Performance appraisal.

Employee evaluation.

No matter what you call it, the thought of managing employee performance reviews is often daunting to both managers and employees. Often considered the yearly “report cards,” performance reviews are viewed by many as a time-consuming and unpleasant experience.

Despite its negative implications, the employee performance review is in no way going out of style. It remains a vital element in any successful organization’s human resources priorities. With a solid review structure in place, this process doesn’t have to be such a nuisance. That’s why we’ve compiled this guide for employers to understand:

• Why performance reviews are important
• How to do performance reviews
• Tips for successful performance reviews

So stick with us to learn how to create a more positive and effective employee evaluation process, now updated for 2023! We’re covering:

• Why performance reviews are important
• How to do performance reviews
• 9 common performance review methods
• What NOT to do during reviews
• 9 bonus tips to make them successful

Click any of the above to jump to a certain section, or keep scrolling for the comprehensive guide!

Why are Performance Reviews Important?

Employees and managers can learn and grow from performance appraisals. They play an important role in:

Clarifying Individual Roles and Organizational Goals

Employee evaluations are an opportunity to check in with employees and ensure they understand the company’s big vision and goals and the impact they have on the organization. Reviews are also the perfect time to clarify an employee’s role and duties and answer any questions.

Confusion leads to frustration and decreased productivity. Regular evaluations are an important step in boosting productivity and performance and ensuring each employee owns their responsibilities.

Providing Regular Feedback

Your company strives to hire, develop, and keep the best employees. Those employees care about their reviews—which means you should too. 

In fact, Officevibe reports that 43% of highly engaged employees receive feedback at least once a week, compared to only 18% of employees with low engagement. These numbers show that regular, constructive feedback from supervisors makes a difference.

Use employee performance reviews to help employees clearly understand their strengths and areas of improvement and encourage them to take initiative and find satisfaction in their work.

Managers should also be documenting performance reviews, which can support not only employee development but also potential employment discrimination or wrongful termination lawsuits.

Career Development

A large part of performance reviews is assessing how the employee has performed against their goals and setting new objectives. Managers can then determine new opportunities for training and mentoring or areas in which the employee could use additional guidance. 

Additionally, the evaluation can provide insight into developing future succession plans for team members in specific roles. Or, if an employee is struggling, the appraisal will provide data and feedback necessary to develop a performance improvement plan (PIP) if appropriate.

Employee Rewards and Appreciation

A solid performance management system helps employers stay on top of employee rewards, such as time off, bonuses, and other forms of recognition. Team members who receive rewards will, of course, remain motivated to keep up the excellent work. And seeing their peers’ achievements will incentivize others to step up their game and reap the rewards!

How to Do Performance Reviews

Now that you understand why they’re so important, you may be wondering exactly how to do performance reviews.

Define Company Goals

Start by defining your company’s goals. These may include any or all of the following:

• Profit goals: Aim to increase profits by a specific percentage for a set time period.
• Service goals: Aim to improve customer satisfaction and retention.
• Social goals: Include philanthropic initiatives to constantly give back to the community through donations or volunteering.
• Growth goals: Focus on expanding the company by hiring new employees, opening new locations, etc.

Understanding your corporate goals will help you hire the right people for the right roles, and then effectively develop those employees to reach those goals. 

Determine Performance Review Frequency

You will also need to set the performance review frequency. A few questions to ask to determine what schedule will work best for your organization are:

• How often will compensation be discussed?
• How long does it take managers to fill out evaluations?
• What tools would make it easier/quicker for managers to complete reviews?
• How long does it take employees to demonstrate growth/change?

That said, your company could choose to conduct employee performance reviews:

Weekly or Biweekly

You might opt for brief evaluations every week or every other week, especially for employees who:

• Have weekly KPIs or goals to hit
• Perform best with specific, short-term goals
• Are working on projects with tight deadlines or lots of moving parts

These frequent check-ins don’t have to dive deep into every aspect of the employee’s performance. They’re more of an effective way to document progress and provide regular opportunities for managers and team members to check in with one another.

Monthly

Monthly performance reviews are ideal for:

• Contract workers or freelancers
• New hires undergoing the onboarding process
• Significant long-term projects with specific milestones

Plus, many employees prefer monthly appraisals over annual reviews so they can gain more specific insights and guidance on their performance, what they are doing well, and areas they need to improve.

Quarterly

Like many companies, you probably set quarterly goals and budgets. As such, you might align employee evaluations and goals with the overall quarterly business goals. Three months is often an ideal time for employees to achieve their goals and make notable progress in certain skills or other areas.

Annually

Annual performance reviews are becoming a thing of the past as employers focus on company culture and employee development. If you do opt for annual reviews, don’t rely on them alone—no employee should go an entire year without specific feedback. Plus, a single yearly appraisal can lead to information overload, vague direction, and an unfair view of an employee’s work that only looks at past performance.

For employers who hold quarterly or annual appraisals, we recommend that managers have regular check-ins (think weekly or monthly) with their team members. Supervisors can then use those weekly, biweekly, or monthly evaluations in the quarterly or annual reviews for a comprehensive look at the employee’s progress and performance. 

In a TriNet survey of Millennial workforce members, 85% said they’d feel more confident if they could have frequent conversations with their managers. So keep the lines of communication open and provide employees with consistent feedback and guidance.

Train and Prepare Managers

One of the most common pitfalls when it comes to employee appraisals is ill-equipped managers. Ensure managers in your organization are trained on how to deliver effective reviews. This means educating them on best practices, such as what to document, what to say, and how to communicate it. It’s important to revisit training in this area and reinforce these practices on a regular basis.

Another area where managers often fall short is preparing and planning for employee performance reviews. In companies with a weak or nonexistent performance review system and training, managers often perceive reviews as a necessary inconvenience. Many simply spring reviews on employees with little to no advanced notice, then rush through the form to comply with HR requirements. 

This means they don’t take the time to provide meaningful feedback to their employees and evaluate their progress. These managers also may not track performance, acknowledge accomplishments, or address poor performance throughout the year. Without this vital information, they cannot be prepared to give accurate and effective employee performance reviews.

Put a Performance Review Process in Place

Many of the problems noted above can be resolved with a strong performance management process. When you have an accurate way to measure employee performance, a clear process, and methods that make it easy for both parties, everyone will be more willing and motivated to do things properly.

A solid employee performance review process includes:

• Continuous and timely feedback throughout the review period to ensure employees understand how they are doing and their expectations.
• Consistent communication that includes performance feedback measured against clear and specific goals and expectations established at the start of the performance management period.
• A process for acknowledging the results of the performance review process that is documented between the manager and the employee.
• A one-on-one conversation between the manager and the employee (ideally face-to-face) at least once a year.

9 Common Employee Performance Review Methods

There are several types of review systems that can be used either individually or in combination with one another. Whatever method(s) your business decides to use, both managers and employees should be given a clear definition of each level of performance. 

Below are the five most common review styles.

Self-evaluation

This method requires an employee to judge their own performance against predetermined criteria. 

Pros: The self-evaluation is typically considered by the manager during the official review to encourage a more thorough discussion. Differences in the employee and manager’s evaluations can be insightful.

Cons: This style may be too subjective to accurately reflect work performance since many employees often rank themselves too high or too low.

Behavioral Checklist

This one is pretty straightforward: It’s a checklist of behaviors an employer expects of an employee to succeed. In this case, an employer responds to a list of yes or no questions. The checklist may be weighted, meaning each question may carry a predetermined value.

Pros: Behaviors differ based on job type, so this technique is easy to adjust for each position. When done correctly, it produces clear results and allows easy comparison between all employees

Cons: This one can get a little tricky since the questions must be worded and weighted carefully to avoid confusing results. Plus, the checklist doesn’t include explanations or detailed answers—so you’ll want to include comments with more specific feedback.

360-degree Feedback

The 360-degree feedback review involves pulling feedback from the employee’s subordinates/direct reports, manager, non-direct supervisors, peers, and potentially even customers. The manager then completes an assessment of the employee’s work performance and technical skillset, while taking the outside sources into consideration.

Pros: As the name implies, this style provides a well-rounded look at an employee’s performance. It can even include an evaluation of the employee’s character and leadership skills. The broad feedback also helps cancel the influence of bias or outlying data points.

Cons: This method can be a bit more time-consuming since it requires obtaining the employee’s complete profile and feedback from multiple sources; however, the benefits of this comprehensive assessment are well worth the effort.

Management by Objectives (MBO)

The management by objectives (MBO) appraisal method, simply put, involves both the manager and employee setting and meeting goals. The employee either hits those goals by the set deadline(s), or they don’t.

Pros: Since the employee is included in the goal-setting process, there is an agreement that the goals are obtainable. It is also easy to define success and failure with this method.

Cons: The MBO style disregards non-goal-related success metrics, so some other important factors may not be taken into consideration come review time.

Project-based Appraisal

This type of employee performance review is used to evaluate an employee’s performance after completing every project. Questions and discussion points will focus on the individual’s most recent work.

Pros: Project-based appraisals are efficient and results-oriented. They provide team members with specific feedback and action items that they can improve upon/prepare for ahead of the next project. Many employees might like this short feedback cycle.

Cons: Since managers would need to conduct a project-based evaluation after every project, this could be somewhat time-consuming. But with a solid system in place, they can run very smoothly. 

Competency Assessment

Competency assessments compare an employee’s current skills to their target level. This helps managers identify strengths and areas where the employee needs improvement. This type of evaluation can be conducted via observation, interviews, or forms. 

