Tag: human resources

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How to Do Payroll Yourself: Steps to Take and Risks to Consider

Summary

  • Small businesses often consider doing their own payroll. This option is feasible, provided you are well-versed in employee wages, tax laws, and payroll regulations.
  • DIY payroll may save you from spending on payroll services or software, but there are other factors you must consider to understand whether it’s cost-effective in the long run.
  • Much of payroll processing starts before timesheets are generated. It begins with onboarding, making sure that employee information is gathered and accurate.
  • Workforce.com’s payroll software takes the stress out of processing pay on your own, handling wage calculations, overtime, deductions, taxes, and more.

If you’re a small business owner or an entrepreneur starting out, you are probably considering doing payroll yourself. And rightfully so – doing this can save you money and give you greater control over your finances.

While this may be true, processing payroll manually presents some considerable challenges, such as keeping track of regulations, taxes, and deadlines. 

So, is doing payroll yourself the best choice for your business? In this post, we’ll explore the process of managing payroll yourself while looking into its complexities and potential pitfalls.

What are the steps for processing payroll?

Processing payroll involves several essential steps, from collecting employee data to calculating wages and managing deductions. Here’s a rundown of what these steps include: 

Apply for tax ID numbers.

You must have an Employer Identification Number (EIN) before you can pay your employees. It’s required to apply for a business bank account, file taxes, and employ people. You might also need to register for different tax IDs if you operate across multiple states. 

Consider setting up an Electronic Federal Tax Payment System (EFTPS), a free tool by the US Department of Treasury to help secure tax payments. The EFTPS allows you to make different types of payments, including estimated taxes, corporate taxes, self-employment taxes, payroll taxes, and excise taxes.  

Gather employee information.

Collect essential employee details, including their name, address, phone number, bank details, date of birth, marital status, social security number, and bank details.

You must also have their W-4 forms or tax withholding documents. W-4 documents show how much taxes you should withhold from your employees’ paychecks. Make sure that a new hire accomplishes this during onboarding. Likewise, any employee whose financial situation changes should update their W-4 as necessary. If you hire freelancers, you must let them complete W-9 forms instead. 

Financial information such as tax IDs, previous payslips, existing insurance coverage, and tax reports is also essential for processing payroll.

Onboarding can be a time-consuming process that’s heavy with paperwork, especially without an organized system in place. Workforce.com’s onboarding system lets new hires log in and input their details, submit forms, and upload necessary documents ahead of their first day. This streamlines the process, ensuring all paperwork is handled upfront and freeing your HR and payroll team from tedious manual data entry.

Set up a payroll schedule or period.

Determine when you will distribute pay to your employees. Typically, you can process payroll weekly, bi-weekly, semi-monthly, or monthly. 

To determine the most suitable pay schedule for your business, factor in the following:

  • Cash flow – The important thing here is to ensure that you have enough cash when payday comes. Determine when you’re most likely to be cash-positive and consider timing your payroll around that time. For instance, timing payroll around the same time you pay for utilities and supplies may not be the best move. 
  • Industry practices – Look at what’s common in your industry. If you employ hourly workers, opting for a biweekly or weekly payment scheme would be best, as they typically prefer more frequent payments than salaried employees. 
  • State laws or payday requirements – Check if there are prevailing state payday requirements about how frequently you need to pay your employees and when to time it.  For instance, Arizona requires that you pay employees two or more days a month as long as they are at most 16 days apart. Meanwhile, in Massachusetts, hourly employees must be paid weekly or biweekly, while salaried employees must be paid at least semi-monthly. The latter can be paid monthly, provided that they agree. These differences and nuances exist around required payday schedules, so factor those in as well.  
  • Payroll processing time – You must also be realistic about how fast you can process payroll. It may not be wise to set up a weekly payment scheme if you’re doing payroll yourself. Factor in the time you need to gather information and calculate wages. 

It’s also important to note that organizations can have multiple pay periods, especially if they employ varied workers. The key to setting the right pay period is to take a look at how your organization operates and what makes the most sense for your employees. 

Workforce.com’s payroll system supports a variety of pay schedules—weekly, fortnightly, semi-monthly, and monthly. You can set up multiple pay periods and assign them to different roles. This ensures that employees get paid on the schedule that works best for them. For you, this means one less payroll task to worry about, because it’s fully automated.

Determine payment method.

Direct deposits are usually the standard form of payment for employers to distribute salaries to their employees. However, even as the standard, some prevailing state laws prohibit employers from making this method mandatory. 

Other ways to pay employees include cash, checks, pay cards, and mobile wallets. Each method has its pros and cons. For instance, checks can be a good option for employees who don’t want to disclose their bank information, but they can be prone to getting lost and are not immediate. While direct deposits may be more commonplace and convenient, employers must factor in how long it takes for funds to reflect in an employee’s account. 

Other considerations include the possible fees that come with each payment method. For instance, pay cards can have setup costs.

As you choose the best payment method for your staff, factor in any prevailing law and what makes the most sense for your employees. Consider providing two options as well. For instance, if an employee can’t be paid through direct deposit because they have no bank account, consider setting up a pay card or issuing paper checks as an alternative.  

It would be best if you also issued pay stubs for your employees. There may be state and local laws that have specific requirements around this. For instance, some states require employers to issue printed pay stubs unless the employees consent to receive electronic ones instead. 

But regardless of whether it’s mandated in your state to issue pay stubs, it’s still best practice to do so. They are essential for transparency. It includes details about what makes up their pay, such as wages, deductions, and taxes. 

Track employee work hours.

Tracking time and attendance is at the core of processing payroll. Record the hours worked by employees, including regular and overtime hours. It also involves monitoring PTO, leave, and holidays.

There are different ways to track employee time, but the goal is to do so accurately. Time and attendance data is vital to calculating wages, and you must get it right from the start. Ensure you have an accurate record of this information to calculate salaries accurately. It’s best practice to have an automated system to capture and export employee time into timesheets. Doing so will help ensure accuracy and avoid time theft. 

Workforce.com’s time and attendance system captures employee clock-ins and clock-outs in real time, automatically generating timesheets. It also sends alerts to both managers and employees if a punch is missed, reducing the need for manual cross-checking during payroll and maintaining the integrity of time records. Plus, employees can clock in directly from their devices with GPS tracking, which is ideal for workers in the field or businesses with multiple locations. 

Calculate gross pay.

Determine the gross pay for each employee by multiplying their hours worked by their hourly rates or by dividing their salary by the pay periods if they’re salaried. 

In order to do any of this, you first need to gather employee timesheets to determine how many hours each employee has worked. This is especially crucial for hourly employees, but you must also look at non-exempt salaried workers’ timesheet records in case they’re entitled to overtime pay.

Aside from their base pay, you must also factor in overtime, PTO, bonuses, and other incentives. Do you offer premium pay rates or shift differentials? Make sure that those are accounted for as well.

Furthermore, if you have employees who receive a significant amount of tips, you’ll need to track that as well and account for all applicable state laws.

Also read: Your guide to tipping laws by state

Note that there are state-based rules for computing overtime. Typically, overtime rates come into play when employees work more than 40 hours a week. However, some states have unique stipulations, like California. Employees who reach the 8-hour threshold in a day are paid 1.5x more per hour of overtime. And if they work over 12 hours, they are paid 2x their regular rate. 

Yes, a lot goes into computing an employee’s gross wages, and clearly, it’s not just about adding up their work hours and corresponding base pay. Here are other relevant and useful guides to help you get started: 

Compute and apply deductions.

After calculating gross wages, you need to factor in applicable deductions. Some of these are involuntary, while others are voluntary. 

Involuntary deductions are mandatory under the law. Employers should subtract these amounts in compliance with applicable laws and remit them to tax agencies and other authorities. Common involuntary deductions include employee withholdings like FICA tax, Medicare tax, social security tax, federal income tax, state and local taxes, and wage garnishments. 

Voluntary payroll deductions are amounts subtracted from an employee’s paycheck by their explicit choice or agreement. These deductions include retirement plans, health insurance, union dues, and other job-related expenses such as parking and travel. Some of these deductions are taken before or after taxes. It pays to double-check whether they are post-tax or pre-tax deductions.

Also read: What are different payroll deductions? Taxes, benefits, and more

Also, consider the necessary paperwork for deductions. There’s the W-4 for taxes and insurance forms for benefits, to name a few. Authorization to deduct is required for voluntary payroll deductions, so ensure your employees accomplish that and update when necessary. In addition, some employees may be exempt from FICA, so you need to consider that, too. 

Free template: Payroll Deduction Authorization Form

Calculate net pay.

The net pay is the amount employees take home after all deductions. Subtract the total deductions from the gross income to find the net pay.

Pay your employees.

Pay your employees according to the set payment method and on the scheduled pay date. Make the necessary transactions and arrangements to ensure your staff receive their pay on time. 

If you’re paying employees through direct deposit, account for how long it will take for the money to reflect in their bank account. Typically, it takes 1 to 3 days, but double-checking is still best.

File and remit taxes accordingly.

After determining federal, state, and local tax withholdings, you must remit these payments to the correct agencies. Depending on the tax type, you may either need to direct the funds immediately or reserve them and make the remittance closer to the payment deadline. 

It’s also important to note that while employer contributions are not part of employee payroll, they are a core part of this process. Some contributions are paid by both employers and employees, such as Social Security and Medicare. Other obligations are solely on the side of employers, such as the Federal Unemployment Tax (FUTA).  

Check with the appropriate agency for more information on handling tax rates and payments. For a complete list of employment taxes and their due dates, visit this full list from the IRS.

Keep payroll records and generate reports.

Create and review payroll reports to ensure accuracy and prepare for external audits. This includes reports for tax filings, financial statements, and employee records.

You must also create reports required by government agencies such as the IRS. Typically, such reports inform the agencies about wages paid to employees, withheld taxes, and employer contributions. Note that these reports may have different deadlines and require specific forms. For instance, Form 941 is used to report an employer’s quarterly federal tax return, while Form 940 is in relation to FUTA.

Furthermore, the FLSA mandates employers to keep payroll-related for three years.

Also read: A guide to accurate and comprehensive payroll reports

You can easily generate payroll reports to get a better understanding of your business and payroll expenses. Workforce.com helps you stay on top of government requirements and also lets you create reports that show how your payroll connects to frontline work and employee performance.

Things to Consider Before Doing Payroll Yourself

If you’re leaning toward doing payroll manually, here are factors you need to carefully weigh before doing so: 

Cost

Doing payroll yourself can save you costs in terms of not having to pay for software or outsourcing payroll. That’s where the appeal comes from, especially if you have a small workforce of 5 to 10 employees. 

However, it’s not just about whether or not to pay for a service, which brings us to the next point. 

Time

Doing payroll yourself requires time – and a lot of it. If you have a growing business, the hours spent processing payroll yourself can sometimes end up costing you more than outsourcing the work.

Consider the opportunity cost of spending a day gathering data, making calculations, cross referencing computations with the latest federal, state, and local laws, staying on top of taxes, and submitting reports. What else could you be doing instead?

All of this work can be incredibly challenging when you have a scaling business. Processing payroll may be manageable for staff with 5 team members, but it can quickly become much more complex when you’re doing it for 50 employees. Not being able to manage your time well can also result in a delayed payroll, which is the last thing you want to happen.

Legal risks

If you or someone on your team is well-versed in tax laws and payroll regulations, doing it in-house might be feasible. However, manually processing pay is risky – errors are inevitable. If you’re doing payroll in a spreadsheet, one wrong entry or a single typo could cause a chain reaction of errors, making you legally liable for inaccurate pay. You can opt to double-check or even triple-check your calculations, but routinely doing so will make payroll take even longer, which, as discussed earlier, can also cost you.

Another risk of manually processing payroll is the potential for employee misclassification. Ensure you understand which staff to classify as independent contractors vs. full-time employees.

Support

When you do payroll yourself and encounter issues, it’s up to you to figure out answers or solutions. This situation can be daunting and complicated. Of course, resources are available, but combing through data sheets and government guidelines can be time-consuming, overwhelming, and prone to misinterpretation.

Operations

If your business is seasonal or operates temporarily, manual payroll might make the most sense since it’s not something you will be doing year-round. But then again, consider the number of employees you have. Choosing a payroll tool might be worth considering if you have a big workforce, even if you won’t be running payroll year-round.

