There’s no denying the tight labor market in the North Bay right now. Between wildfire upheaval and rebuild and current immigration policies and concerns, unemployment is low—and many local industries and employers are feeling the impact firsthand.
There is a way to not only stay competitive but to thrive, even when workers are in such short supply and high demand. It’s time to take advantage of compensation as an effective tool for attracting, rewarding and retaining the very best employees for your organization.
Your Compensation Philosophy
The foundation of any compensation system should be your compensation philosophy: a formal statement that defines how your organization views and manages compensation. When creating it, you’ll want to take into account:
- Mission and strategy. Foremost, use your compensation philosophy to support your organization’s needs, goals and objectives.
- Organizational culture. Evaluate whether your current culture is one of entitlement or contribution oriented, and consider how you would like compensation to recognize achievement.
- Workforce. Think about your workforce characteristics (Are your employees entry-level? Highly skilled top performers? Critical resources?), and determine a philosophy that is appropriate for them.
- Internal factors. Be cognizant of your organization size and financial position.
- External factors. In order to stay competitive, be sure to adequately reflect the local economy, labor market, industry market ranges, etc.
- Equity. Emphasize fair, consistent, transparent pay practices that are compliant with all applicable laws and regulations.
Your compensation philosophy is your opportunity—your chance to match, stay competitive or lead the market in your industry. The experts at Leap Solutions can help you develop or refine a relevant, progressive and sustainable compensation philosophy that can reflect, adapt and evolve with changing conditions.
Philosophy in Action
Once you have your compensation philosophy in place, it’s time to put it into action. Start with questions, such as:
- Does your organization have trouble hiring? If so, in which jobs or geographical areas?
- How long do employees typically stay? What is the turnover rate?
- Why do employees leave? Where are they going?
- Do your employees feel valued? Well compensated?
- What are your employee development strategies?
- What are your promotion policies?
Your answers—and sometimes your inability to answer—will be telling about what areas might need attention, and we can help you assess and address them with creative and effective compensation strategies.
As you know, California employers can no longer ask a job applicant about prior salary history. But don’t worry! With a solid, well-informed compensation strategy in place, you don’t need that personal data to make a competitive job offer. (Under California law, employers may reach out, after giving a job offer, to the selected applicant’s previous employer to verify prior salary. However, in certain jurisdictions, including San Francisco, employers may not disclose the salary history of any current or former employee to a prospective employer without written authorization from the employee.)
The best way to prepare your salary strategy is to conduct a market-based compensation analysis based on job, region, function, relative value and industry. With insider access to multiple accurate, up-to-the-minute market data systems that aren’t available to the public, Leap Solutions can partner with you to update your pay scales (and job descriptions, job tiers and job families as needed) and establish a compensation system that will carry you forward as your business grows.
Beyond the Dollar
Compensation is much more than money. There’s the obvious direct compensation (wages, commissions and bonuses, short-term and long-term incentive pay, achievement awards), and there’s indirect compensation (legally required benefits, medical benefits, retirement programs). And then there are the perks that can really set you apart as an employer and help you attract and retain the very finest talent:
- Time can be invaluable, and employees treasure time off opportunities, alternative work weeks, and more.
- Today’s employees appreciate flexible work schedules, telecommuting arrangements and other ways of managing their own workdays.
- Work-life balance is hugely sought after, and simple allowances such as casual Fridays, charity days and modified summer schedules can make employees feel valued as whole, well-rounded individuals.
- Membership to health and wellness programs and fitness clubs can show employees that you care about their wellbeing.
- By offering education reimbursement and access to coaching and training programs, you invest in professional and personal development that serves both the employee and your company.
- Don’t forget simple extras like meals, parking, product discounts and technology (i.e. software or hardware to make an employee’s job easier and more efficient and enjoyable).
- Profit sharing, pension plans, retention incentives for seasonal workers and sponsorship of employment visas are all ways to energize and retain good employees.
