The HR Matrix Expands to Help Employers’ With Tight Labor Market

New Talent Acquisition Service Helps Employers Find Talent

SANTA ROSA, CA — With the tightening economy, employers are facing a hiring climate they haven’t seen in years: too many open positions and not enough qualified applicants. According to the Sonoma County Economic Development Board’s 2015 Sonoma County Indicators Report, the local unemployment rate is lower than the state average, the U.S. National average, and one of the lowest among comparable counties.

The HR Matrix is supporting organizations in addressing this tight labor market by expanding its Search and Recruitment capabilities, offering clients a flexible model to support hiring efforts.  While other firms offer recruiting on a contingent or retained basis, the HR Matrix has added an hourly model and a ‘capped fee’ solution to provide flexibility and affordability. “We have found many of our clients already have some internal hiring resources, or they want to retain control of the process. We complement their efforts so they can focus attention on selecting and developing those candidate who are a fit for the role,” said Gary Hochman, partner and co-founder of The HR Matrix.

In this competitive labor market, companies are employing new strategies to attract and hire needed talent. Speed and focus are two variables that make a difference.  “Top candidates expect an engaged recruiting process, one that actively communicates to them that the company cares about their time and expertise. We help companies create a great candidate experience and we don’t rely solely on job ads to find talent. We source quality candidates through our extensive research process, which has proven to be the most successful way to fill positions,” said Brenda Gilchrist, partner and co-founder of The HR Matrix.

Mary Beth Ludwig, Co-Founder/COO of Anova Education in Santa Rosa said, “The HR Matrix is the ultimate business person’s matchmaker! The HR Matrix took time to understand Anova’s unique needs as well as we do, and combined that understanding with a deep knowledge of human behavior to match talents with opportunities. Our entire administrative team is a creation of the HR Matrix’s unique insights into human potential. Anova’s most important resource is its people and the staff at HR Matrix know how to find unique personalities that can complement each other, creating amazing synergies for our customers and efficiencies for Anova.”

About The HR Matrix

The HR Matrix ( is a human resources, organization development and search firm. The HR Matrix services include HR advice and consultation, employment law compliance, engagement surveys, HR audits, employee handbooks, compensation surveys and plan designs, change leadership, performance management systems, business process improvement, teambuilding, training and development and facilitation services. For new clients, contact Jennifer Scott at 707-526-0877 (PST).




Posted in Uncategorized

Popular Services – 2015

A few of our programs were especially popular with clients this year:

1. HR Assessments & Audits – scalable services to help you evaluate and optimize your HR staffing structure and skill sets, HR processes and practices as well as full compliance audits.

2. Team 360 – this program helps to build mutual support, accountability and leadership skills through a unique team-based experience designed for senior managers and above.

3. Employee Engagement Surveys – to evaluate and build employee engagement within your company. Discover strengths, areas for concern and opportunities for improvement

4. Sourcing and Recruitment – our specialized research and passive candidate sourcing and screening helps you find and hire the talent you need to make your organization successful.

To inquire about any of these services, feel free to contact us by email or call us at (707) 526-0877.


Posted in Uncategorized

2015 Employment Law Update & Reminders

The HR Matrix team wishes you a happy new year! With the new year, there are many changes that affect California employers in 2015. Here is a snapshot of the most prominent changes, along with some important reminders. If you have concerns regarding these new laws or questions regarding compliance with state and federal employment laws, we are here to help. Contact Jennifer Scott at 707-526-0877 x16 or via email to jennifer at if you have any questions or need support.


Benefits Waiting Periods: new legislation eliminates the relatively new California 60-day waiting period for health benefits eligibility and relies instead on the federal ACA 90-day requirement. Your broker can advise how and when your plan will be affected. Most employers will be affected when their plans renew in 2015. At that time you will need to update your handbook and practices to reflect the 90-day waiting period.

