In our current economy, employers see bad news and leading indicators that affect them every day. One week employment is up; the next week construction spending is down. First, economists predict the recession will be over by the fourth quarter of 2009, and then the US Treasury Secretary says it’s going to take more time to see real recovery. Roller coasters will give employers a smoother ride than the news will!

If you need a chuckle to get you through the week, take a look at what hiring managers are hearing from their employees—including these very odd complaints, reported by CareerBuilder in a recent survey.

Some complaints were about fellow employees:

• Is too sun-tanned.
• Has big hair.
• Eats all the good cookies.
• Is so polite, it’s infuriating.
• Is trying to poison me.
• Their body is magnetic and keeps de-activating my magnetic access card.
• Aura is wrong.
• Breathes too loudly.
• Has ticks.
• Wears pajamas/socks/slippers to work.
• Wears bells on her shoes.
• Reminds me of Bambi.

Others were about the company:

• Doesn’t provide a place for naps during break time.
• 8:00 a.m. is too early to begin work.

Sometimes, we just have to laugh at what makes people upset in the workplace!

What does it mean to hire your first employee? Hiring employees is a major growth point that really takes a small business to another level. While it’s not easy knowing you’re completely responsible for your own livelihood, it’s quite another to take on another person’s. Talk about pressure to perform! No employer wants to hire an employee, only to have to let them go when business falters.

So, how do you know when it’s the right time to hire? Many business managers believe that a business should stay lean—especially in this economy. Plenty of successful companies run with fewer people than they really need. You might approach hiring by asking yourself the question, “is it going to be nice to have this person, or do I absolutely need this person?”  Having a bare-bones staff actually adds to the development of employees’ talents and abilities. Asking for more creativity and problem solving from employees allows them to grow and discover where they can excel.

Letting Go
We’ve all heard a business owner say, “I’d rather do it myself than tell someone else how to do it.” Hiring employees means a business owner must get used to letting go of a number of responsibilities—some of which they’ve been performing since day one. As a single-employee business, an owner is often salesperson, marketing department, financial officer and janitor—and can easily fall into the mind set that nobody cares as much, so no one will perform these tasks with the same level of care as they will.

But nobody can do everything a business needs to run successfully forever. In the short term, perhaps—but if your business is not growing, it’s dying. As an owner, you should be thinking forward, planning growth and strategy, and making the big decisions. This includes knowing when it’s time to hire staff to handle the everyday tasks. Not letting go can lead to a less successful business in the long term.

Balance Staffing with Customer Service
There is a balance between running a lean company and falling short on customer service. Obviously, customers must come first to keep sales healthy, and if your staffing level does not serve the customer, something needs to change. Foster a company culture where employees feel free to communicate their own and the customers’ concerns regarding service levels. Ask your staff for feedback and let them know that you are committed to customer service first.

Legislation is a constantly changing reality for all of us who drive cars, buy and sell property, own a dog, talk on our cell phones, walk down the street, or just inhabit a city, town, county, or any other municipality in the U.S. Laws are something we don’t think about constantly—unless we’re planning to break some.

For employers, legislation is something you must keep up with, or you can really get in trouble. Today we’ll review two laws covering employees that you should already know about, along some new laws that are pending or have passed recently.

First, the newbies:
Lilly Ledbetter: The Lilly Ledbetter Fair Pay Act of 2009 is a result of the namesake’s pay discrimination lawsuit against Goodyear Tire & Rubber Co., which went to the U.S. Supreme Court. The Court heard arguments about a requirement, established by the 1964 Civil Rights Act, that equal-pay discrimination be addressed within a 180-day statute of limitations. The Court ruled it commenced from the day the pay was agreed upon, not the latest paycheck, overturning a lower court’s decision.

The new law amends the CRA to reset the 180-day statute of limitations to begin with every discriminatory paycheck.

