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  • In the 12 years that I’ve been working for GMS, I’ve met with thousands of business owners in hundreds of industries. While every company has their unique problems and issues, some issues tend to be universal.  In the 26 years that GMS has been in business, we have found that most business owners… 

    • Think they’re paying too much in worker’s compensation premiums and not getting enough in return for it.
    • Want to offer their employees great health insurance, but don’t want to pay the ridiculous premiums being charged.
    • Don’t fight their unemployment claims because “it’s just not worth it and they’re going to get it anyway.”
    • Hate the stupid bureaucratic paperwork they have to go through, keeping them from more important tasks.
    • Have trouble finding good employees.
    • Have a hard time keeping them when they do find them because they’re losing them to other companies with better wages and benefits.

    Did I miss anything?

    A small business growing with the help of a PEO serving as an outsourced HR department. 

    Why Do Big Competitors Have an Advantage?

    So now, small business owners often compete against bigger companies and are at a distinct disadvantage. Why? Because large companies tend to have a few things that small businesses don’t:

    • A payroll department that pays the employees, takes care of their W-2s, does all their quarterly filings, etc.
    • An internal benefits department that gets the best rates for them on their ancillary benefits and 401k, and is more often than not, self-insured for their healthcare, giving them the data they need to better manage their benefits and control those costs.
    • An internal risk department that manages all their workers’ comp and unemployment claims and has the legal power to contest claims that they feel are fraudulent.
    • An HR department that handles the entire lifecycle of an employee from the recruiting, either done internally or through a service, onboarding, training, and eventual separation by departure or retirement.

    How You Can Compete

    Fortunately, there are measures you can take to stand with the competition. If you’re like most companies your size, you can:

    • Hire an accountant or a payroll service to handle your payroll.
    • Use a broker for your benefits and rely on your accountant or financial advisor to set you up with the best possible retirement plan option.
    • Sign up with a TPA or insurance broker to manage your worker’s comp, hoping for the best possible discount and then pray you don’t lose it.
    • Waste your time fighting unemployment claims, or worse yet, don’t contest them at all.
    • Use a recruiter, word of mouth or a sign in your front yard trying to find help and then hope that you’re doing all the right things from a regulatory standpoint.

    Well, that’s why the PEO industry, Professional Employer Organization, was created back in the 1970s and has grown to a $176 billion industry and why GMS is rapidly becoming one of the largest PEOs in the country. By acting as an outsourced HR department, our clients get all the same benefits of a large company and you can get:  

    • An internal payroll department that takes on all the tax liability of your employees.
    • A benefits department that can get you the best rates and possibly even into a self-insured healthcare plan with minimal risk. You also have the option of a 401k plan that is low cost and relieves you of fiduciary responsibility.
    • A risk management department that is self-insured for worker’s comp, providing better rates as well as complimentary legal service on all claims, both for worker’s comp and unemployment.
    • An HR department that handles everything from the onboarding of employees to termination and everything in between as well as keeping you compliant with all government regulations.

    The best part is that you’re getting all these specialists for less than it would cost you to hire one of them in even a part-time capacity. At its basic level, a PEO consolidates your vendors, increases your buying power, and provides HR support and recruiting assistance to help you in that growth. How do we do that? Through the PEO relationship.

    We partner with our clients and mutually share or co-employ our clients’ employees. By adding their employees to our PEO, GMS is a 26,000-employee company that has the leverage to be self-insured for our worker’s comp and healthcare and get better rates on everything from 401k to vision, dental, life, disability, drug testing, background checks, etc.  Virtually everything necessary for employee management.

    Contact GMS today to talk to one of our experts about what we can do to level the playing field for your business.

  • Probably. Maybe. Maybe not. Who knows? Do you know?

    As a Sales Rep for a Professional Employer Organization (PEO), I talk with small to medium-sized business owners on a day-to-day basis. I never cease to be amazed at how well they know their company, their employees, their business, their industry, and their competition. When you spend 80 hours a week working on your business, you become an expert.

    Yet, these same business owners will often tell me, “I don’t know what I don’t know. And even if I knew what I didn’t know, I don’t always know how to find out what I need to fix, remedy, or comply with the situation.” Of course, they don’t. They’re devoting all their time to making a better product and/or a better company.

    If you’re new to the game or haven’t spent a lot of time thinking about this, you might be wondering what regulations I’m speaking of in the title of this post. After all, those are geared towards large companies, not small, independent businesses, right?

    Compliance chalkboard for small businesses. 

    Federal Regulations for Business of All Sizes

    Some things are required no matter the size of your company. For example, you must make sure you have I-9 forms on all your employees and that they’re filed correctly.  There are hefty fines tied to misfiled or missing forms. You also need to have the required employment posters hanging in prominent places for your employees so they can see what their workplace rights are.

    Other laws are based on how many employees you have. For example, if you have between one and 10 W-2 employees, these laws apply to you:

    • Fair Labor Standards Act (FLSA)
    • Employee Polygraph Protection
    • Equal Pay Act
    • Consumer Credits Protection Act
    • National Labor Relations Act

    Once you have between 11 and 14 employees, you have to become compliant with OSHA and all federal health and safety standards. That includes all the reporting that comes with it.

    From 15 to 19 employees, you need to start paying attention to the following regulations:

    • Title VII, Civil Rights Act
    • Title I, Americans with Disabilities Act
    • Pregnancy Discrimination Act

    At 20 employees, you have to worry about COBRA (if you’re offering benefits) and Pregnancy Discrimination Act. And it goes on and on and on… you get the idea.

    How to Stay in Compliance with Federal Regulations

    How does a business owner know what they need to be compliant with while working full-time on their business? There are several ways I can think of:

    • During all your downtime, read up on federal regulations and keep tabs on all the changes as they happen
    • Pay an attorney to keep you abreast of these things
    • Hire someone on staff whose sole responsibility is keeping track of these things

    These are all good options, but many small business owners find the best option is to partner with a Professional Employer Organization, like GMS, that will not only keep you compliant but will also take on all the regulatory liability of your employees. 

