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  • Employees are at the heart of every business. From managers to entry-level staff, they are the key to long-term success, so ensuring you have a satisfied, dedicated, and productive team is critical. For small businesses, everyone on your team is integral to the workflow, and the failure of a single employee can have a more significant impact than larger organizations. Because of this, it may be tempting to fire employees who are underperforming and start fresh, but that’s not always the best solution. Taking the time to implement employee management strategies can be the answer to turning a situation around.

    Employee management is not just about reacting to underperformance or issues. It is a proactive approach that shapes the performance and potential of your workforce. It’s more than just ensuring that people are doing their jobs; it’s a range of procedures and strategies that enable you to measure, monitor, and engage with your team, all of which are crucial to your company’s success.

    How Does Employee Management Work?

    Employee management involves a strategic approach to overseeing your organization’s workforce to ensure effective and efficient functioning. It should play a role in every part of the employee lifecycle, starting with employee recruiting and training to guarantee that suitable candidates are properly vetted and onboarded. This involves adopting a few crucial tactics to allow your employees to realize their full potential.

    Support open communication

    Teams that can effectively communicate are 25% more productive than those that cannot. Communication significantly impacts team morale, retention, and recruitment. When communication breaks down, it can exacerbate other issues, leading to more significant problems over time.

    Of course, good communication is more than just talk. It’s essential to set up processes that give employees a voice and allow you better means to listen to their thoughts, suggestions, and complaints. These include:

    • Being visible: Ensure your employees see you around the workplace and know you’re available to talk with them if they need anything. If your team is virtual or hybrid, it’s worth establishing a set time when your team knows you’re free to chat. In addition, you might take the extra step of regularly checking in with your team without them initiating the conversation.
    • Being transparent: Share company information with your employees. Sharing overall objectives, status of projects, and other relevant information will help your team feel included.
    • Being open to criticism: Ensure a proper grievance policy is in place so employees know how and with whom to share any issues they face. This feedback mechanism can help identify potential problems that may negatively impact employees. In addition, addressing these issues whenever possible is crucial. Acting on employee feedback can increase trust in the workplace by 75%, which in turn helps with morale.

    Fostering a culture that values open communication and establishes clear policies and channels for staff communication can mitigate many long-term issues. Beyond these practices, there are more strategies you can implement to help boost engagement and productivity, including:

    Employee development

    Training and development are critical components of effective employee management. Orientation programs help new employees understand the company culture, policies, and roles, ensuring smooth integration into your team.

    Additionally, career development opportunities provide pathways for professional growth and advancement, motivating employees to perform better and remain committed to your organization. Investing in training and development can build a skilled, knowledgeable, and motivated workforce that drives long-term success.

    Build trust

    Individuals in low-trust companies are, on average, 74% more stressed than their peers in high-trust companies. High-stress environments can damage morale and productivity, increase absenteeism, and lead to employee disengagement. Once the downward spiral begins, this harm to your company culture can be challenging to recover from.

    One way to help build trust with your employees is by avoiding micromanagement. Give them enough space to work independently and step in when they need help or to check in on progress. By giving them a level of independence within reason, you can build confidence that can help motivate your employees.

    How Much Does Employee Management Matter?

    Without careful attention to employee management, your team can become disengaged and disconnected, leading to significant costs over time. Poor performers, on average, cost companies 30% of their annual salary; their mistakes, absenteeism, and negative attitudes can permeate your company culture, affecting overall employee well-being. This not only diminishes overall productivity, but neglecting these aspects can result in a cascading effect, where the burden of compensating for underperformers falls on the shoulders of your top talent. This can lead to burnout or discontent, eventually affecting your recruitment and retention.

    Knowing when to terminate the employment of a poor-performing staff member can be difficult but is often necessary. To protect your business from legal issues, you can place poor performers on professional improvement plans (PIPs). These plans should detail specific steps, set clear goals, and outline how you’ll evaluate progress. If a poor performer cannot address the areas you’ve identified, you can proceed with termination, confident that you’ve done everything possible as an employer to facilitate improvement.

    While there are instances where immediate termination is required, it’s still essential to have a clear plan in place. It’s important to have a fair and transparent process for all employees, ensuring that decisions are well-documented and justified.

    Overall, empowering employees to do their best and weeding out those who don’t show any potential for improvement can make your business more effective and save you from ongoing costs caused by poor performance.

    Focus On Employee Management

    Employee management is not just a one-person job. It involves many parts requiring plenty of time and effort, such as performance reviews, a grievance policy, and more. Fortunately, you don’t have to work on employee management alone. A professional employer organization (PEO), like GMS, can take on some of the administrative burden required to improve employee performance and other essential HR functions. Contact us today to talk to one of our experts about how we can help you manage your employees.

  • Employees and independent contractors all play important parts for small businesses across the country. While they can both work for the same company, there are key differences between the two.

    Why does proper employment status matter? There are important legal differences between employees and independent contractors that affect payment, protections, and other key HR matters. In addition, improper employee classification can lead to serious penalties from the IRS. Here’s a breakdown on what differentiates independent contractors and employees and how it can impact a small business.

    A collection of employees and independent contractors for a small business. 

    How to Determine the Degree of Control Through Common Law Rules

    Control is a major factor in what separates an employee and an independent contractor. While employers maintain some control over employees, independent contractors maintain a level of independence. According to the IRS, there are three different categories of control that can help you determine if someone is an employee or an independent contractor.

    Behavioral Control

    The level of control an employer has over how projects are completed is a good identifier for proper classification. The IRS names four different factors that fall under behavioral control. 

    • Type of instructions given
    • Degree of instruction
    • Evaluation systems
    • Training

    Types of Instructions Given

    In terms of instructions, these are directives that employers can give to employees about when, where, and how work should be done. This can include commands on what equipment an employee uses, the order which tasks are done, and where to purchase supplies. Employees are subject to these instructions, while independent contractors have freedom to complete tasks how they see fit if it meets the conditions in their contract or scope of work (SOW). 

    Degree of Instruction

    The degree of instruction also plays a factor. In general, the more detailed an employer’s instructions are, the more likely it is that a worker will be considered an employee. However, this can vary depending on the nature of the work and level of expertise for both the professionals and contractors. According to the IRS, “the key consideration is whether the business has retained the right to control the details of a worker’s performance or instead has given up that right.”

