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  • On November 19th, President Biden’s $1 trillion Infrastructure Law (Infrastructure Investment and Jobs Act) was passed by the House after months of delays and will now be sent to the Senate to approve. The White House is projecting that this bill will create 2 million jobs over the coming decade. However, many are worried about where the funding will come from. 

    This bill will deliver $550 billion of new federal investments in American infrastructure over five years, which will touch everything from bridges and roads to the nation’s broadband, water, and energy systems. Also included in this bill are expanded child-care, paid leave, expanded healthcare coverage, an extension on child tax credit payments, green energy investments and tax credits, universal pre-K, affordable housing, and various other programs.  

    One upside for some is that this could create many jobs in construction, transportation, and energy. The New York Times goes on to describe that if there isn’t enough labor to keep up with the demand, then Biden’s plans could be set back. In an already-tight labor market, employers can expect even more hiring hurdles, should the bill be approved. 

    Employers in the construction, transportation, and energy industries should be proactive in recruiting talent and growing their workforce. GMS can help by creating a hiring plan for your company, streamlining your onboarding process, and ensuring a seamless payroll. Contact us today.  

  • When you own a business, salaries are a big deal. According to the Society for Human Resource Management, employees’ wages can account for 18% to 52% of your operating budget. Your employees play a key role in the success of your business and an efficient employee compensation plan is important for ensuring the pay structure of your business is working properly. A formal compensation structure can help your business manage salary expenditures and retain top talent that will help your company grow.

    What Is A Compensation Structure (And How Can It Help My Business)?

    A compensation structure, also known as a salary structure, is a framework that a business uses to determine compensation. A good structure sets pre-existing guidelines to delegate these pay increases in a fair, unbiased manner, as opposed to using inconsistent factors like negotiation or previous salary history. A formal structure typically includes standards for the following forms of compensation:

    • Starting salaries for various positions.
    • Managing when and how raises are addressed and awarded.
    • Distributing bonuses and commissions.

    Formalizing how you compensate your workers achieves a couple of goals for your business. To start, it creates a structure where you can create accurate staffing projections going into the hiring process, while allowing you to map out how future raises and bonuses will impact your total salary expenditures.

    A formal salary structure also gives employees more insight on how pay decisions are made. This information allows you to justify decisions with existing data and make the criteria for salary adjustments clear to everyone.

    Types Of Compensation Structures

    The good news about creating salary structures is that you don’t have to invent the wheel. There are some established compensation structures out there that you can adopt and adapt as needed. These include the following structures:

    • Broadband
    • Grade and range
    • Step
    • Market-based

    Broadband structures

    A broadband approach is a more traditional structure that was common for older companies. This type of structure creates “bands” of earnings that are based on seniority and position levels. As employees move up the hierarchy and stay with the company longer, they can move up to new bands.

    Broadband structures were very popular when people tended to stay in one job for most or all of their career. These structures typically have fewer bands, but each band has a broad salary range and multiple positions within each band.

    This type of system is good for rewarding employees who acquire new skills to advance from one band to another, or for companies who want extra flexibility in determining pay and promotions within a single band. However, the length of time it can take to move from one band to another may not appeal to ambitious young workers who want to be recognized for their achievements.

    Grade and range structures

    Grade and range structures are similar to broadband structures, but the “bands” are usually much smaller and are not tied to length of tenure. Every grade allows a company to group similar jobs together within and base that grade’s range on market rates, overall responsibilities, and organizational value. As employees advance to new higher grades, businesses can increase the salary range and earning potential to accommodate that level of value.

    The added bands allow for more flexibility to jump from one pay grade to another, rewarding employees that perform well. A series of grade levels allows business owners to visualize each level of responsibility and communicate them to employees. These qualities make grade and range structures a natural fit for larger businesses, companies with extended management hierarchies, and organizations with diverse roles who want more flexibility to promote employees earlier without as much of a commitment as broadband.

    Step structures

    While broadband and grade structures take increased skill or responsibility into account for promotions and hiring, step structures are much more focused on length of service. “Stepping” sets up a structure where employees receive fixed pay rate increases based on a pre-set schedule. For example, an employee with four years of experience would make more than one with two, depending on your stepping schedule.