    Recent studies show that small businesses that use PEOs grow 7 to 9 percent faster, have 10 to 14 percent lower employee turnover, and are 50 percent less likely to go out of business. Contact GMS today to learn how we can help take over these administrative burdens, allowing you to focus on your core business.

  • Ever wonder the reasoning behind a paycheck? As in, why does one employee make a certain amount, while another earns more or less? It all comes down to an organization’s compensation philosophy. 

    Does your organization have a compensation philosophy? A WorldatWork survey found that more than nine in 10 companies have a compensation philosophy; however, that doesn’t mean their compensation philosophies are any good. Nearly one in three compensation philosophies aren’t in writing, while about half of employees don’t even know or understand them. This presents a huge missed opportunity for companies, as there are many benefits to pay transparency. 

    Intrigued? Read on to learn what compensation philosophy is and how your organization can benefit from having a good compensation strategy in place.

     A small business owner handing out a paycheck that was based in compensation philosophy.

    What is Compensation Philosophy?

    A compensation philosophy answers the “why” behind employee pay. In a formal, written statement, a compensation philosophy should identify the organization’s pay programs and reward strategies and create a framework for consistency. This basis will serve as the guiding principles that drive decision making regarding compensation at a company.

    Compensation philosophies are typically created by your company’s human resource professionals. That may be a dedicated employee or yourself, depending on the makeup of your business. When developing a compensation philosophy, the Society for Human Resource Management (SHRM) says several factors should be taken into consideration, including:

    • Company’s financial position
    • Size of the organization
    • Industry
    • Business objectives
    • Market salary data
    • Level of difficulty finding qualified talent

    A good compensation philosophy should support the organization’s business goals and objectives, while still being competitive in the market. A reward system for raises and bonuses should also be factored into a compensation philosophy.

    Why is Compensation Philosophy Necessary?

    Compensation philosophies are used to attract, retain, and motivate employees. There are several reasons why your organization should be transparent about your compensation philosophy.

    Demonstrate commitment

    By taking the time to ensure fair compensation strategies, your organization can help employees feel appreciated. According to a survey by the American Psychological Association, 93 percent of employees said they are motivated to do their best work when they feel valued. Sharing your compensation philosophy will show your employees that you care and are invested in their wellbeing.

    Retain employees

    The way you approach compensation can have a direct impact on employee satisfaction. In fact, how they feel about your pay process can be even more important than how much they’re paid. According to a PayScale survey, an employee’s perception of your payroll process is “5.4 times more impactful on how satisfied they are than how they’re paid relative to market.” That suggests that if your organization is fair and transparent about compensation, employee satisfaction and retention rates could increase.

    Attract talent

    Payroll transparency can impact more than just your current employees. Publishing or sharing your compensation philosophy with job candidates should attract more talent and help find the right people whose needs and values align with your philosophy. As SMART Recruit Online found, job listings with a compensation listed increased the total number of candidates by 30 percent. Candidates appreciate companies that are transparent about pay, and the number of applicants an organization receives will likely reflect that.

    Ensure equal pay

    While there are allowable pay differences based on factors not prohibited by law, your compensation philosophy should show equal pay for equal work. Feeling underpaid is a top reason why employees quit their jobs, so ensuring equal pay through your compensation philosophy will help increase retention rate.

    How to Write a Compensation Philosophy

    There are many different types of compensation philosophy. For example, financial services company Citi and predictive marketing platform Windsor Circle are two very different, yet good compensation philosophy examples. Citi takes a more philosophical approach to its compensation philosophy by laying out guidelines rather than fixed numbers, whereas Windsor Circle delves into the details of its compensation package. Despite their different approaches, both compensation philosophies hit the marks on fairness, transparency, and commitment.

    Small business management blog BizFluent laid out four different ways you can write a compensation philosophy.

    Percentile-based

    Some organizations will use percentiles in their compensation philosophy. Percentiles spell out where wages will fall in relation to the regional wage market. For example, a company might pay its employees at the 60th percentile of the regional wage market. This means that employees will earn more than the bottom 60 percent of your market, but less than the top 40 percent of that same population.

    Fixed numbers

    A compensation philosophy that uses specific numbers will detail exactly what each employee makes. For example, an entry-level employee might make $25,000 during their first year, and $30,000 during their second year, dependent upon good performance. Listing a fixed number or range can also help attract more candidates when it comes time to hire.

    Compensation package breakdown

    A compensation structure is a great place to include items apart from salary that make up an employee’s compensation package. This will include base pay, health insurance, and other forms of indirect compensation and even non-monetary rewards like recognition and achievements.

    Non-specific

    A non-specific compensation philosophy won’t provide percentiles, hard numbers, or even a breakdown of what the compensation package includes. Instead, the compensation philosophy will focus more on the guiding principles that help the organization determine how it will pay its employees. The philosophy, using Citi as an example, might say that one of its objectives is to “attract and retain the best talent to lead the company to success.” Citi’s philosophy aims to do this by providing competitive compensation programs and compensating employees based on ability, contributions, and performance.

    How to Review Your Compensation Philosophy

    Compensation philosophies should be reviewed regularly and updated when necessary. When reviewing your compensation philosophy, SHRM says you want to be able to answer “yes” to the following questions.

    Is the compensation philosophy equitable? 

    HR is the neutral department in an organization, so it’s your duty to make sure all rules, including employee pay, are fair and impartial. One department or employee shouldn’t get preferential treatment over another unless there is a justifiable reason behind it.

    Is the compensation philosophy defensible and perceived by employees as fair?

