hr best practices, HR management trainings, hr policies, Human Resources Training

Putting Compensation Statistics in the Right Perspective Will Lead to Increased ROI


Accurately carried out compensation statistics, when shorn of its jargon, is a useful tool to understanding the dynamics of compensation. This is a critical tool in calculating ROI.

Normally, most discussions on compensation statistics tend to go over the head and over the roof. They tend to be full of arcane data, high-sounding parlance, and muddling tables and figures.

No wonder, professionals in the field of compensation packages use the term “descriptive statistics” to describe the elements of information used in the development and management of pay programs.

How to prepare compensation statistics and how to make sense of these?

Arriving at compensation statistics involves having to get a grasp of these concepts:

  • Pay structure development
  • “Control points” in pay ranges, including minimums, midpoints and maximums
  • Weighted and un-weighted averages
  • Means, medians and modes
  • Weighted and un-weighted averages
  • Regression and correlation analysis
  • Standard deviations and data ranges
  • Compa-ratios, and
  • Independent and dependent variables.

They need to be demystified, if an organization has to get a good grasp of what to do with compensation statistics and how to use them for understanding one of the organization’s core financial aspects, ROI.

Way to go with Compensation Statistics




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Not Calculating Overtime Correctly Can Prove Fatal

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Failure to correct common areas of errors in calculating overtime pay correctly, such as misclassifying non-exempt employees as exempt, not tracking time properly, not paying overtime as required, not paying for break time, travel time, and improperly classifying employees as independent contractors will lead to loss of millions of dollars.

An area in which there is considerable disagreement between employees and employers is on the topic of calculating overtime pay. The reason for this is that the Fair Labor Standards Act (FLSA), which is the guiding document on this topic, is nebulous.

Features of overtime pay disagreements

  • Pay is calculated on an hourly basis
  • There is no agreement on what constitutes hourly pay.
  • Dispute centers around which of the employees’ working hours need to be compensated.
  • Problem arises when an employee legally challenges an organization over lower-than-agreed pay.
  • The Department of Labor added 200 more auditors to handle the increased volume in their investigations
  • Of late, escalated audits have resulted in millions of dollars in back wage payments as well as penalties, fines and interest.
  • This constitutes a clear threat to businesses

Possible Solutions: Overtime Pay Disagreements


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Interviewing has to be Legal and Effective


Legal and effective interviewing is an important first step to ensure that organizations both select the right resources and avoid falling into the legal trap.

On paper, hiring and firing are an organization’s prerogative. But in reality, owing to the myriad changes brought about into the concept of employment at will; organizations that are ham-handed or arbitrary in their hiring and firing are at risk of inviting lawsuits. Legal and effective hiring is a useful first step if organizations have to avoid falling into this quagmire.

Legislations That Vindicate Legal and Effective Hiring


The concept of employment at will has been necessitated owing to a series of legislations that have aimed to curb the tendency of employers to be willful and capricious in their hiring and firing policies. A few of these include:

  • Title VII of the Civil Rights Act
  • Not documenting vital communication can lead to lawsuits
  • Lack of proper and sufficient HR documentation can land organizations and HR professionals in big trouble

Among the first prerequisites for organizations is to make sure that it has followed all the proper steps to conducting an interview with a candidate it seeks to hire.

Do’s for Ensuring Legal and Effective Interviewing


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Human Resource Information Systems – an understanding


A Human Resource Information System (HRIS) is a software system in which all functions of HR, payroll and accounting are automated. An HRIS system helps an organization’s HR and Finance to streamline their activities. This makes it simpler for them to keep track of the activities, and to also plan for many of their work-related schedules and capabilities.

An HRIS is expected to deliver automated solutions to many of the manual and clerical activities that these departments do. These activities, despite being routine, are time-consuming, because of which productivity suffers. It is to address this issue that HRIS is used in organizations.

What functions does an HRIS help speed up?