- Don’t underestimate the draw of an organizational culture that is exceptionally supportive, collaborative and fun. Your enthusiasm about your workplace will be contagious!
Many of these perks don’t even affect your bottom line, and those that do often require little to no upfront cost. However, they can make all the difference in getting fantastic candidates in the door and keeping existing employees satisfied, engaged and loyal.
Above all, your compensation structure needs to be consistent and fair. That means it can be entirely appropriate to grant one employee a 2% raise and another 4%—so long as you can confidently answer how and why you pay the way you do. It also means eliminating the squeaky-wheel concept (giving only to those who make noise) and avoiding blanket bonuses or raises, which can create resentment among top performers. Employees will know that you determine compensation on a well-thought, well-documented combination of business need, educational background, skill set, performance and more.
When you’ve worked with Leap Solutions to develop a compensation philosophy and implement compensation strategies that are thoroughly researched, based on real market data, free of any discriminatory practices and presented with transparency, your employees and potential employees will have faith that they are being treated fairly and equitably. Further, they’ll feel valued and rewarded for their contribution, motivated to succeed and encouraged to grow and prosper along with your organization.
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Employee evaluations are an integral part of a successful performance management system…so why do they so often feel like tedious “corporate” chores? Most companies require managers and employees to endure them, but many don’t have quality systems in place to make reviews truly meaningful and impactful.
If you’re committed to providing employee feedback that is purposeful and will actually make a difference in employee performance and satisfaction levels, read on!
Effective managers provide relevant, constructive, in-the-moment employee feedback on a regular basis. But every so often—every six months or at least once a year—employers should prepare and present documented performance evaluations. In tandem with ongoing open dialog, these periodic reviews shouldn’t uncover any surprises, but they do provide a vital opportunity to more formally summarize and highlight an employee’s contribution over time, recognize and celebrate accomplishments, consider further training and development ideas, and discuss opportunities for advancement.
Thriving companies—and the employees in them—are flexible and progressive. Employee evaluations hold employees accountable to their best work, keep them motivated and engaged, and encourage continual improvement and growth. Employee evaluations can also serve as documentation and support for administrative decision-making about compensation, rewards, promotions and even terminations.
The review process shouldn’t be cumbersome and needn’t necessarily be formal. What’s important is that you implement a universal system that works well across all levels of the company, and that all employee feedback adheres to these guidelines:
- Be direct. When discussing employee performance, use clear, simple and concise wording. If you’re vague or you complicate your message with jargon, you run greater risk of being misunderstood and misinterpreted. Instead, opt for concrete, objective language, and provide specific, relevant examples to support your positions. Everyday language gets your points across clearly and sincerely.
- Check your biases. Remain as consistent and fair as possible during reviews. Take care not to overrate or underrate an employee based upon personal feelings, and don’t let an employee’s most recent success or failure cloud your judgment on his or her performance over the entire review period. Avoid absolutes (“always,” “never,” “every time”…), as they exaggerate claims and lessen your credibility. Acknowledge any environmental factors that may have affected an employee’s ability to accomplish goals; don’t allow circumstances that are out of an employee’s control to reflect negatively on him or her.
- Ground yourself. Cite specific, detailed examples and real-world scenarios to illustrate your points and explain ratings. While providing regular feedback throughout the year, smart managers maintain individual employee records for documenting key conversations, successes and challenges; when employee evaluations come due, those managers have an easier time recalling examples and preparing reviews that accurately and fully reflect total performance.
- Tell the truth. Employee evaluations are meant to encourage employees to do more of what they do well and boost performance where they can. Even when it stings, be honest in your appraisal. If you’re too lenient in an effort to sidestep conflict, you rob your employee of the opportunity to improve (and may even unintentionally expose your organization to liability; it can be difficult, for instance, to legally defend a termination decision if past reviews don’t accurately reflect performance concerns). You foster greater trust when you’re straightforward and genuine.