Pros: Competency assessments help organizations:

• Get a high-level view of the skill gaps in their workforce and use that data to set bigger business goals and strategies. 
• Develop specific training and mentoring programs to help employees learn and grow. 
• Identify gaps and recruit new talent with the skills to fill them.

Cons: You must choose the right competencies for each role in your business to conduct a fair competency assessment. You’ll also need a system to ensure accurate scaling, privacy, and capability analytics. And to see actual results, you’ll need to put action plans in place for each employee.

Rating Scale

Also known as a grading system, this performance review method is probably the most commonly used. It’s based on a set of employer-developed criteria that can include behavior, traits, competencies, or completed projects. Employees are usually judged on a scale of 1 to 5 or 1 to 10.

Pros: This method is simple and provides easy functionality—as long as both managers and employees are on the same page about how the scale works (i.e., what each point on the scale means, or if the ratings categories focus on traits vs. behaviors).

Cons: If managers and employees have a different understanding of the scale, there could be unrealistic expectations and discrepancies. For example, some employees may consider a 3 out of 5 to be average, but you may consider it to be above satisfactory.

Depending on your organization and the types of employees you have, you may use one of these methods above or a combination of them.

For those who use any numerical method, one way to make things easier for everyone is to create a rubric for scoring. This helps by: 

• Holding everyone to the same standards.
• Enabling managers to score more accurately.
• Showing employees what they need to do to improve their score.
• Allowing the employee to feel good with a “meets expectations” score.

Behaviorally Anchored Rating Scales (BARS)

Similar to the traditional rating scale, a behaviorally anchored rating scale (BARS) also typically uses a scale of 1 to 5. The difference is that this method uses behavior statements to measure a staff member’s performance based on how they handle specific situations.

Pros: BARS is an effective way to clarify for both managers and employees the job expectations and what the employee needs to do to improve with a balance of qualitative and quantitative data. It is ideal for companies that:

• Have many employees in the same or similar roles
• Need to eliminate rating errors or bias in their current performance management process

Cons: This type of employee evaluation can be time-consuming, particularly for large companies. It requires time and effort from leaders to develop the scale for each role and conduct an appraisal for each team member.

Human Resource Accounting

Human resource accounting, also known as cost accounting, essentially evaluates the return on investment (ROI) of an employee. It measures the financial impact they offer against the cost of retaining them.

Pros: Human resource accounting is ideal for roles in which employee contributions and costs are measurable. For example, sales reps can be assessed by the revenue they generate, and upper management can be reviewed based on their profit and loss.

Cons: There will always be some gray area when it comes to the costs and benefits an employee brings to your business, for some positions more than others. This method can also lead to negativity, discouragement, and even jealousy among employees after learning their values.

What NOT to Do: Common Rating Errors

Because employee performance reviews are conducted by humans for humans, there is plenty of room for error. This is why it’s so important to have a clear, solid system in place along with a rubric. 

Below are five of the most common performance rating errors and how you can avoid them.

• Lack of Differentiation: Supervisors often lack the confidence to defend their ratings or be reluctant to pass judgment, so they rate everyone about the same. This can lead to leniency (everyone gets high ratings), severity (everyone gets low ratings), or a universal feeling that everyone is doing just fine (so everyone is rated in the middle). Poor training or the failure of an organization to clarify that performance reviews are a critical part of the managerial role are often to blame here.
• Recency Effect: With no review process and system in place, many managers do not continuously measure performance, provide feedback, or document results. When it comes time to review, they are unable to remember the earlier part of the performance period and weigh the most recent events too heavily.
• Halo/Horns Effect: These occur when an employee either performs very highly or very poorly in an area, respectively, and the manager rates the employee correspondingly high or low in all areas.
• Personal Bias/Favoritism: It’s no secret that some managers are influenced by their impressions of or personal feelings about employees, thus affecting their employee evaluations.
• Inaccurate Information/Preparation: Managers sometimes fail to take the time to discuss an employee’s performance with those who work closely with the employee, leading to an inaccurate assessment.

Remember that the employee assessment should be a thoughtful process. Don’t rush through it—instead, sit down and discuss the employee’s performance and how they have helped the company. Consider how you can reengage them in the company for the next year (or your chosen review period). 

It’s About What You Say…

Documenting the performance with context, details, and examples will help the employee understand where they stand and the reasoning behind your review.

Positive Review Example

You give your employee, Joe, a score of 4 out of 5 for Customer Service, meaning he is exceeding company expectations. 

Instead of writing: Joe has been exceeding expectations. He is a great customer service representative.

Try: Joe has exceeded company expectations this year for customer satisfaction. He has the highest ratings from customer surveys, scoring a satisfaction rate of 96%. Several customers have written to the company to provide accolades for his support and service. Additionally, as his manager, I have received calls from customers telling me what a pleasure it has been working with Joe, and how he takes his time to make sure the customer has what they need.

Negative Review Example

Positive reviews are easy to give…but unfortunately, it’s not always great news. You should still provide detail and examples to help the employee understand where they stand and how they can improve.

You might score Kate a 2 out of 5 for Customer Service, meaning she’s not meeting company expectations.

Instead of writing: Kate needs to work on her customer service skills. She has had some issues which have caused the company concern and has had several customer issues arise.

Try: Kate has had several customer service complaints this past year (which are documented in her file). The concern is she is working too quickly to get the customer off the phone, so she is not listening to their needs, or assisting them with their questions in a respectful manner. She has also given several customers wrong information, and there was an incident 6 months ago where she hung up on an angry employee. We would like to see Kate work on her patience and provide great customer service. Her current satisfaction rating is 60%. We need to see this rise to a minimum of 80% in the next 3 months.

Even if you have significant critical feedback, be sure to provide some positive feedback in the review!

…And How You Say It

When managers give reviews, nothing should surprise the employees. This is why regular check-ins with employees are so important!

Don’t simply read what you wrote on the employee’s review. Discuss each topic at a high level unless a certain score was below or above average. Take this time as an opportunity to have a discussion and expand on your feedback in areas of note.

Ensure it’s a two-way conversation by asking questions and getting feedback from the employee on their position, the team, YOUR management, and the company. Some questions you may ask are:

• What do you expect to be the most challenging about your goals for this quarter?
• What support can the department provide for you that will help you reach these goals?
• What are your hopes for your achievements at our company this year?
• How can I be a better manager for you?
• How often would you like to receive feedback?
• What kind of schedule can we set up so that you don’t feel micromanaged, but I receive the feedback that I need as to your progress on your goals?
• What would be a helpful agenda for our weekly one-on-one meetings?

And perhaps most importantly, remember to listen, wait, and THEN respond!

Setting Employee Goals

With each review, managers and employees should collaborate to create new short- and long-term goals. These may include job description goals, project goals, behavioral goals, and stretch goals (especially challenging goals typically used to expand knowledge, skills, and abilities). 

Always make sure the goals set are both flexible and SMART:

• Specific, clear, and understandable
• Measurable, verifiable, and results-oriented
• Attainable, yet sufficiently challenging
• Relevant to the mission of the department or organization
• Time-bound with a schedule and specific milestones

Document the goals, make them available for review, and manage them on a continuous basis. 

Finally, schedule a follow-up after each performance appraisal (before the next official review) depending on the frequency.

Managing Raises and Reviews

Tying in raises with employee performance reviews has been a common practice for a long time. But the compensation aspect can quickly consume the review process, distracting from the real importance and intent of the review. Employees instead want to know simply whether or not they’re getting a raise.

Performance reviews are meant to help employees improve over time which, in turn, helps the company grow and fosters a healthy workplace culture. Traditionally, managers tell employees what they have been doing well and what they could do to level up their performance.

When you separate pay raises from employee evaluations, it puts the focus back on the review process. You can then ensure your employees are developing new skills and becoming better, more fulfilled workers. This is the key to building a stronger, more effective organization.

9 Bonus Tips for Conducting Successful Performance Reviews

Here are our pro tips to prepare both managers and employees for smooth and effective reviews every time: 

• Keep a “notepad” for each employee who reports to you. Use these to write down wins and areas of improvement.
• Send emails to celebrate successes and promote further behavior.
• Address any issues in person, then follow up with an email.
• Provide a blank review and the rubric upon hire or within the new employee’s orientation period. 
• Provide the review AHEAD of time (no more than a day, no less than an hour).
• Do not sugarcoat poor performance.
• Do not downplay high performance.
• Control the discussion if there are negatives the employee does not want to accept. 
• After completing the review, look at last year’s (if applicable).

By keeping things as clear, simple, and consistent as possible, you can create a better review experience for everyone in your company.

Employee Performance Review Consulting

If you take away one lesson from this guide, we hope it’s that employee evaluations are NOT busy work! They are an essential part of fostering employee growth and running a successful business.

We understand, however, that establishing or improving an appraisal process is not an easy or fast undertaking, which is why BlueLion is here to help. Whether you need to create a new employee performance review process for your budding business, or you need assistance reviewing your existing system, learn more about our outsourced HR services or contact us today at 603-818-4131 or info@bluelionllc.com.

In his book, Wickman shares a story from a friend who delayed firing a long-time employee for months, which caused more stress. But once he finally decided to let the employee go, Wickman’s friend realized there were only 36 hours of pain carrying out the termination and managing the transition. Then it was over, and the business owner, his team, and the entire company were happier—and so was the person he fired. 