Employee Freedom of Choice Act: This is pending legislation in the U.S. Congress, which would amend the National Labor Relations Act to make it easier for employees to form, join, or assist labor organizations. EFCA removes the secret ballot requirement that currently exists if employees want to form a union, guarantees workers a contract if they form a union, and strengthens penalties against companies who break laws during union organizing campaigns and first contract negotiations.

And the oldie, but goodies:
FMLA: The Family and Medical Leave Act gives qualified employees of certain employers up to 12 weeks of unpaid leave per year. During the 12 weeks, the employee’s job and benefits must be protected. FMLA applies to public agencies, public and private schools, and companies of 50 or more employees. Employees must have worked for the employer for at least 12 months, and for at least 1,250 hours over the past 12 months.

Under FMLA, qualifying reasons for leave include: the birth and care of a newborn child, the placement of a child for adoption or foster care, caring for an immediate family member with a serious health condition, or the employee’s own serious health condition. Another qualifying reason is in the case of an employee’s spouse, son, daughter, or parent’s active duty or call to active duty status as a member of the National Guard or Reserves. Plus, eligible employees may request up to 26 weeks of unpaid leave to care for an immediate family Armed Forces service member with a serious injury or illness.

ADA: The Americans With Disabilities Act of 1990 prohibits employers from discriminating against qualified individuals with disabilities in hiring, firing, advancement, compensation, and job training. The ADA covers employers with 15 or more employees. The ADA also requires employers to make reasonable accommodations to the employee’s disability if it does not impose a hardship on the employer’s business.

In hiring, the ADA prohibits employers from asking job applicants about the existence, nature, or severity of a disability. Applicants may be asked about their ability to perform specific job functions. Medical examinations may be required of an applicant with a disability, but only if the exam is required for all new employees in similar jobs.

That’s the legislative update for now; more to come!

QuickBooks developer and NetBooks founder Ridgley Evers believes in using technology to make running small businesses easier. In a recent interview, he discussed how he’s currently combining his passion for small business, technology, and food at DaVero, his Sonoma, California farm, where they grow olive trees, grapes, and fruit trees, and make a variety of wines and olive oils.

According to Evers, all businesses, large and small, start with a vision, and leaders work backwards to determine the right path to reach it. Fulfilling a vision can take a few years, or in the case of DaVero’s olive trees—centuries!  But not knowing the company’s vision or purpose is a crucial misstep made by many businesses—one that can lead to their downfall.

Evers’s idea of success is to create a sustainable business and lead people forward to the vision. And, he says, it’s even more important in a small business that everyone is moving toward a common vision.

To make that happen in your company, spend time with new employees to help them understand why your company matters—and where it’s going. You should also ensure that each employee understands their individual role in the bigger vision.  Creating a sense of pride among employees will make them more likely to buy into the company’s goals—which leads to higher loyalty and less turnover.

Evers also laid out the four things he believes every successful businesses does:

1. Focus first on the customer. Concentrate on satisfying each one.

2. Have an authentic voice—so customers understand what the company is about and where it’s going.

3. Hire slowly, but fire quickly. Take the proper care when hiring new employees, but when you make a mistake, cut your losses and move on.

4. Know when to ask for help.

Small business owners are building what is will be their most important asset—so running it well pays off both in the short and long term. Identify and stay focused on the company vision—it’s the first step in every successful business.

All employers must comply with the regulations of the Federal Consumer Reporting Act (FCRA)–whether you have one employee or one thousand!  Make sure you’re in compliance, and avoid making these common mistakes:

1. Using social media sites or a Google search as a background check: Browsing an applicant’s Facebook or MySpace page, or researching them through an internet search engine does not equal a background check.

2. Performing the background check yourself: Employers must ensure they are in compliance with the FCRA. The best, easiest way to accomplish this is by using the services of a reputable background screening company.

3. Burying the screening approval language in the application: You must provide a separate document to obtain the applicant’s approval for credit and background checks.

