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Achieving Growth Through Effective Workforce Planning

In my last blog, I discussed the importance of taking some time – now – to plan for the various HR activities that need to occur throughout the year. A good place to start is with your workforce planning. We all want to grow our businesses. But without a clear understanding of the knowledge and skills that will be required to move the business to the next level, this is a difficult goal to achieve.

Workforce planning helps consider the size, type and quality of the workforce you will need to achieve your company objectives. It helps you strategically recruit, hire and develop employees to ensure that you have the right people in the right place at the right time.

Workforce planning can include operational considerations such as work schedules and hours, distributing talent among divisions and departments, identifying functions no longer needed and reassigning workers, and maintaining employee engagement. The more strategic side of workforce planning looks at identifying skills sets needed as the company grows and changes, transferring company knowledge as employees leave, and defining recruitment strategy for future workforce needs.

An effective workforce plan keeps talent in the pipeline for when you have an immediate need. It improves your bench strength by helping you identify and prepare future leaders. And it ensures that you are ready for future opportunities.

Start by defining job roles: the work that needs to be done, and the skills and competencies required for that work. If you’re starting from scratch, you may want to use an employee who is currently doing the work successfully as a model to identify required skills, experience and behaviors, but remember that a job should be designed around the role requirements, not a particular person.

Once you’ve defined and designed the critical job roles to meet your needs today, spend some time thinking about skills/job roles you may need in the future. This will be helpful in identifying skill gaps, and determining whether it makes more sense to hire for those skills gaps or to develop current employees to fill the gaps.

Next, create formal job descriptions. Job descriptions should be reviewed and updated at least annually, and whenever someone leaves. Job descriptions should be as detailed as possible. This will help you recruit the right person for the job. It will also give you a legally defensible document, or ‘benchmark’ for performance management. Be sure your job descriptions include at least the following:

Job title
Job location
A summary of the job objective/purpose
Scope of responsibility
Reporting relationships
Qualifications required (experience, skills, competencies)
Key functions and duties (including standards)
Physical requirements of the job

Please contact me if you need help creating your workforce strategy.

When Hiring, Be Clear About Work Environment

One of the areas I help my clients with is performance management – both setting up performance management processes, and dealing with performance issues. Lately I’ve been finding that a number of organizations are struggling with issues related to new employees adapting to a small company work environment.

In small companies, where a gap in resources can make a huge impact, hiring managers are often so focused on filling the gap that they don’t take the time to go beyond simply matching qualifications to requirements. However, if they neglect to give the candidate a clear understanding about the work environment, they could be looking at performance issues down the road.

Take, for example, a candidate who is used to working in a large, structured organization, where roles are narrowly defined, and processes and procedures are well-established and documented. They are deeply knowledgeable about their own role, but have traditionally delegated to others responsibilities that don’t fall within the definition of that role. Unless they are told otherwise, when this candidate becomes an employee they may assume that it’s “business as usual.” I do my job and others do theirs.

A small company environment, however, is very different from a large, structured organization. People wear multiple hats, processes are often established on the go, and there are typically many things going on at once. The ability to prioritize is essential.

One of the most important components of effective performance management is managing expectations. This begins in the hiring process. As a hiring manager, help potential employees understand not just what the job requires, but also what working successfully in the company environment requires. Present them with realistic scenarios about what they might be asked to do in their role. Ask behavioral questions to determine how flexible they are, and how they prioritize. Ask them to describe a situation when they were asked to do something out of their job scope. How did they handle it? What was their comfort level?

Performance issues generally have one or more of these three root causes: 1) lack of ability, 2) lack of training or information, 3) lack of motivation. Do your best to avoid these by taking the time to ask good questions, and provide clear expectations during the hiring process.

If you need help with developing an effective hiring process, please contact me.

5 Budget-Friendly Employee Development Ideas

Surveys show that one of the key factors in keeping employees engaged and motivated is the opportunity to learn and grow. For small companies, however, who often have limited (or non-existent) training budgets, providing those opportunities can be a challenge. Yet there are a variety of ways you can develop your employees without a lot of expense. Here are five of them.

Cross-training. Consider putting together a program where employees cross-train each other. Not only will the “trainee” learn new skills and knowledge, the “trainer” will improve in their job by having to teach it to someone else. This also can build closer relationships in the organization and a better understanding of the company overall. When employees learn what others on their team and other teams do, they have a better appreciation of how all the roles fit together to keep the company operating. It can eliminate silos and increase organizational communication.

Internal skill sharing. Identify employees who are particularly skilled in an area and give them the opportunity to share their knowledge in a workshop or “Lunch and Learn.” This increases the knowledge of the participants, and gives the employee sharing the knowledge the opportunity to develop and improve additional skills – leadership, facilitating, organization, communication, etc.