Paid Sick Leave: A new law that goes into effect July 1, 2015 requires California employers to provide paid sick leave to all employees who work more than 30 days in a year, including part-time and temporary employees on the employer’s payroll. There are three ways to comply with this law: 1) accrue one hour sick leave for every 30 hours worked; 2) front-load 24 hours of sick leave at the beginning of each year, and 3) have a policy in place that meets or exceeds the minimum requirements of the law. If employers choose to accrue, they may limit the use of sick leave to 24 hours per year and may cap unused leave at 48 hours. Note: this sick leave does not need to be paid out at time of termination. Our recommendation is to consider Option 1 or 3, providing paid sick leave on an accrual basis.

Kin Care: Kin Care, the California law that allows employees to use half of their annual sick leave for ‘kin’, will now include grandparents, grandchildren and siblings as well as the usual parents, children and spouses/DP’s. This goes into effect with the new sick leave requirement above.

Individual Healthcare Premium Reimbursements in lieu of an Employer Group Health Plan: Employers may no longer make payments (taxable or otherwise) to help employees pay for their own individual health insurance policies. These payments now fall under the category of an actual health plan and are subject to all the provisions thereof. Alternatives include simply stopping the payments, obtaining group coverage for employees, and providing taxable wages or bonuses in place of premium assistance. Talk with your health insurance broker for further details. You will also want to consider tax consequences in the event you decide to start a new group plan and/or offer a paid bonus. With any of these options, you also need to consider disparate impact and ensure the offerings are provided to everyone that meets eligibility requirements.

FMLA changes for same-sex couples: The jury is still out on this one, however the following is in effect for the moment: The current FMLA regulatory definition of spouse is “a husband or wife as defined or recognized under State law for purposes of marriage in the State where the employee resides, including common law marriage in States where it is recognized.” Under this current definition of spouse, eligible employees may take FMLA leave to care for a same-sex spouse only if they reside in a State that recognizes same-sex marriage (as California does at this time).


Harassment Training: CA employers with more than 50 employees must provide biannual harassment training to supervisors. The 50 employee count includes part-time, temporary, agency and independent contractors who worked for 20 consecutive weeks. A new law in effect 1/1/15 requires the training to include training for prevention of abusive or bullying behavior. It doesn’t make that behavior illegal (unless it is directed at a protected class). In addition, farm labor contractors must comply with new harassment training requirements for supervisors and employees. The HR Matrix offers AB1825 compliant Supervisor Harassment onsite training sessions. Contact us to arrange an onsite training.

“Bring your own device” BYOD policies – Recent court rulings in California clarify that employers must reimburse employees for subscription plan costs when employees use their own devices for work (e.g., cell phones, tablets). This rule applies even if the plans feature unlimited minutes. The employer must make a reasonable contribution to the employee. While there is no set amount, we frequently see $25-40 per month reimbursement amounts.

Required Employer Posters – All employers will need to update posters in January 2015 to be in compliance with the new sick leave and minimum wage laws. We recommend using the CA Chamber of Commerce All-in-one posters. Remember that you must have posters at each place of business, and in a language other than English if you have employees who speak another language. Also, CA Wage Orders have been updated and this is a separate required posting. You can download here and post with your other posters.


Harassment/Discrimination Protections Expanded: The new law now includes protection to unpaid interns, volunteers and people in apprenticeship training programs. Also, employees receiving public assistance (Medi-Cal) are protected from discrimination and retaliation. [To do: ensure all your supervisors and staff are aware of your zero-tolerance harassment policy.]

Whistleblower Law Expanded: The Whistleblower Law was expanded to protect an employee who complains internally to a person with authority over the employee or another employee who has the authority to investigate, discover, or correct the violation.

Immigrant Protections: Employers may not discriminate against immigrants by threatening to file a claim or filing a false claim with a state or federal agency. In addition, employers may not discriminate or retaliate against an employee who updates personal information based on a lawful change of name, social security number or federal employment authorization document.

Contract Labor Liability: Employers may now be liable to errors and omissions committed by employment agencies or PEO’s with whom they do business, when those agencies or PEO’s either don’t pay employees properly or don’t provide workers compensation insurance.

Safety: Hospitals must adopt workplace violence prevention plans to protect employees. This will become part of the employer’s Illness and Injury Prevention Plan.

Background Checks: Generally, contractors who bid on state contracts may not ask construction applicants about their criminal history pre-interview. They must wait and see if the candidate is otherwise qualified and then make an informed decision. In addition, certain companies that provide services to children must notify parents or guardians about their criminal background check policies.