We’ve seen similar cases with many of our clients. These business leaders often see the writing on the wall for months and even years. They’ve done the documentation, performance improvement plans, coaching, and so on—yet still won’t pull the trigger to fire a problematic employee.

Why? Out of fear of turnover, how it will affect company culture, and repercussions like legal action.

In fact, this happened with one of our clients who had a long-standing employee that he’d been unhappy with for years. The employee had been unhappy for years, too. While the employer was practically sick to his stomach leading up to the decision and conversation, the termination meeting was over in less than an hour. Afterward, the client felt like a weight was lifted, and the rest of the team was happier!

Let’s dive into why small business owners simply can’t afford to procrastinate on firing employees—and when it’s time to have the tough but necessary discussion.

Why Do Employers Wait to Fire Employees?

So, why don’t bad employees get fired? The common culprits that we see preventing employers from terminating underperformers include: 

• Being uncertain of the outcome and if they’re making the right decision
• Afraid of blowback like lawsuits and reputational damage
• Effects on the rest of their team and company culture, resistance
• The cost of replacing them (which can cost between 30% and 200% of the departing employee’s salary)

And while we understand these concerns and taking the time to properly evaluate employee termination decisions, it’s simply not worth it! Recent research by Gallup shows that the global cost of disengaged employees has soared to $8.8 trillion annually. 

A former Gallup State of the American Workplace report found that disengaged employees have a 37% higher absenteeism, 18% lower productivity, and 15% lower profitability—which equates to the cost of 34% of a disengaged employee’s annual salary (that’s $3,400 for every $10,000 they make). 

You can see how quickly it adds up!

Embrace 36 Hours of Pain

Hopefully, you’re starting to see why “ripping off the bandage” is often a better approach when it comes to employee terminations. It will be uncomfortable for a short amount of time but positive for the long run.

You have a responsibility to the success of your company as well as your employees, customers/clients, and other stakeholders. Yes, you should ensure your planning, documentation, and communication around terminations are thorough and appropriate—but that doesn’t mean you should prolong the inevitable when you know what the right decision is.

Keep in mind that once you get through that 36 hours of pain, you’ll see a boost in employee productivity and satisfaction, making for a significantly improved work environment. 

Know When to Fire an Employee

So, how DO you know when it’s time to fire someone? You can typically find the answer by asking yourself these questions.

Have you put in the work and given them multiple chances?

In other words, you’ve thoroughly looked at why you’re unhappy with the employee and taken steps to support them and improve their performance. This could mean extra training, coaching, a performance improvement plan, or disciplinary action. Despite these efforts, however, the employee is not meeting expectations, and the situation is not getting better.

Are they costing your company productivity—and, therefore, money?

Whether the individual in question is underperforming due to a lack of skills or has an attitude problem, they’re affecting your bottom line. The stats above show that underperforming and disengaged workers can lead to significant productivity loss. This can have a major impact on profitability, which small businesses feel even more because they don’t have enough people to make up for the underperformer’s slack.

Has the position grown?

As businesses grow, so do roles and responsibilities. Perhaps the role has grown, and the employee can no longer fulfill your needs. If you’ve provided resources and development and even offered them opportunities to move laterally, yet it’s still not a fit, it’s time to move on. 

Would you hire them again?

Go with the first answer that pops into your head—if it’s no, then you probably shouldn’t keep them now. Hiring is challenging, which is why firing poor employees is even more important than hiring! Despite how well you interview candidates and what type of assessments you use, many still lie and embellish during the application and interview process. And sometimes, people simply change over time. So, if you wouldn’t hire the employee as they stand in front of you today, then it’s time to let them go.

Have you evaluated the risk?

If you’ve:

• Consulted with your HR and legal teams to ensure the employee termination is compliant (i.e., for just cause and non-discriminatory)
• Documented all efforts like performance reviews, coaching, and corrective actions
• Determined that you would terminate any other employee for the same issues

…then you’ve covered your bases—and you have one more sign that firing the employee is the best decision. It’s time to get your employment termination checklist in order and prepare for the tough conversation.

The Best Approach to Employee Terminations: Rip Off the Bandage

Delaying the termination of an underperforming employee may seem like a way to avoid discomfort, but it often causes more harm to your business in the long run. As Gino Wickman’s concept of “36 hours of pain” highlights, the short-term discomfort of letting someone go is far outweighed by the long-term benefits of a more productive, engaged team. 

If you’ve followed the right steps—evaluating performance, providing opportunities for improvement, and consulting with your HR and legal teams—you owe it to your company and your employees to take action.

If you’re struggling with when and how to make these tough decisions, BlueLion is here to help. Contact us today for expert guidance on navigating employee terminations with confidence and compliance.

Unfortunately, we’ve seen many employers and labor organizations make mistakes in this area, often because they are unaware of crucial employer obligations and union rights, like Beck rights. So, let’s take a straightforward, non-sugar-coated look at what you can, cannot, and must do regarding union agreements.

What is a Collective Bargaining Agreement?

When a workplace unionizes, the CBA is an essential early step. Typically, leadership, HR, and legal counsel negotiate with the union representatives to develop this contract, which outlines requirements and protections for both parties. It usually includes terms and conditions of employment, including:

• Wages
• Hours and breaks
• Benefits
• Dispute resolution and disciplinary action procedures
• Anti-discrimination laws

The CBA should be as clear and specific as possible and note the agreement’s validity period. Learn more about labor union agreements.

Types of Union Security Agreements

Whether your employees want to unionize or have already done so, you probably already know that unions are anything but black and white. For instance, there are several types of union security agreements. 

A union security agreement is typically part of a CBA. It is a contract between an employer and a labor union that outlines the extent to which the union can require employees to join the union and/or pay union dues as a condition of employment. These agreements aim to help ensure stable union membership and funding, supporting the union’s ability to represent and negotiate on behalf of the workforce. The specifics of these agreements vary and are subject to state laws, particularly in right-to-work states where such mandatory provisions are restricted.

The most common types of union security agreements are:

• Closed shop: Employers may only hire union members, which means new employees must already be union members before being hired. Closed shops have been illegal since the Taft-Hartley Act of 1947. 
• Union shop: Employees don’t need to be union members to be hired but must join the union within a specified period after starting their job. This is common in industries with a strong union presence but is subject to legal limitations, especially in right-to-work states.
• Agency shop: Employees aren’t required to join the union but must pay a fee (often called an agency fee) to cover the costs of collective bargaining and other representational activities. 
• Open shop: Employees are free to join or not join the union without any impact on their employment—meaning union dues and fees are entirely voluntary. This is predominant in right-to-work states.
• Maintenance of membership: This clause requires employees who join the union to remain members for the duration of the collective bargaining agreement, although new employees are not required to join.

Right-to-Work vs. Non-Right-to-Work States

Currently, 27 states have right-to-work laws, meaning employers cannot require employees to join a union or pay union dues as a condition of employment, even if their workplace is unionized. However, the CBA still protects all workers.

In a non-right-to-work state, on the other hand, employees may be required to join a union and pay union dues or fees as a condition of employment if their workplace has a union security agreement.

Note that exceptions may apply to public service employees. For example, although New Hampshire is a non-right-to-work state, public service employees can’t be required to join a union. So be sure to check your state’s union laws regarding public service workers and other specifics.

Today, it’s common to find companies where management employees are not union members but floor workers are. Whatever type of agreement you establish, you must understand what you can and can’t include in a CBA and require of employees. 

A good rule of thumb? You can add clauses to the CBA that provide additional benefits to union workers, but you may NOT attempt to supersede labor laws and take legal benefits away. For example, employers can’t state that certain employees are not eligible for overtime pay when they would be entitled to it according to wage and hour laws.

Beck Rights: How Do They Impact Union Rights & CBAs?

As explained earlier, unions entail regular dues, which go toward two broad expense categories: 1) collective bargaining and representational activities and 2) additional tasks and services (e.g., political activities). 

So, what are Beck rights, and how do they impact labor laws and CBAs? Thanks to the 1988 case Communications Workers of America v. Beck, the National Labor Relations Act (NLRA) prevents unions from requiring employees to become full union members. Employees can object and become “core” members, paying specifically for representation costs. The union contract still protects these workers.

Beck rights vary between states and unions, but generally, employers:

• Can require staff to pay partial dues (if located in a non-right-to-work state)
• Must notify employees of this choice and explain how union dues work if they opt out
• May NOT require workers to join the union fully
• May only use core members’ dues for representational costs, NOT political activities (if located in a non-right-to-work state)

Remember, if your business is located in a right-to-work state, employees can choose to either pay partial dues or not join the union at all. 

Understanding Union Rights & Employer Obligations

Navigating CBAs and union security arrangements can be tricky, but understanding the basics is vital for any employer with unionized staff. Different types of union security agreements affect how unions operate and what’s required from employees. 

In right-to-work states, employees can choose whether or not to join a union or pay dues, while union membership and dues might be required in non-right-to-work states. Plus, Beck rights also allow employees to opt for partial union membership, covering only representational costs.

Staying informed about these rules helps employers create fair and effective agreements that respect everyone’s rights. By doing so, you’ll foster a positive workplace and ensure compliance with labor laws.

If you need guidance from HR consultants with a significant understanding of union rights, contact BlueLion today at 603-818-4131 or info@bluelionllc.com. We’re happy to help you in this complex area!

Have you ever established communication expectations? Perhaps you have, but it’s been a while since you revisited them or shared them with your employees. Or maybe you haven’t yet, but your team is growing, and it’s time to streamline your processes. 