    Evaluations

    If done, evaluations also can share insight into whether an employer’s degree of control, mainly in terms of how in depth an evaluation is. Evaluations that only consider end results don’t shed much light on the matter. However, an evaluation that studies specific details of how someone completes a task can be evidence that the worker in question is an employee.

    Training

    If an employer requires training, it’s a strong indication that the person being trained is an employee. This is because training is evidence of control, as it means that the person will learn how an employer wants the job in question to be completed while independent contractors typically have some form of outside training.

    Financial Control

    Another factor of control involves the economic aspects of a job. The IRS designates five different financial control factors that help determine if someone is an employee or and independent contractor.

    • Significant investment
    • Unreimbursed expenses
    • Opportunity for profit or loss
    • Services available to the market
    • Method of payment

    Significant investment

    While included as a control factor, significant investment can be hard to determine. Both independent contractors and employees can spend notable sums to acquire equipment necessary to complete a job. Instead, significant investment plays a bigger role when combined with some of the following factors.

    Unreimbursed expenses

    If an employer reimburses someone for work expenses, that’s generally a sign that the person in question should be considered an employee. It’s not uncommon for independent contractors to incur similar expenses, but they will generally won’t be repaid. However, there are situations where employees aren’t repaid for expenses, so a lack of reimbursement isn’t necessarily a determining factor.

    Opportunity for profit or loss

    A sign that someone is an independent contractor has more opportunity for both profit and loss. If a contractor is already set up with the necessary equipment, he or she can make a greater profit. However, that contractor may also have a job where the investment outweighs the income, resulting in a loss. Employees have a much more stable income and typically don’t need to deal with the ebbs and flows of investment costs.

    Services available to the market

    An employee won’t have to market the availability of their services to you; they’ll simply do their job. However, independent contractors typically make their services available on the market and float from job to job. Note that an employer can have an employee who freelances outside of work hours. In this situation, that person is still considered an employee of the company in question, but any business this employee freelances for on the side, would classify this person as an independent contractor.

    Method of payment

    Employees have a regular payment schedule, whether it’s a base salary that’s paid out in set increments of time or an hourly arrangement. Independent contractors are usually commissioned for a set amount of work. This can be a flat fee that’s delivered at the completion of a project or an hourly agreement. For example, a freelance editor or a lawyer can set a specific hourly rate and you could pay this person for 10 hours of work.

    Type of Relationship

    An employer’s relationship with a worker is a key part of proper classification. According to the IRS, there are four different identifiers employers should consider:

    • Written contracts
    • Employee benefits
    • Permanency of the relationship
    • Services provided as key activity of the business

    Written contracts

    The existence of a contract is not a determining factor for either employees or independent contractors, even if it states that someone is either classification. Instead, the IRS reviews the nature of the employer and the person in question’s relationship to measure their actions instead of written language.

    Employee benefits

    In general, if a worker receives benefits from an employer, they are considered an employee. Independent contractors are considered self-employed and are not privy to be a part of an employer’s benefits package. However, the lack of benefits doesn’t mean that someone must be an independent contractor, as a business may not necessarily offer any benefits package to their employees.

    Permanency of the relationship

    Employers don’t hire employees with the expectation that these employees won’t work for them after a short period of time. While independent contractors are generally temporary solutions for businesses, the IRS views any work relationships are meant to be indefinite as that between an employee and employer.

    Services provided as key activity of the business

    The services that independent subcontractors provide are typically important, but not critical, for a business’ success. However, if an employer hires someone to provide a service that’s the IRS considers a “key activity of the business,” it may view the relationship as that between an employee and an employer. In this definition, a key activity is part of the main services a business provides, such as if an electrical company hired an electrician for regular side work. In this instance, the IRS would view this as a part-time employee instead of as an independent contractor.

    How Employee Classification Impacts HR Management

    Once someone is determined to be an employee or and independent contractor, an employer can use this information to make sure they stay in compliance with any government regulations. The classification status of a worker impacts several HR functions ranging from financial considerations to employee protections.

    Payroll Tax Management

    The classification of a worker has a direct impact on how their taxes are handled. If someone is considered an employee, an employer is responsible for withholding and depositing their payroll taxes. Employers are required to have employees provide their social security number and complete Form I-9 for employment eligibility and Form W-4 for employee’s withholding. The employer will then report what an employee earned during the year on Form W-2 and send copies to both the employee and the IRS by Jan. 31.

    Independent contractors need to complete Form W-9. This will allow employers to confirm the potential contractor’s name and receive his or her Taxpayer Identification Number. After a contractor works for an employer, that employer provides both the contractor and the IRS with a completed Form 1099-MISC by Jan. 31. While employers are not responsible for payroll taxes with contractors, they must report the payments made to the contractor for their own tax purposes. However, if a contractor was paid less than $600 during the year, no Form 1099-MISC is required.

    How and When They’re Paid

    The payment process for employees is fairly straightforward; employees are paid either hourly rates or with a base salary. Their wages are then paid out on set dates that range anywhere from one week to one month apart.

    Payment for independent contractors largely depends on the stipulations provided in a contract or SOW. Both parties can agree to varying payment structures and fees, whether it’s an allotment of hours for work or a flat fee. In terms of when contractors get paid, that’s another matter that should be stated in writing. Some contractors will split fees up, such as requiring half the fee up front and half upon completion of the project. Others will set payment due dates at certain milestones, such as within 60 days of completion.

    Employment Laws and Protections

    If a worker is considered an employee, they are protected by the various national and state employment laws that exist. However, that arrangement doesn’t extend to independent contractors. Since they’re not an official employee of a business, independent contractors are not eligible for many of the same benefits and regulations that cover regular employees. These include unemployment compensation, worker’s compensation, workplace safety laws, and other similar protections.

    Protect Your Company Through Expert HR Management

    As an Employer, you have the final call on who to hire, whether someone will be an employee or an independent contractor. You’re also on the hook to make sure that everything your business does is up to legal standards. Between payroll management, benefits administration, and other HR functions, that’s a lot of work and responsibility, with little time left for core business functions.

    A Professional Employer Organization allows small business owners to share the burden and strengthen their business at the same time. PEOs give small business access to a team of HR experts that can efficiently and effectively manage key HR functions, including proper employee classification. Contact GMS today to talk to one of our experts about how a PEO can help you save time and protect your business.