    There will be times when you need to defend your compensation philosophy like when an employee asks for a raise you can’t give. A good compensation strategy will retain talent by motivating employees to perform to their full potential and rewarding those that do. It will also attract candidates with the right salary requirements. Make sure wages are competitive with market value, or an employee or potential candidate may seek an opportunity that pays better elsewhere.

    Is the compensation philosophy fiscally sensitive?

    It’s important to define the competitive market position of the organization as it applies to base pay, variable compensation, and benefits opportunities. Make sure the compensation strategy supports the business strategy, competitive outlook, operating objectives, and human capital needs.

    Are the programs included in the compensation philosophy legally compliant?

    The rights of employees to be free from compensation discrimination is protected under several federal laws, including the Equal Pay Act, Title VII, the Age Discrimination in Employment Act (ADEA), and the Americans with Disabilities of Act (ADA). The Fair Labor Standards Act (FLSA) also dictates minimum wage, overtime pay, recordkeeping, and child labor practices.

    Does the organization effectively communicate the compensation philosophy to employees?

    Communicating the compensation philosophy to employees can create a sense of fairness so no one feels cheated or underpaid. The WorldatWork survey found that 46 percent of organizations share minimal pay information with their employees, and the ones that do say more than half of their employees don’t understand it. When you share your compensation philosophy with your employees, opt for an “open door” policy so employees feel comfortable asking questions.

    Does the compensation strategy attract new hires?

    It’s a good idea to make job candidates aware of a company’s compensation philosophy, as it can help attract top talent. Does your compensation philosophy include salary listings, fair market pay, and language that makes employees feel valued? Applying these strategies can help attract more new hires to your business. 

    Attract and Retain Good Employees with the Right Compensation Philosophy

    Simply having a compensation philosophy isn’t enough. Understanding what makes a good compensation philosophy and being transparent about pay will help your organization attract, retain, and motivate employees. 

    Group Management Services offers a variety of payroll, risk management and human resources services, including national and local compensation strategies for businesses looking to hire. Contact GMS today to talk with one of our experts about how you can define compensation philosophy at your organization.

  • Let’s face it; you’re not going to get along with every person you meet—and that includes the people you work with.

    Conflict in the workplace happens at every organization and ignoring it can be costly. A study by professional training and coaching company CPP, Inc. found that 85 percent of employees experience conflict in the workplace. When it’s fight or flight, it’s easy to want to avoid conflict at all costs; however, your organization will surely pay the price by avoiding conflict management altogether. CPP’s research found that workplace conflict wastes nearly three hours per week, costing $359 billion in paid hours.

    Because every employee possesses a unique set of attitudes, visions, and values that may differ from that of their co-workers, these differences can sometimes lead to conflicts in the office. We put together some conflict management tips to help you understand what can spark a conflict in the workplace and how you can put out the flames for even the hottest office tempers.

    Two employees with clashing personalities, egos and opinions get into a conflict at work.

    What Causes Conflict in the Workplace?

    Given the multitude of personality types in any given workplace, it’s no surprise that the vast majority of employees find themselves dealing with conflict in a professional capacity. CPP found that the main sources of conflict include:

    •  Personality clashes and warring egos
    • Stress
    • Heavy workloads and inadequate resources
    • Poor leadership
    • Lack of role clarity and accountability
    • Bad team pairing
    • Compensation issues

    When Should HR Get Involved?

    When there’s a conflict in the workplace, it’s best to work to resolve the issue right away. If conflict is left unresolved—or handled incorrectly—workplace conflict can have negative results. It’s especially important for HR to step in during the following scenarios.

    Employees threaten to quit over the problem

    Employee retention rates can drop if a problem isn’t properly handled. Research by PsychTests found that 42 percent of workers would quit their jobs due to a toxic work environment.

    Disagreements get personal

    When you don’t correct a problem, employees tend to believe they can do and say whatever they please, like hurling personal insults and attacks at colleagues. This can lead to a loss of respect between employees and create a huge bullying problem at your company. About one in five workers say they have directly experienced bullying on the job, according to a survey by the Workplace Bullying Institute.

    The morale and success of your organization is affected

    A unified company will boast high morale and great business performance. When conflict threatens the culture and success of your company, your organization can’t perform to its full potential. A toxic workplace culture can cause workers to feel stressed, depressed, and anxious, and they may even lose sleep over it. This can negatively impact your employees’ immune systems, making workers more susceptible to illness and sick days. Employees may even just take days off to avoid the office bully, as the CPP survey found that one in four workers have seen conflict lead to sickness or absence.

    Positive Results of Conflict Management

    Good conflict management can lead to lasting benefits for your organization. By taking the right measures to resolve conflict in the workplace, CPP found that 76 percent of workers saw positive outcomes, including:

    Improved working relationships and a better understanding of others

    Conflict resolution is all about open communication, so it’s important that employees calmly talk about workplace issues to help everyone better understand each other and see situations from different points of views. Maybe one employee doesn’t like when another listens to music at without headphones. Perhaps someone else doesn’t like that he or she was passed over for a promotion. These problems don’t always go away on their own, so talking about it can not only improve working relationships, it can also help prevent problems in the future.

    Better solutions to future problems and challenges

    Having the right infrastructure in place for dealing with conflicts can provide an excellent precedent for how conflicts can be dealt with in the future. That way, you know how to handle any conflict before it becomes a bigger issue.

    Greater performance and increased motivation

    When employees are happy, they will be more motivated to do a good job. A study from the University of Warwick found that employee happiness can result in a 12 percent increase in productivity.

    Try This Conflict Management Strategy

    Whether it’s a quarrel between two employees or a squabble across entire departments, it’s best not to waste any time getting to the bottom of it. Schedule a meeting to address the problem in a private, neutral setting, such as a conference room.