Why Using Payroll Software Makes Sense

Quick answer: automation and accuracy. 

Payroll software helps simplify calculating wages, accounting for labor laws, withholding taxes, bookkeeping, and generating reports. It handles all the vital administrative areas of payroll faster than you would manually do. 

If you run a small business, payroll software helps you stay hands-on with your pay runs, but this time, you can make computations quickly and error-free. Furthermore, if you’re a growing business, payroll software can scale with you and handle the process even as you hire more team members.  

Also read: 14 Best Payroll Software Services in 2025

Features of payroll software to look for

If you’re planning to look at payroll solutions, go for software that has the following functionality: 

Synced with your time tracking system

Much of the payroll process happens even before the part where you calculate wages. This means that the success of your payroll depends on how accurately you record work hours.  

Ideally, your payroll should sync directly with whatever you use to track time and attendance. This way, you can easily process employee time automatically without re-entering or exporting it into payroll.

Automated calculations

Payroll software should be able to automatically compute wages, deductions, and taxes. At the same time, it should account for applicable taxes and labor rules. 

The thing with payroll processing is that every paycheck is different. Your payroll system should account for all these nuances and differences, especially if you employ hourly employees in various locations. 

Go for a payroll system that can handle computations for different employee classifications, pay rates, overtime, tips, deductions, and withholdings.  

Employee self-service

Make payroll information accessible to everyone at your business. Staff should be able to update their personal details and direct deposit information via an online portal or app. This eliminates the need for a middleman; employees handle their own profile changes instead of wasting time asking management.

User-friendliness

While any new software has a learning curve, it is important that you choose one that is intuitive and well-designed. Small businesses don’t have the large departments or specialized expertise required to handle complex legacy systems. Go for an easy-to-use payroll platform that offers quality support—from importing your current data to ensuring that your first pay runs are accurate and smooth. 

Do payroll in minutes with Workforce.com

Workforce.com helps reduce payroll processing time from hours to as little as 20 minutes. It automates adjustments, keeps staff details up to date with self-service features, and sends out incomplete timesheet reminders, taking care of the things that typically slow down and complicate payroll processing.

It can handle tax forms such as W-2s and 1099s, direct deposits, tax filing, wage garnishments, deductions, multiple pay runs, benefits, and payroll reporting. Workforce.com’s payroll software even syncs with other important functions like time tracking, scheduling, hiring, and more.

Discover how Workforce.com can simplify payroll for your small business by booking a demo today. 

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HR Trends for Hourly Workforces in 2025

Summary

  • 2025 will be filled with new and familiar trends, and business leaders must devise strategies specific to hourly teams to maintain employee retention and remain competitive. 
  • This year, there would be increased emphasis on employee experience, continuous AI adoption, and a potentially bigger labor gap with tighter immigration rules. 
  • An all-in-one HR technology can help hourly teams stay ahead of the trends and overcome staffing challenges.

This year, hourly workforces will face a mix of old and new challenges, from labor shortages to technological advancements and a maze of shifting compliance rules. HR leaders and managers must step up in 2025 to retain top talent and stay competitive, or risk widening the labor gap and losing their team to competitors.

So, what’s coming up on the horizon? Check out these top HR trends you’ll want to watch when managing your hourly workforce this year.

1. Staffing and hiring challenges with stricter immigration laws

With stricter immigration laws and ongoing labor shortages, hourly workforces face a greater challenge in attracting and retaining talent.

According to the Bureau of Labor Statistics, foreign-born workers account for 18.6% of the U.S. civilian labor force. With stricter immigration laws, a bigger labor shortage challenge could be looming.

While the crackdown targets undocumented migrants, even legal, documented workers may struggle to stay in the U.S. when mass deportation separates them from their families. This uncertainty can push them to leave, creating vacancies in industries that heavily depend on hourly workers.  Worse, some immigrants may not aspire to come to the U.S. for work at all. 

For instance, in Nebraska, one of the top meat producers in the U.S., businesses are already grappling with a massive labor shortage. For every 100 jobs, there are only 39 workers to fill them, and Nebraskans fear that the gap will only get bigger. 

So, what does this mean for employers? They must fight hard to not only hire and attract talent but also maintain employee satisfaction.Another key area is tightening the vetting process. While undocumented workers have rights, knowingly hiring them is illegal for employers. This creates an added challenge for HR professionals to ensure their vetting procedures are foolproof, preventing penalties or complications from accidentally hiring ineligible individuals.

How to stay ahead:

HR departments need a system that streamlines talent acquisition, quickly assesses qualifications, and ensures new hires and existing staff stick around. 

Workforce.com’s HR system can augment recruitment by allowing you to post job openings across your business locations. You can even generate QR codes for job postings, making it easy for interested applicants to scan, read job descriptions, and start their application process. 

Set custom questions to quickly qualify candidates, like their experience, available hours, and whether they have the qualifications and documentation to work in the U.S. 

Plus, Workforce.com helps your managers retain current staff by offering flexibility with shift swapping and advanced scheduling. It also tracks people analytics such as performance, highlighting areas for training, upskilling, and development.

2. AI adoption in HR processes will continue

Artificial intelligence will continue to play a role in HR this year. While we have seen its adoption in the previous years, the trend will continue in 2025. More and more organizations will adopt AI in human resources to eliminate admin tasks, repetitive processes, and paperwork. 

However, AI can be a double-edged sword in workplaces. Sure, it can make things easier and faster, but questions remain about its impact on work quality, particularly with the rise of generative AI tools. Some even call for regulatory rules, prompting organizations to develop policies governing how employees use AI at work. 

How to stay ahead:

Focusing on how AI can bring the most value is key to making the most of it. For hourly teams, labor forecasting is key. Workforce.com has long used AI to help organizations anticipate demand and avoid overstaffing or understaffing. 

Workforce.com labor forecasting system utilizes AI to analyze sales, booked appointments, historical foot traffic, seasonal trends, weather, and other business-specific indicators. For example, hospitals can factor in ICU bed availability, while hotels can account for bookings and reservations. Considering these variables, the platform accurately forecasts staffing needs for each shift, helping you curb overstaffing, reduce overtime costs, and improve decision-making around schedules.

3. Shifting labor laws pose new challenges to HR

As if labor compliance was not complicated enough, a new administration in place in 2025 could throw even more curveballs.

Case in point: President Trump’s move to end “illegal” discrimination in DEI programs. In a recent executive order, he ordered DEI programs within federal agencies. While it does not directly ban DEI programs in the private sector, the order imposes requirements on federal contractors and grant recipients, potentially increasing scrutiny of DEI policies. This could create pressure for private companies to adapt to the shifting political and regulatory landscape.  

In addition, there are changes slated to happen this year, such as increases in minimum wage laws in some states and the enactment of paid leave laws in some cities.  

How to stay ahead:

Employers should carefully balance compliance with federal directives and maintaining fair practices to support their teams and prevent long-term workforce challenges. For hourly workers, this can be as simple as being mindful of how shifts and overtime are distributed. Workforce.com makes this easier by giving managers a clear, real-time view of how many hours each team member works. This helps ensure everyone gets the right amount of hours or shifts.

Labor compliance is tricky, but automation can simplify the process. HR teams can stay on top of labor regulation developments through systems with a compliance engine, such as Workforce.com.

Workforce.com ensures compliance for hourly teams at every stage of HR management—covering employee classification, wage and overtime calculations, adherence to allowable work hours, and compliance with break time rules. From hiring and onboarding to scheduling and payroll, managers can trust they’re operating within state and federal laws every step of the way. 

4. A new emphasis on employee experience

For white-collar and salaried workers, a good employee experience often means hybrid work setups, the freedom to do remote work, and opportunities for long-term career development. But hourly workers, who are typically onsite and part of operations that may run around the clock, have quite different needs. So, what does a positive employee experience mean for them? 

Hourly workers desire work-life balance, too, but in a different way. For frontline teams, it’s about knowing their schedules in advance, allowing them to plan for childcare, a second job, or personal time off. Flexibility also means having options for how they work, like swapping shifts with coworkers or picking up extra shifts without a lengthy approval process.

Employee well-being will also be a focus in HR strategies in 2025. It’s about offering programs such as counseling services, mental health programs, and wellness initiatives tailored to the needs of hourly workers. This could mean offering flexible work options, encouraging regular breaks, and ensuring that workers have a safe space to express concerns without fear of stigma.

HR teams should also consider upskilling, reskilling, and defining career paths for hourly staff. Consider offering certification programs or opportunities to learn new technical skills. It’s also time to define growth paths for these teams. Can they move into higher-paying roles? Is there a path to salaried positions? Answering these questions can make a big difference in retaining and engaging hourly employees as well as addressing any skill gap in your business.

How to stay ahead:

Much of the employee experience for hourly employees involves admin processes, which can be easily streamlined with the right technology. Workforce.com simplifies scheduling with its labor forecasting and scheduling software. Create demand-based shifts in minutes and notify staff weeks in advance. If you’re in a city or state with predictive scheduling or Fair Workweek laws, this tool also helps ensure compliance.

Shift swapping or shift replacements is another area where Workforce.com can make it easy for managers. The system eliminates long approval processes and back-and-forth communication. Managers can quickly offer vacant shifts to qualified employees, who can pick them up with a single click using the employee app.Since most of this admin work is done, HR leaders and managers now have time to optimize hiring practices, spend more time coaching their teams, devise career trajectories, determine appropriate training for their employees, which they can also track using Workforce.com’s performance management module.

5. Prioritizing constant feedback and review process

Another continuing trend into 2025 is focusing on more dynamic feedback and breaking free from rigid timelines like annual reviews. This is especially important for hourly workforces, where the fast-paced environment calls for real-time input and adjustments.

How to stay ahead: 

Operational issues can’t wait until the next performance review. Managers need a system that enables them to give and receive feedback in real-time. Workforce.com can prompt employees to rate their shifts at the end of the day. Using this feedback, managers can see what’s working and what needs improvement. This approach helps maintain a good work environment, resolve issues early and keep them from escalating over time.

6.  Access to wages and pay transparency

Businesses will maximize payroll technology to offer more flexibility and options to employees. This year, the focus will continue on giving employees the option to access their wages before payday. This can serve as a great middle ground for companies that can’t yet increase salaries or augment benefits.

Transparency around wages and payslips will remain a key priority. Employees expect an easy way to view their payslips and understand how their wages are calculated, especially for hourly staff.

How to stay ahead:

It’s all about having an efficient payroll platform, one that’s housed in the same ecosystem as HRIS and time and attendance tracking. Payroll is not just about processing paychecks. It’s about ensuring that all the data used to calculate employee pay is accurate, starting with employee qualifications and time logs. Workforce.com streamlines this process, making it easy for you and your employees to access accurate pay information, including payslips.

7. Integration between HR, workforce management, and payroll will be a top priority.

With all the changes and disruptions this year, organizations need a system that will allow them to streamline their recruitment, create worthwhile onboarding processes, track employee time accurately, schedule employees according to classifications and preferences, and pay them accurately. It is all about breaking down silos between these processes, and businesses would likely seek a system that streamlines all of these.

How to stay ahead:

Innovative businesses would stay ahead by ensuring their systems operate well together. Even better, they opt for a platform where everything is housed in a single system.

Workforce.com eliminates silos between HR, workforce management, and payroll. All processes operate within one ecosystem, ensuring a single source of truth and smooth coordination across the board. With a unified platform, managers have less digital upkeep, as they only need to log in once to manage everything—no switching between multiple applications.

Staying ahead with Workforce.com

Organizations that work hard will lead the pack, especially with everything happening in the business, technology, and labor landscape. They must focus on creating strategies to attract new workers, retain their current teams, and ensure profitability and maintain a good workplace culture simultaneously. 

Workforce.com handles the admin side, so you can focus on the big picture. It adapts to market shifts, labor law changes, and trends, streamlining every step of the employee journey.

Ready to see how Workforce.com can help your business? Book a call today.

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Hiring Seasonal Employees: A Guide to Minimize Legal Risks

Summary

  • Hiring seasonal employees offers flexibility during busy times of the year, but it isn’t without legal risks.
  • Employers must comply with specific employment laws and ensure seasonal workers receive the wages and benefits they’re entitled to.
  • Workforce.com helps simplify seasonal hiring and keeps compliance tight and hassle-free.