    Step structures offer a couple of key advantages for both employers and employees: they’re easy understand and simple to manage. This type of compensation structure usually involves smaller increases per step, but employees will advance predictably up the ranks. Employees can very quickly understand what it takes to increase compensation, while employees can easily automate salary adjustment and forecast future expenditures based on set dates.

    These advantages make step structures a natural fit for businesses with smaller compensation budgets or those that want to ensure steady increases to company spending. Organizations that prefer to tie their compensation philosophy to tenure instead of individual performance will also find step structures appealing.

    Market-based structures

    Market-based salary structures are less about what is happening inside your company and more about external factors. Businesses with this type of philosophy will base salaries and proposed pay increases on data gathered from outside sources.

    This approach allows employers to benchmark starting salaries and promotions around what the market pays for similar positions. Businesses can then evaluate other external factors – cost of living, average compensation by location, etc. – to adjust their structure to their needs. For example, a business in a smaller market may offer slightly lower salaries than big cities because the cost of living is lower. By benchmarking salaries, businesses can be flexible enough to compete with the market for top talent.

    How To Create Your Salary Structure

    Now that you know the various salary structures, it’s time to create one that‘s best suited for your business. This process depends requires a few key steps to not only identify which type of structure is right, but also put that plan in motion.

    Identify the value of each position in your company

    Even though there may be salary data available for specific roles, they aren’t specific to your business. Take some time to evaluate just how essential each role is to the operations of your company. If a job is critical to your success, you may want to put that role in a higher pay grade or adjust your structure accordingly. This process will help you cater your structure to your exact needs so that you can attract and retain talent for pivotal positions while balancing your expenditures.

    Consider how your company stands compared to your market

    Your place in the market can dictate a lot about how you approach your employee compensation structure. This process involves asking yourself a lot of questions. For example, do you need to pay employees more than market-level wages to retain key talent? Do you need to adopt a lower-than-market strategy to stay within budget? Are employees in your market more likely to stay with your company for a long time?

    Each answer will help dictate which approach is right for your company. Identifying opportunities in your region and industry can help you balance what’s most valuable to your business with what you need to pay to compete with competitors.

    Formalize your compensation structure and align current employees with your strategy

    Once you have the answers you need, you can build a compensation strategy tailored to your needs. This compensation plan should include a detailed breakdown of each salary range, pay grade, or steps so that nothing is left unanswered. Document everything from minimum and maximum salaries for each position, timelines, and other details that pertain to your structure of choice.

    It’s also important to remember that this new structure applies to not only future hires, but also current employees. Take some time to evaluate your current employees’ salary rates and see how they compare to your new structure. You may find that some workers are behind – or ahead – of where they would be in the new system.

    Create a plan to have these outliers align with your new structure. For people behind schedule, that may call for greater increases to help them hit their expected minimum rate. Meanwhile, employees that are well ahead of schedule may call for a pay freeze or smaller increases until they match the compensation you identified as appropriate for your structure.

    Build a Compensation Structure That’s Right for Your Small Business

    Creating a new employee compensation plan is a daunting task for small businesses. It’s not just about money – these decisions also need to factor in the costs of hiring and training employees, navigating payroll, and the ever-present need for compliance. That’s why it’s helpful to go through these processes with the right partner.

    GMS works with small businesses to give them the tools and support they need to grow. Our experts can work with your company to implement salary structures that not only help you attract and retain key employees, but also work with your bottom line.

    Are your ready to make your business simpler, safer, and stronger? Contact GMS today to about how we can help you save time and money through payroll administration and other HR strategies.

  • As a small business owner, it’s essential to understand how different events affect your bottom line. Sometimes this process is as easy as checking an invoice, but other cases are not quite as clear. This is exactly the issue when it comes to employee separation costs.

    Losing an employee costs you more than just a member of your business. The departure of an employee can cost your business in a variety of ways. Let’s break down the reasons for employee separation, the true costs of employee turnover, and what you can do to prevent talented people from leaving your business.

    The Costs Associated with Employee Turnover

    When an employee leaves your company, it has a number of direct and indirect financial impacts on your business. Unfortunately, you won’t receive an itemized bill that helps you understand the cost and implications of turnover. Instead, you’ll need to recognize the different factors that will impact your business’ bottom line.

    Exact employee turnover costs vary depending on the employee and the nature of your company. However, the Society for Human Resource Management (SHRM) reports that it costs an average of half to three-quarters of an employee’s salary to replace that individual. For an employee who makes $50,000 a year, it could cost your business roughly $25,000 to $37,500 to find, hire, and train that person’s replacement.