4. Failing to obtain the applicant’s signature: Applicant signatures must be obtained before you run any type of credit checks.

5. Improper disclosure when rejecting an applicant: If you reject an applicant because of poor credit history, provide them a copy of their credit report, along with the reason they will not be hired.

6. Failure to obtain permission from online applicants: You cannot simply state online that you will be performing a background screening and/or credit check—you must have an electronic approval from the applicant.

7. Inconsistency: You cannot require a background and credit check for some applicants, but not others. Inconsistent policy enforcement could lead to accusations of discrimination.

8. Believing that FCRA doesn’t apply: Even small employers are subject to the law. There is no distinction made between a one-person business and a huge corporation.

9. Not obtaining permission from current employees: If you decide to run credit checks on your employees after they were hired, you must disclose your intention and get their approval in writing.

10. Improper disposal of information: Employers must comply with the Fair and Accurate Credit Transactions Act of 2003 (FACTA), an amendment to the FCRA. This law requires proper disposal for information contained in or derived from a consumer report. That means no tossing reports in the trash can—they must be shredded or otherwise destroyed so they cannot be reconstructed. Digital information must be destroyed before a computer is sold or donated.

What do employers need to know about complying with the Fair Credit Reporting Act (FCRA)? It may seem unlikely that you would have to worry about legislation designed to protect consumers against unlawful use of their credit and personal information. But you must comply with FCRA if you:

• Want to check the credit history of an applicant for a cash-handling position;

• Intend to promote a long-term employee, but want to be certain they have a good credit record;

• Have already obtained a credit history on a job applicant, which is unfavorable; however, it is a lack of experience, not the credit record, that impacts your decision to not hire this person.

Employers are entitled to run consumer credit reports on applicants or existing employees at any time, providing they comply with the FCRA. Employers who use consumer reports have legal obligations under FCRA, which was designed to prevent applicants from being denied jobs or employees being denied promotions unjustly.

You cannot obtain a consumer report until employees or applicants have given their written permission for you to do so. This cannot be accomplished on the employment application.  A separate disclosure must contain the proper notification, and the employee must sign it.  If employees gave permission in the past, you must ensure that they receive a separate notice stating that reports may be obtained over the course of their employment. 

So, what if you didn’t include the disclosure and obtain permission during the hiring process and now you want to run reports on your employees? You must notify employees and get their written permission before you run the reports.

Who can supply pre employment screening reports to ensure an employer is in compliance? To be covered by FCRA, employers must use employee screening reports provided by a Consumer Reporting Agency (CRA). The reports can range from simple credit checks to criminal, housing, employment, and driving record checks. 

The FCRA requires employers to comply with reporting requirements. These include: 

• Certifying that the employer is obtaining information for employment purposes;
• The proper disclosure has been provided to and written authorization has been obtained from the applicant or employee; 
• The applicant or employee will be provided with a copy of the report;
• And the information will not be used in violation of equal opportunity laws.

What happens if you deny an applicant or a promotion based on information you obtained from a CRA? 

Before you take adverse action, such as terminating an employee, or denying a job or a promotion, you must give the individual a pre-adverse action disclosure, including a copy of their consumer report and a copy of “A Summary of Your Rights Under the Fair Credit Reporting Act.” This document can be provided by your CRA.

After you have taken adverse action, you are required to give the individual notice, either orally, electronically, or in writing, that the action has been taken. The notice must include the name, address and phone number of the CRA that supplied the report, as well as a statement that the CRA did not make the decision for adverse action and cannot give specific reasons for it. In addition, the individual must be notified that they have the right to dispute the accuracy or completeness of the information and their right to obtain a free report from the agency within 60 days.

Photo Courtesy of flickr

Have you seen the Top 10 lists of “Late for Work” excuses? One employee apparently convinced herself that a long line at Starbucks justified her tardiness. Another said a groundhog bit his bike tire and flattened it. And then there was the guy whose cat was in traction. No matter how creative the excuse, the fact is that workplace tardiness is on the rise.