    You can also follow these nine steps adapted from the Society for Human Resource Management to quickly and effectively resolve the conflict:

    1. Set ground rules. All parties should agree to treat each other with respect and try to listen and understand each other’s views.
    2. Ask each participant to describe the conflict and their ideal outcome. Focus on specific behaviors and problems instead of on people and have them use “I” statements rather than pointing the finger with “you” statements.
    3. Ask participates to repeat back what others have said to ensure there is no miscommunication.
    4. Summarize the conflict based on what you have heard. Make sure participants are all in agreement.
    5. Brainstorm solutions. Discuss all possible options in a positive manner. Remember: No idea is a bad idea.
    6. Process of elimination: Rule out any solutions that participants agree won’t help resolve the issue.
    7. Summarize all possible options to determine the best possible solution. Make sure all parties agree on the solution.
    8. Execute the agreed-upon solution by assigning next steps to each participant. Make sure all parties agree on their next steps. Lay out a plan to follow up, if necessary.
    9. End the meeting on good terms. Ask the participants to shake hands, apologize and thank each other for working to resolve the conflict.

    While it’s easy to want to shy away from conflict at work, it’s far better for your organization to address these issues. Employee training and performance managementare key HR functions that can help create a workplace culture that fosters camaraderie—not conflict—among your employees. Contact Group Management Services today to talk with one of our experts about the different ways you can manage conflict at your organization.

  • Going to work shouldn’t feel like, well, going to work.

    Sadly, that’s how most workers feel. A Gallup study found that two-thirds of full-time workers experience burnout on the job. Yet, only 23 percent of companies offer burnout prevention programs, according to a 2017 Statista survey. It’s a huge issue for many companies and a major reason why talented workers leave for better opportunities.

    However, employee burnout doesn’t have to be part of the job. Learning how to spot job burnout and understanding its effects can help employers not only reduce burnout and job stress, but also increase productivity and revenue. We put together some tips to learn more about what job burnout is, how job burnout is affecting your company and ways you can prevent (and even reverse) job burnout at your organization.

    An employee shows signs of job burnout when they are unmotivated, overworked, cynical and frustrated.

    What is job burnout?

    Job burnout is a type of job stress defined by Mayo Clinic as “a state of physical, emotional or mental exhaustion combined with doubts about your competence and the value of your work.” Job burnout symptoms can include lack of motivation, cynicism, frustration, impatience, irritability and even physical pain like headaches and backaches.

    From demanding deadlines to bad bosses, there are many factors that can be attributed to the causes of job burnout. Lack of control, unclear job expectations, dysfunctional workplace dynamics, unreasonable time pressure and work-life imbalance can all cause an employee to experience burnout from work.

    Effects of job burnout

    An overworked, over-stressed and unhappy employee can take a serious toll on any company. Burnout affects every facet of an organization, with decreases seen in production, morale, retention and revenue.

    Quantity and quality of work both suffer when an employee is burned out. Data from The O.C. Tanner Institute’s Health and Wellbeing Study revealed that employees with poor wellbeing, on average, self-reported that they are only working at 64 percent of their maximum output. That’s because employee productivity decreases with a lack of motivation, causing slower work and lower productivity.

    The previously mentioned Gallup survey also found that employees who suffer from burnout are 63 percent more likely to take sick days, as burnout can lead to increased instances of illness. You’ll also start to see increased errors in work, which could be attributed to factors including apathy, lack of communication and/or time constraints.

    You’ve likely heard the saying, “it only takes one bad apple to spoil the bunch,” and the same can be said for a burned-out employee. Employee burnout is highly contagious, as team morale decreases, and workplaces are more susceptible to conflict, ultimately resulting in a toxic work environment.

    Retention rates will suffer with good workers leaving bad situations due to burnout. A study conducted by Kronos and Future Workplace found that burnout is the biggest threat to employee retention, according to 95 percent of human resources leaders.

    Overall, job burnout can cost your organization serious losses in revenue. The American Institute of Stress estimates that job stress can cost U.S. businesses as much as $300 billion annually.

    Job burnout solutions

    You don’t have to—and shouldn’t—accept burnout as part of the job. While job burnout doesn’t just happen overnight, it can creep up slowly if you’re not paying attention to the warning signs. Job burnout can be prevented (and even reversed) by changing how you manage and lead your employees. Follow these five steps to prevent job burnout at your organization.

    Define goals and expectations

    Regular check-ins with employees can increase productivity, lower stress levels and encourage open communication throughout the company. Perhaps that’s why 65 percent of employees wished they received more feedback from their employer, according to a study by employee engagement firm Office Vibe.

    When was the last time you had a check-in with an employee that involved more than just giving project updates? Frequent check-ins and employee reviews can help make sure goals and expectations are clearly defined by providing direction, eliminating guesswork and creating better employee/manager relationships. These check-ins can also help you spot a burned-out employee.

    Should you notice signs of burnout in one of your employees, address the situation head-on by scheduling a one-on-one meeting to determine ways you can work together to reverse the symptoms before they escalate.

    Delegate tasks evenly

    When you’re understaffed, it’s easy to see how employees can become overworked or overwhelmed. Just make sure it’s not one person carrying the entire team. A study by the Families and Work Institute found that almost one in three employees feel overworked or overwhelmed by the amount of work they have to do.

    Overloading employees can cause stress and increase the chance of burnout if the weight of responsibilities becomes too much.

    If your employees are downing in a sea of work, it’s up to management to provide the life rafts—not add stress by upping the workload. To prevent work overload, distribute job responsibilities fairly, monitor scheduling, set reasonable deadlines and arm your employees with the tools and resources needed for them to be successful. Even more than that, create a culture where the word “no” is respected.

    Foster creativity

    On the flipside of being overworked, burnout can also occur when employees are bored or under-stimulated. A Gallup study found that about two-thirds employees are disengaged on the job, which means they are not performing to their full potential.

    Creativity helps maintain mental fitness by keeping the mind sharp and increasing engagement and motivation. Holding brainstorming meetings or inviting employees to participate in decision-making processes can be great ways to keep employees engaged.