    Those estimates can balloon even higher depending on the position. It can cost more than an entire year’s salary to replace technical or supervisor positions. Meanwhile, turnover for hourly employees can quickly add up as well, with an average turnover cost of $1,500 to replace each person.

    Of course, estimates are only one part of the employee turnover puzzle. It’s also important to understand exactly why those costs are as high as they are. Here are some of the factors that go into calculating the cost of employee turnover:

    • Recruiting and hiring costs
    • Onboarding expenses
    • Lost productivity
    • Reduced employee engagement
    • Increased risk of errors

    Recruiting and hiring costs

    Any time you must hire a new employee, it’s going to take some time and money to do so. To start, you’ll need advertise your open positions. Some jobs may even call for a recruiter to help you find the right person to fill the position. 

    Recruiting costs don’t stop with that initial search, either. Once you find some qualified candidates, your managers and supervisors will have to take time away from their jobs to interview and vet them. This is especially true for any job searches that last for months. As you may know, time is money, so any extra time spent will add to employee turnover costs.

    There are also a number of other expenses that can add up once you find the right fit for the role. For example, you could have additional fees for background checks, drug screenings, and other pre-employment assessments. These measures are important to ensure that your hire is the right person, but they do add to your overall hiring expenses.  

    Onboarding expenses

    Hiring an employee is just the first step – you will also need to spend time with onboarding and training. This process will incur a number of additional expenses to get your latest team member up to speed. 

    The exact onboarding costs can depend on your business, but employee training is a pretty common expense. The average company spends 31.5 hours training a new hire, which adds up to an average of $1,888 in training and development costs for businesses with fewer than 500 employees. You’ll also need to factor in how much it’ll take to provide that new employee with the tools to do their job, whether that means a computer, certain supplies, or other needs.

    Lost productivity

    The goal of hiring someone is to boost productivity and improve your business operations, but it will take some time to get them up to speed. The person will need to learn the processes that are unique to your business, as well as any new systems they will be required to use. 

    Someone will also need to help them get started and be available to answer their questions along the way. This will result in lost productivity for the rest of the team as well since they’ll need to take time away from their jobs to assist them. 

    Reduced employee engagement

    Anytime someone leaves your company, there can be ramifications for the employees left behind. Other individuals may start to question why that person left and what their future might look like at your firm. Depending on their outlook, they may start looking for another opportunity as well.

    A departing employee can impact your remaining workforce in other ways as well. You may see reduced engagement from any employees who end up having to cover for a temporarily vacant role. This process will not only force them to spread themselves thin, it can also leave them feeling burnt out from the extra hours and impromptu responsibilities. As a result, that transition period could spur further turnover down the road. 

    Increased risk of errors 

    When you lose an employee, you also lose important knowledge and experience.  Following, turnover can easily result in reporting errors or other costly mistakes. Even if you spend extra time to help ensure these errors don’t occur, that simply means you or someone else is spending extra time to address something that your departing employee handled regularly.

    How to Prevent Your Talented Employees from Leaving

    The best way to reduce the cost of employee turnover is to keep your talented employees from leaving in the first place. It’s important to assess the different reasons why high voluntary turnover occurs. 

    There are a variety of reasons why people leave a company. By identifying contributing factors for employee turnover, you can take appropriate measures to reduce avoidable turnover costs. Let’s evaluate a few ways that you can retain top talent, avoid wrong fits, and reduce your employee turnover costs.

    Offer a competitive benefits package

    Losing employees is an expensive process. Offering competitive pay and benefits can help limit the chances that employees try and leave for a small raise or certain work perks.

    It’s important to consider what perks employees truly find valuable in order to attract and retain top talent. It’s not uncommon for employees to value key benefits more highly than their pay, which makes an appealing benefits package a powerful retention tool. Some of the top benefits included:

    • Better health, dental, and vision insurance
    • More flexible hours
    • More vacation time
    • Work-from-home options
    • Paid parental leave

    Improve company culture

    Your company’s culture has a significant impact on employee satisfaction and can determine whether they stay or go. Creating a culture that fosters a positive work environment, encourages work-life balance, and recognizes employees will help you attract and retain top talent. 