- Stay constructive. When you keep feedback constructive and supportive, you minimize employee defensiveness and maximize the positive impact of your message. Whether delivering criticism or praise, focus on describing the employee’s behaviors rather than judging the person. Avoid an accusatory tone when pointing out areas for improvement, and base your appraisal on specific observations, actions and accomplishments.
- Invite discussion. Without a two-way dialogue, it’s easy for managers and employees to make inaccurate assumptions about one another. Encourage your employees to respond openly to your feedback, explain themselves and offer their point of view, and discuss the reasoning behind particular ratings. When people feel safe in expressing themselves and sharing their concerns, they feel heard, valued and empowered.
- Partner up. As you continue to build and strengthen a foundation of mutual respect and trust with your employees, involve them in relevant decision-making. To score an employee’s buy-in, work together to come up with shared solutions to identified issues, strategic steps toward advancement, and ways that you as a manager, your department, and the organization as a whole can support the employee’s continued development and growth.
Ultimately, remember the intent of employee evaluations: to motivate your employees to perform better than ever. People feel understandably vulnerable when receiving feedback, so don’t lose sight of the human element. Stay cognizant of the potential impact of your words, and be sure to convey yourenthusiasm, support and confidence in your employees’ abilities to overcome challenges and achieve new goals.
One size doesn’t fit all. Your ideal employee evaluation format will depend on your organization, industry, size and employee population. When you’re ready to create a truly relevant, sustainable, streamlined system that best suits your company needs and culture, Leap Solutions can help you:
- Decide how often your reviews should take place and how formal they should be
- Evaluate the most effective procedures for motivating your unique workforce
- Incorporate essential job functions and core competencies into review criteria
- Develop objective review questions and a fair rating system (if warranted)
- Factor control into the process so reviews don’t vary widely by manager
- Ensure equity and consistency across departments
- Determine whether to tie evaluations to compensation/bonuses
- Provide an avenue for an employee’s point of view if not in agreement with a review
We have decades of experience, handy tracking tools, web-based systems, forms and resources for developing and streamlining your employee evaluation process into one that everyone will see as a wholly worthwhile use of time and resources—a process that reflects and directly impacts the continual success and growth of your individual employees and your company as a whole.
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Trainings are often overlooked or undervalued as occasional workplace necessities—mind-numbing information dump sessions dreaded by employees and leaders alike. But the smartest and most successful organizations wouldn’t settle for any such thing. They have learned to leverage quality training programs to support, strengthen and develop their employees, equipping them with the mindset and skills they need to succeed, lead and contribute immeasurably to the organization’s overall strategy and long-term goal achievement.
When It’s Time
A great training program can be ideal for any number of scenarios, including:
- Required programming. Whether it’s a mandated training, industry-specific in-service, process-oriented safety training, or supervisory training, a quality program will keep you in compliance and out of hot water. You’ll want it to be customized to your unique needs as well as relevant, engaging and memorable to every person in attendance.
- On-boarding. Training programs for new employees, individually or in groups, can be an invaluable part of a smooth on-boarding process. Why make new hires guess at how best to fit themselves and their talents and knowledge into your company when you could instead ease the transition by actively training them into the culture and systems you’ve created and virtually guaranteeing that they’ll thrive there?
- Performance management. When many people think of performance management, they think of the perfunctory yearly performance review. But that’s just one piece of an effective performance management system. With a solid training component in place, you can intentionally develop and strengthen employees at all levels, providing the ongoing support they need to consistently perform at their very finest as they—and your organization—grow.
- Management training. People often fall into middle management positions as companies expand, and they would be well served by formal training to hone skills in managing, coaching and developing employees; giving compelling feedback and handling discipline; resolving conflict; building effective teams; anticipating the unanticipated; and much more.
- Leadership training. A comprehensive leadership program can turn leaders into visionaries. Top-tier training can show them how to drive change, inspire innovation, and translate simple ideas into brilliant ventures for your organization.