    Additionally, sending employees to training courses or conferences can rejuvenate employees, boost productivity and help not just them, but also your company reach its full potential.

    Encourage breaks and vacation time

    Vacations are good for more than fancy drinks with tiny umbrellas in them. A 2015 study by the American Psychological Association found that vacations make for great stress relievers, which can help prevent burnout.

    But don’t think that just because your organization has a vacation policy that workers will actually take advantage of it. Many employees think they can’t take time off over fear of being replaced, they’re burdened by too heavy of a workload or there’s simply no one else who can cover their work while they’re gone. Perhaps that’s why 52 percent of employees left unused vacation time on the table in 2018, collectively throwing away 705 million vacation days, according to the U.S. Travel Association’s Project Time Off.

    Not only do you want to encourage your employees to take time off, you need to make sure they stay off. Discourage the practice of working after hours or answering email while on vacation—and lead by example. Allowing flexible scheduling or remote work options can be another way workers can catch a break from the office bustle.

    Show appreciation

    Saying “please” and “thank you” is more than just polite manners. A study conducted by Clear Review, a performance review software system, found that the top workplace frustration is a lack of appreciation regarding performance and effort, with 40 percent of employees saying that employee recognition isn’t a priority at their company and thus limited their motivation to truly excel.

    Give credit where credit is due by showing your employees their hard work is appreciated. Recognizing accomplishments and top performers can help increase employee engagement. It also provides management with an excellent opportunity to provide feedback and guidance for an employee’s growth and development.

    A few ways you can show your appreciation could be as simple as a round of applause in a meeting or celebratory lunch, presenting an award, or rewarding an employee with a promotion and/or pay raise.

    Ignoring the warning signs of employee burnout and promoting dysfunctional organizational standards can create a serious burnout epidemic for your organization. However, leaders can work to eliminate burnout by being proactive and taking measures listed above. Decreasing job stress and creating work-life balance will help drive your organization’s continued success by reducing burnout and raising engagement, productivity, retention and revenue.

    Contact Group Management Services today to talk with one our experts about job burnout solutions for your organization.

  • It’s easy to recognize certain milestones, but it’s not as simple to think ahead and avoid growing pains. Reaching the 50-employee threshold is a momentous occasion, but it also means that it’s time to consider some potential changes. Aside from taking the right steps to make sure your company is compliant with federal and state laws – don’t worry, we cover compliance considerations in another post – here are five ways to prepare your business for growth.

    A management team helping run a 50-employee business. 

    Embrace Process Documentation

    As you employ more people, it’ll be harder to keep everyone on the same page. You may know the most efficient way to complete something, but you can’t always be there to share this knowledge. Is there a specific way that something at your business should be done? Write that process down so that everyone has access to it. 

    Process documentation allows you to identify the core parts of your business and document the steps that it takes to consistently perform important tasks the right way. As you grow, these standard operating procedures can help train and guide new employees so that they know what to do and how to do it. 

    You should also document any tools or procedures that make a process more efficient. Creating operational best practices or process templates will benefit your workforce, while making your business more efficient. Make these documents available to your employees so that they save time instead of starting everything from scratch.

    Improve Company-Wide Communication

    Good communication is a crucial for any organization, but it can be hard to keep your company connected as it grows. In fact, it can become nearly impossible to keep regular face-to-face communication possible with everyone, especially if you have employees who work remotely. As a result, it’s important to give you and your employees ways to initiate company-wide conversations. For example, a cloud-based collaboration tool like Slack can help employees stay connected, while video conferencing platforms like Zoom can benefit remote employees and improve communication with clients and customers, depending on your business.

    In addition to providing more ways to communicate, you should also consider creating a comprehensive communication strategy for your business. This strategy can help your company establish a recognizable brand and consistent messaging for people outside of your business. This way, your employees have guidance not only on what to say, but also how to say it. According to the Society for Human Resource Management, a communication strategy should include the following elements:

    • Top-down strategies where senior management sets the tone for a cascading series of messages
    • A budget for various types of communication vehicles depending on need
    • An evaluation process to determine the right messaging for specific situations
    • A method for generating feedback and using it to shape follow-up messages
    • A customized delivery approach with communication materials that are easy to understand

    Entice Employees with New Benefits

    While the 50-employee threshold makes it a requirement for your business to offer health insurance, that doesn’t mean you shouldn’t consider providing other benefits as well. Finding good, new talent – as well as keeping current employees – is critical for a growing company. 

    An attractive benefits package can help you reward your current employees while enticing better candidates to your business. Aside from health insurance, Employee Benefits News found that employees looked for the following types of benefits:

    • Monetary bonuses (54 percent)
    • Paid vacation (53 percent)
    • Retirement plan with defined benefits (51 percent)
    • Flex-time (51 percent)
    • Employer matches for retirement plans (50 percent)
    • Ancillary health insurance benefits (vision, dental, etc.) (48 percent)
    • Paid sick leave and personal days (48 percent)
    • Profit sharing (40 percent)

    In addition to these benefits, consider some other options that may be especially valuable to your employees. Flexible work times and environments are a great perk for employees with young children. Roughly 80 percent of millennial employees show interest in companies that offer student loan repayment assistance. It’s hard to grow without good employees, so think about ways to make sure your benefits package matches the quality and type of job candidates you need to succeed.

    Build a Management Team with Defined Roles

    It’s common for small companies to employ people who can do a little bit of everything. That goes for the owners, as well. While there’s a time where it’s fine to juggle multiple roles, you’ll reach a point where you need to build a management team and assign different responsibilities.

    It can be hard to step away from having a hand in every aspect of your company, but you can’t be an expert at everything. Consider creating an organizational chart and identifying people who can oversee key aspects of your company. This management team can take the burden off you so that you can focus on what you’re best at – the continued growth and success of your business.