    According to research conducted by LinkedIn, 47 percent of employees want to work for a company with a welcoming culture, while 51 percent of professionals seek employment at businesses that promote work-life balance and flexibility. Fortunately, benefits such as work-from-home options and flexible hours offer the dual perk of making your business more attractive and helping employees avoid burnout and other issues. That level of support can make your workplace a space where employees don’t want to leave.

    Recognize employees

    Establishing procedures to recognize employees is also essential to boost engagement and retention. Over 70 percent of companies report that employee recognition had the highest impact on engagement. As such, it’s important to make sure that employees know they’re appreciated.

    Consider implementing a formal recognition program that incorporates ideas like employee spotlights and peer recognition. Recognizing the individuals that work hard to contribute to the success of your business will improve morale and create additional incentives to perform well.

    Monetary prizes aren’t the only options either. Get creative with other ways to reward your employees, like an extra day off or an experience that they can enjoy. Even short conversations expressing your appreciation for an employee’s work can go a long way toward making them feel good about where they work. 

    Provide potential for growth

    One reason why employees leave is because they don’t think there’s a future with their current company. Giving employees the tools they need for career development can help them feel like they can continue to grow at your business.

    Growth can come in many forms – opportunities to advance in the company, stipends for development, etc. Regardless of the form the prospects take, nearly 95 percent of employees would stay with a company longer if they had access to learning opportunities. These efforts can play a key role in limiting employee turnover, so work with your employees to create employee development plans, provide training, and put measures in place to invest in your team.

    Welcome employee feedback

    One of the best ways to understand why people leave your company is to ask for feedback. If you’ve noticed that employee turnover has increased or want to address any issues before someone leaves, talk to your employees about what they value and encourage feedback regarding what you could do better.

    Collecting feedback is not enough though – you need to listen to them and implement their ideas to make them feel valued at your company. Making changes based on thoughtful, serious feedback shows your current workforce that you’re listening. That step along can make a major difference in morale and show your employees that they’re heard.

    When someone does choose to leave, conduct an exit interview to determine why. Use this interview as an opportunity to learn from your mistakes – they will be more likely to share candidly at this point since they are on their way out anyway. This feedback can help you narrow down potential weakness, strengths, and opportunities to improve your company and reduce employee turnover.

    Cut Out Turnover Costs With Employee Retention Strategies

    Losing a talented employee costs your business in a variety of ways. Fortunately, GMS can help you attract and retain top talent and keep your business strong. 

    Our experts can manage key functions like employee training and recruiting and benefits administration to help you find the right employees and keep them on your team. Meanwhile, you can spend that time to focus on growing the business instead of constantly dealing with the hiring process. Contact GMS today about how we can support you and your employees.

  • Hiring a new employee is an exciting occasion for a small business. However, it does call for a lot of paperwork.

    The onboarding process requires new employees to review and sign several documents. These papers range from government forms to records specific to your business. Regardless of their purpose, it’s important to make sure new hires address these documents shortly after they join your company. Let’s break down the various documents required for onboarding a new employee.

    The Different Types of New Hire Forms and Documents

    Onboarding documents have many different functions. Some are needed to collect important information from a new employee. Others are designed to properly inform new hires about certain practices and give them the ability to sign up for certain benefits. Essential onboarding documents are broken up into a few different groups.

    • Initial hiring documents
    • Employee eligibility forms
    • Tax forms
    • General business documents

    Regardless of their intent, it’s best to have employees review and sign these documents on their first day if possible. While the paperwork may not be all that exciting, it’s best to get these steps out of the way early and create a good foundation for new hires.

    Initial hiring documents

    The onboarding process starts with a job offer. There are a few documents that new hires will need to sign in order to get the job and help ensure that they’re the right fit for a company. As such, all prospective employees should fill out the following documents to get the onboarding process into motion.

    Job application form

    The job application form is the very first official document required to onboard new hires. While this form may seem obvious, it’s crucial to have it on file so that you have information such as work history, education, and personal data available in case any issues were to occur in the future. Some states have requirements for including specific statements in job application forms, so having this document can help you prove that you followed any legal obligations.

    New employees should sign this document to verify all the information and consent to a background check. It’s also important to note that this form should be included even if a job candidate already submitted a resume. You can then hold onto this document for a full year along with any notes or other details documented during the hiring process.

