Human Resources Overview of Business Plan Products.

Human Resources

Overview of Business Plan Products

• Proposed Budget for Human Resources

– Payroll = $7,231,000– Benefits = $2,381,857– Department Technology = $21,510– Recruiting Costs = $98,736

• Total Budget of $9,783,103

Compensation

Components of Compensation

• Salary• Benefits

– Required by Law• Healthcare insurance• FUTA, FICA, Disability

Insurance• Workers Compensation• Days off (jury duty,

military)

– Optional• Life insurance• Retirement plans• Days off (vacation, sick,

personal)

• Incentives– Tangible

• Stock Options

– Intangible• Work Environment

Our Philosophy on Salary: An Example

Salary of HR Director

$181,976

$132,590 $148,951

$0

$50,000

$100,000

$150,000

$200,000

25th %ile

50th %ile 75th %ile

Percentile

Sala

ry

Salary Example Cont.

• Example– Role: Human Resources Director– Median: $148,951– Location: Hackensack, New Jersey– We offer $140,000

Healthcare Benefits

• Traditional

• HMO– HMO Act of 1973

• PPO

Traditional Healthcare

• Indemnity

• Freedom to choose doctors

• Reimburse employees 80%

• Deductible: Out-of-pocket maximum

• About 10% more expensive than HMO

Sample Analysis: Oxford

Freedom Plan C $572.96 monthly

Employee pays: $114.59

(20%)

Company pays: $458.37

(80%)

What is an HMO?

• Health Maintenance Organization (HMO)– Set network of doctors– Premium dependent on:

• Marital status• Co-pay

– No deductible– 100% coverage

An Example: Blue Cross Blue Shield (HMO)

Annual Out-of-Pocket Maximum (includes deductible)

$3,000 per single

Annual Deductible No deductible

Co-pay for Office Visits $10

Monthly Rates Individual: $226

Two-Party: $444

What is a PPO?

• Combination of HMO and traditional

• Doctor from network– No deductible– Required co-pay

• Doctor out of network– Traditional

Status Co-pay Price

Individual $40 $98

Two-Party $40 $189

Family $40 $311

Individual $30 $166

Two-Party $30 $323

Family $30 $532

Copay vs. Premium

Our Options: Brokers, Providers, or Alliances

• Brokers– Require salary

• Providers– Direct

• Alliances– More attractive– Receive competitive rates

Required Benefits

• Workers Comp

• FUTA

• FICA

• Disability Insurance

Optional Benefits• Retirement plans

– 401k– 403b

• Life insurance

Incentives• Tangible

– Stock options

• Intangible– Work environment– Other employees

Recruiting

How do you know it’s time to hire?

• When expansion is needed• When producing more products or

serving more clients• When trying to gain more customers• In anticipation of job openings within

the company

Considerations When Hiring

• Full-time employees•  Part-time employees•  Family•  Temporary help•  Leased workers

Job Qualifications

• Experience•  Education•  Ability•  English language

ability•  Physical effort ability

General Recruiting Process

• Advertising• Screening• Interviewing• Final Decision/Hiring

How to attract potential employees?

• NEWSPAPERS– The New York Times

• TRADE JOURNALS– The New Jersey Journal

• ONLINE POSTING– NationJob.com– HotJobs.com– CareerBuilder.com

What are the essential components of a good job ad?

• Including information that will draw responses from the best candidates

• Avoiding discriminatory language

Candidate Data Collection • Type of Information Required

– Requiring applications designed by us– Requiring resumes for the applicants to give us the

information they want us to have • Responding to Applicants

– Writing letters to acknowledge inquiries and to advise unsuitable applicants that they will not be considered for employment

• Testing Applicants: Examples– Achievement Tests– Aptitude Tests– Drug Tests– Medical Tests

Cost Effectiveness of Advertisement

• How do you determine cost effectiveness of an advertisement?– Making sure that the method of advertisement

(newspapers, online postings, and trade postings) is targeted to the appropriate candidates

– Because the company is seeking professional and sophisticated employees, popular newspapers and trade journals such as The New York Times and The New Jersey Trade Journal will be used to attract these types of people

• Defining the target and principal audience– The audience is based on the company’s reputation and

principal product manufacturing

Options: Outsourcing the Search

• Public Employment Services– State offices affiliated with the USDLTES– Services– Large pool of job seekers

• Private Employment Services

• Temp Agencies

Performance Assessment

How would we evaluate our employees?

Image FX is a company with seventy-twoemployees. In order to make certain that

each employee is working productively and to hisor her fullest ability, assessments must becompleted at regular intervals.

• Ensure that the employee is working to his or her fullest potential

• Ensure that he or she is promoting a healthy work environment

• Ensure that he or she is working towards the company’s mission

Why should we evaluate our employees?

What?Summative

Assessment- Generic

Formative Assessment- Department specific

When?Annual SummativeQuarterly Formative

- 360 Degree Feedback Assessment

Our Performance Assessment System

Checklist vs. Narrative

Pros:- Quicker - Simpler

Cons:• Is not detailed enough• Too general• Cannot make

personalized statements

The Checklist

Pros:- It is more personal- Can help both the

employee and employer

- Detailed and specific

Cons:• Takes too much time

• Tedious

The Narrative

•It gives room for personal statement as well as general commentary.