Wherever you’re at, follow these seven steps to put these important guidelines in place.

1. Evaluate Your Workplace Communication Needs

Before you begin developing or updating workplace communication guidelines, assess your current communication practices, channels, and tools. Gather your leadership team and start by asking: 

• Are you managing an in-person, hybrid, multi-location, or remote workforce?
• Where are there gaps? What are the pain points? 
• Who are the audiences/stakeholders?
• How do you measure the effectiveness of your communication? Is it effective? 
• Do you have a crisis communication plan?

It’s also a good time to ask your employees for their feedback on existing workplace communication techniques. You could do this in a few ways, such as one-on-ones with managers, department meetings, or employee surveys. 

Then, find the common themes (i.e., concerns, breakdowns, bottlenecks, etc.) and focus on strengthening those areas throughout the rest of this process. 

2. Set Internal Communication Goals

Once you’ve assessed your business’s strengths and weaknesses regarding internal communications, it’s time to establish a broad strategy. This should account for everything from everyday information and announcements to significant political and societal issues, which have been on the rise in recent years. Include guidelines for leaders to spread key messages and recognize employees who go above and beyond.

Additionally, include steps for communicating essential updates with the internal team before broadcasting them elsewhere—letting employees hear major announcements via social media, online, or the news can be a major morale killer. Instead, make team members feel valued by communicating all news, good and bad, with them before the public. This portion should also include guidelines for what employees can or can’t do with the information and how it affects them and the overall business.

Ensuring your employees are aligned with your goals will not only maintain a transparent, respectful corporate culture but also create a consistent, clear customer experience. However, not aligning your team could lead to miscommunication, poor customer experience, and potential backlash.

3. Create Style & Tone Guidelines

If you have brand guidelines, they could be a great starting point for establishing workplace communication expectations—in fact, the two should work hand in hand. While we’re specifically addressing internal communication here, consider how you want to communicate with your external stakeholders (e.g., customers and partners). Your tone and style should be consistent from the inside out, which comes back to your employees.

Of course, the tone of internal workplace communication may vary depending on the purpose and context. As LinkedIn notes, your official documents and reports may call for a formal and professional style, while you allow a more casual, friendly tone for social media and newsletters. 

4. Select Communication Methods & Channels

Include guidelines for both written and verbal workplace communication methods. Similar to tone and style, this depends on the purpose, goals, and audience of the message. Examples include:

• Posting official announcements, policies, or procedures (format) to the company intranet (channel), where these crucial resources can live permanently for employees to easily access. 
• Compiling important data and detailed information in a report (format) and sending it via email (channel) with an outline, context, and action steps
• Presenting (format) a new service or product via a virtual or in-person demo (channel) to educate your employees live and invite questions or feedback 

Outline tips for when and how to use specific workplace communication tools and apps. Consider what format and channel will make it easiest to digest and remember the message at hand. For example, in one study, 48% of workers said video is the most engaging form of communication—are there ways you can incorporate video more? 

You might also note when a meeting is necessary vs. when an update could simply be shared via your project management tool, chat, or email.

5. Make Communication Integrative & Inclusive

As you choose your organization’s primary communication tools and purposes for each, you should also determine when asynchronous vs. synchronous communication should be used.

Asynchronous communication refers to methods where participants don’t need to be present or engage in real-time interaction. Instead, messages or information are exchanged without the need for immediate response, thus allowing: 

• Employees to engage with messages or content when it’s convenient for them, regardless of the sender’s availability
• Individuals to focus on other tasks before responding thanks to fewer interruptions during the workday
• Easy collaboration across different time zones and geographical locations—making it ideal for remote and multi-location businesses
• Well-documented communication for later reference (since asynchronous communication typically involves messages that are saved)

Team members can send non-urgent messages via asynchronous channels like your project management platform (e.g., Asana), messaging apps (e.g., Teams or Slack), or email.

When you have time-sensitive information, you might leverage synchronous (i.e., real-time) methods like Zoom meetings, phone calls, or messaging apps, which can be used for both types of communication.

Taking a multi-channel approach to workplace communication ensures employees are included in relevant discussions and decisions, thus making them feel included and valued. In turn, this will boost employee engagement. Proactive, inclusive communication is particularly important with the shift to hybrid and virtual teams over the last few years. 

6. Set Employee Expectations

Next, it’s time to set employee workplace communication expectations. These should outline:

• Frequency for checking each communication channel
• Acceptable response times, 
• Updating their calendars and out-of-office (OOO) messages
• How much notice employees should give for rescheduling meetings

Define these expectations clearly—if you say respond in a timely manner, outline what that means for each channel.

For example, social media scheduling tool, Buffer, notes that employees are expected to respond to Slack messages by the end of their workday, Threads within two days if you’re tagged or a week if not, and within two days for all other methods.

Your guidelines should also set standards for CLEAR communication and good writing practices (e.g., proper grammar, spelling, punctuation, formatting, etc.). Remind people to provide sufficient background information and context and monitor their tone. This is harder to convey in written workplace communication, so rereading and proofreading our content is vital.

However, the same goes for verbal communication—we can get carried away with emotions, so when things get stressful or heated, it’s easy to let that seep into our speech. We need to think carefully about our tone and words before speaking. 

7. Consider Timing

We’re all inundated with messages and information daily. In fact, one study found that 80% of global workers experience information overload, while 76% felt that it contributes to increased workplace stress. This is why you’ll also want to provide guidelines on how and when employees should communicate.

Thoughtful, effective leadership also includes careful consideration about the timing and frequency of sending messages and sharing information. They set the standard for healthy workplace communication practices (e.g., setting boundaries and expectations about when messages should be sent and responses). Avoid creating a toxic workplace culture by calling, emailing, and texting employees at all hours—which puts pressure on employees to always be available. 

Ensure your workplace communication policies define what it means to respect one another’s time, such as contacting coworkers outside regular working hours and giving people sufficient time to respond. For example, if certain colleagues like to email in the evening, they might include a line in their signature noting there is no pressure to respond immediately. 

8. Share Workplace Communication Guidelines

Once you establish workplace communication guidelines and policies, it’s time to—you guessed it—communicate them with your team! A few places they should live include the employee handbook and company intranet. 

Additionally, you can share communication expectations by:

• Conducting workshops
• Sending it regularly in internal newsletters
• Incorporating it into the new hire orientation process

When you first share your workplace communication guidelines, you might accompany them with a video introduction (this works well when sharing via intranet or email). This video could outline the key elements, like style, tone, audience, and methods/formats, as discussed earlier. 

Finally, don’t hesitate to ask for feedback. Your employees may have valuable insights and ideas to continue improving communication practices. After all, different roles and departments may have different needs, challenges, or perspectives.

Prioritize Workplace Communication, Strengthen Your Team

In the ever-evolving landscape of business, effective communication is more than a tool—it’s the cornerstone of collaboration, innovation, and organizational harmony. By embracing the principles outlined here, you’re not just setting guidelines; you’re fostering a culture where all employees know they’ll be heard, ideas flourish, and connections thrive. 

So as you navigate the cadence of workplace communication, remember it largely comes down to how every message is shared, heard, and understood throughout your business!

Need tailored guidance as you develop employee communication guidelines and expectations? Our HR consultants love helping small business owners and leaders level up areas of their corporate culture like this! Contact BlueLion today at info@bluelionllc.com or 603-818-4131 to learn more. 

That leaves many employers wondering how the election year will impact their workplace and how to handle it while keeping their teams safe, satisfied, and productive. Navigating politics at work is no easy feat, as related conversations are more prevalent than ever. At the very least, they can cause disruption and tension when not addressed. Worse, they can result in conflict and a toxic environment.

Leaders and HR departments must now take a more proactive, empathetic approach to politics. But what does that look like, exactly? Let’s dive in below. 

Create a Psychologically Safe Environment

Developing a psychologically safe space with a focus on mental health should be a priority not only during an election year but 24/7. Start by getting a pulse on current employee sentiments about whether they feel safe in the workplace via anonymous surveys or other tools or by simply listening. This will help you understand your strengths and weaknesses regarding empathetic and respectful discussion, and then provide guidance and coaching where necessary.

Understand that an election year can be stressful for people. The SHRM study also found that “1 in 5 U.S. workers (20%) have experienced poor treatment in the workplace by coworkers or peers due to their political views.”

Foster a safe environment for employees to share political views without fear of ridicule or retaliation. Remind people that it’s okay to have conversations and disagree, and it’s possible to do so without becoming disrespectful or hostile. 

Research by workforce resilience platform provider meQuilibrium (meQ) shows that in workplaces with strong psychological safety, “employees are 60%-90% less likely than others to report uncivil behavior on their teams.”

Bottom line: Investing the time, energy, and resources into creating a psychologically safe space is worth it and makes a difference!

Don’t Ban Political Discussions

During the 2020 election, Zippia’s survey of 2,000 workers reported that 47% admitted to talking politics at work, and 79% found themselves distracted by the election. 

Prohibiting political discussions in the workplace may be tempting, but it’s often unrealistic—and can backfire. Instead, talk openly about your company values and remind people that everyone has different views and experiences. 

There’s also the matter of protected speech and concerted activity. Employers can ban activities like campaigning and wearing political attire at work. However, National Relations Board general counsel Jennifer Abruzzo told SHRM that political conversations may be covered by the National Labor Relations Act. 