Time off for Emergency Duty/Training: If you have employees who may be called upon for emergency duty, there have been some expansions in the definitions of these workers to include Reserve Peace Officers and Emergency/911 Rescue Personnel.

AB60 Drivers Licenses: A new law allows undocumented workers to obtain CA drivers licenses for driving purposes only, not ID. These licenses are not usable for I-9 employment eligibility verification.

IRS Mileage Rate: Going up to $0.575 in 2015.


NLRB: With union representation on the decline, the National Labor Relations Board is targeting non-union employers who (they believe) are restricting employees from organizing. Handbooks and policies should not restrict employees from discussing wages or working conditions, or attempt to over-govern behavior outside of the workplace.

Severance and Arbitration Agreements: We strongly recommend updating severance agreements with an employment attorney as many laws have changed. Also, many attorneys no longer recommend arbitration agreements, so if you have one, you may want to review with an attorney to see if it needs updating or removal. HR Matrix can coordinate the analysis and evaluation of your current practices through our preferred law firms. Contact us if you would like us to help you with this.

Workers’ Compensation – Medical Network Providers – If your workers’ compensation policy is an MPN plan (and most small employers’ plans are) then there are notification and posting requirements. One of the areas we frequently see missed is making sure all employees know where their local clinic is located should they experience an on-the-job injury. With an MPN plan, employees need to go to the network doctor. Contact your broker for more information on MPN compliance and clinic locations.


  • OSHA 300 Log: Most employers who had over ten employees during the prior year must post the annual OSHA 300A summary, by February 1st.
  • EEO-100: Most employers with over 100 employees and federal contractors with over 50 employees must complete on the EEO-1 survey annually. The deadline is usually 9/30 and the survey is now online.

The HR Matrix can help you with employee handbook or policy reviews and updates to include these 2015 law changes as well as any other changes or new policies that need to be added.

Posted in HR Matrix News/Press, HUMAN RESOURCES

2014 HR Updates & Reminders

The HR Matrix team wishes you a happy new year. With the new year come many changes that are going into effect for California employers in 2014. Here is a snapshot of the most prominent changes along with some miscellaneous reminders. If you have concerns regarding compliance, we are here to help. Contact us at 707-526-0877 or via email at if you have any questions or need support.

•Affordable Care Act (ACA): ACA compliance this year includes providing exchange notices and summary of benefits documents to new hires, providing affordable health insurance, shortening wait periods to no more than 60 calendar days (CA only), and adhering to new limits for HSA’s. In addition, small employers may be eligible for health care tax credits. We hope your insurance brokers are fully supporting your ACA needs. If not, we can help you with a referral to a local full-service broker or work with you directly to ensure you have a handle on the ACA changes.

•New Required Employer Postings: Employer postings have changes again this year. The changes are relatively minor, but to be in compliance you will need to update your postings. If you haven’t replaced your posters lately, now is the time to do so. The Cal Chamber all-in-one employer posting is available via this link, or, for current customers, we can order them for you as part of your retained agreement with HR Matrix. If you are not a current customer of HR Matrix for our retained HR services, contact Jennifer to discuss our monthly HR advice and consultation services: Chamber Postings

•Handbook Updates: Make sure your employee handbooks reflect 2014 legislative changes including benefits eligibility and waiting period for benefits in California. If it’s time for a once-over on your handbook, we specialize in handbook reviews and updates and would be happy to help.


• OSHA 300 Log: Most employers who had over ten employees during the prior year must post the annual OSHA 300A summary, by February 1st. For forms and instructions, see OSHA Online
• EEO-100: Most employers with over 100 employees and federal contractors with over 50 employees must complete on the EEO-1 survey annually. The deadline is usually 9/30 and the survey is now online at the EEOC site.
• Minimum Wage: Minimum wage is going up! Beginning July 1, 2014, the minimum wage will be $9.00. It is slated to increase to $10.00 effective 1/1/16.

For a complete list of new regulations, see the CalChamber site.

In 2013, we worked with many new clients on legal compliance issues, problems and claims. Many of the cases we supported could have been prevented. Let us know if we can help you tune up your HR practices with a HR processes review or HR compliance audit.