Hiring seasonal employees is a common staffing strategy during busy seasons with increased demand, such as holiday peak times, vacation surges, or festival weekends. Working with seasonal employees can help businesses scale up (and down) easily. 

But seasonal hiring isn’t without legal risks. The flexibility of using seasonal workers also creates a minefield of compliance issues. If you misclassify a worker or fail to meet requirements under wage and hour laws, you can face legal trouble. 

Seasonal employees are only with you for a few weeks or months, but there are labor laws that apply to them. Let’s look at what these are, what they mean for employers, and what best practices are to stay on the right side of the law when hiring seasonal workers.

What is a seasonal employee?

Seasonal employees work only part of the year, typically during periods of high demand. They could also be employees hired by seasonal businesses that only operate part of the year.

Some examples of industries that hire seasonal staff include: 

  • Retail stores – during demand surges such as the holiday shopping season
  • Agriculture businesses – during planting and harvesting season when they need extra help. 
  • Hospitality establishments—beach resorts, ski lodges, theme parks, and summer camps—are used during high-peak tourist months such as summer and winter.

Temporary employees vs. seasonal employees

Temporary and seasonal staff can easily be mistaken for one another, but there are distinct differences in how and why businesses hire them.

Temporary workers fill staffing needs by assuming the role of an employee on maternity leave or recovering from a disability. In some cases, employers hire them for short-term projects. Their employment length varies from a few weeks to several months, and they’re typically hired through staffing agencies. While benefits are often limited, temp jobs can sometimes lead to a permanent position. 

On the other hand, employers hire seasonal workers to handle predictable busy periods, like holidays or harvest seasons. These demand spikes are typical in the retail, agricultural, and tourism industries. While some seasonal employees return year after year, their jobs generally end once the season ends. 

What does the law say about hiring for seasonal work?

FLSA

According to the Fair Labor Standards Act, non-exempt seasonal workers must at least receive the minimum wage and overtime pay for any hours worked beyond 40. Generally, the FLSA doesn’t limit the number of hours an employee can be scheduled to work per day or week, except for youth workers.  

Federal law limits how much minors under 16 can work. They can work up to 8 hours a day and 40 hours a week when school is out. However, when school is in session, they can only be scheduled to work for 3 hours per day and 18 hours per week. Additionally, minors under 16 can’t work after 7 pm and before 7 am. From June 1 to Labor Day, minors under 16 can only work until 9 pm. Remember that states may have their own labor laws for minors, so it’s always a good idea to double-check those regulations as well.

Also read: Child Labor Laws by State + Federal (2024)

But some amusement or recreational businesses can be exempt from the FLSA rules around minimum wage and overtime rules as long as they satisfy any of the following conditions: 

  • If they don’t operate for more than seven months in any calendar year. 
  • If their average receipts for six months during the preceding calendar year is at most 33.33% than the receipts of the other six months. 

The first condition is simple—it’s all about how long a business operates during the year. So, if a business is only open during summer, typically from June to August, it meets the criteria. 

The second condition deals with revenue. Even if the business operates for over seven months or year-round, it can still qualify for the exemption. How? If the revenue earned during the six busiest months is 33.33% or less compared to the slowest six months, the business can be exempt from wage and overtime rules under the FLSA.

IRS

When it comes to taxes, the IRS treats seasonal employees just like any other workers. 

You’re responsible for withholding, depositing, reporting, and paying employment taxes. Seasonal employees must also be asked to submit necessary tax forms to you, and you must turn those in to the IRS and Social Security Association (SSA). 

But just like the FLSA, there can be stipulations here, too. Take the Affordable Care Act (ACA), for instance.  

Under the ACA, not all companies must provide health benefits, but Applicable Large Employers (ALEs)—those with an average of 50 or more full-time employees—must offer affordable healthcare coverage. So, how do you know if a seasonal employee is eligible for ACA coverage?

One way is to use a look-back measurement period to track an employee’s hours over 3 to 12 months. They may be considered full-time if they average 30 hours or more per week during the look-back period. If they qualify, employers must provide healthcare benefits for as long as the measurement period, which can be up to 6 months. Even if their hours decrease later, their benefits must remain in place. The look-back method helps businesses that experience fluctuations in their schedules stay compliant and avoid penalties.

Seasonal workers vs. seasonal employees under the ACA

Labor compliance is always about making sure you get the wording right. Under the ACA, seasonal employees and seasonal workers may mean different things because they are applied in different contexts. For instance, “seasonal employee” is used to determine if an employee is full-time under the look-back method. “Seasonal workers,” on the other hand, is used to determine whether an employer needs to follow the ACA’s employer mandate based on the total number of employees for that year. 

Family Medical Leave Act (FMLA)

Seasonal workers can qualify for FMLA, especially if they are recurring seasonal employees who have worked regularly for the same employer over the years. 

The Family and Medical Leave Act requires employers to provide up to 12 weeks of leave to eligible employees under certain circumstances. It applies to employers that employ 50 or more individuals during each of 20 or more calendar workweeks in the current or preceding calendar year. Under the FMLA, seasonal employees count toward the 50-employee requirement.

How do you know if a seasonal employee qualifies? If they worked for an employer for at least 12 months, which can be accumulated throughout their employment. Aside from that, the employee must have worked at least 1,250 hours during the 12 months. 

Tips for minimizing the legal risks when hiring seasonal workers

For many employers, hiring seasonal employees is a must during the holiday season. As employers depend on seasonal employment to beef up their staff in anticipation of a holiday shopping rush, it is important to remember that hiring seasonal employees—as with hiring any employee—requires adherence to specific employment guidelines. To minimize some of the issues associated with hiring seasonal employees, employers may want to consider the measures outlined below.

Avoid litigation land mines.

Hiring seasonal employees comes with its own set of legal challenges, and employers need to be vigilant. Make sure you’re up to date on employee classification and compensation rules. If anything seems unclear, seeking legal advice is always a smart move to ensure compliance.

Employers must also remember that federal, state, and local laws prohibiting employment discrimination, harassment, and retaliation apply with equal force to seasonal employees. Accordingly, employers should take the same care in preventing and addressing allegations of discrimination, harassment, and retaliation against seasonal employees as with regular employees.

Make it clear.

Although seasonal employees are generally aware that they have been hired only temporarily, employers must specify the limited duration of employment upfront. Employers should consider requiring seasonal employees to acknowledge, in writing, that they understand they were hired for a limited duration. Employers should also clarify to seasonal employees that they are “at-will” employees: Their employment may be terminated with or without cause at any time (even before the end of the holiday season).

Provide proper paperwork.

Seasonal employees must complete all paperwork required for employees under federal or state law. For example, all seasonal employees must complete federal I-9 forms to prove their employment eligibility in the United States. Additionally, employers should ensure that seasonal employees who are minors have acquired permits authorizing them to work.

Keep track of hours and overtime.

Employers must make sure they follow all state and federal wage-and-hour laws during the holiday season. This includes ensuring that employees take required meal breaks and that overtime is accurately recorded and paid. Also, employers must comply with all wage-and-hour laws applicable to minor employees.

Consider NDAs.

Protect confidential information when filling a seasonal role. If seasonal employees can access the company’s confidential or proprietary information, an employer may want to consider requiring a nondisclosure/confidentiality agreement.

Simplify seasonal hiring with Workforce.com

Seasonal employees provide flexibility to handle busy periods, but managing them can get tricky. Workforce.com can help streamline some of the things involved with managing seasonal employees. Here are some of the ways:

Hiring

Workforce.com’s applicant tracking system speeds up the hiring process for seasonal positions. For instance, you can set pre-qualifying questions to quickly filter out candidates who meet your requirements so you can move them straight to interviews. Every step is tracked and documented, keeping applicants in the loop and ensuring your hiring process runs smoothly.

Onboarding process

Seasonal employees still have paperwork. Workforce.com’s onboarding system makes it easy for new hires to submit their information, sign contracts, and complete forms quickly.

Time and attendance tracking

Time and attendance tracking is crucial for managing seasonal employees, especially when determining their eligibility for certain benefits. Workforce.com ensures that everything is logged accurately.

Payroll

With automated timesheets and correct classifications, Workforce.com’s payroll software ensures your seasonal employees get paid on time and correctly, including any overtime or taxes owed.

No matter the time of the year, managing seasonal employees can be easy with Workforce.com. Stay organized and compliant with Workforce.com. Book a demo today to get started. 

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10 Tips for Designing a Better Hiring Process

Summary

  • The hiring process is an employer’s first chance to make a good impression. It needs to be seamless to attract the best candidates.
  • 86% of HR professionals say that recruitment is becoming more like marketing. And in today’s competitive labor market, it’s easy to see why.
  • Applicant experience is crucial for keeping top candidates engaged and maintaining a good employer brand. Streamlining recruitment using technology can transform a good hiring experience into a great one.

In a tight labor market, hiring can make or break your chances of capturing quality new hires. It is often the first touchpoint between a company and potential new employees, and an excellent first impression is everything. A clunky approach to hiring will not only slow things down but also deter quality people from applying.

If you’re looking to attract qualified candidates fast while keeping things efficient, it might be time to rethink the hiring process. In this post, we’ll dive into 10 practical tips to improve your recruitment strategy.

1. Focus on setting clear hiring goals.

All of your recruitment initiatives will stem from your hiring goals. They act as your jumping point; if you’re unclear about these, you risk wasting resources and missing out on filling the company’s staffing needs. 

When determining what your hiring efforts should aim for, here are questions you need to ask yourself:

  • What are the staffing gaps, operational needs, or business needs you must address? Is it filling roles for a new business location, or is it to replace team members who left? 
  • What are the specific roles needed to fill the gap? 
  • What are the characteristics of an ideal candidate? 
  • What are the specific skills or experience candidates must have? 
  • What soft skills must they possess? Consider your company culture and define what characteristics would make a hire fit to work with the team. 
  • How fast should you be able to hire?

Talent acquisition requires significant effort, and you should focus your energy on defining hiring goals that drive business results.

2. Create clear job ads. 

“What’s in it for me?” – This is the question your job descriptions should answer for potential candidates. 

Try to frame your job listings through the applicant’s POV. First, the listing should cover the basics of the job role, which includes what’s expected in terms of tasks and responsibilities. Second, it should paint a picture of how an ideal candidate would fit in the organization, which can allude to the type of working environment you offer. 

Let’s discuss wording. Avoid overly technical jargon and internal corporate speak. Potential candidates won’t care much for those. Instead, keep your wording concise and direct and language neutral.

Here are crucial elements that your job descriptions should cover:

  • Job title
  • Duties and responsibilities
  • Required skills, competencies, and qualifications 
  • Preferred qualifications or nice-to-haves
  • Working location
  • Benefits
  • Salary range

In addition to the basics, you can include more information about the team they will be part of and brief details about the organization. 

Writing job descriptions can be time-consuming. We’ve curated a list of job description templates to give you a headstart. Feel free to download them and customize them according to your specific requirements. 

3. Be smart with advertising open positions. 

Generally, hiring teams utilize job boards and social media sites like LinkedIn to reach as many candidates as possible. While those are great, there are other opportunities to get the word out. 

Consider placing job postings in your place of business. Of course, no one has time to read a job description if they are just passing by your cafe or retail store, so why not simply print out a QR code that leads to the details of your job opening?  

Workforce.com’s Applicant Tracking System (ATS) lets you print customized QR codes that link to online job applications. Any interested applicant can simply scan the code and apply straight from their mobile devices, and you will be alerted when submissions come in. 

But before you go broadcasting an open position to the public, think about the roles you’re trying to fill. Consider hiring from within to reduce the time and resources it takes to onboard a new employee.

What about referrals? Nothing beats word-of-mouth advertising. Your current employees can be your best ambassadors since they have first-hand experience. They can share insight into company culture far better than any job posting you publish.

4. Get serious about employer branding.

Better branding attracts better candidates. In fact, 86% of HR professionals agree that recruitment is becoming more like marketing, according to a study. And with today’s challenging labor market, it’s easy to see why. Like marketing, you need to understand your target audience—your ideal candidates—and find ways to stand out.  