An HRIS facilitates all activities of HR and some functions of Finance. These are some of the areas of HR that an HRIS helps to keep track of and optimize:

  • hiring
  • hours of work each employee has put in on a particular day
  • benefits due to each employee
  • performance and appraisals
  • trainings that each employee needs from time to time
  • announcement of company policies

Some of the ways by which Finance benefits from an efficient HRIS

In many human resource information systems, Finance is built into HR activities. An HRIS usually helps Finance streamline and regulate work related to:

  • payroll
  • W-4 forms and related documentations
  • All types of accounting, such as tax deductions, etc. of each employee


Modules of HRIS

Most human resource information systems have an interface in which they have modules that help them keep track of their individual functions and activities. Each of the activities under HR and Finance comes under respective modules.

A daily work tracker for instance, will have details of the employee log in on each day of work, the hours worked, and so on. Likewise, when a certain training need arises for an employee who has completed a stipulated tenure of work, the HRIS raises alerts about it.

hr best practices, HR management trainings, hr policies, Human Resources Training

What all fall under Employee Policies and Regulations?

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Employee policies and regulations are as essential and integral to an organization as its business. No doubt, it is the business that drives the organization, but a good deal of how the organization conducts itself in relation to its employees is reflected in its employee policies and regulations.

What are employee policies and regulations?

Employee policies and regulations are a set of declarations from the organization, which state what attitude and expectation the organization has for a host of activities. Usually, most organizations spell these out in written form and make the employee policies and regulations available to everyone in the organization.

These concern everything about the way an organization conducts itself. It could be employee recruitment, employee interviewing, induction, discipline, dress code, safety and a host of related aspects. These are spelt out in the employee policies and regulations of the company. An organization’s employee policies and regulations can thus be understood as a guideline that declares what procedures it follows in relation to many activities.

Why are employee policies and regulations necessary?


Employee policies and regulations are needed for every organization to demonstrate the kind of organization it is. The employee policies and regulations document is a living and organic document that describes the organization’s conduct vis-à-vis employee behavior. The set of employee policies and regulations also insulates the organization against potential legal actions by employees, as it serves as a written proof of what policies the organization follows in relation to employment terms and conditions, as well as what it expects from its employees.

Some of the areas in which employee policies and regulations are applied

Each organization has its own set of employee policies and regulations that are unique to it and apply to the organization. Some of these include:

  • Employee policies and regulations in relation to the employee’s conduct
  • Employee policies and regulations in relation to shareholding
  • Working hours
  • Holidays
  • Working conditions, meaning place of work, and so on
  • Leave policies, with breakup relating to leave details, such as paternity leave, maternity leave, etc.
  • Rules relating to travel for the organization’s staff: How much allowance is permitted, how to avail it, etc.
  • Facilities, such as daily transportation, transportation when an employee is traveling for office related work and on other occasions, and so on
  • Employee policies and regulations relating to issues such as phone and mobile phone usage
  • Employee policies and regulations relating to promotions and salary raises
  • Rules relating to benefits such as retirement policy, gratuity, etc.
  • Employee policies and regulations rules relating to medical allowances
  • Exit policy
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The Employee Handbook is an Important Document

Employee handbook

All organizations need to have a document that is as important and prized as the offer letter it rolls out to its employees. It is the employee handbook. Variously described as a staff handbook, staff manual or employee manual; the employee handbook is a booklet that contains essential information about the organization’s policies, rules and procedures. It is handed to the employee, usually at the time of joining the organization.

The employee handbook is in a sense sacrosanct, because it spells out the rules and procedures for a number of activities from the employee. It is a document that states the exact requirements and expectations relating to employee behavior from the organization. The employee handbook is also an important legal document, as it serves as an important reference during legal proceedings that may come up between the employee and the employer.

General components of an employee handbook

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An employee handbook usually has the following general elements in it:

  • Terms and conditions relating to employment
  • A description of the company’s policies and procedures
  • List of all types of holidays
  • Rules on facilities such as lunch, transportation, sports, etc.
  • Work schedule
  • Company rules on payment of wages (mode of payment, etc.)