    Offer letter and/or employment contract

    The offer letter is another standard part of adding on a new employee. Still, it’s important to not only give employees an offer letter and employment contract, but also attach a copy to the employee’s file. This inclusion will just give businesses another document to reference in case any issues arise in the future regarding that contract or offer details.

    Drug testing records

    Whether a company wants to drug test a job candidate upfront or conduct tests throughout employment, you’ll need to provide employees with a copy of the company’s drug testing policy. You should also maintain records of any test results for at least one year, although some regulations may increase the minimum time frame for saving these records.

    Employment eligibility forms

    Once you’ve decided on the perfect candidate, the government requires them to confirm their eligibility to work in the United States. There’s only one document that falls under this section, but it’s a very important one: Form I-9.

    Form I-9 requires both the new employee and the employer to fill out parts of the document. New employees must fill out and sign the first section of Form I-9 on their first day of employment. Employers are then required to review the first section for completion.

    Employers also must also fill out the second section of Form I-9 within three business days of the date of hire. This step requires new employees to provide unexpired original documentation to prove their identity and employment authorization. This documentation can come in may forms such as passports, driver’s licenses, Social Security number cards, and more. U.S. Citizenship and Immigration Services provides a complete list of acceptable Form I-9 documents online.

    Once an employer has the required information, they can fill out the remainder of the form. Employers do not need to fill Form I-9, but they should keep it on file for at least three years after the employee’s first day or for a full year after an employee is terminated. This will allow employers to present the form if any authorized U.S. government officials visit the business for inspection.

    Tax forms

    Employment eligibility is just the first step toward completing government-mandated documents for new employees. Employees are also required to fill out Form W-4 so that you can properly manage payroll for their business.

    Form W-4 is used so that employees determine the federal income taxes that their employers should withhold from paychecks. As such, new hires should fill this form out right away so that employers can apply the information toward their first pay period. Some states also have their own version of Form W-4 for local income tax withholding, while others simply use the federal document.

    Employers aren’t required to regularly submit these forms, but they should keep them on file for reference and in case the IRS requests a copy to compare withholdings. Each W-4 should be kept on file for at least four years after these taxes are either paid.

    General business documents

    While some onboarding documents are required by law, many others are simply a means to provide new hires with all the information they’ll need at their new company. These papers can range from means to gather payroll and benefits information to simply giving individuals more detail about their roles and other company materials.

    Direct deposit form

    Direct deposit is a convenient arrangement for both employers and employees, but businesses need some details to set up this payment method. New employees that will receive direct deposit will need to fill out a bank account information form to ensure that their paychecks go to the right place. These forms should require the employees to include:

    • Their full name
    • Bank account number
    • The account type (checking or savings)
    • Name and routing number of the bank

     Benefits forms

    If a business offers a benefits package to its employees, that company should provide information about those benefits to new hires and have them opt in or out of programs. These programs can include:

    • Health insurance
    • Life insurance
    • Retirement plans
    • Disability insurance
    • Wellness programs

    Employers will need to hand out different benefits forms for each offering in their plan. These forms should have details about each offering and give employees the chance to opt in for them if they’re eligible. Even if they opt out, employers should retain those signed documents as evidence that they were informed of benefits options and chose not to enroll in them.

    Mission statement and strategic plan

    Some onboarding documents are simply to help new employees get more accustomed to a business. A company mission statement, strategic plans, or any other relevant documents will help new hires understand the company’s culture and goals. This type of information will help them understand how their role fits in with the organization’s vision and fit in from day one.

    Employee handbook

    As long as an organization has an employee handbook, it’s best to give a copy to new employees right away. A good handbook lays out all the important elements about a business – company policies, procedures, and other key details.

    Handing out a handbook to new employees allows them to consult this document about key questions they may have about an organization. A handbook also serves as a noteworthy compliance tool, acting as proof that employees had prior information about company policies. As such, you’ll also want employees to sign an employee handbook acknowledgment form to verifying they received and read through the handbook.

    Job description and performance plan

    Every employee should be given a clear direction of what their role should accomplish and how their success will be measured over time. Employers should provide new hires with a document that lays out responsibilities, expectations, and potential timelines of what should be accomplished during their first few months. Having employees sign off on this document will not only help them understand expectations, but also provide employers with written guidelines when it comes time to evaluate performance.