To get leadership on board, here’s a compelling stat: a strong employer brand can reduce the cost-per-hire by up to 50%. Plus, half of job seekers won’t consider working for a company with a bad reputation. In short, employer branding isn’t just nice to have; it’s crucial for staying competitive. 

Start by improving the hiring experience. Use data to track candidate experience and satisfaction, communication frequency, and key metrics like time-to-hire. Streamlining these processes with applicant tracking technology enhances efficiency and leaves a positive impression on candidates. Remember, every interaction counts, and a smooth hiring process can make all the difference. 

Keep in mind that negative stories spread fast these days, whether it’s a poor recruitment experience or a toxic work environment. With social media and online forums, you don’t want to be trending for the wrong reasons.

So, how do you build a strong employer brand? It starts with your core: a healthy company culture. Today’s candidates can spot inauthenticity a mile away, so your efforts need to be genuine. Once you establish strong values, they’ll naturally shape how you hire and manage talent on a daily basis.

5. Use technology to streamline the process.

There’s a lot of work that goes into hiring. Without the right tools to help you stay organized, you run the risk of mishandling important information, wasting time, and hiring the wrong people. Consider using an HR platform or an applicant tracking system (ATS) to streamline your hiring process. 

Workforce.com is a prime example of one such system. Its HR suite significantly reduces time spent sifting through resumes and onboarding new hires. Here’s how it improves your recruitment efforts: 

  • It helps you get more applicants. Every time you create a new job posting, you can generate a QR code associated with the listing and post it in your business to make access to applications easier. Workforce.com also collates all previous applications and the positions a person is interested in. When you post new job listings that match a previous applicant’s interests, the system notifies this talent pool, automatically getting you more traction from the moment you post the new job.
  • It helps you with the selection process and pre-qualifies applicants quickly by setting up role-specific questions about availability, experience, and requirements. This enables you to screen candidates before scheduling interviews, weeding out those who don’t meet your criteria upfront.
  • It reduces data reentry by using one user profile across hiring, HR, and payroll. Since the whole employee lifecycle is synced in Workfore.com, applicant information from the hiring stage is automatically brought into a new hire’s payroll and HR profile. This means that once someone fills out an application, they have essentially already filled out about 80% of their employee profile. If you decide to hire them, all of this information is used—there’s no need to create multiple profiles with repeat information. 
  • It helps you onboard new hires right away. Within minutes, your new hires can fill out onboarding forms, provide their personal information, and submit their W-4s and I-9s. No lengthy paperwork and manual entry is needed.
  • It helps you track recruitment metrics. It gives you an overview of hiring progress, spotting delays, and identifying roadblocks. Plus, it covers all your locations, so you can see who needs extra recruitment support.

An ATS is great for hiring, but one that’s housed in the same HR system as onboarding and payroll is a game-changer and can save a significant amount of time. It streamlines the entire journey—from recruitment to onboarding to that first paycheck. 

6. Eliminate unconscious bias.

We’re human, and we’re naturally wired to have biases. However, if these biases are left unchecked during the hiring process, they can lead to poor decisions. Take steps to eliminate anything clouding your judgment from focusing on what a candidate truly offers. 

Reduce unconscious bias by focusing solely on an applicant’s technical skill sets instead of their demographic details such as gender, race, and age. Furthermore, you can view job applications with redacted names or personal information so their skills and experiences are front and center.

7. Improve how you interview. 

The interview stage is crucial for applicants and the company to get to know each other better. It’s an opportunity to assess technical skills and values, making it the ideal time to evaluate cultural fit alongside qualifications. And you do that by asking the right questions. 

Whether you utilize structured questions or free-flowing discussions is your prerogative. But regardless of what route you choose, make sure that it helps you evaluate applicants objectively.

Structured interview questions help you gauge how applicants fare against each other. This interview style makes it easy to compare and judge applicants based on their answers to a series of important and relevant questions.

On the other hand, a less structured approach can better reveal a person’s values, personality, and soft skills, helping you assess their cultural fit. Unstructured interviews can also make applicants feel more comfortable during interviews. 

Ultimately, the goal is to find the best fit for the role. Whether you prefer a structured or flexible interview style or a mix of both, ensure it leads to a fair and informed hiring decision.

8. Understand who you’re hiring. 

Not all hiring processes are the same, especially when it comes to salaried versus hourly roles. Your recruitment approach should adapt to each, from sourcing, screening, onboarding, and compliance. 

For instance, recruiting a line cook for one of your restaurants is a much different process than hiring a finance manager for an insurance agency. Hourly roles often require a faster and leaner process to meet urgent staffing needs. Having a system that lets candidates apply easily and keeps unnecessary data and timelines to a minimum is ideal.

In contrast, hiring for salaried positions usually involves multiple interview stages and a more thorough vetting process. For these hires, it’s crucial to have a comprehensive applicant tracking system that monitors each stage efficiently and keeps candidates engaged throughout the process.

Ultimately, hiring for hourly positions prioritizes speed, volume, and efficiency, while salaried roles focus on depth, fit, and long-term alignment. Understanding these nuances allows you to tailor your hiring processes and shapes how you manage time tracking, shift scheduling, and payroll for each type of hire.

9. Always communicate with applicants.

You don’t want to be labeled as an employer who ghosts applicants, do you? 

While you will undoubtedly need to prioritize some applicants over others, you should never leave unqualified candidates hanging. Keep candidates informed every step of the way —from confirming their application to updating them on the next steps, whether they qualify for an offer or not.  

Additionally, offer a channel for applicants to reach out when they want to follow up or ask a question. This will help them feel at ease and keep strong candidates engaged in the process.

10. Regularly evaluate your hiring process.

As new technologies and trends emerge, your hiring process can quickly become outdated. Conduct regular assessments of your hiring process and practices. Identify what works, spot areas for improvement, and tackle any roadblocks. A flexible, evolving hiring process keeps you aligned with market shifts, maintains efficiency, and positions you to attract top talent.

Fill roles faster and simplify your recruitment process with applicant tracking software

Workforce.com hiring app

Hiring hourly employees? Workforce.com’s online hiring system can help you find the best talent to fill your staffing needs.

Workforce.com is end-to-end HR, scheduling, and payroll software for hourly teams.

The cloud-based platform features an applicant tracking system that streamlines hiring—from posting job advertisements to pre-qualifying candidates, interviewing them, and eventually onboarding them—all without lengthy paperwork or double entry.

Discover how Workforce.com can help you with hiring and more. Book a demo today. 

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How to Manage Compliance for Contractors

Summary

  • Managing contracted employees (1099s) fundamentally differs from managing typical W-2 staff.
  • Employers are legally responsible for correctly classifying workers according to the FLSA, IRS, and any applicable state-based rules. However, the line between employees and contractors can easily get blurred.
  • Workforce.com helps streamline contractor compliance management by ensuring workers are treated according to their classifications.

Suppose you are considering hiring independent contractors for a specific job. Or maybe you already employ a few. Have you done all of your research to handle them compliantly? If not, this guide is for you.

Strict labor standards govern how to properly classify and manage independent contractors, otherwise known as 1099 workers. Let’s examine how to stay on top of these rules and safeguard your business from legal risks.  

Why hire an independent contractor?

Hiring independent contractors offers flexibility, especially when you need help for short-term projects. Unlike full-time employees, contractors usually come in with the expertise required to start working right away, meaning less time spent on training and onboarding. 

Another advantage is cost-effectiveness. Contractors are not entitled to overtime pay, employee benefits like health insurance or retirement plans, or perks like paid vacations and promotions. You also avoid expenses like unemployment insurance and tax contributions that generally come with traditional employment. 

While engaging independent contractors gives you flexibility, there are risks involved. Misclassification is the biggest one. Since contractors are not entitled to the many lucrative benefits of regular employment mentioned above, misclassifying an employee as a contractor can result in serious legal trouble, fines, back taxes, and even lawsuits. Because of this, it is vitally important to understand what qualifies someone as a contractor. 

Key legal guidelines for managing independent contractors

Employee Classifications

Correctly classifying a worker as a contractor is the first step to staying compliant. At the federal level, the Fair Labor Standards Act (FLSA) uses a six-factor test that evaluates the “totality of circumstances” around the working relationship. With this assessment, businesses can determine the correct classification while considering crucial aspects such as control, independence, and the nature of work. These factors are:

  • Opportunity for profit or loss depending on managerial skill
  • Investments by the worker and the potential employer
  • Degree of permanence of the work relationship
  • Nature and degree of control
  • Extent to which the work performed is an integral part of the potential employer’s business
  • Skill and initiative

It’s important to note that the FLSA doesn’t assign a rule defining whether someone should be a contractor or an employee. Instead, it evaluates the facts of each situation to determine the working relationship and whether the worker is truly independent and doesn’t rely on the business like an employee would. 

Aside from federal rules, businesses must also check if there are state rules that govern how they should differentiate contractors from employees. In California, for instance, a worker is classified by default as a standard W-2 employee unless all of the following conditions are met: 

  • The worker is free from the control and direction of the hiring entity in connection with the performance of the work
  • The worker performs work that is outside the usual course of the hiring entity’s business
  • The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. 

In essence, a worker in California can only be classified as an independent contractor if they have autonomy over how and when they perform their tasks, as long as they complete their responsibilities. Also, the work must be fundamentally different from what the business does; For instance, a hospital commissioning people to construct a new building wing. Lastly, the worker must be independently engaged in an established trade and offer services to multiple clients.

Understanding the difference between independent contractors shapes how you manage payroll and benefits. Full-time employees are protected by wage and hour laws, ensuring they’re paid at least minimum wage and receive overtime pay. Full-time employees are also protected under meal break rules depending on the state. On the other hand, 1099 workers aren’t generally covered by these rules. Independent contractors are paid according to their contracts. In addition, they are not entitled to certain benefits, such as health insurance and workers’ compensation.

IRS Rules

Employers must also look at IRS guidelines because these will define how active their role is when handling taxes for their workers. It will also dictate how they report workers’ compensation, the types of forms to submit, and whether or not they would be legally liable to withhold taxes.

Employers withhold and deposit income taxes, social security taxes, and Medicare taxes from employee wages. On top of that, they also match contributions to SSS and Medicare taxes. But it’s a different situation for contractors. Employers generally don’t deduct income taxes from the contractor’s payment and don’t need to match contributions. 

So, under IRS rules, what factors will help you gauge whether a worker should be classified as an employee or contractor?

  • Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
  • Financial: Are the business aspects of the worker’s job controlled by the payer? (these include things like how a worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
  • Type of relationship: Are there written contracts or employee type benefits (that is, pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?

Like California’s ABC Test, the IRS guidelines also consider the level of autonomy workers have over their jobs. Employers typically have less control over how contractors fulfill their tasks and don’t dictate the methods and tools workers use. 

The IRS also considers how financially dependent workers are on their employers. Contractors typically cover their own costs, such as transportation and equipment, whereas employees rely on their employers for those provisions. 

Employees typically have an ongoing relationship with an employer, while contractors typically work for a set period on specific tasks or projects and aren’t as involved in a company’s core operations. 

Classifying employees correctly is also a prerequisite for filing the correct forms and determining whether you must file a W-2 or 1099. Employers typically file W-2s for full-time and part-time employees, reporting all wages, compensation, and tax withholdings for the year.

On the other hand, form 1099 shows how much an employer pays an independent contractor in a tax year. You must file a 1099 if a contractor earns $600 or more annually. These 1099 forms will not include tax withholdings since contractors calculate and submit them to the IRS independently.

OSHA Regulations

The Occupational Safety and Health Administration (OSHA) requires employers, including those using contractors, to adhere to safety regulations and keep workplaces free from hazards to prevent injury or death.

OSHA has general safety regulations that apply to most workplaces, but specific guidelines exist for construction, maritime, and agriculture industries. If you’re in any of those sectors, it would be wise to know these regulations.

Typically, OSHA regulations cover the following areas: 

  • Safety training requirements include construction safety training, such as handling scaffolding, fall protection measures, and ladder safety.
  • Handling hazardous tasks, including hazard communication standards, proper labeling, data sheets, and training on handling hazardous substances.
  • Personal protective equipment (PPE) for specific working environments, including hard hats, gloves, goggles, or respirators, should meet OSHA standards.
  • Rules that must apply when multiple employers are present in a worksite, which is typical for big projects involving contractors and subcontractors. The company that hired them, the controlling employer, is responsible for following OSHA rules. This means that they must check for hazards, ensure safety standards are followed, especially with heavy equipment, and have a system to report and address safety concerns. 