  • A good background check is a protective measure that allows employers to make a fully-informed decision on a job candidate. Whether your business is hiring for an entry-level position or for a position of trust, these checks will help you identify potential issues up front as opposed to leaving unpleasant surprises in the future.

    There are several components to a good background check. Each of these parts provide different bits of information to help employers gain a better understanding of who an applicant is and if there are any issues. However, you also need to make sure that you’re following legal guidelines while you investigate candidates’ backgrounds as well. Keep reading for a breakdown on background checks for small businesses.

    How To Maintain Background Check Compliance

    In general, background checks are regulated by the Fair Credit Reporting Act (FCRA) and the Equal Employment Opportunity Commission (EEOC). One FCRA requirement is that you notify job candidates that you will perform a background check and have them sign off on this before you can turn to a Consumer Reporting Agency (CRA) to begin any checks or searches.

    The FCRA also requires employers to take certain steps if they decide not to hire, promote, or retain a job candidate, also known as adverse actions, due to information uncovered in a background report. First, an employer must notify the subject of the background check. This can be done orally, in writing, or electronically. Second, an employer must provide this person with an adverse action notice. According to the Federal Trade Commission, this notice includes:

    • The name, address, and phone number of the consumer reporting company that supplied the report
    • A statement that the company that supplied the report did not make the decision to take the unfavorable action and can’t give specific reasons for it
    • A notice of the person’s right to dispute the accuracy or completeness of any information the consumer reporting company furnished, and to get an additional free report from the company if the person asks for it within 60 days

    Another important detail to note is that some history may be too old to be picked up during a background check. The FCRA notes that “in most cases, a consumer reporting agency may not report negative information that is more than seven years old.”

    A small business background check for a new job applicant.

    What You Should Include In Background Checks

    A comprehensive background check should account for a variety of red flags. Small businesses should consider including the following types of checks whenever they investigate a potential employee’s background.

    Social security validation

    Tracing a social security number is a good place to start a background check. This process allows employers to complete a couple of key tasks:

    • Verify that a candidate’s social security number is legitimate
    • Uncover any additional aliases or name variations used by the candidate in the past, along with dates of birth and addresses associated with the number

    These details can help uncover any criminal records or other unsavory information that wouldn’t normally fall under the name given by the candidate. Traces can be performed through the Social Security Number Verification Service.

    Criminal records check

    If an employee has a criminal history, you’ll want to know. There are three variations of criminal records checks that will provide insight on whether an applicant has been in trouble with the law.

    • National Criminal Record Database (NCRD) search – The NCRD houses millions of searchable criminal records and sex offender registries, which can quickly point out any red flags. While an NCRD background check is a good starting point, these screenings may not include every jurisdiction or not offer enough detail for your needs.
    • Statewide criminal records check – These checks narrow down your search to a specific state, which can offer more detailed information about any potential felonies or misdemeanors.
    • County criminal records check – While county criminal background checks cover the smallest geographic area, they can offer the greatest amount of detail, including the places that an applicant with a criminal record has lived or worked.

    Employment history

    According to CNBC, 78% of candidates either misrepresented themselves on their application or would consider lying on their resume. An employment history check can help you verify job titles, dates of employment, the reason someone left a job, and rehire eligibility. Employer verification can be done through a CRA and calling a candidate’s references.

    Motor vehicle report

    This report allows employers to verify a candidate’s driver’s license verification and review driving records. According to the DMV, this information can include:

    • Past and current driver’s license statuses including suspensions, revocations, and cancellations
    • Driver’s license class
    • Special driver’s license endorsements
    • Any restrictions on your license
    • Traffic violations, such as:
      • Traffic citations
      • Vehicular crimes
      • Accident reports
      • Driving record points
      • DUI convictions

    This information is crucial for employers hiring a driver, although it can be insightful for any other job candidates as well. Motor vehicle screening services can be completed by a consumer reporting agency or through your state’s driver’s license agency, which can be found via the DMV.

    U.S. terror watch list check

    In addition to criminal records, background screenings can also include a review of the U.S. terror watch list. Third-party checks can compare candidates to various government watch lists, which can be important for any jobs where security is involved.

    Drug testing

    While drug testing is not technically a part of a background check, it’s commonly done in conjunction with pre-employment screening. In addition, past drug-related offenses can also surface during criminal record checks.

    There isn’t a single, comprehensive law that covers drug testing, so you’ll need to review your state’s specific drug testing regulations for specifics on what is and isn’t restricted. The American Civil Liberties Union keeps a list of each state’s regulations online.

    How To Run A Background Check

    Running a background check is a multi-part process that requires some initial planning and consistent application. The following five steps will help your company lay the groundwork for pre-employment background checks.

    1. Have a background check policy in place

    A written background check policy makes it easier for companies to lay out guidelines for a fair, consistent process. This policy should include the following details:

    • Which background checks your company will conduct
    • How and when the company will conduct these screenings
    • How the results of these check will be used in employment decisions
    • The responsibilities of the hiring managers and HR team when it comes to the screening process

    2. Choose a background check partner

    There are several professional background check companies that provide screening services, but not all of them are right for your business. Narrow your search to FCRA-compliant partners who can scale with your business and offer a range of screenings that will help you make the most informed hiring decision.

    3. Notify candidates of the background check

    As mentioned above, it’s essential to notify candidates of any background checks. Employers must also give candidates the aforementioned adverse action notice and have them sign a release form for any screenings before they begin.

    4. Allow for explanation

    If a candidate’s background check uncovers some information that would impact your offer of employment, give them a chance to clear any mistakes or explain the situation. Employers are required to allow candidates to review their background check results and file a dispute with the screening service if they choose to go that route.

    In addition, there are candidates who simply want to be honest and open about their past. For example, an applicant with a past misdemeanor could have learned from their mistake and be a great fit. That decision comes down to the employer, but it’s important to give employees the ability to exercise their FCRA rights before you make a call either way.

    5. Make a decision

    Once you have all the necessary information, it’s time to make the best call for your company. If the candidate is the right fit, then you’re all set to make an employment offer and prepare for the onboarding process.

    How Long Does A Background Check Take?

    On average, a typical background check is completed in three to seven days. There are times when checks are delayed due to incomplete or inaccurate check request forms or release forms. However, the majority of checks should be complete within a week. One exception is that any FBI checks can take around 30 days, but most jobs won’t require that type of timeframe.