Remind team members that while they have freedom of speech, they are responsible for their words and actions and how they affect their colleagues—and free speech does NOT cover inappropriate activity and language such as verbal abuse, bullying or harassment, disrespectful behavior, and threatening language and behavior. Create boundaries that allow for healthy conversation but prevent it from crossing the line. 

Simply put, emphasize mutual respect!

When crises or significant social/political events occur, take the time to determine how your organization will respond. We get it—this can be tricky. How can you respectfully speak on sensitive matters with your team and the public while accounting for various experiences and backgrounds? This is where consulting with a diversity, equity, and inclusion (DEI) expert can guide the way on a case-by-case basis.

Train Managers & Leaders

Successfully navigating an election year at work starts at the top, so companies should provide training and workshops for management to enhance their skills around sensitive topics like politics, racism, social issues, and world events. Your leaders should:

• Know how to facilitate open, respectful dialogue rather than shy away from it
• Get comfortable with the uncomfortable
• Remain neutral with an open ear without disregarding an employee’s opinions or experiences

Management should also focus on building rapport and trust with their employees—effective leaders will likely do this naturally. A 2023 survey by Development Dimensions International (DDI) found that less than a third of employees believe senior leaders at their workplace do “what’s right.” This drop shows the growing division and distrust, which is just another reason HR and leadership must focus on it now.

Communicate a zero-tolerance policy for hostile, harmful rhetoric and know how to address it. You might also host a company-wide meeting before, during, or right after Election Day to remind your team about healthy, safe dialogue—and to avoid discussions they can’t keep civil. During this meeting, leadership can reinforce the zero-tolerance policy on harassment and harmful behavior.

Review & Update Your Policies

Have you pulled out the employee handbook and revisited your political activity and civility policies recently? If not—or if you haven’t developed these policies yet—now is the time.

A political activity policy provides expectations and guidelines to prevent political discussions and activities from disrupting the work environment or damaging your company’s reputation. This document promotes an inclusive and respectful company culture by mitigating conflict between employees. A political policy typically:

• Outlines prohibited behavior (e.g., campaigning, soliciting, wearing political attire)
• Requires workers to ensure their political activities do not negatively impact the business
• Defines unacceptable behavior, like harassment or discrimination based on political beliefs

While a civility policy is particularly relevant during an election year, it should also guide your team on respectful, professional behavior year-round. With political rifts growing, this policy is becoming more common in employee handbooks. This document outlines acceptable and unacceptable behavior, therefore helping your business: 

• Foster a positive and respectful work environment—which can boost morale and productivity
• Prevent incidents of workplace harassment, discrimination, or violence, along with legal liabilities
• Showing employees, customers, and partners that you’re committed to creating a safe and respectful environment

Note that clarity and specificity are critical when describing unacceptable behavior. Learn more about political activity and civility policies and what each should include.

A Realistic Outlook & United Workforce for Election Year

If you know BlueLion, you know we keep it real—and there’s no sugarcoating the challenges of this politically and socially tumultuous time. So, if you’re wondering how to deal with politics at work, the first answer is not to simply look the other way.

Employers and HR professionals can bring their employees together by facing it head-on and instilling a culture of compassion, respect, and inclusion. People might even learn and gain perspective from one another’s experiences!

Do you need help navigating politics in the workplace? Whether you need guidance on policy development or handling a specific situation, BlueLion has your back. Contact us today at 603-818-4131 or info@bluelionllc.com. 

The information on this website, including its newsletters, is not, nor is it intended to be legal advice. You should contact an attorney or HR specialist for advice on your individual situation.

With the World Health Organization (WHO) naming stress the health epidemic of the 21st century, it’s no surprise that both personal and professional stress permeates so many corners of our lives.

This is why it is so important for companies to implement Employee Assistance Programs (EAPs). An EAP can be an essential resource for employees who are dealing with a range of issues.

Unfortunately, these valuable programs are underused, with only 5 out of every 100 employees with access to an EAP leveraging the benefit in a year. However, usage has doubled since the COVID-19 pandemic—which makes sense when you consider how employee stress has skyrocketed over the last few years. 

It seems employees typically have two main concerns regarding EAPs: 

• There is often a stigma because, historically, it was primarily a resource for people with substance misuse problems or serious mental health issues.
• Employees are reluctant to use EAP counseling due to confidentiality concerns.

Modern EAPs, however, address a much broader range of problems and are always 100% confidential. They can offer significant assistance to your workforce and, in turn, have very positive effects on your company. 

If your organization does not already have one in place, we highly recommend getting one! Below, we’ll tell you:

• Exactly what an EAP is and what it covers
• Why your company needs one
• How to implement one effectively

Keep reading for the low-down on EAPs so you can get one in place today.

What is an Employee Assistance Program (EAP)?

An employee assistance program or plan is a voluntary work-based intervention program designed to offer employees support and solutions for issues impacting both their work and personal lives. It is employer-sponsored and completely free for employees to use. 

Employee assistance program services can include counseling and guidance for areas such as:

• Marital/relationship problems
• Financial struggles
• Emotional problems
• Family issues
• Substance or alcohol misuse

Some EAPs may even offer a wide range of services covering basic legal assistance and referrals, adoption assistance, help finding elder care services, and more. It is separate but complementary to your other employee wellness programs, as your provider can often help you find related wellness offerings. The employee’s spouse, children, or partner living in the same household also typically have access to the EAP.

Program counselors will work in a consultative role with managers and supervisors to address employee and organizational challenges and needs. This means they can help organizations prevent and cope with workplace violence, trauma, and other emergency response situations.

Why does your company need an EAP?

EAPs are great for employees because they are paid for by employers and often extend to employees’ immediate family members or to anyone living in employees’ homes. On the same token, EAPs are cost-effective tools for employers that can truly pay off long-term. 

As an employer, you have a vested interest in your employees’ performance. If they are distracted and affected by personal issues and stress, it can affect their ability to reach their full potential. This, in turn, can hurt productivity and drive up costs for businesses. 

EAPs cover certain needs that the healthcare system can’t handle, like financial counseling or elder care assistance. People often struggle with these areas silently simply because they don’t know where to turn for help or can’t afford it. Again, these are totally free services to employees.

EAPs can be the key to helping employees deal with these types of issues and significantly improving their performance. 

The Stress is in the Numbers

Are you still unsure if your workplace really needs an EAP?

The State of the Global Workplace: 2023 Report by Gallup found that employee stress remains at a record high for the second year in a row, with 52% of American and Canadian respondents stating they experienced a lot of stress the previous day. 

While employee stress has likely risen partially due to the pandemic, it’s been increasing for over a decade. Gallup also found that 26% of U.S. employees “very often or always” feel burned out at work, and only 24% feel their employer cares about their well-being.

So, how does workplace stress impact your business? When your employees are struggling with excessive stress or other mental health issues, it can:

• Interfere with employee focus, engagement, and productivity
• Cause performance issues, such as mistakes or missed deadlines
• Decrease morale and create a tense work environment
• Increase tardiness, absenteeism, and turnover
• Spark workplace conflicts between coworkers and/or staff and supervisors
• Lead to more illnesses and injuries—which can, in turn, affect your insurance rates

According to the American Institute of Stress, around 1 million workers are absent every day due to stress, and this job stress is estimated to cost American companies “more than $300 billion in losses due to absenteeism, diminished productivity, and accidents.” 

Those are some ugly stats—and there are many more regarding the negative effects of stress in the workplace.

Employee Assistance Program Benefits

Fortunately, employers can prevent and address many stress-related problems by properly implementing an EAP with resources to help employees manage their stress. The U.S. Department of Health and Human Services reports that for every dollar invested in an EAP, employers generally save anywhere from $5 to $16. 

Are you concerned about the costs of adding an EAP to your employee benefits package? Statistics show that only 1-2% of employees need to use it for counseling each year “to yield enough savings in work productivity outcomes” to break even on your ROI!

But an effective EAP is about more than a purely financial return on investment. It can help:

• Reduce absenteeism
• Boost employee engagement
• Improve job performance and productivity
• Decrease presenteeism
• Ease depression and promote mental health
• Support employees in recovery
• Attract and retain talent

One study even found that employee satisfaction regarding EAPs is “often over 90%.” Additional research found that these programs can strengthen the company from a bigger-picture perspective because they provide “consulting to managers and leaders, workplace crisis preparedness and incident response, organizational level behavioral health risk management services, and specialists for difficult workplace events (i.e., harassment, bullying, sexual inappropriate behavior, customer conflicts, work team dysfunction).” 

How can you implement an EAP?

If you’re ready to get an EAP for your business, we recommend first asking your employee benefits broker if they offer one. Oftentimes (but not always), short-term and long-term disability providers offer this to employers at no cost!

When searching for an EAP, you will want to evaluate what kind of program will best suit your organization’s needs. A few things to consider include what the plan provides, how EAP contracts work, critical requirements any EAP should follow, and how employees will access EAP services.

EAP Delivery Options

There are a number of options when it comes to how an EAP is managed and delivered. Businesses can choose to keep it in-house or outsource all services. The Society for Human Resource Management (SHRM) reports that the most common EAP delivery models include:

• Management-sponsored EAPs: Employers (often large organizations) hire internal EAP staff to deliver the services all in-house.
• Fixed-fee contracts: Employers pay for various services (i.e., counseling, referrals, and supervisory training) with fees based on the number of employees, regardless of their actual EAP use.
• Fee-for-service contracts: Employers contract an EAP provider and pay only when the service is used.
• Consortia: Small businesses join together to contract for EAP services, lowering the cost per employee.
• Member assistance programs: Unions provide these programs with services ranging from prevention and problem identification to referral and counseling activities for employees and their family members.
• Peer assistance programs: PAPs are sponsored by employers or unions and train peers to work with troubled employees to address substance abuse and other problems within predetermined rules and limits.
• Mixed-model programs: These are used by employers and unions with multiple worksites that have different needs and resources.