Aside from training, employers are also responsible for communicating such rules and ensuring that contractors have the safety training needed for the job.

How to build an effective contractor compliance management policy

Employing third-party contractors differs from managing employees, but your legal obligations remain just as important. It’s crucial to have a dedicated compliance strategy for employing contractors to reduce risks and avoid violations. Here are some practical tips:

Establish rules and guidelines for classifying contractors.

A significant part of contractor compliance is classifying them correctly, so you must have a process for doing so.

Before hiring, vet potential workers carefully. Assess the task or job and how you plan to oversee it. From there, you can determine whether a part-time worker or a contractor is the right fit. Getting the classification right from the start ensures compliance with tax filings, payroll, and other regulations.

Create airtight contracts.

Contracts and agreements between you and contractors must clearly outline the scope of work, duties and responsibilities, and payment terms. Draft them with the regulations in mind. To avoid legal missteps, ensure these agreements comply with FLSA, IRS, and OSHA regulations.

Avoid scope creep. 

The law is very clear on factors that dictate whether a worker qualifies as an independent contractor. Remember that it all comes down to their financial and behavioral independence. Be careful not to overstep legal boundaries that could change their classification.

The key is consistency. Set clear rules for overseeing the job and adhere to the contract’s terms. Your treatment of contractors should remain uniform and standard throughout the project.

Provide necessary training. 

Safety training is a must for hiring contractors. Ensure they complete all required health and safety training before the project begins. 

It’s also in your best interest to train your managers on the legal principles governing contractors and employees. This can equip them during the vetting process and help them better manage projects in accordance with regulations. 

Set regular progress check-ins. 

See to it that the process stays on course. Establish regular check-ins where contractors submit performance reports detailing their deliverables, remaining tasks, and any challenges they face. This keeps you informed and allows for timely adjustments if needed.

At the same time, conduct routine assessments or audits from your end to track how the project is progressing. This helps ensure that contractors are set to meet deadlines and follow safety and health regulations. Regular check-ins keep the projects on track and minimize potential issues before they become bigger problems.

Stay abreast of relevant rules and regulations.

Labor laws can change at any time, so employers must stay up-to-date. Case in point: US Department of Labor’s final rule on worker classification. Previously, the law only looked at the economic dependence of workers on their employers. The more economically dependent a worker was on the employer, the more likely they were to be considered an employee. However, the changes take a broader approach and now consider the “totality of circumstances” when classifying workers. 

Streamline the process with technology. 

Contractor compliance can be complicated, requiring new administrative tasks and management processes for your managers and HR. However, technology can simplify some processes involved with working with contractors, such as onboarding, time tracking, payroll, and documentation.

Workforce.com simplifies contractor compliance

Managing employees is complicated enough, and adding contractors into the mix can come with its own set of challenges. But don’t let this discourage you from getting contractors for specialized projects, especially if they provide more flexibility. 

There’s a way to manage contractors in a more streamlined way. Here’s how Workforce.com can help. 

Onboarding 

Workforce.com’s onboarding system lets 1099 workers easily and independently submit all necessary paperwork, bank details, and contracts to employers. This self-service portal relieves the administrative burden from the employer and ensures all information is in place for contractors to get paid correctly.

Time tracking

Depending on the contract, contractors submit timesheets before they get paid, but you can simplify the process with Workforce.com’s time and attendance system. Instead of dealing with paperwork, contractors can log in and out through the time clock, automatically generating timesheets based on their time punches.

You can set up a Workforce.com on-site or you can allow contractors to clock in and out through their own device via the Workforce.com app. This ensures accurate time tracking across multiple locations, making recordkeeping more manageable and ensuring contractors are paid on time, especially if specific hours were agreed upon.

Scheduling & task management

Workforce.com also has a scheduling system that contractors can use to plan their work accordingly. They can build and assign shifts, create to-do lists, and communicate with other workers to more easily map out where and when work gets done.

PayrollWorkforce.com’s payroll system can simplify how you pay contractors. Along with your W-2 staff, the system will also automatically process payment for your 1099 workers based on hours worked and the terms of their contract. At the end of the year, Workforce.com will also provide you with all necessary 1099 forms, which your contractors will use to file their taxes.

Recordkeeping

Workforce.com keeps all contractor records organized in one place, helping you access everything in case of audits or compliance reviews. It stores contracts, timesheets, IRS forms, and other important documents related to each project, helping you stay on top of everything and remain compliant. 

Ready to improve how you manage contractor compliance? Book a demo and see how Workforce.com can help.

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Webinar: How Tech Can Stop Turnover for Small HR Teams

Smaller HR teams are facing challenges in maintaining employee loyalty due to being overwhelmed with various responsibilities.

It’s understandable that focusing on employee engagement can be difficult in such circumstances. However, utilizing technology can be a game-changer for lone HR managers looking to enhance employee loyalty.

This webinar aims to address these challenges by offering insights into leveraging technology solutions. By exploring both free and investment-worthy options, HR pros can learn how to create compelling job descriptions, cultivate loyalty beyond competitive compensation, and leverage the unique dynamics of small companies.

We brought on Retensa’s CEO, Chason Hecht, as well as talent specialist & Director of Employee Experience, Dana Small, to discuss free and premium tech tools that HR can use to offload nearly 30% of their admin work.

Check out the list below as well as the full webinar here:

12 free & investment-worthy tools to…

Streamline the Hiring Process:

1. ONET.com: This occupation keyword search directory allows recruiters to quickly identify and match job descriptions with relevant skills and competencies. It helps create accurate job postings and ensures candidates’ qualifications align with job requirements, speeding up the screening process.

2. Applicant Tracking System: An ATS automates the recruitment process by managing job applications, screening resumes, and tracking candidates throughout the hiring pipeline. It reduces manual tasks, ensures compliance, and helps prioritize top candidates, making the hiring process faster and more efficient.

3. Applicantstack.com: ATS platform that streamlines recruitment by automating job posting, resume management, and candidate communication. It helps organize and track applicants, reducing the time spent on administrative tasks and improving the efficiency of the hiring process. If you have a few positions open it costs less than $50 a month. If you hire more, unlimited jobs for $100 a month. You can also leverage it for onboarding if your budget is higher.

4. Claude AI: Assist with candidate screening by conducting preliminary interviews, answering candidate questions, and gathering necessary information. This reduces the time spent by human recruiters on initial interactions, allowing them to focus on qualified candidates. Also, this tool reduces your hiring data into interactive, understandable visuals. Leverage this to summarize the candidate pipeline.

Enhance Onboarding:

5. MS Planner: A simple but capable project management tool that can be customized for onboarding. It allows HR teams to create visual boards with tasks, checklists, and timelines for new hires. Free with Office 365.

6.  Loom: Allows you to create video tutorials and walkthroughs that can be shared with new hires. This is especially useful for remote onboarding, where face-to-face interaction is limited.

7. Free Fuse: Free Fuse offers a tool to build interactive learning trees that can be used to train and onboard candidates faster. By using this tool, employers can provide potential hires with bitesize information, assessments or onboarding materials, automating the learning process based on their learning pace and performance. Fully functional basic package is free.

8.  Leverage Learning Management Systems (LMS): Libraries of courses and topics for technical and soft skill development.

Create a Retention Environment:

9. TalentPulse: A turnkey employee feedback platform that captures real-time insights at every stage of the employee lifecycle. Automates and reports on employee sentiment through questions, surveys and 360’s, helping organizations identify real-world issues to better engage and inspire the workforce. Any 1 of 24 surveys can be sent for free up to 5 responses.

10. Flexible Scheduling: Schedule staff in minutes & reduce labor costs 11%

  • Create fast and accurate schedules with templates,
  • staffing ratios, and shift swapping.

Lower Turnover Rates:

11. ExitPro: Provides secure and streamlined Exit Interview program in minutes. With several pre-built exit interview question templates, instant exit interview reports, and a suite of tools to predict and prevent employee turnover. A Free trial can last up to 12 months and unlimited exit interviews for as little as $79/month.

12. Notion AI: Notion AI is an advanced feature within the Notion platform that leverages artificial intelligence to enhance productivity and organization. For employee retention, Notion AI can assist in creating personalized onboarding experiences, maintaining detailed employee records, and automating repetitive tasks

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How to Terminate an Employee: Essential Dos and Don’ts

Summary:

  • Employee termination is a delicate art of upholding company policies and maintaining a good relationship with employees leaving the company. When handled wrong, it can result in legal repercussions.
  • Having a policy for how to terminate employees is vital. But knowing when to do it is equally crucial.
  • Use an official Employee Termination Letter when letting someone go. Also, be sure to properly document performance records and calculate final paychecks in your HR & Payroll system.

Terminating an employee is a challenging yet sensitive process for managers and business owners. It requires a balance of empathy, professionalism, and strict adherence to legal and organizational policies. When handled correctly, it can protect the company’s reputation, maintain team morale, and uphold the dignity of the departing employee. On the other hand, mishandling employee termination can lead to legal repercussions, a toxic work environment, and damage to company culture. 

Here’s a rundown of best practices on what you must do and mistakes to avoid to ensure that your employee termination process is carried out with fairness, compassion, and respect for all parties involved. 

The Dos

Do follow company policy and legal requirements. 

Every organization should have a policy regarding employee terminations. This policy goes beyond a list of paperwork and items that employees need to return before they leave. With this in place, you would have a clear framework and set of steps to follow when letting go of an employee. 

There are several reasons why employees need to be let go, and your termination policy should clearly outline a process for when such conditions are met. Employment typically ends for the following reasons: 

  • Voluntary termination happens when employees decide to leave an organization. Once an employee turns in their resignation or notice, the turnover period usually lasts two weeks to a month, depending on what’s stated in your company policies or what you have discussed with the employee.

The steps for when an employee resigns are pretty straightforward. They will be given a list of things they need to return and informed of when they can receive their final paycheck.

  • Involuntary termination happens when the employer initiates it, and there are several reasons why employers can do so. First, companies experience changes that prompt them to downsize, let go of redundant roles, lay off employees, implement furloughs, or close the business completely. Second, employees fail to perform or commit major violations or offenses.  

Involuntary termination is more challenging to navigate because more legalities must be accounted for. For instance, is the employee given ample opportunity to improve if the termination is due to poor performance? Was the issue communicated clearly to them? You may be liable under the law if you answer no to both questions. 

Your termination policy should clearly state offboarding processes specific to the nature of the termination. More importantly, every rule should adhere to applicable labor laws to avoid non-compliance and potential lawsuits.

For instance, there are employment laws governing when final paychecks should be released. Depending on what states you operate in, you would need to release the final paycheck on the actual last day, the next scheduled payday, or a specific number of days after the termination of employment. Here’s an updated guide on severance pay and final pay rules for 2024. 

Lastly, this policy should be included in the employee handbook.

Do comply with all applicable termination laws.

The dismissal process is straightforward if an employee leaves your company on their own accord. All you need to do is determine their last working day, prepare the necessary paperwork, provide a list of things and responsibilities the departing employee needs to turn over and issue the final pay. 

However, if an employee needs to go for involuntary reasons, you must take additional steps to ensure a smooth and compliant transition. Get thorough legal counsel to ensure that you comply with all termination laws that apply to your business. In particular, ensure you are following your state’s final paycheck regulations. 

Do document everything

Prepare the necessary documentation ahead of time. While nearly every state in the US adheres to the employment-at-will doctrine, it’s good practice to have a paper trail of performance evaluations and disciplinary records that support your reasoning for terminating an employee. You should also create a termination letter, an official document to notify employees that they are being let go. It must include the reason for termination, effective date, and next steps, such as turning over company assets and releasing final pay.

Termination letters may seem straightforward, but you must be careful when writing them. As an official document, they should stand in court if needed. Ensure that they are factual and include all the necessary information. Here’s a free template and guide to writing employee termination letters.

In addition to the termination letter, it is good to prepare and refer to employment contracts and other vital data that will help the employees understand why they are being let go. If you offer a severance package, discuss what’s included and how it will be computed.

Do have a termination meeting to notify the employee privately. 