    Can A Background Check Be Done Before A Job Offer?

    While background checks are traditionally done after an employer selects a final candidate, there is no federal law that prevents employers from running checks before an employment offer is made. There are certain state laws that dictate when you can run background checks during the hiring process, along with which types of checks are allowed. Make sure to check your local laws before if you want to test early background checks.

    Protect Your Business with Proper Background Checks

    While we highlighted several areas that should be included in a background check, there are several other areas that may be important depending on the nature of a business. Financial institutions may want to run a credit report. Other companies may want to verify an applicant’s educational degrees and school history. The answers to these inquiries are crucial, as a bad hire can lower morale, hurt company productivity, and cost as much as three times the salary of the person being replaced.

    Regardless of how much an employer decides to include, a thorough background check is a complicated process that can pull business owners away from other important tasks. As a Professional Employer Organization, GMS has the human resources experts to manage the background check process and many other critical HR functions. Contact GMS today to talk to one of our experts about human resource outsourcing and how it can save you time and money.

  • You don’t need to be in school to learn a few tricks. Employees play a huge part in the success of your business. Retaining and developing a good group of employees can set your business up for bigger things in the future, especially when you consider that replacing an employee can cost up to 50 percent of that employee’s salary.

    Employee training and performance management are key HR functions that can help you shape your employees into an even more successful group. Here are some back-to-school tips to help you make sure that your business is on the right path when it comes to training and performance management.

    A small business owner going through a performance management review with a happy employee.

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    Employee Training Tips

    Plan Ahead

    Whether you just hired a new employee or are preparing to conduct ongoing employee training, it’s good to make a list of everything that employees should learn. This can serve as a checklist to guide you and your employees through the training process. 

    Start your list off with simple items or information. For example, a training list for a new employee could kick off with introductory information like where to park, a tour of the workplace, and an introduction to their workspace. As your employees progress through training, the list items can gradually cover more complex information and education. You can also modify this list as you progress through training to account for any knowledge or skill gaps you discover.

    Have Employees Get Involved

    More than one person can assist with training. In fact, it can be good to have various members of your business train employees on other facets of the business if they’re an expert in a certain area. Not only does this help spread the responsibility of training employees, it can also empower your employees to take a more active role in improving your company.

    Another way to have existing employees train newer or younger people at your company is to start a mentoring program. Experienced mentors can help teach other employees things that they normally wouldn’t pick up in manuals, training videos, or other traditional methods. Also, these relationships can help inspire employees to stay with a company, especially for millennials. According to Forbes, “millennials planning to stay with their employer for more than five years are twice as likely to have a mentor (68 percent) than not (32 percent).”

    Train Employees Regularly

    A single day isn’t nearly enough to truly prepare an employee for a job. Training is an ongoing process that shouldn’t be contained to the beginning of an employee’s tenure at a company. 

    Regular training updates can help make sure that employees are on the top of their games and keep them interested and motivated. Continuous professional development can include regular training sessions, all-staff meetings, or outside events like conferences that can help employees maintain skills and knowledge long after their initial onboarding process.

    Performance Management

    Set Realistic Goals

    It’s hard to evaluate an employee’s performance if you don’t set goals for them first. However, an unattainable goal won’t do anything to help motivate employees. Sure, tripling sales numbers for a quarter would be great, but it’s not a good guideline for growth if it’s something an employee has no chance of completing. Instead, base employee goals on the SMART framework:

    • Specific – Clear and relevant to an employee’s duties
    • Measurable – Able to be tracked to determine success
    • Achievable – Reasonable, but still difficult to push employee toward growth
    • Relevant – Worthwhile for both the company and employee
    • Time-based – Has a target date for completion and review

    It’s also important to include your employees when it’s time to set goals. If you dictate goals to employees, they won’t be as likely to take them to heart. Giving them some say in what they want to achieve allows employees to own their goals and give them a milestone to work toward in the future.

    Communicate

    Setting and reviewing goals shouldn’t be the only time you check in on employees about their performance. Annual reviews provide a good opportunity to discuss overall growth or review goals, but it’s also good to regularly talk with employees about their performance.

    A great way to motivate employees is to build relationships with them. Establishing regular face-to-face communication and making yourself available can help employees open up about their thoughts, suggestions, and complaints.

    In turn, random check-ins with an employee about how he or she is performing should feel less like a pop quiz and more like a natural work conversation. The information you gather from these talks can be extremely helpful toward making meaningful changes that can help both you and your employees make strides to change your company for the better.

    Give Them Rewards They Want

    A big part of performance management is making sure that talented employees feel properly rewarded for their hard work. Rewarding employees can benefit business in two impactful ways. First, it can help you save money, as disengaged, disinterested employees led to a loss of up to $550 billion per year for U.S. businesses, according to Entrepreneur. Second, talented employees who don’t feel adequately rewarded are more likely to try and find a job somewhere that will recognize their efforts.

    The types of rewards you should use depend on your employees. Financial incentives are an obvious go-to option. However, some of the more impactful rewards are those personalized to fit an individual.

    For example, if an employee has children and has to manage dropping kids off at school or daycare, offering them the ability to work from home or shift their hours to be more flexible shows you care while giving them something they want. Other employees may desire chances to advance in the workplace, so rewarding them with the ability to attend conferences or other career development events helps them reach their personal goals. 

    These rewards also don’t have to be grand gestures. Small, affordable rewards like open recognition in the office or gift cards are small rewards that can help employees feel validated by the work they did.

    Invest in Training and Performance Management

    The ongoing development of your employees is important, but it’s also yet another responsibility that’s on your plate. Fortunately, you can still invest in the growth of your employees and business without the time commitment. 

    GMS can help take on the administrative burden of training, performance management, and other HR functions so you can spend your time building relationships with your team growing your business in other ways. Contact GMS today to talk to one of our experts about how we can help you strengthen your business today.

  • It won’t be long before millennials dominate the workforce. The Society for Human Resource Management (SHRM) reports that about a third of the current workforce is comprised of millennials. That same report indicates that millennials “are projected to make up 75 percent of all U.S. employees” by 2025. That means that you’ll probably want to take measures to attract top millennial talent when that generation dominates the pool of available job candidates.

    Of course, each generation has different priorities when it comes to finding an employer. For example, cash doesn’t rule everything around millennials. Instead, they tend to value a good company culture and special benefits more than a high dollar number. In fact, Forbes reports that “millennials would be willing to give up $7,600 in salary every year to work at a job that provided a better environment for them.”

