy to strengthen their position to be the liaison between management and employees, so maintain open communication with your team and address any issues immediately. The National Labor Relations Board (NLRB) has already implemented a new rule for almost all employers (very limited exceptions) to post a notice to employees making them aware of their rights to organize. While this issue is currently being contested in court, as of now, the posters are required to be posted by April 30, 2012. The NLRB is also pursuing ways to speed up the election process to incorporate unions into companies more quickly.
Currently, a particularly touchy subject for the NLRB is how employers handle employees’ use of social media with a primary interest in any off-the-job negative comments about their manager or employer. Stay tuned for further guidance on this subject. In the meantime, address your particular situation with your HR representative and/or employment attorney.
Make sure your employees know exactly where they stand with regard to their performance. If there’s an issue, address it immediately. If there’s praise to be given for a job well done, let them know. Always remember to praise in public, address any issues in private and document both the good and the bad.
Engage in a development plan with your employees. How can they be better from a professional and sometimes a personal level? For example, if a person could benefit from a time management seminar, have them pursue that as a goal and support them in it.
Be careful what you say
Be careful when speaking with employees, particularly during performance or termination meetings or when they are requesting a leave of absence. Employees are constantly watching and listening to what managers say, so ensure your managers are well-versed on how to handle employee situations. A manager’s voiced opinion about protected classes or leaves can come back to haunt an employer in future litigation.
When employees go on leave, whether for military or family purposes, know the laws and ensure your company is in compliance. Make sure managers are trained on a regular basis on what to say, what not to say, diversity and inclusion, and how to handle harassment, discrimination and retaliation complaints.
With the expansion of the Americans with Disabilities Act (ADA), employers need to be cognizant and cautious to make sure they are not doing or saying anything that may get them into a legal minefield. It’s important to know the laws and try to work with your employees so they can perform the essential functions of their jobs.
If you don’t already have job descriptions in place, specifically explaining the role and duties of the position, now is a good time to get them. They should include language related to the ADA and make accommodations where necessary, provided such accommodations are not unreasonable or create undue hardship on the employer.
Terminations, contingency and succession planning: Retaining the best talent
If several of your employees were to walk out today, do you have a plan in place to pick up the slack? Managers need to spend time considering how they will handle an unexpected leave or departure from the organization. Have a contingency plan in place and communicate it with senior management and staff so all will be prepared in the event of an emergency.
Also, ensure you manage performance regularly and consistently. If management determines a termination is in order, seek the advice of your HR professional and/or legal counsel as necessary. Make sure you aren’t discriminating against the employee, have done your due diligence and have made a sound, prudent business decision.
Know that when someone leaves the organization, they were likely friends with their coworkers. So, be careful what you say and make sure you stick to the facts. Furthermore, understand that employees will be watching how managers handle the situation and will form opinions as to whether or not they would like to continue working for you.
As this is an election year, be on the lookout for more employee-related legislation. While most of the feds are concentrating on the upcoming election, state legislatures are filling in the gap, standing at the ready to implement various policies that directly affect employers. Therefore, now is the time to ensure your team is compliant, has established best practices and is poised to win.