Regardless of the reason, it would be best to notify the employee privately that they are being let go. It’s never easy to receive such news, and doing it in front of others will make it even more painful. 

A face-to-face meeting keeps their dignity intact, especially if they are being let go for job performance issues. 

It is important to keep these meetings short, straightforward, and professional. During the meeting, present them with the facts, such as the reason for the employment termination, what company property they need to return, when they can expect their final pay, and other next steps. End the meeting amicably, wish them well, and thank them for contributing to the company. 

Consider recording the meeting to ensure that all your bases are covered. Be sure to inform the employee beforehand that the meeting will be recorded. 

Do have a witness when notifying employees that they are being terminated. 

Having a third party present during the meeting is another good idea, both for the employee and the manager. 

Typically, the witness is a human resources person. HR professionals are well-versed and have the expertise to handle terminations, and it can help frontline managers carry out an otherwise daunting task. 

Do provide assistance when possible. 

Depending on the termination circumstances, consider offering recommendation letters to terminated employees to help them find new employment. This can be an excellent way to end things amicably, especially for team members who are let go because of downsizing or layoffs.

The Don’ts

Don’t dismiss employees without personally talking to them. 

Firing someone is never easy and typically comes as a blow, especially for unexpected reasons like layoffs or something more sensitive like “for cause” termination. 

While a termination letter is, in principle, a tool to notify employees that they are being let go, it’s not advisable to deliver the news through this channel only. Think of it as documentation that makes everything official and prevents legal repercussions. But at the end of the day, it’s merely that—a formality. 

When letting people go, it’s best to talk to them in person before presenting formal letters and documentation. A face-to-face dialogue helps soften the blow, demonstrates respect, and allows employees to ask questions regarding the termination. 

Don’t terminate employees on a whim. 

Termination should always be the final recourse because firing an employee without due process can have legal consequences. Letting people go should never be a knee-jerk reaction to the first sign of financial challenges, unsatisfactory performance, or conflict with other staff.

If a team member is not performing up to par, consider putting them under a performance improvement plan or PIP. A PIP is a documented program to help underperforming staff members improve. If an employee falls short of the goals set under the PIP, then termination should be considered. Here’s a guide and free template for creating a performance improvement plan. 

Even if an employee violates a company policy, firing them on the first offense is often not wise. Make sure that they are given the chance to correct their behavior and provide warnings accordingly. There should also be ample investigation and facts before letting employees go due to offenses like tardiness or conflict with another co-worker.

Also read: 3 Mistakes with Employee Conflict Resolution – How to Avoid

Don’t overlook the right timing. 

When it comes to employee termination, the when is equally important as the how. 

While it seems there’s never a right time to announce that an employee is being let go, it’s still essential to time it well. In some cases, firing people at the wrong time can even result in legal risks. 

So when is it NOT advisable to terminate an employee? When they are on medical leave. While an employee who’s under FMLA leave is not exempt from termination, you need to tread carefully. Certain conditions need to be met before you can let go of an employee undergoing said leave. Make sure to consult with your legal team to handle it properly. 

Other times when it’s not advisable to fire employees include: 

  • When they are going through difficult challenges, such as getting diagnosed with a severe illness or getting divorced
  • When they are on vacation or about to celebrate their birthday
  • During December or January, when they would be dealing with the holidays and the bills that come with it
  • During Fridays, because employees may have questions or clarifications. If termination is done close to EOD or on the weekend, it’s not helpful to wait through the weekend before they can get answers or details. Doing it during the midweek is the best way to go. 

Timing is crucial because it can result in a legal issue. However, whether there is a legal risk or not, it’s best to terminate employees with as much consideration as possible. Look into how much your operations could allow and time the termination accordingly. Losing a job is the last thing anyone would want. Make it as manageable for your employees as possible. 

Don’t forget to check in with remaining staff members. 

Employee termination can also affect staff who remain with the company. Ensure you check in with current team members to see how they feel about the situation. 

It’s normal for the remaining staff to feel anxious about their employment, especially after layoffs. Schedule a time to sit with them so you can address their concerns. Use this opportunity to gauge your team’s sentiments and take quick action if you think they are likely to disengage and quit. 

After terminations, it’s best to stay transparent with the remaining team. Have an open-door policy and answer their questions honestly. 

Don’t insinuate that the decision is not final. 

Don’t give false hopes when breaking the news to employees. It has to be clear and direct that they are being let go, and nothing can alter that decision. Don’t allow room for any vagueness or misinterpretation, whether verbal or written.

Don’t part ways on a bad note. 

Terminations, for whatever reason, will never be a comfortable discussion. However, it’s always best to part ways amicably with a departing employee. Even if there’s conflict, it’s pointless to rehash the negative things that happened. At this point, it’s best to focus on the positive sides of their tenure with the organization. 

Say goodbye on a positive note, or at the very least on a professional and civil level. If you think that there’s a risk of violence, have someone nearby to assist you, and don’t engage. 

Workforce.com can help lighten the load of employee termination

There are a lot of areas concerning employee termination, and Workforce.com can help simplify them for you.

Employee termination usually requires extensive documentation of time and attendance, performance reviews, payroll details, and other information related to calculating final pay. Workforce.com can help you gather all of this data and streamline the termination process.

Discover more about how Workforce.com can help you. Book a demo today. 

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3 Mistakes with Employee Conflict Resolution – How to Avoid

Summary:

  • 85% of employees report experiencing workplace conflict.
  • Conflict at work results in personal attacks, frequent absences, and even health issues when not handled properly.
  • Conflict resolution takes up valuable time. Have processes and automation in place to handle HR admin work while dealing with workplace issues.  

Workplace conflicts are inevitable to some degree, but mishandling them can lead to more significant problems. Whether it’s personality clashes, differences in work styles, or disagreements over responsibilities, managing these conflicts effectively is crucial for maintaining a healthy company culture and productive work environment.

According to a study by CPP Inc., 85% of employees experience some kind of conflict. When managed right, conflicts can result in a better understanding and working relationship among the employees, fostering a more positive work environment. But when not handled properly, conflict can transform into bigger problems such as personal attacks, frequent absences, and, yes, even health issues. 

Unfortunately, many managers and HR professionals make common mistakes when dealing with employee disputes, often exacerbating the situation rather than resolving it. In this article, we will explore some of the most frequent pitfalls in employee conflict management and provide practical strategies for avoiding them. 

Mistake 1: Sweeping things under the rug

A study by CIPD found that approximately 31% of employees who experienced conflict felt that their concerns were not taken seriously by the person they reported to, and 48% believed that the interests of the other party were given priority over their own. 

Conflicts are typical in the workplace, but like most problems, they’re never really out of sight or out of mind. If anything, unaddressed conflicts can escalate to bigger issues, such as people leaving jobs, reduced productivity, or a full-blown outburst that can compromise safety and operations. So, the best thing is to tackle conflicts head-on. 

How to avoid: 

Unfortunately, managers and team leaders may tend to avoid conflict simply because they don’t know how to deal with it properly. The good news is conflict resolution skills can be developed. Equip your frontline managers with the right tools and training to help them navigate different communication styles and improve their problem-solving skills.

According to the same study from CPP, Inc., 60% of employees didn’t receive basic training on conflict management and resolution. The others who did, on the other hand, said that the training equipped them to manage workplace conflict and reach positive outcomes or solutions. 

Train your managers to identify different types of conflict effectively. More often than not, the root of the problem is something deeper and something that’s not always apparent on the surface. Is the issue rooted around a task, or is the problem more relational? If it’s the latter, conflict typically stems from differences in values and emotions. Emotional intelligence comes in handy in such cases. Train managers to improve or develop how they read emotions, empathize with others, and manage feelings. Active listening and knowing to use neutral language are also vital for managers and HR professionals.

Administrative tools are equally important as conflict management training, enabling managers to spend more time on the frontlines spotting issues and resolving conflict. Software like Workforce.com streamlines and automates HR processes, scheduling, timesheets, and payroll. When frontline managers finish admin tasks quickly, they get more time on the floor with staff, leading to better conflict management. 

Aside from the functionality mentioned above, Workforce.com also has a shift feedback feature that allows employees to rate their shifts. They can also say what was effective and what needs improvement. Using this information, managers and supervisors can help spot potential conflict or have a clearer perspective of what’s causing tension or challenges.

Webinar: How to Design a Retention Strategy for Hourly Staff

Mistake 2: Not communicating the outcome of the investigation

It’s great when employees are given the chance and platform to air their grievances, but that’s just the start. Employers often miss the other important part of conflict management, which is letting all parties involved know the outcome of the investigation and what next steps to take. 

Some team leaders may treat post-conflict procedures as an out-of-sight, out-of-mind matter—this definitely won’t work. Just because time has passed after the initial conflict doesn’t mean that everything should go back to normal. If anything, leaving team members hanging would further fester ill feelings, cause disengagement among staff, and even increase attrition. 

How to avoid:

Establish a process for conflict resolution and stick with it. Designating clear ground rules sets the tone and direction. The clearer the steps, the higher the chances of issues being resolved. It’s also easier to track the case’s progress and determine roadblocks to conflict resolution.

Every organization’s conflict resolution process differs, but here’s a brief framework to help you create yours. 

  • Determine the source of conflict – Gather information. You can begin by getting statements from all involved parties but don’t take anything at face value. Ask the right questions to probe further and determine the root cause of the issue. Watch out for possible indicators to better understand the reason. For instance, is the issue really about a co-worker, or could it be because of another underlying issue rooted in your operations? In addition, you can look at supporting data from your systems if needed, such as performance evaluation or time and attendance data.
  • Define possible solutions – Ask the people involved how they would want to see the issue resolved. Doing so will give you insight into their point of view and what they value most, and that’s key to coming up with the best possible solution that everyone can agree on.
  • Communicate the solution – Once you develop a solution, communicate it — whatever it is. Make sure to explain how the resolution benefits all parties involved and the organization as a whole. The key here is not always to create a perfect situation for everyone but a space where both sides can move forward, agree, and collaborate.
  • Document the process and agreement – Make sure to document the agreement and ask them for steps they would take to avoid the same issue or conflict moving forward. Note that preventive measures ideally must come from all parties involved, including the organization, if need be. If it would result in change in company policies, ensure that it is appropriately communicated to everyone else and reflected in your employee handbook. 

When conflicts arise, staff must see accountability from the parties involved. It’s not about revenge or getting back at the other but about being heard and seeing the company’s rules correctly implemented. 

Furthermore, seeing conflicts resolved and given the proper attention would encourage staff to speak up and provide feedback. Having that culture would be beneficial in terms of improving your operations and employee engagement. 

Mistake 3: Having a reactive approach to managing conflict

In an ideal world, there would be no conflict in the workplace. But we’re not in an ideal world. Conflict will always eventually arise. However, most organizations tend to fall into the trap of taking a reactive approach to conflict or not taking an approach at all. And this is where things can get messy. 

Typically, most organizations’ policies tend to be reactive, which means they only take action once conflict presents itself. While conflict cannot be completely avoided because people are…well… people, having a more active approach to dealing with issues is still key. 

How to avoid: 

Create a work environment that’s less prone to conflict. What does that look like exactly? 

First, you must equip your organization with tools that allow work to be clear. Sure, the job may have nuances, but it’s best to have a system for clearly black-and-white areas. Take, for instance, software like Workforce.com. It helps reduce or avoid disputes around time and attendance, scheduling, PTOs, and payroll because it’s automated. Should there be any concerns, they are easy to clarify or correct since there is only one source of data. 

Furthermore, you need to create a feedback system that helps spot conflicts and prevent them from blowing up. Aside from regularly scheduled check-ins and performance reviews, it also helps to incorporate a more spontaneous feedback process. Workforce.com’s shift rating and feedback can help. Asking people to rate their shifts can be crucial to identifying conflict early on. 

For instance, if consistent feedback or comments about how a certain piece of equipment delays closing time occurs, you can address it before it causes any further tension among staff. Another example would be if you’re getting reports about staff not endorsing properly for the next shift; you can also address it more ahead of time. 

Typically, conflict starts with small things or minor grievances. By creating a working environment where you can identify those triggers, you can manage conflict before it becomes big enough to disrupt your operations. 

Also read: 10 Best Practices for Employee Surveys

Tips to improve your conflict resolution strategy:

Have an open-door policy

Conflict needs to be brought to light before it can be solved. But how would that happen if employees don’t feel safe speaking up?