    Millennials have different expectations than past generations. Here’s what you can do to make your business more appealing when recruiting millennials.

    Young professional happily employed by a business that recruited millennials.

    Reconsider Your Recruiting Style

    Technology has changed the way the people find jobs. The internet gives people so much access to find information about potential job openings and the companies that list them. This means that what potential applicants find online about you can be the first impression of your company.

    Fortunately, you have some control over your online presence. You can use social media platforms to showcase what your company is all about, including your values and culture. A mobile-friendly website is another way to showcase your business in a good light, especially since mobile job search is prevalent across all generations, not just millennials.

    Of course, how you communicate with millennials is a key part of recruiting them. For many millennials, it’s important to be authentic and make them feel like they would be working with you instead of for you. It’s important to make your company sound like a place where they would want to work. However, that doesn’t mean that you should hide certain aspects of your business. Some people are just not a good culture fit regardless of generation. Be honest about your company, your expectations, and the potential applicant’s role and both parties should be able to tell if a pairing just won’t work out.

    Stress Development and Career Path

    Contrary to the stereotype that millennials are job hoppers, studies show that the majority of the generation highly value a workplace that gives them a chance for a bigger and brighter future. A Gallup poll found that “93 percent of millennials left their company the last time they changed roles,” but that may have more to do with a lack of opportunities for growth within a company than simple job hopping.

    According to that same Gallup poll, 87 percent of millennials consider “professional or career growth and development opportunities” as a key value for jobs, while only 69 percent of non-millennials said the same. If a millennial finds that he or she is in a position with no viable chance for growth or promotion, that employee is more likely to find that opportunity elsewhere. By investing in employee training programs, mentorship programs, and other development tools, you can show job candidates that you care about their growth. Also, promoting a qualified, motivated employee can lead to lower hiring costs, which makes the situation a win for both parties.

    Consider Work-Life Balance and Other Key Benefits

    The ability to work remotely or have flexible hours is a major consideration for many millennials. At this point, a significant portion of millennials are getting married, having kids, and making life choices that will have major impacts on their future. Other generations have gone through the same process, but Inc. reports that millennials are “almost twice as likely to have a spouse or partner who works at least full time than boomers (78 percent versus 47 percent).” This means that instituting workplace programs or policies that allow for flexibility or telecommuting can be a major selling point for your business.

    Other benefits that are attractive to millennials aren’t all that much different than those for other generations. According to a Capital Group survey, millennials, generation Xers and boomers all share the same top-three benefits: 

    • Health insurance
    • Vacation time
    • Matching 401(k) plan

    Another way that your business can make itself more attractive to millennials is through benefits related to student loans and schooling. Forbes reports that about 80 percent of millennial employees “would like to work for a company that offers student loan repayment assistance,” although only four percent of companies did as of 2016. Because of this, you can make your business stand out in a big way by offering such a sought-after benefit. However, millennials aren’t only considering student loan benefits for themselves. The aforementioned Capital Group survey also found that 34 percent of millennials think that a 529 tax-advantage college savings plan is another important benefit to offer so that their children don’t have to go through crippling student debt in the future.

    Invest in Employee Recruitment

    It’s important for a growing business to find the right employees, but recruiting isn’t easy. A SHRM study found that more than two-thirds of organizations have a difficult time recruiting full-time staff for job openings. This can be caused by not knowing where to look, not having enough applicants, and not having enough time to spend on recruitment efforts. Between creating job ads, background checks, and the interview process, that’s a lot of time and effort that you could spend building your business in other ways.

    As a Professional Employer Organization, GMS provides employee recruitment services that take the burden of recruitment off your shoulders and leaves the process of finding qualified applicants to HR experts. GMS also gives you the opportunity to outsource your employee benefits administration, which can help you build an attractive benefits package without spending the time it takes to manage everything yourself.

    Do you want to save time and attract top talent? Contact GMS today to talk to one of our experts about how GMS can help your business today.

  • Thanks to technological advancements in the modern workplace, remote work, or work-from-home (WFH) jobs have become increasingly more common. According to the Global Workplace Analytics’ analysis of 2018 American Community Service data, work-from-home jobs have grown 173 percent since 2005—11 percent faster than the rest of the workforce. Remote work has likely grown even more so as a result of the 2020 outbreak of COVID-19, which prompted many employers to shift to a remote work model to limit the spread of the coronavirus. 

    Telecommuting can be an attractive work option for both employees and employers. For employees,  flexible work hours and more time to spend with family can make remote work an ideal situation. For employers, hiring remote workers can save money and increase productivity if you manage your remote team effectively. 

    As more businesses implement work-from-home policies, employers will need to consider how the trend will impact HR initiatives. Here are some best practices for managing HR for remote employees.

    A small business employee working from home.

    Remote Employee Performance Management

    How do you manage an employee that you don’t see face-to-face every day? With technology and some effort, it may not be as hard as you think it is. In fact, some evidence shows that working remotely can improve performance. 

    According to the Society for Human Resource Management (SHRM), “77 percent [of employees] reported greater productivity while working offsite.” In addition, the article cites a U.S. News & World Report story that states “Telecommuters log five to seven more hours per week than non-telecommuters” With good management, remote employees can be a boon for business.

    Of course, this can all depend on making sure that proper employee performance management practices are in place to monitor performance and make sure that employees stay engaged. In terms of monitoring performance, timesheets or online time tracking can help you keep track of employee productivity.

    It’s also good to set up phone or video check-ins to see how they’re doing (but not so often that it feels like they’re being micromanaged). In addition, regular facetime can help remote employees feel like they’re a part of the company.

    While telecommuters can have flexible schedules, it’s a good idea to make sure that part of their schedules overlap with office workers and that they work together via Skype, Zoom, Slack, or other communication programs. 

     

    Payroll for Remote Employees

    Managing payroll can be a complex and time-consuming task for any business owner. However, remote employees might be subject to different payroll regulations and laws depending on where they’re located. Each state, county, and even city can have its own stipulations on how much people are paid and how it happens. This can affect multiple aspects of payroll compliance, including:

    Employers must also find a way to display federal and state labor law posters for remote employees. You can electronically share the posters via email or in an employee online workplace portal, or you can mail copies for the employee to keep.