According to a recent poll, 20% of employees are reporting to work late at least once a week. This is up 5% from last year, pre-Recession. It’s easy to understand this trend, when layoffs are rampant and stress is high. Most folks who dread going to work do not arrive super-early.

Every employee handles stress differently. Some thrive on it, tapping into their inner hero and becoming more efficient and focused than ever before. Others feel helpless and as a result, may be less productive. Still others might become angry, affecting others as they complain about the economy, politicians, or the unfairness of life.

Being late is a side effect of low morale. Whether your employees are passively punishing your company for layoffs or other cost-cutting measures, or are distracted by the stress the economy is putting on their lives, low morale can easily turn into a serious problem.

Managers and leaders need to take control of low employee morale before it gets out of hand. How? By banishing fear and anger, and replacing these nonproductive emotions with a realistic, hopeful picture of the future that everyone can buy into. Keep talking to your employees—even when you think you’ve done enough talking. Continue to assure your staff that everything will be okay, and that eventually the economy—and the company—will turn around. 

Let them know that everyone is in the same situation—they’re not experiencing the stress alone. Encourage them help improve the company’s bottom line by making one more sales call, one small improvement in customer service, or by coming up with one new idea to cut costs. Remind them that profit cures all ills, and even a small increase can make a big difference for everybody.  

With a hopeful environment at work, your employees will find better ways to spend their time than coming up with creative excuses for being late!

Thousands of companies have instituted layoffs, which generally means a hiring freeze, too. Businesses with steady work levels are fortunate in this economy; but if they have already cut back staff levels, they can expect overworked and stressed-out employees. For companies in this position, it’s probably not the best time for restructuring.

But for businesses experiencing work slowdowns, a hiring freeze is a good time to re-evaluate staffing needs.

In business, proper planning means success.
Plan for the post-freeze work increase now, and you’ll be better positioned when the economy begins its recovery. First, take a look at each department under your supervision. Observe the team’s workload and how it all flows. Are they able to get their work accomplished each day, or are they perpetually behind?  Are they looking for more work to do, or—even worse—extending each task out to take up their available time?

Eliminate time-wasters.
Review all the individual responsibilities required of your staff.  Is each one essential to getting your company’s products into your customers’ hands? Or, are your workers required to fill out unnecessary paperwork or perform redundant tasks at the expense of producing sales? Consider putting a freeze on all non-essential tasks until the hiring freeze is over. 

Poll your employees. 
Engage staff in dialogue and you can learn exactly what they think of their workload. Ask for their suggestions to streamline workflow or eliminate unnecessary steps and procedures. You may find they have been hoping you’d have this exact conversation for weeks (or even years!).

Reconsider the organizational chart.
Are there workers reporting to the wrong supervisor? Does it make more sense to combine the Training Department with Production? Are there holes in areas that could be generating revenue?  Shifting existing staff to these areas could improve workflow and increase revenues, while keeping your valuable employees motivated.

What can you do without?
There is nothing like eliminating positions to help you determine whether or not they are actually needed.  When the hiring freeze is over, fill revenue-generating positions first, then look back over your evaluations and decide which positions are most essential, and which ones never were.

When hiring again, don’t neglect employment background checks to screen out potential problem employees before they’re hired.

Layoffs Should be a Last Resort

The current economic climate is taking its toll on businesses, and by extension, on workers and their families. Stress levels are high, from top-level management to entry-level workers. Employees who manage to keep their jobs might have a spouse who has lost theirs, or they’re experience the loss of contact with laid off co-workers. Some even feel remorse or guilt for keeping their job.  