Staff may refuse to talk about conflict or concerns bothering them because they fear retaliation. In some instances, they don’t know where to begin. Having an open-door policy promotes open communication and a safe space for your employees to come up and talk to you if they’re facing any issues. 

When you implement such a system, ensure staff are aware of it. Reiterate that they can access their superiors if they need to raise concerns. Ensure, as well, that whatever’s discussed will be confidential or only be disclosed to others to the extent necessary to resolve issues. 

Practice active listening

In conflict management, facilitators must know how to listen, not just to respond but to understand. 

Active listening is vital to gathering information for conflict resolution. It takes into account everything being communicated, including nonverbal cues. When you listen actively, you become more conscious not just of the facts being stated but also of the person’s tone and emotions. 

Furthermore, it also pays to ask questions to validate information and recap what was discussed. 

Understand different conflict management styles

People tend to approach conflict in different ways. Here’s a general overview of these styles and why people resort to them. 

  1. Accommodating – This approach means setting aside one’s needs to give way to the other party’s needs and concerns. People tend to lean toward this approach when they want to keep the peace or if they realize they’re at fault and just want to move forward.
  2. Avoiding – As the word suggests, it means to steer clear of conflict. Some people approach conflict this way when they think the issue is trivial or not worth fighting over. Meanwhile, others avoid facing the problem because they need more time or space to think about it.
  3. Compromising – This approach aims to reach a common ground between two conflicting parties. Note that this approach aims to reach a solution that both parties can be okay with but not necessarily fully satisfied with. While it is not the most ideal, reaching a compromise can cause things to move forward, especially when there’s a deadline.
  4. Collaborating – Unlike compromising, collaborating is about reaching a win-win situation for both parties. This approach aims to reach a resolution that both parties can be happy with.
  5. Competing – Unlike accommodating, competing means standing one’s ground and not budging until the issue is resolved how they see fit. This approach is common among people who think that a rule or law was violated or if they believe that they are in the right. 

Understanding conflict resolution approaches is not just about finding the best way to tackle issues as a manager. It’s also a way to gain deeper insight into why employees approach a situation differently. For instance, if you learned of an issue concerning an employee, yet they chose not to report to you, you would want to probe if it’s just a non-issue for them or if they fear resentment.  

Use a system that keeps employee and workforce data accurate

Conflict can stem from workplace disputes around time and attendance, schedules, payroll, PTOs, and other employee information. That’s why it’s best to use a system that records all of this information, giving you a paper trail to refer back on.  

Information and data from a single source can help thwart conflicts or clarify things more easily. 

Don’t fall behind while resolving conflict 

Conflict resolution is a stressful and time-consuming responsibility for HR practitioners, especially in smaller companies. Resolving issues eats up valuable time, which is often spent on administrative tasks. To prepare for inevitable workplace conflicts, equip yourself with software that handles the admin work for you so you don’t fall behind. 

Discover how Workforce.com can streamline PTO requests, payroll processing, timesheet approvals, applicant tracking, and more so that you can handle strategic HR better. 

Schedule a demo today. 

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Work Opportunity Tax Credit (WOTC): How to claim & where to file

oil painting of blue collar workers

Summary:

  • WOTC is a federal tax credit available to organizations that hire marginalized job seekers, like disabled veterans or ex-felons, who traditionally have a difficult time finding employment. 
  • Employers typically receive a maximum tax credit equal to 40% of up to $6,000 of wages paid to a qualified WOTC employee in their first year of employment. WOTC cannot be claimed beyond that first year.
  • To claim WOTC, employers must fill out additional IRS and DOL forms and submit them to their State Workforce Agency
  • Many Payroll & HR Software providers handle WOTC screening and certification requests for employers, making the process of claiming tax credits much easier. 

The Work Opportunity Tax Credit (WOTC) is a federal tax credit that incentivizes employers to hire people who typically face significant barriers to employment. This program typically offers employers between $2,400 – $9,600 per new qualifying hire. According to the U.S. Department of Labor, roughly $1 billion in tax credits are handed out yearly through WOTC. 

To receive the credit, taxable organizations must complete a screening and certification process when hiring potentially eligible staff. If approved, employers then file an additional form with their annual business tax return. Non-taxable organizations can also participate in the program by receiving a credit against their payroll taxes. 

Introduced in 1996 as part of the Small Business Protection Act, the program was recently extended through Dec 31, 2025, largely due to the impact COVID-19 has had on the labor market. Currently, there is a bipartisan push in Congress to make WOTC permanent.

Benefits of the Work Opportunity Tax Credit

The intended goal of WOTC is to benefit both employers and employees alike. Incentivizing the hiring of targeted individuals through tax credits not only reduces costs for employers by decreasing their federal income tax liability, but it also makes it much easier for these individuals to get hired. WOTC also benefits non-taxable employers by allowing them to receive a credit against their share of Social Security taxes.

While the financial boon to employers is obviously a nice benefit, the main purpose of WOTC is really to help individuals who typically have a difficult time finding a job get hired. Over the years, WOTC has helped people like disabled veterans and ex-felons find jobs, re-enter the workforce, and get a fresh start. Not only is WOTC supposed to help these people get hired, but the program also encourages job retention by requiring WOTC-certified new hires to work a minimum of 120 hours before employers can receive the minimum credit. 

Who is eligible? 

The IRS specifies nine “target groups” employers can hire from to receive tax credits. These groups are:

  • Qualified veterans
  • Ex-felons
  • Designated community residents in Empowerment Zones or Rural Renewal Counties
  • Vocational rehabilitation referrals
  • Summer youth employees living in Empowerment Zones
  • Supplemental Nutrition Assistance Program (SNAP) recipients
  • Supplemental Security Income (SSI) recipients
  • Temporary Assistance for Needy Families (TANF) recipients
  • Long-term unemployment recipients designated by a local agency who have been unemployed for at least 27 consecutive weeks

For the most part, employers can only claim tax credits during the first year a person from one of these target groups is employed. The only exception is for TANF recipients, who employers may claim credit during the first two years.

How to claim in 5 steps

The process for claiming the Work Opportunity Tax Credit upon hiring a qulaiifed individual is relatively straightforward, but it does involve multiple steps and additional tax forms. For more information, visit the IRS website. But for now, here is the general timeline:

  1. Screen Applicants: you’ll want to ensure every new hire is screened for WOTC eligibility. Do this by ensuring applicants complete the IRS Form 8850 Pre-Screening Notice on or before the job offer date. You’ll submit this form and a written request to your State Workforce Agency (SWA) to see if an applicant qualifies for the tax credit. Visit the DOL website for a complete list of links to State Workforce Agencies. 
  2. Complete DOL ETA Form 9061 or 9062: The WOTC Individual Characteristics Form should be completed by the new hire as part of their onboarding. Along with this form, the new hire will typically need to provide supporting documentation or forms certifying their status as a member of a targeted group. 
  3. File Documents: Submit Form 8850 and 9061 along with all supporting documentation to your SWA within 28 days of the new hire’s start date. The SWA decides the eligibility of your new hire and can sometimes request additional information before approving your certification request.
  4. Track hours and wages: To claim the minimum tax credit, qualified new hires must work at least 120 hours in their first year of employment. Depending on how many qualified staff an employer has, accurately tracking all of this information can be tedious. To make things easier, use a Time and Attendance system to automatically record hours and wages on electronic timesheets. 
  5. Claim the tax credit: To receive the tax credits, submit IRS Form 5884 when filing your annual tax returns at the end of the year. Tax-exempt organizations will need to submit Form 5884-C. 


If an employer uses an outside consultant, such as a payroll or CPA firm, to sign and file WOTC forms on their behalf, they will also need to complete the Employer Representative Declaration form 9198. This form essentially declares a third party as a legal representative to manage WOTC certification requests.

How is it calculated?

At the end of the year, employers receive a maximum tax credit equal to 40% of up to $6,000 of wages paid to a qualified WOTC employee in their first year of employment. The employee needs to work at least 400 hours for the employer to receive the credit.

If the maximum tax credit above is met, employers typically receive $2,400 in credit per WOTC employee. However, employers may also claim credit on 25% of the first-year wages earned by a qualifying employee who works at least 120 hours.

There are several exceptions to the maximum credit amount of $2,400. Here are the WOTC target groups with different maximum credit amounts:

  • Veterans with service-connected disabilities who have been employed for more than six months – $9,600
  • Long-Term Family Assistance recipients who have received TANF benefits for at least 18 consecutive months – $9,000
  • Summer Youth program participants ages 16 and 17 and live in a designated community area – $1,200

Is WOTC truly a win-win?

The Work Opportunity Tax Credit program has obvious benefits for both employers and individuals in target groups. Over the years, the tax credit incentive has not only saved organizations thousands of dollars every year but also helped marginalized people across the country re-enter the workforce and provide for themselves.

However, there are some question marks regarding the effectiveness of the WOTC program. 

One of the proposed benefits of WOTC is to encourage retention. Unfortunately, meeting the minimum 120 hours for tax credit only equates to roughly three weeks of full-time employment. This low threshold has led to temporary employment agencies taking full advantage of WOTC, hiring cheap labor, getting a tax credit, and then quickly moving on from these workers.

But temp agencies aren’t the only problem. Large, low-wage employers with high turnover also take advantage of WOTC. Investigative journalism outlet ProPublica discovered that Walmart, Dollar General, and Amazon were some of the top recipients of the tax credit in a 2022 analysis. While these large companies are raking in the financial benefits, workers from target groups tend to fall by the wayside, working low-wage, high-stress jobs for a few weeks before getting laid off and starting the whole process over again.

This begs the question: With the government losing out on over $1 billion due to WOTC and temp agencies sometimes earning $114 million over the past ten years in credit, who is truly benefitting here? Without WOTC, what could the government spend its money on instead to help marginalized Americans? 

The outlook for WOTC is still uncertain. As of now, it is set to end after 2025. But, if it is either renewed or made permanent, perhaps a reassessment of who benefits from this program the most is in order. 

In the meantime, smaller employers would do well to make the most of this tax credit while also taking genuine steps to retain WOTC-qualified new hires for the long term. In most situations, WOTC is a win-win for employers and job seekers, and the program’s effect is most likely a net positive for the job market, even with a few bad actors tainting the program.

Claiming WOTC through Workforce.com

Properly screening new applicants for WOTC can be time-consuming and overburden your HR team. Not only does it prolong the hiring process, but it also opens the door to all kinds of mistakes if either a new hire or HR team member fills out a WOTC application form incorrectly.

If your organization wants to qualify for tax credits but doesn’t want to deal with the hassle, find a payroll system that does all of the work for you. 

Workforce.com features an easy-to-use WOTC screening service that allows new job applicants to check a few boxes to determine their eligibility. Using this information, Workforce.com fills out both forms 9061 and 8850 for you and sends them to your SWA for approval. Once approved, you can track all wages and hours worked through Workforce.com’s Time & Attendance system. At the end of each pay cycle, these hours are automatically reported for your organization so that you’ll receive the tax credit at the end of the year.

To learn more about claiming WOTC through Workforce.com, please reach out. We’d be happy to talk!

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Creating a Better Onboarding Process for Hourly Staff

Painting of an Astronaut Husky sitting at a computer

Summary:

  • Employee onboarding significantly impacts productivity and retention. Given the nuances of hourly workforce operations, this process is more complex.
  • Technology can help streamline onboarding, but communication and human touch are crucial to successful onboarding. 
  • Onboarding processes and materials should be regularly assessed to ensure they remain aligned with and relevant to what happens on the frontlines.

If recruitment is about attracting employees, onboarding is about keeping them. The goal for any new hire is to make them productive members of the team as soon as possible—the onboarding process is key here. And no, we’re not just talking about giving them the company handbook and calling it a day. 

There’s no one-size-fits-all approach to an effective onboarding process. It greatly varies by industry, role, and whether you are managing an hourly workforce. If you are, this guide is for you. 

If you are just looking for the basics, check out our free onboarding checklist template below:

Free onboarding checklist

If you want more insight into onboarding best practices, read on. But before we dive into how to optimize employee onboarding for hourly staff, let’s take a look at the reasons why you should prioritize this stage of the employee lifecycle. 