Service Options

Another awesome benefit of EAPs is that many of them offer different forms of in-person and e-counseling. These include tele-counseling and video-counseling, which suit the needs of many professionals who live a hectic lifestyle and are looking for a more convenient, practical alternative. Virtual counseling eliminates travel time and offers more scheduling flexibility.

Many EAP providers offer both e-counseling and in-person counseling. This allows the client to choose what works best for them. In some cases, a blended approach is taken based on the employee’s needs. This means the employee can enjoy the benefits each method has to offer.

Communication

Once an EAP is in place, employers and/or their HR teams need to inform employees about it regularly (ideally on a monthly basis). This way, all employees will be aware of the program’s existence, how it works, and their options. 

Be sure to communicate the comprehensive services included in the EAP during these routine reminders. Let workers know that they are free and available to everyone in the company. By properly educating all employees about the program, you can remove the stigma around EAPs and encourage them to take advantage of it. 

Confidentiality

Another important factor to address is confidentiality. Remind employees that any services they seek through the EAP are kept completely confidential. 

Employees don’t need to get permission or go through HR to utilize the services. All they have to do is contact the EAP provider. Counselors do not report back to the organization nor keep external records of the counseling sessions. No one in the company has to know that the employee is receiving assistance. 

Executing an Employee Assistance Program

It will be up to your HR team to manage your organization’s employee assistance program and the relationship with your EAP provider, but the use of the services will always stay confidential. 

HR will need to stay in contact with the EAP provider to ensure the programs in place are effective and to guarantee the timely and accurate flow of information to employees. This will help the organization develop services over time and encourage employee engagement with the programs. It only makes sense that HR should be involved since an EAP is an investment in your people!

If your company needs assistance implementing and maintaining an EAP, contact BlueLion at 603-818-4131 or info@bluelionllc.com today. From finding the perfect program for your business to creating policies and procedures, we’ll help you get started on the right track toward ensuring your employees’ well-being and productivity.

The information on this website, including its newsletters, is not, nor is it intended to be legal advice. You should contact an attorney or HR specialist for advice on your individual situation.

Altogether, payroll software can play a significant role in saving time, reducing costly errors, and strengthening data security. But it’s still important to research various services and find the one that best suits your small business. Read on for key considerations and features to look for in your search.

5 Steps to Choosing a Payroll Software

1. Determine Your Business’s Payroll Needs

Start by defining your specific payroll requirements. This will help you understand what features your business needs and establish a budget. Consider your:

• Business Size and Growth: Can the software accommodate your business today and in the future as it grows? Small to medium businesses can likely find sufficient and affordable options with simpler features to avoid paying for features they don’t need, while large companies may need a higher level of service.
• Types of Workers and Pay Schedules: Do you have employees and independent contractors? Hourly, salaried, and tipped workers? How many of each? How often will your pay periods occur? These are crucial details to keep in mind while you research payroll systems.
• Staff Locations: If your team is spread out among different states or countries, ensure your payroll provider can manage their payments.
• Integrations: What other platforms does your business use? Your payroll software should integrate with your accounting software, time-tracking tools (many payroll systems now come with this feature), or HR management system.
• Benefits: You’ll also want to ensure your payroll system can handle benefits like health insurance, retirement contributions, paid time off (PTO), and worker’s compensation.

2. Establish a Budget

Payroll software services vary widely in features, pricing, and pricing structures. Most charge a monthly base fee plus a charge per employee.

As you evaluate options, look at the total cost of the software, including any setup fees, subscription costs, and additional charges for extra features or support. Researching various companies and pricing will give you an idea of what to budget based on your company’s needs. Remember, you often get what you pay for with payroll platforms when it comes to features and customer service! Look for a provider with reasonable costs and high-quality service.

3. Evaluate & Compare Payroll Software

Once you’ve determined your needs and set a budget, you can check out different payroll service providers and start narrowing down your list. As you do, keep a list of the must-have features your payroll software should have based on Step 1. At the very least, ensure it offers:

• Automation and direct deposit (pay attention to payment timing—is it next-day?)
• Payroll taxes and filing of federal and state taxes
• Integration with your essential business software
• Attendance and time-tracking functions (a necessity for hourly employees)
• 24/7 customer service availability in your preferred method

Again, most platforms should also offer mobile apps for you and self-service tools for your employees. For even more insights, check out reviews of your top runners. What do users say about the customer support and responsiveness? How about implementation and ease of use? You might even ask fellow business owners about their experiences with certain payroll companies.

4. Assess Compliance & Security Measures

Another important factor that deserves its own call-out is compliance and security—not to be taken lightly when it comes to your company and your team! Verify that your selected payroll software complies with relevant tax and labor laws and reporting requirements in your region or industry. 

These regulations are always changing, so you’ll want a provider that quickly adapts their software to these changes and keeps you compliant with wage and hour laws like overtime pay. 

Your payroll service should also use robust data security measures to protect sensitive employee information and ensure confidentiality. To be extra safe, you can even search online to see if they’ve been subject to any data breaches and ask them what protections they have in place if one arises.

5. Leverage Those Free Demos/Trials & Make a Decision!

After evaluating all of your business needs and features and narrowing down your top two to three choices, it’s time to test them out. Most providers offer a free demo and/or trial, so take advantage of them! This way, you can get an up-close experience with the platform, confirm it does all you need it to do, and ensure it’s intuitive for you and your team. 

Finally, it’s time to choose your payroll software. It may not hit every single bullet, but opt for one that aligns with your major must-haves and budget. And don’t be afraid to take them up on any implementation support to set your system up for success from Day 1.

7 Vital Payroll Software Features

To recap, below are several capabilities all payroll software services should include:

• Payroll Processing: Your payroll software should offer—you guessed it—automated calculation of wages, taxes, and deductions based on employee hours worked and pay rates. The platform’s primary function is paying employees the correct amount on time via their selected payment method.
• Direct Deposit: At this point, every payroll service should allow for the transfer of funds directly into employees’ bank accounts, eliminating the need for paper checks. While some still like receiving a paper check, the American Payroll Association’s 2022 “Getting Paid in America” survey found that 93% of respondents choose direct deposit. 
• Tax Compliance: Your payroll platform should also handle automated tax calculations, deductions, and filings to ensure compliance with federal, state, and local tax regulations. This includes managing W-2s and 1099s, as mentioned earlier. 
• Time Tracking: If you have hourly employees, it’s easiest to use payroll software that includes a time clock feature rather than finding a separate time-tracking tool. Connected time clock and payroll systems ease the approval and calculating process. If you need to use separate time and attendance software, ensure your payroll system is compatible. 
• Non-standard Pay: In addition to typical payroll processing and administration, you may have cases of workers’ compensation, wage changes and related adjustments, and bonuses. These calculations can add complication and time to your plate, whereas your payroll service should take care of them.
• Reporting & Analytics: A quality payroll system will generate customizable reports and analytics, allowing you to track payroll expenses, employee costs, and other financial metrics.
• Employee Recordkeeping: Finally, payroll software is one central, organized location for essential employee records, including personal information, employment history, and benefit details. 

Conclusion

By carefully considering these factors and evaluating the key features offered by different payroll software solutions, you can choose the best option to streamline your small business’s payroll process and meet your specific needs. Say goodbye to that time you and your team spent stressing over tax compliance, wage calculations, and recordkeeping! Investing in a payroll service is a MUST when you have a team of any size. 

Do you have questions about payroll software recommendations or need assistance establishing a process? Contact BlueLion’s HR pros at 603-818-4131 or info@bluelionllc.com today to learn how we can help!

Consider this scenario: A seemingly harmless comment about a colleague’s work ethic evolves into a full-blown rumor questioning their competence. Before long, productivity suffers as trust deteriorates among team members, leading to strained relationships and a toxic work environment. 

Gossip isn’t just a nuisance—it’s a productivity killer. Its ripple effects include reduced employee morale and job satisfaction, ultimately affecting organizational performance.

Let’s explore the intricacies of workplace gossip, its impact, and, most importantly, how employers and managers can effectively address and prevent it. 

Preventing Workplace Gossip & Conflicts

Follow these tips to mitigate office gossip from the start.

Set the example

Managers should start by setting a mature, respectful example by not participating in gossip in the first place. They must set the tone—which can be hard for newly promoted managers, who should no longer participate in the water cooler rumors. But remember, it starts at the top!

Train managers on preventing and addressing gossip

Regular training sessions and workshops on preventing and handling workplace gossip are also essential. These workshops should equip managers with the skills to spot early signs of negative talk, intervene effectively, and facilitate conflict resolution. The goal is to prevent or stop gossipers as early as possible. 

Stop gossipers before they divulge

Employees should feel empowered to shut down the conversation politely but firmly when a colleague approaches another with workplace gossip. They could even forewarn the gossiper that they will act on the information by addressing the issue with the original source. This proactive approach sends a clear message that gossip has no place in the workplace culture.

How to Deal with Gossip in the Workplace

Of course, you employ humans, and sometimes, workplace gossip is unavoidable. So, how should leaders and managers address negative chatter when it arises?