    Employee onboarding checklist

    There’s a whole lot that needs to happen in the first few weeks on the job. An onboarding checklist is a detailed action plan that documents all the training, tasks, and other key items that will happen at the beginning of someone’s tenure with the organization. A solid outline will help keep everyone on track and give new employees a sense of reassurance that their new employer has a plan and values their position.

    Security and parking signoffs

    If the job calls for special security or parking details, employers should lay out all that information and arrange for special clearances in time for a new hire’s first day. Employees should receive any forms they need to sign and key items or information related to parking, entrance, and more. These items can include parking passes, keys, and passcodes. Documentation for these items should also include details on next steps if an employee leaves the company or is terminated.

    Emergency contact information and plans

    Everyone hopes that they’ll avoid any emergencies, but it’s important to be prepared just in case. New employees should be given relevant contact information for managers and other individuals in case anything happens after hours. Employees should also provide the company with an emergency contact in case something happens to them on the job as well. Finally, provide new hires with any disaster readiness plans if the company has any created.

    Set Up Your New Employees for Success

    While new hires call for a lot of paperwork, a good onboarding process can make for an easier transition into your company. Of course, gathering all these documents is just the first step in a long process. It’s important to set the right tone for new employees so that they can help your company grow.

    Fortunately, GMS can help your business build an onboarding process that not only sets up new hires for success, but also takes the administrative work off your hands. Contact GMS today about employee onboarding management and other critical human resource functions.

  • In a former life I was a general manager. A large part of my position was screening and interviewing potential new hires. This important yet time-consuming process included:

    1. Phone screening
    2. Background checks
    3. Scheduling initial interviews
    4. Clearing my schedule to make time for interviews
    5. Conducting interviews

    …you get my point.

    Recruiting Takes Major Time

    My assistant managers and I would spend between 1 to 3 hours each week on these administrative functions, depending on the season. That averages out to 100 hours over the course of a year.

    During this entire time I was unaware of the HR and recruiting assistance offered by a professional employer organization (PEO) such as Group Management Services Inc., which would have cut those hours by more than half.

    Saving time – sounds good right? It gets even better.

    Finding the Best Candidates

    In a recent Inc. article, Ed Powers shares this insight about initial recruiting efforts:

    “Get a big funnel. You don’t want to be overwhelmed with candidates who all look the same, but you do want to have enough candidates so that you can be selective within a large pool. Reaching out beyond your usual go-to sources can uncover skilled candidates you may not have realized were out there.”

    When recruiting to add to your team, it’s important to:

    • Have a larger reach of candidates
    • Ask consistent questions
    • Fully comply with EEOC and labor laws

    Who can consistently meet those criteria: your HR recruiting professional from GMS, or you?

  • If your employee injures a co-worker or customer while on the job, your company might be on the line.

    Employers can face negligent hiring charges if a hiring decision results in an employee injuring or harming any person they come in contact with through the job. Not only can negligent hiring result in exorbitant financial costs, but it can also damage the organization’s reputation.

    According to Clint Robison, a partner at Hinshaw & Culbertson, employers lose negligent hiring cases 75% of the time, and the average settlement of such claims is $1 million.

    Negligent Hiring

    There are many elements needed to form the basis of a legal action for negligent hiring or retention. They include:

    • Existence of an employment relationship.
    • Employee’s incompetence.
    • Employer’s actual or constructive knowledge of such incompetence.
    • Employee’s act or omission causing plaintiff’s injuries.
    • Employer’s negligence in hiring or retaining the employee as the proximate cause of plaintiff’s injury.

    Does Outsourcing HR Functions Mean You Lose Control of Your Business?

    Duty of Care and Foreseeability

    The key standards assessed by the courts in a negligent hiring claim are duty of care and foreseeability.

    Duty of Care

    For the employer, there is “the requirement to act toward employees and the public with reasonable watchfulness, attention, caution, and prudence as dictated by the circumstances. If an employer’s actions do not meet this standard of care, then the acts could be considered negligent, and any damages resulting may be claimed in a lawsuit for negligence”.

    The courts commonly assess two things when determining an employer’s duty of care:

    1. Does the employer owe a duty of care?
    2. How much care does the employer owe?

    Employers are expected to take reasonable care .The level of care depends on the nature of the job and the severity of the risk to third parties.