Why a well-structured employee onboarding process matters 

Onboarding sets the tone for the rest of a new hire’s employment. Getting it right can massively impact a number of things, including:

Productivity

Focus on detailed onboarding protocols if you want a new team member to hit the ground running as soon as possible. New hires get productive quickly when they have a clear roadmap to follow. When employees are provided with all the necessary information and tools, they learn the ropes faster. However, note that crucial information goes beyond the handbook and training materials. Some details are best understood when they have an assigned mentor or partner while on the job. 

Bottom line

Poor onboarding can hurt your organization financially. The average cost of hiring a new employee is $4700, according to SHRM – and this only covers posting job ads, doing background checks, and interviewing. Training cost is another story altogether. It ranges from $481 to $1240 per trainee, spending on company size and industry, one study shows. 

So, how do you prevent all that money from going down the drain? Improve the employee onboarding experience. The costs associated with onboarding and training will all be for nothing if new hires decide to leave shortly after their first day. 

Employee Retention

According to the 2023 Training Industry Report, excellent onboarding can improve retention by 82%. New hires will most likely stick around when engaged from day one. Good onboarding ensures they are not just stuck in the back room in front of the computer, glossing over training and being overloaded with information that they wouldn’t likely remember by the end of the week. It’s about having a curated program that covers all the necessary training yet still allows room for hands-on learning and peer-to-peer interactions.

How to Improve Onboarding for Hourly Employees

The nature of onboarding for hourly employees differs greatly from onboarding in a corporate environment. “It’s more challenging to nail down for hourly-based industries or those employing shift-based workers because of all the nuances around it,” says Laura Timbrook, a national board-certified health and wellness coach, international speaker, and well-being strategist for manufacturing and other shift-working industries. 

Standardizing onboarding is a good place to start, but there are many considerations for integrating new hires into an hourly workforce. Here are some ways to work around challenges and improve how you integrate new hires into your team:

1. Determine how long onboarding is going to take

Typically, an onboarding program takes at least three months. However, it might not always be the case for hourly employees. 

First, consider whether the position is a seasonal role or a more permanent one. If it’s the former, you wouldn’t have three months to onboard them because the season may be over in three months’ time. How, then, can you ensure that onboarding is still effective within this timeframe?

It’s all about clarity. Having a list of tasks can help, but there’s still a learning curve. This is where having them work alongside a more experienced employee is essential. “If we can buddy seasonal workers with somebody who can show them the ropes quickly, that would be key. Our systems can often provide a checklist, but it can be too much if they also need to learn the system,” says Laura. 

Streamlining the process is crucial, especially during a short onboarding period. It should involve having the right systems so seasonal employees can quickly understand workflows and having somebody working with them who can easily address questions they may have along the way.

Meanwhile, you’d have more room to work with if you’re onboarding a new hire for a permanent position. Even so, the whole process must be curated to cover the administrative, compliance, and practical aspects of the role. Prioritization is key here, which brings us to the next tip.

2. Set priorities and milestones. 

One thing to avoid when onboarding new hires is to overwhelm them with information and admin work. 

“A lot of times, we get these employees in and get the legal paperwork out of the way, and then we just throw them on the floor. It’s a sink-or-swim scenario. As an employee, that won’t make you feel good about your job. It’s not going to make you feel good about yourself. And it won’t make you feel good about the organization,” shares Laura. 

It’s crucial that you set priorities and determine what a new employee must accomplish and by when. Space out tasks so that onboarding is more dynamic instead of spending a lot of their early weeks on paperwork. 

In some roles, mandatory compliance training must be completed before an employee can perform the job. If an employee needs to go through lengthy training material, check in with them. Otherwise, you can streamline the process by dividing a new hire’s hours between theoretical training and practical learning on the floor. 

“We really need to look at what they need by day one. Are we going through compliance training because, say, there’s a cardboard crusher they need to know from OSHA how to operate safely, yet they’re working the cash register? So do they really need that training on day one?” says Laura. 

The goal of onboarding is to complete the most important tasks that are prerequisites for new hires to get up and running. So, look into the training needed, see if you can space it out, and optimize the onboarding process around it. 

A good place to start is to outline what you expect to happen before an employee’s first day, first week, first 30 days, and so on. Having a schedule keeps things organized and expectations clear. 

Here’s an example of an onboarding timeline that lasts for 3 months and what typically happens in each period: 

Before the first day or preboarding

  • Documentation and paperwork – Send job offer letters and lodge paperwork contracts, tax forms, and IDs into your HR system.
  • System profiles—Once their information is entered for payroll, copy all of it into any operations systems new hires might need to use daily. This could mean setting them up in your scheduling and time clock system, project management tool, POS platform, and much more. 
  • Workspace and materials – Set up workstations or prepare work materials such as uniforms, IDs, lockers, and access to company systems.
  • Answering FAQs – It’s normal for new employees to feel anxious during preboarding because stepping into a new role involves many firsts. Sending them a message that covers vital information can help them with the first-day jitters. Doing a quick call to address any initial questions they may have can also help.
  • Prepare a welcome email or note for the new hire. It’s advisable that this note not be system-generated but personalized by the team they will be joining. 

The first day

  • New hire welcome – Greet the first hire upon their arrival. Introduce them to other team members and give them a quick workplace tour. This is also the time to hand them a welcome token or a note from their manager or teammates.
  • Employee orientation—Limit the first-day orientation to the essentials. A brief discussion about the organization and its policies should suffice. This information is also in the employee handbook, which your staff should have access to anytime.
  • Getting settled: Show the new hire their work area or station. On the first day, provide access to learning resources and e-learning platforms. You can also set some time for the new team member to get acquainted with other staff. An all-hands meeting or going on a team lunch are great ideas.

The first week

  • Training
    • Job-specific training: During the first week, it’s time to start discussing what happens day-to-day on the job. Start with the basics and gradually ease into the more complicated parts of the role.
    • Mentorship: Assigning a mentor to a new hire helps with coaching and makes feedback more fluid. Mentors aren’t necessarily managers or team leaders; they could simply be more experienced coworkers. 

“A buddy system can take the load off managers who are already dealing with a lot. Having an onboarding buddy could answer nuanced questions that seem minute to everybody else but big for the new employee,” says Laura. For instance, this could be questions around seemingly simple things like filing leaves, how to operate the time clocks, or when the next pay run will be.  

Sometimes, the buddy doesn’t even have to be tenured. They can be someone who was onboarded maybe two or three months prior, depending on their performance. It helps because they just went through the same process and probably had the same questions any new hire would have.  

  • Goal-setting: Lay the groundwork during the first week. Discuss how the rest of the onboarding process will go and what is expected of them. The last thing any new hire wants to feel is lost, so set the tone, provide direction, and discuss metrics at this stage. New hires will likely perform better if it’s clear what they need to accomplish. In addition, include regular check-ins in your onboarding schedule.

The first month

  • More Training: This is fairly obvious, but the training doesn’t just cease after the first week. After new hires learn the basics of their job function, it is important to evaluate their improvement over several weeks and make adjustments accordingly. 
  • Performance check-in: Discuss with the new hire how they are faring with goals and expectations. This is also a good time to ask their feedback about the onboarding process and the job so far. If they cite anything that needs improvement, look into it and make changes as necessary. 

The first 90 days

Within the first three months, there should be 30, 60, and 90-day check-ins or performance reviews where you discuss progress, achievements, and areas for improvement. 

At this point, you can also start probing into long-term career goals since the new hire will most likely have a grasp of the work and culture, and you, as their manager, will have figured out the type of development you see for them. Discuss their aspirations and see how their performance and current role will tie into that.  

A feedback loop should also be established at this point. It’s important to note that feedback should not be limited to formal check-ins or sit-down meetings. Try to implement feedback into daily routines, such as right after a shift. 

3. Streamline onboarding with technology.

While everyone loves to theorize about strategy and engagement, realistically, the biggest lift of employee onboarding is on the administrative side of things. However, this shouldn’t be the case. The right technology should reduce the time you spend on admin work, giving you more time to focus on engagement and training.  

Effective employee onboarding software should let you do the following:

  • Capture new hire details and send them straight to HRIS, scheduling, and payroll. Ideally, onboarding should be the same system you use for applicant tracking and hiring; this way, you won’t need to waste time manually re-entering applicant information once you hire them. 
  • Complete new hire paperwork forms such as I-9 and W4, collect e-signatures, and get acknowledgment of company policies. A good onboarding platform allows you to go paperless. 
  • Track onboarding progress and send follow-up reminders to new employees to accomplish specific tasks.  
  • Let staff update their details. Adding a new bank account or changing an address should not require lengthy paperwork or email exchanges. An efficient onboarding tech allows employees to update their personal information through a self-service portal. It’s best if they can do so via a mobile app.  
  • Allow staff easy online access to resources like employee handbooks, HR policies, and training guides. Sometimes, new hires grapple for information not because it’s unavailable but simply because they can’t find it. 

“HR spends a ton of time and money writing these safety protocols and putting this all together. They need to know where that is because half of the questions a new employee might have asked or need to ask are in the employee handbook. They just don’t know where it is,” shares Laura.  

Aside from the employee handbook, staff must have a single place to find training materials and other details crucial to their day-to-day work, such as their shifts, leave balances, payslips, and timesheets.  

Keep in mind that onboarding is not a siloed process and should integrate well with other areas of workforce management. Ensure your onboarding syncs with time and attendance, scheduling, payroll, and HRIS.

“Technology is about 60% of onboarding. It has an amazing power to streamline things,” says Laura. However, as much as technology plays an important role, the human touch is still crucial. Your onboarding platform may have all the bells and whistles, but that will be for nothing if the employers fail to engage and communicate well with new staff. The key is to automate and simplify what you can with technology so that you can focus on the overall employee experience.  

Also read: A guide to writing employee performance reviews

4. Review and update your onboarding process.

Onboarding templates, materials, and processes should keep pace with operational changes. Every company policy change should also be reflected in onboarding. However, this is easier said than done. 

Managers and HR must be transparent about these things. A common pain point is that onboarding processes sometimes don’t align with what’s happening on the floor. 

“Often, the people that design the onboarding are in the corporate office. Hourly wage employees, whether they’re in plant production, retail, or transportation, have a much different experience on the ground. We’re often not making those connections,” shares Laura.

So, the key to bridging that gap is ensuring that frontline managers and HR collaborate to design onboarding plans. Managers can provide more context about what actually happens during operations, and HR can help adapt the program according to that insight. That way, the process is much easier to implement and makes the most sense for new hires. 

Another key area is revisiting the review and feedback process during onboarding. Take, for instance, the 30-—to 60-—to 90-day reviews. Typically, these sync-ups are conducted by the direct manager. However, some organizations mix it up and allow the new hire to talk to different people within the company during these check-ins. 

“I saw an organization where for the first 30 days, new hires deal with the direct managers. And then at 90 days, a general manager or a director comes in,” shares Laura. Such practice provides an opportunity for more open communication across different levels. Also, it can be especially helpful if the new hire staff has concerns with their direct manager. 

Webinar: Best Practices for Onboarding Hourly Staff

5. Understand the role of everyone involved in onboarding.

New hires will have different touch points within the organization, which can influence their decision to stay or leave.

At first glance, it seems like HR is the only team that interacts with new hires during recruitment and onboarding. But they’re not the only key players here. Managers also have a significant role in training, so it is crucial to ensure communication is aligned across the board between HR and management.

Part of designing an onboarding process is understanding the role of everyone involved. Aside from HR and hiring managers, identify if you need to involve other staff in the process, such as onboarding buddies or mentors. Set expectations and provide coaching on how they can balance their tasks while guiding new staff. 

Simplify employee onboarding with Workforce.com

While all of the tips we’ve given are a good start, the secret to better onboarding really comes down to connecting it with your Applicant Tracking System. 

Too many HR departments struggle with needless manual reentry. Ideally, all of an applicant’s information should transfer seamlessly to the rest of your software systems. 

Luckily, you can do this with Workforce.com. 

As an all-in-one platform for hourly teams, Workforce.com automates admin work throughout the employee lifecycle. Staff have one profile with one login starting from when they apply for the first time. All of their data flows from onboarding to scheduling, HRIS, and payroll without data re-entry. 

Learn more about better applicant tracking and onboarding by booking a call today.