Mentoring. Create a mentoring program or identify individuals who can coach others in areas where they’re struggling or want to develop. This is a great way to tap into the knowledge and skill base of your more experienced employees to ensure that your company mindshare gets transferred. And the beauty about mentoring relationships is that there are benefits to both mentor and mentee as they learn from each other.

Online courses/books. There are myriad free and low cost online courses available on a variety of topics from business knowledge to leadership skills to software. Books are another way to provide learning. Consider setting up a small library or book sharing program.

Special projects and stretch assignments. On-the-job training through a special project or stretch assignment can be very effective when combined with adequate management support and/or a mentor or coach. Have a special project coming up? Consider assigning someone who wants to develop leadership skills to head up the project.

Be sure that you include in your employee development program not just the job-related skills tied to your future needs, but also soft skills that have been identified as essential for the 21^st century: communication, emotional intelligence, collaboration, problem solving, and adaptability.

Recognize that the time spent in learning activities – whatever those may be – is an investment in the growth of the company and in the growth and satisfaction of employees.

“An investment in knowledge pays the best interest.” – Benjamin Franklin

Update: Federal and State HR Laws

In my last blog I talked about the change in the minimum salary requirement for exempt employees that goes into effect in December. Here are some other HR-related legal updates that may also affect you.

State Disability Insurance eligibility waiting period. The waiting period for State Disability Insurance eligibility has changed for individuals who file a second disability claim for the same condition or a condition related to the initial claim. SB 667, which went into effect July 1, waives the 7-day waiting period for the second claim if it is filed within 60 days after the initial disability benefit period. The bill also extends to 60 days (from 14 days) the time between claims for the same or related cause or condition to be considered one disability benefit period.

Wage garnishment. SB 501, effective July 1, reduces the prohibited amount of an individual judgment debtor’s weekly disposable earnings that may be garnished based on a withholding order.

Electronic Unemployment Insurance reporting. Starting January 1, 2017, employers with 10 or more employees will be required to electronically submit their unemployment insurance reports to the Employment Development Department. Under the new requirements, employers must also remit contributions for unemployment insurance premiums by electronic funds transfer. The requirement will apply to all employers beginning January 1, 2018.

California minimum wage. SB 3, signed by Governor Brown in April, will increase California’s minimum wage annually, reaching $15/hour by January 1, 2022. For employers with 26 or more employees the minimum wage will increase per the following schedule:
January 1, 2017 – $10.50/hour
January 1, 2018 – $11/hour
January 1, 2019 – $12/hour
January 1, 2020 – $13/hour
January 1, 2021 – $14/hour
January 1, 2022 – $15/hour

Employers with 25 or fewer employees will be on a schedule one year behind the above schedule, reaching $15/hour on January 1, 2023.

In my next blog I’ll talk about changes at the county and city level. It’s important to keep your Employee Handbook up to date to ensure you are in compliance as requirements change. Please contact me if you are interested in a mid-year review of your manual.

New Overtime Rules Go Into Effect December 1

The Department of Labor has announced new federal regulations increasing the minimum salary that must be paid to qualify an employee as exempt from overtime. As of December 1, 2016, an exempt employee must be paid a minimum of $913 per week, or $47,476 annually.

The current California minimum annual salary for exempt employees is $41,660. This means that California employers with employees who are currently classified as exempt and earn between $41,660 and $47,476 will need to decide before December 1 whether to reclassify these employees as nonexempt, or increase their salaries to at least $47,476.

The duties tests for exempt classification have not changed. In California, a position may qualify as exempt if more than 50% of the work is administrative, professional or executive in nature.

In addition to increasing the minimum salary, the new federal regulations allow employers to count non-discretionary bonus compensation and certain other incentive pay for up to 10% of the minimum salary, and provide for automatic adjustments in the salary and total compassion levels for the exemption every three years, starting in 2020.

Misclassification of employees is one of the top three areas where employers are vulnerable to lawsuits. Be sure that you understand the duties tests, and check with your employment attorney if you are unsure how to classify an employee.

As a reminder, in California, employees may be exempt from overtime pay rules if:

They are engaged in work which is primarily intellectual, managerial or creative, AND
They are paid the required minimum salary. As mentioned earlier, this salary will be $47,476 as of December 1, 2016.

Employees who meet these criteria are generally classified in one of the three exempt classifications: Executive, Professional, or Administrative. Unless a job falls into one of these exemptions, an employer must pay overtime. In California, non-exempt, hourly employees are entitled to overtime pay for any hours worked over 8 in a day and over 40 in a week.