    Foreseeability

    An act is reasonably foreseeable if the employer knew or should have known that the employee had a propensity to engage in similar criminal, wrongful, or dangerous conduct.

    Negligent Hiring Cases: Employer Found Guilty

    There are vast amounts of negligent hiring cases in which the employer was found guilty.

      • A nursing home was found liable for $235,000 for the negligent hiring of an unlicensed nurse with numerous prior criminal convictions who assaulted an 80-year-old visitor. (Deerings West Nursing Center v. Scott)
      • An employee with a criminal record sexually abused a child and his employer was found liable for $1.75 million for negligent hiring and retention. (Doe v. MCLO)
    • A vacuum cleaner manufacturer was found liable for $45,000 because one of its distributors hired a door-to-door salesperson with a criminal record who raped a female customer in her home. (McLean v. Kirby Co.)

    Compliance with the EEOC

    Employers should demonstrate due diligence and the duty of care by performing background checks on potential employees. Criminal background checks can be used as tools for employers to determine foreseeability with regard to employment decisions.

    However, the Creative Commons Attribution 2.0 Generic license.

  • According to Career Builder, 43 percent of businesses check out the social media profiles of potential job candidates to learn more about them. Job interviews can tell you a lot about a candidate, but social media can provide some more information that you may not have been able to find out in a meeting.

    Watching for Social Media Red Flags

    When you’re planning on adding someone to your team, you want to know just what type of person you’re hiring. Social media can show off a whole new side of a person – and it’s not always good. Some red flags that you can find on social media include:

    • Inappropriate photos or messages
    • Bad mouthing their current or past employer
    • Discriminatory messages or comments
    • Evidence of potential illegal activity

    In this day and age, candidates should know that potential employers might be looking through their social media profiles. If they can’t stop themselves from posting those embarrassing photos or that offensive status from a personal account, what’s to stop them from making the same bad decision at work?

    Signs of a Good Candidate

    Warning signs aren’t the only things you can find on social media. A job candidate’s social media profiles can help you get a sense of their personality and what they’re like outside of an office setting.

    If they run a professional, updated profile on LinkedIn, it’s a sign that they are serious about their career. Facebook and Twitter can also serve as a means of information outside of looking for red flags. Social profiles can help you verify some information that the candidate may have given you. Even better, social media helps you figure out a candidate’s personality, allowing you to get a sense of if he or she might be a good fit for your company’s culture. 

    Hire the Right People for Your Company

    You need more than just the right resume for your team; you need the right person. GMS has experts that can help your company with employee recruiting and training services, letting you find the right candidate for your open position. Contact us today to learn more about how GMS can benefit your business.

  • Would you choose a candidate solely based on the fact that they attended the same college as you? How about choosing a candidate based on how attractive they are? If this line of reasoning sounds absurd to you, then you’re right! However, you may unintentionally use that type of information to make a selection.  

    Almost all business owners become an interviewer at some point in their careers. While the main goal of an interview is to evaluate the candidate, it’s also important to understand common interviewer biases. These are preconceived ideas and beliefs that we assign to candidates unknowingly and may ultimately sway our hiring decision.  

    Image of a job interview. Learn about seven interview biases that can sway hiring decisions.

    Seven Common Interview Biases That You Should Be Aware Of

    Stereotyping Bias – Forming an opinion of someone based on gender, religion, race, appearance, or any other type of characteristic. 

    First Impression Bias – Making judgements about an interviewee based on their first impression being positive or negative. 

    “Similar to Me” Effect – Thinking highly of someone who has a similar mind set or personality to the interviewer.  

    Negative Emphasis Bias – When the interviewer receives a small amount of negative information and uses it to base their entire hiring decision off of it. We tend to weigh negative information heavier than positive information.  

    Halo and Horn Effect – The Halo Effect is when the interviewer lets one positive fact about the candidate overshadow everything else they say or do. The Horn Effect is the opposite and allows a weak fact to influence everything else. 

    Cultural Noise – The interviewer’s ability to distinguish between a candidate’s socially acceptable answer rather than revealing their true opinion.

    Contrast Effect – When a stronger candidate interviews after a weaker candidate, they may appear more qualified than they are because of the contrast between the two. 

    These are just a few of the many biases we are subjected to while interviewing. Our recommendation to you is to ask open ended questions, take notes during interviews, ask each candidate the same questions, and be self-aware of the judgments you place into others.    