    In addition, employers need to be aware of any state requirements for the reimbursement of business expenses that remote employees may incur, such as Internet access from a home office. Where the expense may be used for business and personal use, such as having a stable WiFi connection, consider a system to help employees monitor and record how much of the cost is related to business activities and reimbursing employees at least that amount.

    Nobody wants to be hit with costly non-compliance penalties, especially for infractions that could be easily avoided. If your employee works in a different city, make sure that you or your payroll provider checks each state’s payroll regulations to make sure that your business is compliant.

     

    Hiring Remote Employees

    While some HR functions may be impacted more by remote work locations, the hiring process can be very similar to what it would be for anyone who works on location. Aspects of the process like creating face-to-face time for an interview, assessing skills, and determining if someone is a good culture fit all apply to remote employees as well.

    While it’s not always possible to have remote applicants sit down for an in-person interview, technology gives you a way to conduct a “face-to-face” interview. Video interviews through Skype, Zoom, and other tools allow you to still get a more personal feel for how an applicant would fit through nonverbal communication and body language.

     

    Terminating Remote Employees

    As for termination, you need to take the same precautions that you would for someone located in your office. Create a checklist of matters to address when an employee is terminated, such as final pay requirements, removing IT and security access, and retrieving any company property in their possession (if the employee has anything). If the employee is out of state, make sure to review the laws in that state. For example, final payment laws can differ, impacting what’s included in a final paycheck and deadlines for when it must be provided.

    Another item to consider is how you inform your soon-to-be former employee about the termination. Even if he or she telecommutes, it’s good to let an employee hear the news face-to-face, whether it’s for an in-office meeting or through a video conferencing tool like Skype. The latter may not be as personal, but it’s much better to let someone know about a dismissal during a video conference than via email.

     

    Workplace Safety Concerns for Work-from-Home Employees

    Even though remote employees may not work in your office, they still may be subject to health and safety regulations. The level of responsibility an employer has regarding workplace safety for remote employees is hazy. 

    According to SHRM, OSHA is on record as saying that it “will not conduct at-home workplace inspections and that it will generally not hold employers liable for at-home safety issues.” However, the article also cites attorney Alec Beck stating that “OSHA continues to maintain that employers are responsible for safe working conditions regardless of location.” 

    As a result, the best plan of action is to create safety reporting systems and policies that can help protect you and your employees. SHRM suggests the following risk management strategies to help reduce the chance of claims against your business:

    • Create an at-home work policy and disseminate it to all employees.
    • Require that remote employees create and provide evidence of a dedicated work area at home that has been set up according to your specifications.
    • Periodically follow up to ensure compliance.
    • Require employees to have homeowner’s or renter’s insurance that covers any potential equipment damage or liability.
    • Review the employer’s insurance to make sure that all contingencies are covered—including business travel incidents.
    • Make it clear that computer security issues are monitored and that employees wishing to use their own computers must have safety protocols installed.

     

    Manage HR for Remote Employees with a PEO

    It takes a lot of hard work to run a business. Telecommuting adds yet another layer of complexity to HR management, a task that already requires plenty of time and know-how. This amount of work and expertise is a big reason why many businesses turn to a professional employer organization (PEO) to help manage HR.

    At GMS, our experts can help you save time and strengthen your business through payroll management,  benefits administration, and other key functions. Contact GMS today to talk to one of our experts about how we can help your company manage remote employees.

  • A small act of recognition can make a big difference for an employee’s morale. When Forbes reports that nearly two-thirds of employees would “likely leave their job if they didn’t feel appreciated,” these gestures can help you retain happy, talented employees.

    While recognition is a good goal, you also need to make sure that these efforts make sense for your bottom line. Fortunately, there are plenty of good rewards that won’t break the bank. Here are five low-budget ideas that small business owners can use to show employees their appreciation.

    A small business owner recognizing an employee for hard work.

    A Warm Welcome

    One of the most important times to recognize an employee is on his or her first day. According to the Society for Human Resource Management (SHRM), “Up to 20 percent of turnover takes place in the first 45 days.” Considering the average cost of replacing an employee, this can make early recognition a very cost-effective strategy.

    Fortunately, it doesn’t cost much to make new employees feel recognized on day one. There are several ways to help a new hire feel welcome right away, such as:

    • Greeting them personally on the first day
    • Giving them a tour and introduce them personally to team members
    • Sending out a welcome email
    • Creating a personalized orientation program
    • Sitting down and getting their feedback at the end of the first day

    A welcome package is also a nice first-day reward that can make workers feel like they belong. A bag with some mugs, a gift card or two, and some written welcome notes from team members is a small investment to make for a new employee who could be a long-term member of your company.

    Written Recognition

    Speaking of written messages, an employee doesn’t have to be new to appreciate a heartfelt note. Gallup cited that only three out of 10 U.S. employees feel they received recognition for their work in the past week. A handwritten note can show your workers that you not only notice what they’re doing, but also appreciate them for their hard work. 

    How can something as little as a handwritten note be so effective? Unlike a quick email, written notes can create a personal connection that electronic messages just can’t match. Former Campbell Soup Company CEO Douglas Conant found that handwritten “thank you” notes were so effective that he wrote more than 30,000 of them over the course of a decade. While you don’t need to match his productivity, the occasional note is a small, inexpensive way to motivate your workforce.

    Open Recognition

    While handwritten notes are a great way to privately thank employees, company announcements are a free way to highlight workers in front of everyone else. Highlighting achievements during company meetings or via company-wide email are a way to make sure that everyone recognizes the efforts of various employees.

    Recognition doesn’t only have to be about what your employees do for your company. Your employees may appreciate when their peers recognize them for personal accomplishments as well. Did one employee finish that marathon she trained for? Congratulate him or her on the achievement. Did a group of employees volunteer at a local animal shelter? Share that in a company email. It may seem like a small thing, but these acts show that you care about more than just your employees’ performance.

    Gift Cards

    A little money is a nice reward for just about any employee. With gift cards, you can set a budget that works for you. They also allow you to diversify your gift ideas by catering to your employees’ personal preferences. If an employee makes a coffee run before arriving at work every day, a $10 gift card to his or her coffee shop of choice is a great perk that shows you pay attention.