There is no doubt that morale and productivity are greatly affected by seemingly unending layoffs. 58% of respondents to a recent survey by i4cp (Institute For Corporate Productivity), indicated they reduced their workforce in 2008, and almost 40% planned a reduction in 2009.  Even companies who don’t necessarily need to reduce their workforces are deciding this is a good time to let people go or restructure their organizations. It is vital that management handle the process effectively to avoid a corresponding productivity decline by remaining employees.

Layoffs should be a last resort. If your problem is too little profit, consider asking employees for help in cutting expenses or brainstorming ways to increase sales. Losing the experience and knowledge of your employees is difficult to overcome. Your company will not be well-positioned for future growth if your first reaction is to cut staff. 

If your problem is too many employees, then layoffs are more difficult to avoid. Here are some Layoff Dos and Don’ts:

Do not implement layoffs without a strategy: first, know what your post-layoff company looks like, including its structure and the staffing levels that will be needed in each department; then, decide exactly when the layoff will occur, how much severance will be paid to each employee, and how far the company will go to assist laid off workers.

Do avoid legal issues: base decisions on the needs of the business, not on head count or seniority. Avoid accusations of discrimination based on age, gender or race.

Do give as much notice as possible: there is no evidence that more notice of a layoff will make workers unproductive or increase chances of harm to the business. On the contrary, too little notice leads to mistrust and feelings of disrespect. Employees have the right to plan their lives, and employers should give them the opportunity to do so.

Do not treat employees like children: Remember you are being watched! Keeping secrets and “trying to act normal” fuels the rumor mill. Be open, dignified and efficient when conducting layoffs. 

Do over-communicate: rather than withholding information, clarify the why, when, and   how.

Do not behave as though nothing happened: employees will talk whether or not management chooses to participate in the discussion. By discounting the layoffs, employers contribute to employees’ feelings of helplessness, and make them wonder what else is being hidden from them.

Do encourage employees to talk about it: honest, open communication speeds recovery and can strengthen ties between surviving employees and management.

Do give employees something to look forward to: share the company’s vision with your remaining employees; focus on what you can achieve in the future, not what you’ve lost.

When hiring new employees again, employment background checks will help you attract and retain the best candidates.

Frequent communication can keep employees happy.

Who enjoys evaluations? In our experience, neither the employee nor the evaluator thinks they’re much fun.  Individuals measure their worth differently; a high score in one area may not mean a thing to Jane, while it means the world to Joe. Your company may place a high value on promptness; while Kate thinks being a minute or two late is no big deal, as long as she is at work every day. 

Traditional evaluations that reduce an employee to a letter or number score may not be working—and you may not even know it. There are many ways to measure success. Maybe it’s time you evaluated your evaluation process!

Employee reviews tend to be more interactive, a word that is thrown around a great deal these days. It’s all about sharing information. Younger employees—the Gen Ys and Millenials—expect to participate in the process, rather than to be told what is happening. They want to feel like part of something important, and to know how they can make a difference.  Embrace this as you consider how best to manage them.

Consider weekly or bi-weekly chats with your employees. You may think, “there’s no time for that!”  But consider how much time you put into annual evaluations, with all the preparation, writing, and presenting time that go along with them. Many employers never get around to the formal evaluations because the process takes too long. Shorter, more frequent reviews could be the solution for your company.

Asking for feedback makes employees feel like important individuals. Focus on their needs and goals, tracking progress and asking how you can be effective in helping them reach theirs.

Reviews are a good time to talk about new responsibilities, too.  With more frequent communication, you’re likely to know better when an employee is ready for you to delegate new projects or tasks, making your job easier.

Don’t forget to take the opportunity to show appreciation for contributions to their team and the company. Tell them what they’re doing right. Then, explain the things that haven’t gone well, with suggestions for improvement. Keep it short and provide examples to follow.

Look at frequent employee reviews as time savers! Your operation can run more smoothly when you guide employees to meet goals, and add responsibilities you know they can handle.  It’s a win-win situation.

When hiring new employees, employment background checks will help you attract and retain the best candidates.