    Find an HR Partner

    A good management team isn’t the only group that can help you ease your workload. A growing company has a mounting list of internal administrative responsibilities, from handling payroll for all your employees to taking the measures required to keep your business compliant with federal and local laws. Proper management of these responsibilities take both HR expertise as well as time. Fortunately, a Professional Employer Organization (PEO) can help you on both accounts.

    The right PEO allows you to cost-effectively outsource critical HR functions so that you can spend your time elsewhere. A PEO partners with your company to co-employ your workforce as it relates to payroll administration, employee benefits, and any other functions that you need managed. This process gives you access to a range of HR experts who help you make informed business decisions without losing control of your company.

    You don’t have to grow your company by yourself. Whether you just hit the 50-employee milestone or only have a few workers, Group Management Services can help you manage key administrative needs. Contact GMS today about how we can make your business simpler, safer, and stronger through comprehensive HR services.

  • The 50-employee mark is more than just a milestone; it’s also an important number for some major regulation requirements. Once your business has 50 full-time employees, various federal and state laws become mandatory, which can wreak havoc on your business if you don’t prepare for them. Here’s what your business needs to do to stay compliant once it reaches 50 full-time employees.

    Multiple employees during a training session at an applicable large employer.

    Health Insurance

    While smaller businesses can choose to offer health insurance, it becomes a requirement once your business reaches 50 or more full-time or full-time equivalent employees. At that point, the Affordable Care Act designates your business as an applicable large employer (ALE).

    Any ALE is required to meet the employer shared responsibility provisions found in the Affordable Care Act. These provisions give ALEs two options:

    • Offer health coverage that the ACA deems “affordable and provides “minimum value” to full-time employees and their dependents
    • Make a payment to the IRS any of the ALE’s full-time employees receive a premium tax credit for purchasing individual coverage on a Health Insurance Marketplace

    In addition to offering coverage – or opting to not offer coverage and pay penalties – ALEs are required to report to the IRS about their health care coverage. This means every ALE must file both Form 1095-C and Form 1094-C to the IRS, as well as a similar statement for each full-time employee.

    Determining full-time equivalent employees

    You may have noticed that threshold to be considered an ALE was set at 50 full-time or full-time equivalent employees. This means that you don’t need 50 strictly full-time employees to meet ALE designation if you have enough part-time individuals to qualify.

    Full-time employees include any worker who averages at least 30 hours of service per week in a calendar month. Full-time equivalent employees are a combination of individuals who do not meet full-time specifications, but whose combined work is determined to equate to that of a full-time worker.

    Per the IRS, there is a two-step process to determine the number of full-time equivalent employees at your business.

    1. Combine the number of hours of service of all non-full-time employees for the month (do not include more than 120 hours of service per employee)
    2. Divide the total by 120

    The total number represents a company’s number of full-time equivalent employees. That total would then be added to the number of regular full-time employees. If the combined number is at least 50 – for example, 40 full-time employees and 10 full-time equivalent employees – your business is considered an ALE.

    Family Medical Leave Act (FMLA)

    Unlike the Affordable Care Act, the Department of Labor (DOL) does not look to full-time and full-time equivalent employees to determine which businesses must comply with FMLA. Instead, the DOL simply writes that “private employers with at least 50 employees are covered by FMLA.” FMLA also applies to businesses with fluctuating workforces as long as they had at least 50 employees for 20 or more total workweeks in the current or previous year. These employees must then meet the following stipulations to be eligible for FMLA:

    • Work for the employer for at least 12 months
    • Work at least 1,250 hours during the 12 months before the start of leave
    • Work at a jobsite where the employer has at least 50 employees within 75 miles

    If eligible, employees are entitled to take unpaid, job-protected leave for various permissible reasons. These include taking up to 12 weeks of leave in a 12-month period for the following:

    • The birth of a child and to bond with the newborn child within one year of birth
    • The placement with the employee of a child for adoption or foster care and to bond with the newly placed child within one year of placement
    • A serious health condition that makes the employee unable to perform the functions of his or her job
    • To care for the employee’s spouse, son, daughter, or parent who has a serious health condition

    FMLA Compliance requirements

    Covered employers must also take steps to notify employees about FMLA rights. The first step is to display an FMLA poster prepared by the DOL at all locations. The next is to provide general notice with the same information as the poster in the employee handbook. If no handbook exists – and it absolutely should – employers must distribute a general notice to all employees and any new individuals when hired.

    As expected, the FMLA has penalties in place for any employers who meet the 50-employee threshold who deny or interfere with permitted leave or fail to meet notification requirements. Updated penalty amounts can be found on the DOL website.

    Miscellaneous State Laws

    Only looking to federal requirements can land your business in hot water. Certain states have their own regulations for businesses once they reach the 50-employee threshold. One of the more notable examples is that New York employers with 50-plus full-time employees must give at least 90 days’ written notice for mass layoffs, employment losses, or relocations. This law is a variation of the federal Worker Adjustment and Retraining Notification Act (WARN), which only applies to businesses with at least 100 employers. As a result, you’ll want to consult with your state government’s site to review any local laws that go into effect at the 50-employee threshold.

    Prepare Your Growing Business

    Growth is great, but it can become a major problem if you aren’t prepared for the additional compliance concerns and internal responsibilities. More employees mean more time spent handling payroll management, benefits administration, and other key HR needs – unless you find a partner that can manage these critical functions and save you much-needed time.

    Whether you’re a startup or a 50-plus employee business, Group Management Services provides professional HR management to help you make your business simpler, safer, and stronger while you focus on ways to grow your company. Contact us today to talk to one of our experts about what we can do to help you protect your company now and prepare for the future.

  • Human resources are one of the most important components of any small business. However, the responsibilities often fall to the owner or an executive, as many small businesses don’t have the capacity for a designated HR department or full-time employee. Often, managing these HR functions in-house creates many challenges. 