•It is both general, yet specific, being more useful to the employee.

•It does not consume too much time, yet enough to allow for a productive evaluation.

Our System: The Best of Both Worlds

The Summative Assessment will be doneannually. It will be generic and completedby the upper-management personnel. It will

beaimed at assessing an employee’s work

habits.

It will involve:A. ChecklistB. Narrative

Summative

The Formative Assessment will be donequarterly and will be department specific. It

willbe aimed at assessing an employee’s progresstowards the company’s mission.

It will involve:A. Checklist (by upper-management)B. Narrative (by upper-management)C. Narrative (two by peers)

Formative

- This process is to provide employees with a better understanding of how and when he or she accomplishes their work.

- The employees will not be evaluated only by the upper-management levels, but also by fellow co-workers.

360 Degree Feedback

Response to Pending EEOC Litigation

As a result of two lawsuits filed against our company we have prepared a defense to

these cases.

Case 1• Who: Jon Doe• Basis: The recruiting and hiring practices of Image FX

violated Title VII of the Civil Rights Act of 1964.  • Background Information: Applied for the position of

Marketing Director • Claimed he was as qualified as the female candidate who was hired

for the position. 

• Claimed he was denied the position because of his gender

• Claimed Image FX made it a priority to hire more female candidates in management roles. 

Executive Order 11246• The contractor will take affirmative action to

ensure that certain applicants are employed.• Forces companies to hire members of the

discriminated party.• Affirmative action - policy that seeks to

redress past discrimination to ensure equal opportunity.

Legal Precedence Johnson vs. Transportation Agency- was a similar case

to the one presented. Diane Joyce was promoted to road dispatcher

over Paul Johnson. Both candidates were qualified for the job.

As an affirmative action employer, the Agency took into account the sex of the applicants in making the promotion decision.

Transportation Agency was forced to higher Diane Joyce due to affirmative action.

Conclusion: Case 1

• Due to the EEOC laws regarding affirmative action, Image FX was entirely within its rights, if not obligated to hire Jane Doe as opposed to Jon Doe.

Case 2• Who: Jane Doe • Basis: The hiring and recruiting practices of Image FX

violated Title VII of the Civil Rights Act of 1964. • Background Information: Applied for the position of

Director of Finance • Claimed that the requirement of an MBA degree

discriminated against minority applicants• Claimed that it prevented a disproportionate

number of minorities from even applying for the position.

Title VII of Civil Rights Act

• It is not unlawful employment practice for an employer to give and to act upon the results of any professionally developed ability test provided that such test, isn’t used to discriminate because of race, color, religion, sex or national origin.

Section 703(h)

Legal Precedence• Griggs vs. Duke Power Company

– Willie filed a class action, on behalf of several fellow African-American employees.

– Griggs challenged Duke’s requiring employees to register a minimum score on two separate aptitude tests in addition to having a high school education

– Griggs claimed that policy discriminated against African-American employees in violation to Title VII of the 1964 Civil Rights Act by causing a disproportionately low number to apply.

• Neither the high school graduation requirement nor the two aptitude tests was directed or intended to measure an employee's ability to learn or perform a particular job or category of jobs within the company.

• Court concluded…

Conclusion to Case 2• Due to the job description of Director of

Finance the requirement of an MBA is directly connected to the performance of that job.

• Image FX has the ability to screen those who do not possess this requirement.

Statistics• (Survey conducted by the Society for Human Resource

Management):• 31% of the female workers claimed to have been

sexually harassed at work• 7% of the male workers claimed to have been sexually

harassed at work• 62% of targets took no action• 100% of woman claimed the harasser was a male• 59% of the men claimed the harasser was a female

What is sexual harassment?• According to the EEOC:

– …a form of sex discrimination that includes unwelcome sexual advances, remark, or other conduct of this sexual nature when…

• Submission to this conduct is made a term or condition of employment.

• Submission to or rejection in response to the advance has an effect on the individual’s employment.

• The conduct may effect and/or interfere with the individual’s work performance or create an unfriendly work environment.

Image FX Philosophy

• Image FX supports a NO TOLERANCE policy.If the company receives a complaint or indication that this conduct might be taking place…

- Action will be taken immediately

- A thorough investigation will be carried out

- All results of the investigation will be kept private and retaliation is strictly prohibited.

What you should do if you have been harassed?

• …inform the offending party that his or her conduct is offensive and inappropriate.

• …if harassment continues, behavior should be reported to Samantha Dickson (Director of Personnel) or Noelle Hozumi (VP of Human Resources).

• …keeping a journal or record of harassments may be helpful to the investigation.

If Employees are Unhappy with the Results of the Investigation…

• He or she may contact the following agencies:– Harassment Hotline: (805) 489 8203– Equal Employment Opportunity Commission:

(617) 565 3200• Complaints must be lodged within 300 days of the alleged

sexual harassment.

– New Jersey DCR Civil Rights Commission: (973) 977 4500

• Complaints must be lodged within 180

days of the alleged sexual harassment.