- Team building and development. When you want a particular board, department, team, or sub-group of your organization to work together more collaboratively and efficiently, training can be ideal. A skilled training facilitator will see threads between members, bridge distinct communication styles, develop mutual understanding, and link systems and processes for a far more connected, cohesive and effective group dynamic.
- Problem solving. Don’t overlook the value of training to address specific challenges, issues or problems. A great trainer will be able to analyze symptoms, identify hot issues and tailor a program to break down barriers, create workable systems, broaden communication, build relationships and pave the way for success.
How Training Works
A professional training facilitator should be much more than a subject-matter expert. The best will start a conversation with you well before the training to build rapport, learn about the culture of your organization, gain a thorough understanding of your employees, and begin to identify pain points, conflicts, challenges and opportunities.
The facilitator will then design a training program that’s totally tailored to your organization and people and entirely based on what you’re aiming to accomplish. It’s likely to include examples and case studies geared to your industry, role-playing of applicable scenarios and how to handle them, hands-on activities and much more. The training should be an informative, interactive, collaborative session that’s genuinely meaningful and motivating to the participants, and everyone should come away feeling that it was an incredibly wise use of time and resources.
Leap Solutions doesn’t offer “canned curriculum.” When you work with us, you can be assured that your training program will be industry-specific, entirely customized to meet your needs and goals, and thoroughly engaging from start to finish. From human resources, compliance and succession to organizational development, retreats and team building—you name it, and you can count on Leap to design and deliver one-of-a-kind, focused, high-impact training programs with lasting results.
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Employment and labor laws are simply meant to protect rights and outline responsibilities in the workplace-but they’re anything but simple. Constantly changing and highly complex, they can overwhelm even the most on-the-ball employers and their HR staff, hiring managers and supervisors.
We’re here to alert you to some recent and upcoming HR changes that will impact your hiring practices, new hires and existing employees, and bottom line. And we’re eager to help you navigate the changes as wisely, efficiently and cost-effectively as possible.
If you’re considering any new hires in 2017, you’ll want to take particular note of the following changes:
Effective January 1, 2017, SB 1001 makes it unlawful for an employer to request more or different immigration documents than those required under federal law or to question the authenticity of or refuse to honor documents presented. Further, the bill makes it unlawful to reinvestigate or re-verify a continuing employee’s authorization to work (unless required by federal law).
Also, beginning January 22, 2017, employers must use the 11/14/2016 N version of Form I-9 (Employment Eligibility Verification) to verify the identity and work eligibility of every new employee hired. (The version date can be found on the lower left-hand corner of the form.) Prior versions of the form will no longer be valid for use.
How to respond: While you verify that new hires are either U.S. citizens or authorized to work in the United States, be mindful of the rules regarding which Form 1-9 to use, what eligibility questions are permissible during pre-employment screenings, and what type of immigration documents are acceptable. If you don’t comply, you could face a violation penalty of up to $10,000.
Juvenile Criminal History
Effective January 1, 2017, AB 1843 prohibits employers from asking job applicants to disclose any information regarding juvenile convictions and makes it unlawful to seek or use any information related to juvenile arrests, detentions, or court dispositions as a factor in employment determination.
How to respond: Review your policies and practices to be sure that “off-limits” information is not requested or considered during any part of the hiring process. Note: if you are an employer at a health facility, you may inquire about an applicant’s juvenile crimes if a juvenile court has ruled that the crime committed was a felony or misdemeanor involving sex crimes or certain controlledsubstance crimes and happened within five years of applying for employment (unless the record has been sealed).
Fair Pay Act Expansions
Effective January 1, 2017, SB 1063 prohibits an employer for paying any employees wage rates that are less than those paid to employees of another race or ethnicity. In addition, AB 1676 specifies that prior salary cannot, by itself, justify any disparity in compensation.
How to respond: Employers and employees must negotiate and set salaries based on the requirements and expectations of each position and the qualifications of the employee rather than his or her prior earnings. You’ll want to update job descriptions accordingly and revise any job applications that seek information about prior salary.