See our 7 Ways to Steer Clear of HR Problems article on our website for more info.

Additionally, if your goal is to assess and enhance the level of employee engagement at your company, ask us about our Employee Engagement Survey and/or 360 feedback process. If your goal is to conduct a compensation study this year, we offer full service compensation consulting. We can gather salary survey data and create competitive compensation practices, including pay ranges and employee communication materials to show the value of your overall pay and benefits program.

Best wishes to you and we look forward to working with you in 2014.


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Postponed: Becoming a Trusted HR Business Partner Workshop

Becoming a Trusted HR Business Partner: How to shine as an Internal Consultant


This 2-day workshop based on the Flawless Consulting model is pre-approved for 15 HRCI re-certification general credit hours.

You have the HR knowledge, the people skills, and the intelligence, but for some reason, the partnership with senior management is never quite as satisfying as it could be. Sometimes you’re carrying the burden alone, as if nobody cares about HR. At other times, you reluctantly implement someone else’s program, knowing you could do better. You have more to offer, but the organization’s leaders might not fully appreciate the value you bring. HR knowledge and skills aren’t enough…

In this highly interactive and provocative workshop, you will discover how internal consulting skills are the key to both creating more impact with your clients and to shifting your contribution from tactical to strategic. You will have an opportunity to practice new behaviors, get feedback from others, and develop your consulting skills as you learn to:

• Understand the different roles we play – doctor, pair of hands, partner
• Attend to each critical stage of the consulting process to ensure success
• Respond to requests in ways that increase the likelihood of success
• Create agreements and negotiate expectations
• Increase authenticity and deal with client resistance
• Position yourself as an equal and strategic partner

NOTE: The skills in this workshop are valuable for anyone in an internal staff role – whether you work in HR, Quality, Finance, Safety, or IT.

Come prepared to share your stories at this session – the good, the bad, and the ugly. We will use your experience and knowledge to help set the stage for future success and increased job satisfaction. Take your learning back to the workplace after Session 1 and then return to deepen your understanding and skill in Session 2. Participants will leave with increased confidence about their ability and impact.

Pre-approved for 15 HRCI re-certification credit hours for the 2-day workshop.

Held at: Exchange Bank, 444 Aviation Blvd, 2nd Floor, Santa Rosa, CA 95403

Check-in / Networking: 8:00-8:30 am
Workshop: 8:30 to 5:00 both days

Cost $899 includes lunch both days
Early registration – save $50 before 12/20/13
Group registration – save $50 per participant

For questions and information please contact
Jennifer Scott at or
707-526-0877 x16

To register by credit card, CLICK HERE.

To register by check, please complete the attached and email to or mail to 528 B Street, Santa Rosa, CA 95401.

About the Presenter:

Gary Hochman has worked in the development of organizations for over 25 years and has served in senior executive, line, and staff roles. As founder of The HR Matrix, his consulting business integrates strategy, work systems design, and team and individual performance to enhance organizational effectiveness.

Throughout his career, Gary has led numerous projects helping executives and managers rapidly achieve results in a wide variety of demanding situations. His facilitation and leadership skills coupled with his business acumen and understanding of organization culture and change, have made him successful in a wide variety of interventions and situations, including start-ups, mature organizations, non-profits, and a diverse range of complex work systems. Working in close partnership with his clients, Gary designs highly interactive processes to support desired outcomes while building accountability and commitment throughout the workplace.

Gary is the former vice president of HR at OCLI / JDSU and senior organization development consultant at Hewlett-Packard. He holds a B.A. in sociology and a M.A. degree – with a focus in organization development and training. In addition to his commitments to his family and the local non-profit community, he previously served on the faculty of the Organization Department Program at SSU for 6 years and USF for 4 years, teaching consultation skills, strategic HR, and organization development.

Posted in Uncategorized

2013 Employment Law Update & Reminders

Several employment regulations changed in 2013. Here are highlights and also a few reminders. If you have questions regarding compliance, we are here to help. Contact your HR Matrix representative at 707-526-0877 or Jennifer Scott (ext. 16) for assistance.