    Hiring the right job candidate can be a tricky proposition. That’s why Group Management Services offers interview coaching and recruiting services to business owners. Contact us today to learn how we can help find the top talent and grow your team of dedicated staff.  

  • An unexpected departure from an employee can leave owners in a tight bind. Recruiting and hiring a new employee is a big undertaking for any company. Just like employee separation, the replacement process can cost your company a lot of time and money.

    Image of a job interview. Learn about the costs of employee replacement.

    The Costs of Employee Replacement

    Employees leave companies for any number of reasons. No matter the situation, their replacement won’t be cheap. In fact, it can cost up to 50 percent of an entry-level employee’s annual salary to find a replacement. That percentage goes even higher for employees with more experience.

    Replacing one employee can be costly enough. Hitting a period where you have multiple employees leave around the same time can really hurt the company coffers. Just a few departing employees can potentially mean hundreds of thousands of dollars in replacement costs.

    Why Replacement Takes Time

    Even if you’re looking to replace someone quickly, it’s important to try and find the right person for the job. That means spending time to go through the hiring process. Necessary but time-consuming replacement costs during this time include:

    • Recruiting applicants
    • Entrance interviews
    • Employment Testing
    • Pre-employment administrative expenses
    • Medical exams, drug testing, background checks
    • Training costs

    Making a rushed hiring decision can end up hurting you in the long run. Think of the time you spend during the replacement process as an investment in your future. Sure, a person might be able to fill a role right away, but unless you take the time to make sure that they have the right skills and are a good cultural fit for your office, you might end up having to replace them sooner than you’d like.

    Employee Management

    Recruiting and replacement takes time, and sometimes you just don’t have much time to give. Teaming up with a Professional Employer Organization like Group Management Services can allow your company to spend the time necessary to recruit, train, and retain new employees.

    At GMS, we’re in the business of making your business simpler, safer, and stronger. Contact us today to see how we can help with your recruiting needs.

  • Whether your company is growing or you are simply filling an open position, the hiring process can be painstaking for any business owner. Where do you start? Should you post a listing to online job sites? Should you place ads around the local university? Do you set up a booth at a job fair?

    Hiring the right people is not an easy task. It can be a lengthy process that takes away from other priorities, like growing your business. It takes an average of 52 days to fill an open position, according to a recruitment study from Bersin by Deloitte.

    Image of an employee interview. GMS helps businesses with employee retention and hiring decisions.

    The Right Candidate

    Let’s imagine that you have a new opening. The job has been posted and now it’s time for an interview. The candidate shows up early. They look sharp. Their resume shows experience where you need it. They have all the right answers. You make the offer and they accept.

    A month later, you now see an entirely different person showing up at the office. They come in late. They miss deadlines. Your business is now struggling because you’re not getting the work you expected. The U.S. Department of Labor and Statistics notes that the average cost of a bad hire can equal 30 percent of that employee’s first year potential earnings. 

    Whether it’s an employee that develops a bad attitude affecting the general morale, or a person that simply doesn’t meet and exceed the expectations of their position, the effects of a bad hire can be devastating to a small business.

    Employer Liability

    In the end, the person you choose now represents you and your business. As an employer, if you fail to exercise due diligence and someone is harmed by a person you employ, you can expect a lawsuit.

    Accusations of negligent hiring can have lasting consequences. Employers have lost more than 79 percent of negligent hiring cases with settlements of $1 million on average. That is why it is so important to do a thorough background check on job candidates, making the hiring process that much more laborious. 

    Employee Retention

    Once you hire the right person, you want to keep them to avoid having to start the never ending hiring process all over again. A study performed by The Society for Human Resource Management, showed that it costs 6 to 9 months’ salary on average to replace an employee over retaining that person. Between interviewing, screening, onboarding, training cost, errors, and loss of productivity, the process can take a financial toll on small business.

    GMS is a professional employer organization that offers consultation on techniques to aid in employee retention. We can help you retain an engaged and enthusiastic workforce through the use of team building activities, rewards programs, incentives, survey tools, and more.

    We are here to help manage the administrative burdens associated with all aspects of the employee life cycle. You retain full control over hiring decisions – we just make it easier.

    Contact GMS today to learn more about our services and how we can make your business simpler, safer, and stronger.