Minimum Salary Increase
If instituted, new Department of Labor overtime legislation (currently on hold during nationwideinjunction) will almost double the minimum annual salary for full-time exempt employees to $47,476. This is higher than California’s minimum salary (which is no less than two times the state minimum wage) and will remain higher throughout 2017 (when state and federal minimums differ, you must comply with the more restrictive requirement of the two). In classifications.
How to respond: While we await a federal court outcome, you should confirm that you’re classifying each of your employees properly as exempt or non-exempt as well as consider honoring any salary increases or status changes that were implemented to meet the new threshold or status requirements. You might also conduct a cost analysis to determine whether your current compensation structure will work under the new regulations and make any necessary adjustments.
Legalization of Marijuana
While California has legalized recreational marijuana in California for people aged 21 and over, marijuana is still designated as a Schedule 1 substance under the federal Controlled Substance Act (CSA), which criminalizes the possession, manufacture, distribution and sale of the drug. We have yet to learn what the passing of Prop 64-as well as the discrepancy between state and federal marijuana legislation-will mean for California workplaces in terms of productivity, safety, employee privacy rights, zero-tolerance policies, drug testing methods and more.
How to respond: You’re still entitled to maintain drug-free workplaces. As you await legislation addressing issues that will inevitably surface, confirm your background check and drug screen methods, review consent forms, and maintain clear and consistent, well-defined and well-communicated drug-use policies.
Upcoming Laws in 2017
As you incorporate new hires into your workplace, keep these upcoming laws in mind:
- All-gender bathrooms: As of March 1, 2017, AB 1732 will require all single-user toilet fac
- ilities in any business establishment, place of public accommodation or government agency in California to be identified as “all-gender.” Update your facilities accordingly and obtain and install the appropriate signage.
- Workplace violence notices: Starting July 1, 2017, AB 2337 will obligate California employers with 25 or more employees to provide written notice—to new employees upon hire and current employees upon request—of their right to take protected time off, without threat of termination, discrimination or retaliation, for domestic violence, sexual assault or stalking. (You might choose to include this notice in your employee handbook.)
If you’re in one of these particular industries, take note:
- Health industry: Effective April 1, 2017, the Workplace Violence Prevention in Healthcare rule (California Code of Regulations/CCR Title 8, Section 3342) requires healthcare employers to develop and implement a specific written workplace violence prevention plan, review the plan and train employees annually, maintain a workplace violence incident log, report workplace violence as indicated, and more.
- Janitorial industry (and any California employer who employs at least one “covered worker” who enters into a contract, subcontract, or franchise agreement to provide janitorial services): Effective July 1, 2018, AB 1978 establishes requirements for the janitorial industry, including registering annually with the Labor Commissioner, to protect janitorial employees from wage theft and sexual harassment. It also requires employers to develop and implement biennial in-person sexual harassment and violence prevention training.
- Agricultural business (that means you, wine industry!): AB 1066 requires California employers to pay agricultural workers overtime over a four-year phase-in process. Beginning January 1, 2019 (though you may choose to implement sooner), employers are required to pay overtime for any hours worked over 9.5 hours per day or 55 hours per week (to incrementally lessen yearly until reaching 8 hours per day or 40 hours per week, beginning January 1, 2022). Also beginning on January 1, 2022, any employee who works over 12 hours per day must be paid at a rate no less than twice the regular rate of pay. (Employers with 25 or fewer employees will have an extra three years to comply with the phase-in.)
Thriving Through the Changes
How you respond and adapt to these complicated, ever-changing employment and labor laws is key to how you’ll thrive through them—and we can help you do just that. HR professionals who specialize in compliance and stay continually up to date on federal, state and local regulations and requirements, we have the tools and resources to keep you abreast of these and many other changes, help you develop a thorough understanding of how specifically they will impact your unique organization, and work with you to tailor a plan to address them with success.
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