    Small businesses find it helpful to outsource human resource management.

    Small Business HR Challenges

    When you devote so much time to growing your business and improving your products and services, how are you supposed to find the resources to manage HR? From recruitment and retention to payroll and benefits, it’s important that HR doesn’t fall by the wayside in a small business. Deficiencies in any of these areas could result in:

    • Non-compliance fines
    • Lack of talented employees
    • Inefficiencies that slow down your production cycle

    Below, we identified some of the most common HR challenges for small businesses and how you can overcome them.

    Hiring process

    Hiring new employees is a major time and financial commitment for a small business. When job ads and interviews are improperly handled, the recruitment process can quickly become a time-consuming headache. 

    For one, it takes an average of 23 days to find the right candidate, according to Glassdoor, taking time away from other important projects. For more technical positions, it can take a lot longer. On top of that, poor job descriptions can attract non-qualified applicants, eating away even more time to manually sift through each resume.

    A hurried interview process or failing to ask the right questions can then result in bad hires, which can cost nearly $15,000 according to CareerBuilder. While many small businesses rely on referrals when it comes to hiring, interviews need to be consistent and conducted in a way that attracts quality talent and provides a clear path toward making a job offer.

    Employee training and safety

    Once employees are hired, having HR resources can be a great asset during training to prevent costly errors and even injuries from occurring. However, many small businesses simply don’t have the time to properly train new hires, which could affect workplace safety.

    According to the National Safety Council, a worker is injured on the job every 7 seconds, with 25 percent of these injuries caused by contact with objects and equipment. Proper training can help prevent workplace injuries like sprains, strains, cuts, lacerations, and punctures as well as promote morale and retention.

    Employee handbook

    Along with poor training, new employees may look to the employee handbook to gain a better understanding of the work environment and job expectations. When was the last time you updated your handbook? An outdated employee handbook can cause miscommunication and even legal issues for a small business. Employee handbooks should be updated at least annually to reflect the ever-changing employment laws and regulations.

    Payroll

    For small businesses, managing payroll and filing taxes can be a time-consuming and challenging task. Small and mid-sized companies spend an average of $2,000 per employee each year to handle payroll, according to PricewaterhouseCoopers. Proper bookkeeping and tax filing may be a hassle, but they play an integral role in the success of your business when it comes to avoiding compliance issues. The IRS found that 40 percent of small businesses incur an average of $845 in penalties each year, which can be a huge financial burden.

    Employee time tracking

    Depending on where you live, you’ll need to comply with local, state, and federal laws regarding vacation, paid leave, breaks, and overtime for your employees. Without a solid time tracking system in place, it can be difficult to ensure your employees are being paid fairly. Utilizing an online platform can help save time and energy for both small business owners and their employees.

    Employee benefits

    In order to attract and retain top talent, it’s important for small businesses to include quality benefits in their employees’ compensation packages. Employees want comprehensive benefits that include everything from health insurance to retirement plans to supplemental insurance. However, many small businesses find that it can be very expensive and time-consuming to purchase and manage these benefits on their own, compared to the buying power of group benefits.

    Employee compliance

    Small businesses must adhere to federal regulations, and failure to comply is common and costly. Perhaps the most common compliance issue for small businesses is employee misclassification. According to the U.S. Department of Labor (DOL), up to 30 percent of audited businesses had misclassified employees. Many misclassify workers as contractors in error, so it’s important to know the difference. While the consequences vary depending on whether the DOL and IRS deem the misclassification intentional or unintentional, it can be a costly mistake. 

    Other laws include the Fair Labor Standards Act (FLSA), Equal Pay Act, and Americans with Disabilities Act (ADA), to name a few. It’s important to stay educated on these federal regulations in order to stay compliant.

    Conflict resolution

    When growing a business, there is a potential for conflict in the workplace, and ignoring it can cost time and money. A study by professional training and coaching company CPP, Inc. found that 85 percent of employees experience conflict in the workplace. Workplace conflict wastes nearly three hours per week, costing billions in paid hours. Not having an HR resource to properly handle conflict resolution will only take up more time and money in addition to dampening employee morale and retention rates.

    Employee retention

    When HR management issues aren’t handled properly, it can be difficult for small businesses to retain quality employees. According to the Society for Human Resource Management (SHRM), retention is a growing problem for many, with the average turnover rate sitting at an unhealthy 18 percent. Running the gamut from bad hires to insufficient benefits to conflict issues, employees are less likely to stay with companies that don’t take initiative when it comes to HR management.

    Your HR Solution

    Between recruiting and retaining employees to managing employee performance, there are many challenges small businesses face when it comes to the responsibilities of HR management. Outsourcing HR through a professional employer organization (PEO) like Group Management Services can help small businesses save time and money, while allowing you to focus on growing your business. 

    GMS provides comprehensive HR services, including payroll administration, risk management, employee benefits, and more. Additionally, GMS can perform HR audits to help your business improve HR functions in a fraction of the time. Contact GMS today to see how we can help you cover these challenges in human resource management, so you can focus on your core business.

  • The first wave of minimum wage increases hit New Jersey employers July 1 after state legislators reached the deal earlier in the year. However, business owners need to prepare themselves for more than just this initial wage boost. Here’s what New Jersey employers need to know about New Jersey’s plan to raise the minimum wage to $15 – and why business owners across the country should pay attention.

    A small business owner accounting for increasing minimum wage.

    Breaking Down New Jersey’s New Minimum Wage Deal

    As of July 1, 2019, the minimum wage in New Jersey is now $10 per hour, but it won’t stay there. The new minimum wage deal instituted regular intervals for wage increases. The current $10 rate is set to increase to $11 starting Jan. 1, 2020. From there, it will go up by $1 every subsequent Jan. 1 until capping out at $15 in 2024.