Speak with the primary gossipers

When workplace gossip occurs, managers should first meet with the main perpetrator(s) to stop it from escalating. These should be one-on-one meetings in an enclosed office or conference room; if more than one person is involved, meet with them individually. This allows you to understand the root cause and provide support or resolution where necessary.

Rather than calling out individuals publicly, keep the conversation confidential and constructive by going directly to the source of the gossip for the full story. Listening and keeping an open mind is important, as is maintaining a critical eye—without making accusations, as this could spur defensive responses. 

Start by addressing the content of the gossip rather than the act of gossiping itself. This means addressing the gossipers’ concerns or complaints. 

This puts you in a better position to hold the perpetrators accountable for the gossiping behavior. Begin by focusing on the facts. If you find they have been spreading harmful gossip, highlight the potential harm of their actions and inform employees about the repercussions of what will happen if they don’t stop gossiping. Corrective action could include a written warning, demotion, or suspension.

Document the issue and relevant conversations

Record the workplace gossip incident and all related conversations with those involved. This ensures you have proof of the issue, how it was resolved, and any warnings or disciplinary action you’ve taken with the gossipers. 

Hold a team meeting

After speaking with the key gossipers, gather the relevant team(s) to discuss the situation and the issue of workplace gossip. Remind employees to avoid gossip, work out issues directly with coworkers if possible, and bring any concerns to management. Addressing the issue transparently encourages open communication and reinforces the expectation of professionalism in the workplace.

Something you can encourage is “positive gossip,” such as sharing team or individual wins. For example, spreading the word about an employee going the extra mile for a client or a department providing a unique solution or idea that positively impacts the company. Sharing positive stories can be rewarding and boost morale and productivity. 

Should Companies Have a Workplace Gossip Policy?

You might think a workplace gossip policy is necessary, but past cases prove otherwise. In December 2013, National Labor Relations Board (NLRB) Administrative Law Judge Donna Dawson found Laurus Technical Institute’s no-gossip policy “overly broad,” stating that it violated the National Labor Relations Act. 

The school’s policy prohibited discussing an individual personally or professionally when they or their manager weren’t present. It also prevented “making negative or disparaging comments or criticisms about anyone; creating, and sharing or repeating, a rumor about another person; and discussing work issues or terms and conditions of employment with other employees.”

Establishing a strict policy on workplace gossip could be ineffective and even risky. Often, these are too broad to be enforceable or are too restrictive and violate protected concerted activity (e.g., voicing concerns about working conditions, discussing wages, or complaining about supervisors). 

Instead, take an educational approach with both leadership and staff. Train managers to identify the line between harmless chatter and genuinely concerning issues of harassment, health, or safety. Incorporating these discussions into an overarching effort to mitigate bullying or unprofessional conduct fosters a culture of accountability and mutual respect.

However, one policy you can and should include in your employee handbook is an email and electronic communication policy encompassing chat tools (like Slack or Microsoft Teams). Many employees make the mistake of viewing these channels as regular conversations, spreading detrimental rumors, opinions, and other negative messages. 

The policy should inform employees of the dangers of using email and chat apps for gossip because these messages can accidentally be sent to unintended recipients. A solid email and electronic communication policy should outline these issues, explain employees’ privacy expectations concerning these methods, and ensure all employees read and understand the policy.

Bottom Line on Handling Gossip in the Workplace

While you may not be able to completely do away with workplace gossip, you can certainly take proactive steps to mitigate its impact. By setting the right tone, addressing issues promptly, and encouraging open communication, your organization can foster a culture of trust and respect. This prevents incidents from blowing up into larger conflicts and boosts morale and productivity.

Contact BlueLion to learn how they can help strengthen your workplace environment at info@bluelionllc.com or 603-818-4131.

Before you panic, respond negatively, and harm employee relations, take a moment to breathe! Consider what it means that your employees want to form a union.

Workers generally don’t organize unions with the goal of going to war against their employer. They’re trying to communicate with you about what they want, the things that your company could do to improve the working conditions and lives for themselves and their team members. Instead of viewing it as a threat, consider how you can work with employees to lift them up along with your organization.

With the right proactive measure, you can mitigate the chances of employees feeling the need for a union. If they do take this road, responding calmly and communicatively can lead to a positive outcome—but handling union efforts poorly (e.g., punishment, termination, or preventing unionization) can have a severe impact on your employee turnover, operations, reputation, and more.

Read on to understand why there is a “right” and “wrong” way to deal with employee unions and tips for responding wisely.

The Status of Unions

Why is it that unions seem to be on the rise again? Consider the current job market, where employees now have leverage as the unemployment rate remains below 4%. This means workers feel there is less risk in unionizing and are more confident about their ability to find another job with better conditions and pay.

But what do the laws say? The National Labor Relations Board (NLRB) allows workers to form a union in one of two ways. Organizers can pursue an NLRB election if they get at least 30% of workers to sign cards or a petition saying they want a union; if the majority vote for a union, the NLRB will certify it. Or, the employer can voluntarily recognize a union based on proof (i.e., signed union-authorization cards) that a majority of employees want union representation.

Concerted activity is also protected, meaning employers can’t stop employees from discussing work conditions, how to improve them, and unionization. Follow the NLRB’s “TIPS” rule, outlining which actions are illegal: 

• Threats: Employers cannot threaten employees for supporting a union.
• Interrogation: Employers cannot question employees about their union sympathies, activities, or those of their peers.
• Promises: Employers cannot promise or provide benefits to employees to gain their support and deter them from supporting the union. 
• Surveillance: Employers cannot spy or pretend to spy on union activity.

However, managers and supervisors can communicate specific information during a unionization campaign under the “FOE” rules: 

• Facts: You may share publicly available facts from reputable sources like the NLRB and unionfacts.com.
• Opinions: You may share why your company believes a union is unnecessary.
• Examples: You may provide real stories of others to highlight why a union might not be the right choice.

Create an Employee-Centric Corporate Culture

Let’s face it: Your employees are your most important business asset. Not your facility, equipment, inventory, or cash flow. It’s your people—without them, your operations and productivity, even your customer experience, would suffer.

It goes without saying, then, that the first step in avoiding unionization is creating a workplace culture where employees don’t feel it’s necessary to form a union. So, how do you do this? Maintain employee satisfaction by: 

• Fair, competitive pay and benefits
• Ongoing performance management 
• New opportunities and room for growth
• Safe, healthy, and enjoyable working conditions
• Flexible work schedules and paid leave policies
• Providing a system for employee feedback and ideas—and showing you listen to them!

With a positive company culture that puts your people first, employees will know that leadership cares about their well-being at work and beyond. In turn, they likely won’t feel a need to unionize. 

Typically, union talks begin when teams believe management does not care about and value them. So remember, even when workers have concerns and conflict arises, listening can go a long way. People often just want to be heard!

Address Concerns Early

Sure, you can look for warning signs of employees wanting to form a union, but by this point, it’s likely too late. 

Instead, you should have a pulse on your workplace culture and employee satisfaction long before problems are significant enough that people start talking about unionizing. Hence the importance of building a positive workplace culture and putting employees first from the beginning!

Once you start hearing rumblings of unionization talk, you first need to assess what issues could be driving them to unionize. Consider the common issues mentioned above. What changes can you make? If you can’t afford the pay and benefits workers are requesting, what else can you offer? Look at work-life balance perks like those flexible work schedules and leave policies.

Despite discussions about forming a union, it may not be what your employees truly want—often, they feel it’s the best option to garner attention and change. Again, showing them an effort to listen and create a fair work environment can often deter union efforts.

Shift Your Perspective

Historically, many companies believe that unions would not be good for either party and attempt to convince employees of this, too. From the last couple of years, we can look to the recent Starbucks, Amazon, and Target stories as glaring examples of what companies should NOT do. 

Starbucks fired workers known to be involved in union organizations and closed stores with strong union activity. Amazon has been found in violation of labor laws by retaliating against employees for union activities and threatening employees. The company also required workers to attend a series of anti-union meetings in the weeks leading up to the Staten Island union elections. And leaked Target training documents showed that the company instructs store management to prevent workers from forming unions.

Employers walk a fine line regarding workers’ rights to unionize. At the least, they risk reputational damage; at worst, they risk violating labor laws. 

Recognize that when employees form a union, it means they are dedicated to improving the company. Yes, they could simply quit and find work elsewhere—but they are invested in their coworkers and some part of the organization.

When you go the collaborative route in your relationship with a worker union, it can actually have positive effects, such as:

• Improved employee retention and relations
• Fostering trust and more efficient problem-solving—without the power struggle that often comes along with union negotiations
• A more equitable and sustainable workplace

Respond to Unionization Efforts

Take the time to find out what employees want and why they’re forming a union, then evaluate how you can address their concerns. Consult a labor law attorney before reacting to unionization efforts or making any rash decisions. Then, determine how you will respond—remember, it isn’t black and white or one extreme or the other.

Establish open communication channels between management and employees, and encourage continued dialogue. This is one way to immediately address concerns and issues and demonstrate that the company values employee feedback, helping to build trust and reduce the appeal of unionization. 

Below are a couple of approaches employers could take. 

Pursue an Active Partnership

Working together can strengthen employee relations and result in a positive outcome, preventing the situation from going sour. You could start by implementing: 

• Employee engagement programs focused on improving job satisfaction, work-life balance, and overall employee welfare
• Labor management committees where management and employees collaborate on workplace issues 

Both can help build trust and address concerns before things escalate to unionization.