    It’s important to note that the IRS does view certain gifts as taxable income for an income. According to SHRM, “Although there may be limited situations when the value of a gift card or gift certificate could be excluded from an employee’s income, employers might want to take a conservative view and include the value of all gift cards and gift certificates in employee wages.” This doesn’t mean that you can’t use gift cards as a low-budget gift; you just need to plan ahead to protect yourself from any tax issues.

    The Gift of Time

    Sometimes the best way to show your employees that you appreciate them is by freeing up their calendar. The occasional day off allows workers to recharge. If an employee does well, consider giving them a “free day” pass that can be used at a future date. 

    The occasional day off isn’t the only way that the gift of time is on your side. Flexible work schedules can be an amazing gift for an employee that has to balance daycare schedules and other family responsibilities. If a good employee needs to stay home to watch the kids, work-from-home privileges shows a level of empathy that can build a strong bond between you and your employees.

    Invest in Happy, Talented Employees

    When your employees play such a huge role in your success, it makes sense to try and invest in top talent. As a Professional Employer Organization, Group Management Services offers a variety of services that help you invest in your workforce, such employee benefits administration and training programs. 

    Ready to learn more about how GMS can strengthen your business? Contact GMS today to talk to one of our experts about how we can help your company.

  • The last election cycle may have added to the number of states with legalized marijuana, but is your business ready for it? Michigan became the 10th state to legalize recreational marijuana this past midterm election, ushering in the creation of the Michigan Regulation and Taxation of Marihuana Act (MRTMA). As more states adopt these measures, it’s a good time to consider how legal marijuana affects your business and what you can do to protect yourself.

    A small business owner and an employee reviewing marijuana policies in the employee handbook.

    What Does Legalized Marijuana Means for Small Business Owners?

    While MRTMA does legalize the use of recreational marijuana, it doesn’t do so at the expense of business owners. In fact, the new law doesn’t change much in terms of an employer’s ability to maintain the same drug and alcohol policy that was in place before the law. Per the MRTMA itself, the act still allows employers to do the following:

    • Ban conduct allowed by this act in any workplace or on company property
    • Discipline, discharge, or take other adverse employment actions against an employee for violations of a workplace drug policy or for working while under the influence
    • Refuse to hire a person after failing a pre-employment drug test or take adverse action against an existing employee in terms of tenure, terms, conditions, or employment privileges for working under the influence

    There’s also the fact that recreational marijuana is still illegal in terms of federal law, which has generally trumped state laws in marijuana-related cases so far. While Michigan’s new law and federal law in general doesn’t reign in an employer’s ability to maintain a drug-free workplace, that doesn’t mean that you shouldn’t takes steps to protect your business. It’s up to you to set clear guidelines that make your company’s policies are clear to your employees.

    What You Can Do to Protect Your Company

    Institute a Drug-Free Workplace Policy

    Regardless of whether you’re in a state like Michigan that has legalized recreational marijuana or not, it’s good to establish a written drug-free workplace policy (DFWP). This policy should make it clear that employees should never have any illicit substances on company grounds.

    Consider Drug Testing

    If you plan to test your employees for drug use, you need to have your policy carefully outlined to make sure that your employees have a clear understanding of your drug testing policy. This includes expectations and rules associated with each type of test, such as when they can happen, testing timelines and steps, and what’s expected of the employees. The types of drug test include:

    • Pre-employment tests for applicants
    • Probable cause tests for reasonable suspicion
    • Arbitrary tests on set dates (such as work anniversaries)
    • Random tests

    Of course, how you administer these tests can vary depending on your state. For example, Michigan has no law addressing drug testing regulations for private employers if your policies are not found to be discriminatory or violate any other legal provision. Other states may have set regulations for what types of test can be done and how those tests and conducted. OHS, Inc. provides abstracts of each state’s workplace drug testing laws, although it’s good to check local laws yourself to make sure you’re in compliance with any necessary rules and regulations.

    Set Discipline Standards

    In a way, marijuana can be treated the same way as alcohol; employees can’t come to work impaired, and they’ll be in trouble if they do. You’ll want to set firm policies to protect your business in case there are any incidents, but you should also consider whether your state has any protections in place for marijuana users, especially for places where medical marijuana is allowed.

    Of course, these potential protections can vary greatly based on your location. The Society for Human Resource Management notes that employers in Vermont and Minnesota “can’t fire someone for the first failed drug test if the employee agrees to complete a rehabilitation program.” The Small Business Association of Michigan highlights a Maine law that “prohibits adverse actions against employees for using marijuana outside of work.” Federal law may generally prevail, but adjusting your discipline standards to fit local laws can help you avoid costly legal battles while still affording your company some protection.

    It’s also crucial that, no matter how you decide to discipline employees for failed drug tests, you treat everyone equally. If you use a failed test as the basis for firing one employee but refrain from punishing a separate long-term employee, the fired employee could argue that your inconsistent application of your own rules was discriminatory. That could lead to litigation and a long, costly headache that could be avoided.

    Another good item to include is some language involving what it means if an employee attempts to delay a test or outright refuses to take one. If you decide to drug test employees, you should include a clear definition of “refusing to test” to offer you some protection. If you find that an employee is too evasive about drug testing and should be dismissed.

    Prepare Your Business for Marijuana Laws

    It’s not going to get any easier trying to figure out how marijuana laws will impact your business. Between new states adding legal marijuana and various regulations, it can be an absolute headache to keep track of everything your business should do to protect itself unless you’re an expert. If an employee gets hurt while under the influence of marijuana, the process can be even more complicated. Because of that, it’s best to turn to an expert to make sure you stay on top of federal and state marijuana laws.

    A Professional Employer Organization like GMS can help you navigate through confusing, ever-changing regulations and update your handbooks to protect your business. We have experts in multiple locations across the country, including at our Detroit office. Contact us today to talk to one of our experts about how we can help you prepare for marijuana regulation and strengthen your business in other ways.

  • As a small business owner, you’re in control of your business. However, things that you can’t control can impact your business as well. 

    Certain laws and executive orders can potentially require you to change certain processes and policies to protect your company. It’s important to keep an eye out for any news that can lead you to review current practices and make changes, such as when Michigan Gov. Gretchen Whitmer signed an executive order to increase protections that prohibit anti-LGBTQ discrimination in January of 2019. Whether your business is in Michigan or not, it’s a good time to consider how orders like these can impact your day-to-day operations.

    A job applicant being interviewed by a small business following non-discrimatory hiring practices. 

    What Does This Mean for Your Small Business?