More important contents of an employee handbook


While the above items constitute some of the broad contents of an employee handbook; there are a few more items that go into it, which may be considered specific to an organization. This set of items concerns the more crucial aspects of the employee-employer relationship. It includes:

  • Non-disclosure agreements, in which what information about the organization the employee will be given access to, and what she should do with it
  • A description of the organization’s policies relating to anti-discrimination, compensation, equal employment, etc.
  • Conflict of Interests and ways of dealing with it
  • The organization’s responsibility for ensuring the employee’s security arrangements
  • The employer’s rules of conduct as given by the employee

The employee handbook could also have detailed information about mandatory work rules that are required by law, as well as optional ones that the organization has put in place.

hr best practices, hr management training, HR management trainings, hr policies, hr training, Human Resources Training

Understanding payroll fraud and preventing it



Payroll fraud is a matter of serious concern to the people affected by it, the organization in which it happens, and to the economy overall. It is estimated that payroll fraud is involved in around an eighth of all workplace frauds and makes up about a twelfth of all occupational frauds worldwide. On average, a payroll fraud case results in loss of $ 48,000 and avoids detection for about three years. Each payroll case fraud costs around $ 72,000.

It is rather unfortunate, but expected that small organizations bear the brunt of payroll frauds. The reason for this is not far to seek: They usually lack the requisite fraud detection mechanisms, making them particularly susceptible to payroll fraud.

Common methods for preventing payroll fraud

Many organizations take a few steps to prevent payroll fraud. Some of these include limiting access to the information relating to payroll, engaging different people for different levels and areas of payroll functions so that it acts as some kind of checks and balances system, conducting thorough background checks of the employees in charge of payroll functions, checking ghost employee accounts, installing automated clearing house (ACH) filters, and a few others.

Section 404 of SOX Act

Additionally, the Sarbanes Oxley Act, which was a landmark legislation aimed at putting checks on large corporate frauds, also requires companies to take a few steps to prevent payroll fraud. Section 404 of the SOX Act requires a few stringent steps:

  • Companies have to include an Internal Control Report in their annual financial reports stating that the management takes responsibility for implementing what SOX terms an “adequate” internal control structure
  • Management has to assess the effectiveness of this internal control structure
  • Deficiencies and discrepancies in these controls must be reported
  • These declarations by the management have to be attested by external registered auditors.

A complete discussion of the ways of preventing payroll fraud

A thorough understanding of all the elements of payroll fraud and the ways of preventing them will be discussed at a webinar that is being organized by TrainHR, a leading provider of professional trainings for the human resources industry. At this webinar, Dayna Reum, who is Payroll Tax Manager at PetSmart Inc. and has been heavily involved in the payroll field over 15 years; will be the speaker.

To get an in-depth idea of payroll fraud and to understand the ways of dealing with it, please register for this webinar by visiting TrainHR

Tools for detecting payroll fraud

The purpose of this session is to help participants gain an understanding of the legal rules around detecting and deferring payroll fraud. Dayna will review tools that companies can use to detect or deter fraud with immediate effect. She will take up Section 404 of the SOX Act for detailed discussion and examine the requirements in it that publicly traded companies have to meet. She will also explain how the provisions of the Act are designed to check payroll fraud.

This webinar will be of high value to professionals involved in payroll functions, such as Payroll Professionals, Compensation Professionals, HR Professionals, and Benefit Professionals. In the course of this webinar, Dayna will cover the following areas:

  • Payroll Fraud Statistic’s-How big of a problem is it?
  • How does payroll fraud occur?
  • Preventing Payroll Fraud
  • Internal Controls
  • Tools (Process Maps, Business Continuity Plans, Process Documentation)
  • Audits
  • Sarbanes-Oxley 404 Requirements
  • Ethical Business Practices.