Proactively working with employees could also mean voluntarily recognizing the union (i.e., recognizing the union without requiring a formal NLRB-run election). At this point, you should begin good-faith negotiations. This involves sincere efforts to reach an agreement on terms that both parties find acceptable.

Maintain a Neutral & Respectful Stance

If you choose not to voluntarily recognize a union, you can still respond legally and in a way that won’t further damage your relationship with workers. Avoid making negative comments about the union or its organizers, and refrain from any actions that could be perceived as attempting to influence employees’ decisions. 

You might also establish key agreements with union organizers, such as: 

• A neutrality agreement stating you agree not to oppose unionization efforts actively. This can include not holding anti-union meetings, distributing anti-union materials, or taking actions that could be perceived as attempting to influence the outcome. 
• An agreement allowing union organizers reasonable access to non-working areas of the workplace for organizing purposes. This agreement should outline a reasonable time, place, and manner to ensure minimal disruption to business operations.

Remember, you have the right to communicate with employees, so you may share information about the potential consequences and benefits of unionization to help them make educated decisions. 

After an NLRB Election

In the case an NLRB election takes place and employees vote in favor of unionization, accept the results and begin bargaining in good faith with the union. One essential piece to negotiate is a collective bargaining agreement (CBA), which outlines the terms and conditions of employment. 

Additionally, ensure your company follows any NLRB orders related to the election process and subsequent bargaining by providing necessary information to the union and engaging in good-faith negotiations.

When it comes to communication with employees, keep it positive and respectful. Reassure them of the company’s commitment to maintaining a positive workplace despite the changes and encourage collaboration between membership and the union. Conduct orientations for employees and management to familiarize them with the rights and responsibilities established by the National Labor Relations Act (NLRA).

Maintain this open dialogue with the union to address concerns and ensure a collaborative relationship. This can help prevent misunderstandings and foster a positive working relationship. Explore opportunities for joint initiatives that benefit both the company and the unionized workforce. This could include joint committees to address workplace issues and improve communication.

Final Thoughts on Worker Unions

It’s essential for employers to strike a balance between addressing the root causes of employee dissatisfaction and respecting their rights to organize. Be cautious about engaging in activities that may be perceived as unfair labor practices, as these can lead to legal challenges.

By proactively addressing underlying issues, maintaining open communication, and respecting employees’ rights, you can create a positive workplace environment that mitigates the appeal of unionization. It’s crucial to approach the situation with empathy, transparency, and a commitment to addressing employees’ concerns.

Remember, each workplace is unique, and the appropriate response may vary based on the specific circumstances. Seeking legal advice and consulting with HR professionals can help tailor your approach to your organization’s needs and challenges. Contact BlueLion to learn how at info@bluelionllc.com or 603-818-4131 today!

The information on this website, including its newsletters, is not, nor is it intended to be legal advice. You should contact an attorney or HR specialist for advice on your individual situation.

We get it—another hefty responsibility for the small business owner to manage! What records do you need to retain? And for how long? 

Federal laws and agencies like the Federal Labor Standards Act (FLSA), Equal Employment Opportunity Commission (EEOC), and Department of Labor (DOL) have established employee recordkeeping requirements. Plus, you might have state and local laws to adhere to. 

Keep reading for a checklist of employment records you’ll need to keep, along with guidelines for how and when.

How long do employers have to keep employee records?

This depends on the type of records and any applicable federal, state, and local laws that apply. The Society of Human Resource Management (SHRM) notes that many employers keep it safe and straightforward by retaining employee records for seven years, which meets most regulations. 

Employee Personnel Files

Most personnel files should be retained for at least one year after employment ends. This includes everything from personal details to hiring documentation. Under the FLSA, employers should keep personal and hiring records, such as: 

• Full name and Social Security number
• Complete address
• Birth date (if under age 19)
• Demographic information
• Job description
• Job application and cover letter
• Pre-employment evaluations
• References
• Background checks and drug test results
• Offer letter
• Employment, noncompete, nonsolicitation, and any other contracts
• Start and end dates

When it comes to performance and disciplinary records, keep the following for at least two years after the employee leaves:

• Performance reviews
• Wages and changes 
• Trainings, classes, and certifications completed
• Job titles, promotions, or transitions
• Leaves of absence
• Corrective actions or complaints
• Exit interviews, layoff, or termination information

Form I-9, Employment Eligibility Verification

Form I-9 is one of the most important documents for every employee you hire in the United States, including citizens and noncitizens. You and the employee must complete your respective portions of the form by their first day of work. 

You must retain all I-9s for three years after the employee’s hire date or one year after their termination, whichever is later. Be sure to file them securely and separately from other employee records. The new I-9 alternative procedure offers a remote method, making completing and retaining each form much more efficient.

Payroll Records

This is another crucial area of employee records, which can become overwhelming and confusing due to the numerous documents and regulations around payroll. Many requirements range from three to seven years—and employers often err on the side of caution by sticking to the higher end. If you’re not sure if you should keep certain documents, hold onto them and consult with an HR professional. Below are some guidelines.

First, the Department of Labor (DOL) requires businesses to retain any wage-related records for at least two years, including:

• Employee schedules, whether fluctuating or fixed
• Regular pay rate
• Wage tables
• Time cards and piecework tickets
• Total daily or weekly straight-time earnings
• Total wages paid each pay period
• Overtime earnings
• Additions to or deductions from wages

If you’re ever selected for a DOL audit, you’ll need to provide these employee records, which should be stored at the workplace or in a central records office.

Regarding the method and format you use for timekeeping, you may use a time clock, have a designated timekeeper track employees’ work hours, or have workers write their own times. The DOL allows any of these as long as the records are complete and accurate.

For workers on fixed schedules, you can simply document their daily and weekly hours, indicating that they followed the assigned schedule. If an employee works more or fewer hours than their set schedule, record those hours on an exception basis.

Tax Records

The IRS also requires employers to keep employee records related to federal and state taxes for at least four years, including: 

• Your EIN
• Amounts and dates of all wages, annuities, pension payments, and tips
• The fair market value of in-kind wages paid
• Employee names, addresses, SSNs, and occupations
• Dates of employment
• Payment details for employees who were absent due to sickness or injury
• Copies of employees’ income tax withholding certificates (Forms W-4, W-4P, W-4R, W-4S, and W-4V)
• Dates and amounts of tax deposits you made
• Copies of returns filed and confirmation numbers
• Dates and amounts of fringe benefits and expense reimbursements
• Documentation to substantiate any credits claimed

Employee Benefits

According to the Employee Retirement Income Security Act of 1974 (ERISA), employers must retain employee records of 401(k) plans for at least six years after filing Form 5500. These include but are not limited to fiduciary plan documents, participant disclosures, payroll records, selections, and beneficiary designation forms. 

The EEOC also mandates that employers keep documentation of all employee benefits (e.g., pension and insurance plans) “and any written seniority or merit system for the full period the plan or system is in effect and for at least one year after its termination.” Records of benefit plans, enrollment forms, and plan descriptions should all be kept.

These requirements are part of anti-discrimination laws. If an EEOC charge is filed against your business, you must show these records and hold onto them until the charge or a related lawsuit is resolved. Retaining accurate, clear paperwork can protect your company in these situations.

Health & Safety Records

The Occupational Safety and Health Administration (OSHA) mandates retaining records of workplace injuries, illnesses, and exposure to hazardous substances for five years after termination. Additionally, HIPAA regulations require storing medical files separately from personnel files for confidentiality, while EEO laws protect sensitive personal information.

To be safe, keep documentation of:

• Employee medical records related to their ability to perform their jobs safely (e.g., fitness-for-duty exams, medical evaluations for specific tasks, and records of workplace accommodations)
• Leaves of absence and details
• FMLA leave documentation (see next section)

If an employee is exposed to a toxic substance, employers must keep documents related to all medical exams and safety data for 30 years after the worker’s termination.

Family and Medical Leave Act Documentation

The FMLA also has employer recordkeeping requirements, stating that businesses must maintain specific documentation related to employees’ leave for family or medical leave for at least three years. These include:

• Notices given to employees regarding their FMLA rights (e.g., general notice postings, individual eligibility notices, and rights and responsibilities notices)
• Records of the designation of FMLA leave, including any forms or communications specifying the leave as FMLA
• Medical certifications provided by employees to support their need for FMLA (which should detail the serious health condition of the employee or family member and the leave duration)
• Records of any paid and unpaid leave taken under FMLA, how it was designated (i.e., FMLA or otherwise), and benefits maintained during leave
• Employer policies and practices on benefits and compensation during paid and unpaid leave

Maintain the confidentiality of FMLA-related records by storing them separately and ensuring only authorized personnel can access this sensitive information. 

Conclusion

Investing the time and energy into proper employee recordkeeping is worth it to protect your company and employees and mitigate risk! This is a major area that will help you remain compliant and streamline HR processes. Inaccurate or missing paperwork can lead to one or a chain reaction of costly events, including:

• IRS or DOL audits
• Labor law noncompliance
• Disputes about compensation, hours worked, overtime, and more
• Discrimination and harassment allegations
• Privacy and data protection violations and breaches

And all of the above opens up your company to potentially significant penalties. For a small business, every dollar counts—and thousands of dollars in fines can take a severe hit on your bottom line!

Staying up on these many items and requirements takes time and effort. So, if you have questions about employee records and how long to keep them, contact BlueLion today for guidance at info@bluelionllc.com or 603-818-4131!