    That’s not necessarily the end of any potential minimum wage increases, however. After 2024, any additional increases are “tied to the consumer price index for all urban wage earners and clerical workers, or CPI-W,” per NorthJersey.com. These changes would go into effect Jan. 1 of every year after 2024.

    Of course, there’s more to the new deal than just one set of minimum wage rollouts. There are some exceptions where certain types of workers will follow an alternative rollout. These include the following groups:

    Seasonal workers or employees with five or fewer workers

    The minimum wage rate is drawn out for these groups compared to the normal rollout. These types of employees are still currently at $8.85 per hour and follow a modified timeline.

    • $10.30 – Jan. 1, 2020
    • $11.10 – Jan. 1, 2021
    • $11.90 – Jan. 1, 2022
    • $12.70 – Jan. 1, 2023
    • $13.50 – Jan. 1, 2024
    • $14.30 – Jan. 1, 2025
    • $15 – Jan. 1, 2026
    • CPI-W-based increases plus parity to make up any remaining difference between standard minimum wage

    Tipped workers

    The take-home pay for these workers follows the same structure as the normal minimum wage rollout, although the how they’re paid is different. Tipped employees must receive at least minimum wage through the combination of salary and tips. The new rollout updates the salary floor for these workers accordingly:

    • $2.63 – July 1, 2019
    • $3.13 – Jan. 1, 2020
    • $4.13 – Jan. 1, 2021
    • $5.13 – Jan. 1, 2022
    • CPI-W-based increases starting 2025

    Agricultural workers

    Unlike other groups, agricultural workers will cap out at $12.50 before being tied to CPI-W. Like seasonal employees, these workers are still at $8.85 and follow an adjusted timeline

    • $10.30 – Jan. 1, 2020
    • $10.90 – Jan. 1, 2022
    • $11.70 – Jan. 1, 2023
    • $12.50 – Jan. 1, 2024
    • Any further changes depend on future wage raises

    How Employees Can Prepare for Minimum Wage Increases

    When it comes to minimum wage, there’s not much you can do as a business owner except prepare your business for the future. The first step for this is to convert your payroll every time minimum wage increases. If you don’t, the state of New Jersey can dole out fines of up to $1,000 and an “administrative fee equal to not less than 10 percent or more than 25 percent of any payment due to employees.”

    You’ll also need to evaluate how the slate of minimum wage increases affect your employees and what it will do to your profitability. This can mean planning out price adjustments for products and services over the next several years to account for the set wage increases. Meanwhile, you can potentially use the new rates to find better employees if you have the financial wiggle room to do so. Offering a little more than minimum wage may make your business more attractive and give you more interested candidates. From there, you can choose the best employees if you struggle to find good talent.

    Prepare for the Future with Proper HR Management

    The new minimum wage deal is a big change for business owners in New Jersey. However, employers outside of the state should also take notice. New Jersey, along with California and New York, serve as a sort of testing ground for changes like this. If the minimum wage increases do well in New Jersey, other states may look to adopt similar increases as well.

    Whether you own a business in New Jersey or some other state, it’s important to make sure you keep up with current and future legislature. As a Professional Employer Organization, GMS not only helps you stay compliant, we can save you time and stress by managing key business functions like payroll, benefits administration, and other important services.

    Ready to prepare your business for the future? Contact our New York office or one of our many other locations today to talk to one of our experts about how we can help you make your business simpler, safer, and stronger.

  • When you’re thinking of starting a business, your passion is ultimately what drives you to provide the best product or service. The first thing that comes to your head is not about the technology you need for payroll, or how you are going to recruit top talent. Need an employee handbook? “I’ll type something up real quick.” 

    These are just a few of the many human resource topics you can easily put on the backburner without realizing the full scope of responsibilities you now carry as a business owner. As for the future of HR, it’s only getting more crucial for businesses to stay compliant with laws and stay protected.

    Two small business owners responsible for many HR functions, including payroll and taxes. 

    HR Responsibilities for New Business Owners

    The U.S. Small Business Administration puts the followings tasks under human resources:

    • Recruitment and hiring
    • Payroll and benefits
    • Employee retention and compensation
    • Laws and regulations

    Recruiting can be a difficult and frustrating process. Doing it the right way, the first time, will save you time and money to produce the best results down the line. This can result in hiring committed, talented, and loyal employees that will benefit your company and your bottom line. “Where do I even start,” you may ask. A job description and an employee handbook can get the ball rolling, but you must write both correctly to save yourself in the long run. According to HR Dive, 72 percent of hiring managers say they provide clear job descriptions, while only 36 percent of candidates agree.

    Once you have employees, you must have a system for payroll. Again, you may not know where to start. You know how much you want to pay your employees, but now you must log hours, file taxes, and keep up with your own finances. This is where retention and compensation come into play as well. Keeping up with workers’ compensation, healthcare, 401k, and all other benefits go hand in hand with retention and compensation. According to MetLife, 51 percent of employers say using health and wellness benefits to maintain employee loyalty and retain talent will become even more important in the next three to five years.

    Lastly, staying on top of laws and regulations can be overwhelming because of how often they change. Failing to put these new regulations into place can result in legal issues, which is why it is essential to stay on top of them. Dozens of new laws take effect yearly and as an owner, you are responsible for making sure your company is compliant. 

    Set Your Business up for HR Success

    Preparing for the future of HR can be simple with the right resources. Being able to embrace change, technology and the new workforce is essential. Now what can GMS do for you? GMS is a Professional Employer Organization that puts all of your HR responsibilities under one roof for your company. We have the HR experts who will keep your organization up to date with the latest regulations, making sure you and your workforce are protected. 

    GMS has you covered when it comes to areas like payroll, tax, human resources, risk management, benefits, and healthcare. We help you reduce costs, limit your business risk, and save time and money when it comes to HR administration. Contact GMS to see how we can help manage and benefit your organization!