    For most businesses, Whitmer’s order won’t change all that much. Outgoing Gov. Rick Snyder signed a directive in December of 2018 that, per the Detroit Free Press, “barred state contractors from discriminating against gay or transgender employees,” with exceptions for churches and religiously-affiliated organizations. The new order removes that exception, but that still puts most small business owners in the same spot as before.

    The bigger takeaway from this order is that it’s a part of a bigger trend across the U.S. to extend protections to people seeking employment, whether it’s because of sexual orientation and gender identity or another reason. In addition, LGBTQ and gender discrimination claims are expensive. The U.S. Equal Employment Opportunity Commission (EEOC) enforces discrimination laws on a federal level and has forced offending employers to pay out more than $3.3 million in monetary relief. As discrimination laws evolve across the country, it’s important to be proactive about potential changes instead of waiting for an issue to arise.

    How You Can Protect Your Business During the Hiring Process

    Discrimination is a matter of hiring–or not hiring–a candidate for reasons that aren’t based on an applicant’s qualifications. Each state’s anti-discrimination laws can differ, but the best way to avoid potential issues is to have a hiring process in place that treats everyone equally and documents interviews so that you can protect yourself from any anti-discrimination claims.

    Establish Set Interview Questions

    If you don’t already, create a regimented interview process with standard interview questions that you ask every candidate. This will help you give each applicant an equal opportunity to make their case for the job. You also need to be careful about the questions you ask. Making direct inquiries that impact gender, race, age, or other protected criteria can lead to trouble. 

    For example, the Yale Office of Career Strategy notes that inquiries about family information status are potentially illegal in a job interview. A question as simple as “Are you married?” can be viewed as a way to probe for personal information or to even determine a candidate’s sexual orientation, even if it was an innocent attempt at conversation.

    Don’t Treat Some Candidates Differently than Others During the Interview Process

    No matter the opening, it’s important to conduct every interview the same way no matter who sits in front of you. Use your set list of questions and provide the same type of feedback. Follow-up questions can certainly vary depending on certain responses or specific qualifications, but it’s good to give everyone the same chance to answer the same base list of questions.

    Take Notes and Document the Results

    As you go through the interview, make sure to write detailed notes about a candidate’s responses for future evaluation. Not only are these notes useful if you have to compare a couple of close candidates, it creates a record of what was said in case an applicant tries to make a discrimination claim. In this case, you can present information on why you hired one candidate over another based on their responses and your notes. 

    If possible, it’s also good to conduct interviews with another colleague so that he or she can take notes as well. Not only will this give you another person to help during the interview, it gives you a second set of recorded notes to use in case any claims are filed.

    Keep Your Hiring Practices Ahead of the Curve 

    Finding and hiring the right job candidates is stressful. When you add in anti-discrimination considerations and other potential pitfalls that you can face in the hiring process, it can be overwhelming. Rules and regulations will continue to change over time, but there is a way that you can be proactive and protect your business.

    As a Professional Employer Organization, GMS can be the partner you need to shoulder the administrative burden and strengthen your business’ HR functions. Our team of experts allow you to outsource everything from payroll administration to employee recruitment and training programs. In turn, you not only save the time necessary to run your business, you gain the advantage of working with a group that can keep you up to date on any issues that may impact your company.

    Ready to keep your business ahead of the curve? Contact our Detroit office or one of our other locations across the country to talk to one of our experts about how we can help you strengthen your business today.

  • Running a business comes with more responsibility than most people realize. The administrative requirements to stay compliant while growing a successful business can overwhelm most. Some business owners will hire office managers, an HR generalist, interns, etc., but some completely put off the HR needs of their company. This can cause major issues down the line with compliance issues, payroll dilemmas, job description disputes, and the list goes on.

    The Professional Employer Organization (PEO) industry exists to help business owners outsource their back-office functions to focus on the real reason they developed their company, which is to generate revenue. 

    A happy small business owner who outsources key business functions to a PEO. 

    Five Indicators That it Might be Time to Partner with a PEO

    The administrative functions of running your business have become overwhelming

    If you’re trying to find more hours in the day for you and your staff, using a PEO may be a good way for you to free up time. Many growing businesses find it hard to maintain efficient administrative processes as they expand. GMS can help streamline the payroll process, handle compliance issues, assist with employee recruitment, provide salary analysis, and much more.

    You aren’t 100 percent confident that your business is compliant with State and Federal regulations

    Face it, the business of being a business owner has become more and more complicated with rising costs and liabilities of having employees. Just through the Affordable Care Act alone, there have been about 900 new regulations enacted in recent years. Are you aware of all the changes? GMS provides the HR expertise with a designated and certified account manager attached to an HRIS platform to ensure compliance with all federal and state employment regulations.

    You lack the financial resources to develop a full HR department

    Building an HR department can be time-consuming and expensive. The median salary for a Human Resource Manager is $110,112 per the Bureau of Labor Statistics. Depending on the need, an in-house department can involve hiring an HR Director, using a payroll company, securing an EPLI policy, paying a 401(k) audit fee, and paying attorney fees, all of which can add up quickly. GMS can often provide a broad array of services and qualified experts without having to hire internally.

    You want to focus more on the growth of your business

    Outsourcing the daily administrative aspects of running your business frees you up to focus your attention on growing your business. You retain full control over decision-making, employee responsibilities, core job functions and requirements, hiring decisions, and the structure of your organization. While GMS can offer input in these areas, you remain in control of all final decisions. This is the foundation of the co-employment relationship that GMS creates with its clients.

    You’re in a high-risk industry

    Small businesses can be paralyzed by compliance requirements with labor laws, tax reporting, and workers’ compensation insurance. The list of acronyms – like FSLA, FMLA, EEOC, HIPPA, PPACA, FUTA, and SUTA – are enough to cover the entire alphabet while overwhelming any business owner. If you have employees, you must provide them with workers’ compensation insurance that will pay wages and medical expenses in the event of hours lost because of workplace injuries. By partnering with a PEO, you can rest assured that your business and your employees are protected.

    Ease Your Workload and Strengthen Your Business at the Same Time with a PEO 

    Businesses are created from a passion, and that passion doesn’t usually include handling all the administrative functions required to keep your business running. GMS takes those burdens off the business owner, so they can focus on the core functions of their business. Contact us today to see how we can make your business simpler, safer, and stronger!