1. New Form I-9 – As of May 8, employers are required to use the new Form I-9 when verifying employment eligibility.

2. New Required Employer Postings  - Employers who are subject to the Family Medical Leave Act (e.g., those with over 50 employees) must update employer postings to include:

  • In addition to those currently serving, a “covered servicemember” also includes veterans discharged in the last five years.
  • FMLA definitions of “serious injury or illness” for current servicemembers and veterans “are distinct from the FMLA definition of ‘serious health condition.’”
  • Special hours of service eligibility requirements apply to airline flight crew employees.

We recommend the Cal Chamber all-in-one employer postings, and we can order them for you. Or you can download and post the FMLA poster from the Department of Labor individually, free.

3. Written Commission Agreements – Effective 1/1/13, all employees who earn commissions must be provided a written commission agreement explaining how commissions will be calculated and paid. This applies to new and existing employees.

4. Notice to Employee – This went into effect 1/1/12, but we want to remind employers that non-exempt employees (commonly known as hourly employees) must receive a “Notice to Employee” of hiring terms at time of hire. You may use the DLSE’s form or create your own (e.g., as part of the offer letter) as long as it contains all the DLSE form’s information. If you use two rates of pay, they must both appear on the notice. The notice generally does not apply to union hires. Templates of the forms may be obtained at the DLSE website. Or see the DLSE FAQ for more information.

5. Personnel File Inspection and Copies – Employee rights around personnel files have expanded. Employers must observe the new regulations:

  • Current/former employees and authorized representatives may view and receive copies. You may charge employees for the actual cost of copies made.
  • Access must be provided to all documents (except criminal investigation documents)
  • Access must be provided to documents within 30 days of request
  • Files must be retained by employers for three years after termination (same as payroll files)

6. Affordable Care Act and Benefits – New notice requirements go into effect this year for health insurance. We recommend partnering with your benefits broker to stay current on ACA requirements and the impact on your health insurance benefits.

7. Health Care FSA Limit – Starting with plan year 2013, employee contributions to a Health Care FSA are limited to $2,500 each year. This limit applies on a plan year basis not calendar year.

8. Itemized Wage Statements – Paychecks must contain the following per Labor Code 226: Gross wages, hours worked (omit for salaried employees), hourly rate, piece rate info if applicable (number of pieces and rate), all deductions, net wages, dates of pay period, employee name and last four digits of SSN or an Employee ID#, name and address of legal entity paying wages. Click here for more information.

9. Exempt vs. Non-exempt, continued…A quick tip on a common problem area: In California, a properly classified exempt employee must be “primarily engaged” in exempt level duties, i.e., the employee must spend more than 50% of their weekly work time performing exempt duties. So even if an employee supervises other employees, they still might not qualify as exempt, if they are performing mostly low level duties (e.g., stocking shelves).

10. AB1825 – Mandatory Sexual Harassment Training – Most employers with over 50 employees/contractors in or outside of California are required to conduct two hours of harassment training for their supervisory staff every two years. Also, new supervisors must be trained within six months of hire. The HR Matrix offers both supervisor and harassment training.

11. IRS Mileage rate 2013 – The rate went up to $0.565 per mile on 1/1/13.

12. NLRB Poster Requirement – postponed – A rule that was supposed to take effect April 30, 2012, requiring most U.S. employers to post a notice of employees’ rights has been blocked by a federal circuit court after a determination that the issuing agency lacked authority to approve the rule. No required posting date has been determined.

There are other changes that don’t affect most employers or are just notice changes. For a complete list, see the HR CA list.

Posted in Uncategorized

7 Ways to Steer Clear of HR Problems

Over the years, The HR Matrix team has advised businesses on a variety of employment related matters. In recognition of our 7 years in business, we compiled our seven most common areas of concern. If your organization needs assistance in these areas, we’re here to help.

1. Have accurate and current policies in place. “We never updated our handbook.” “We borrowed someone else’s handbook.” “We’ve never enforced it but now we have a problem…” We hear these types of statements frequently. Having a set of current policies that are applied evenly across the organization is the best practice. Some companies offer policy and handbook templates that can be a good foundation but usually need adjustment for California requirements and company practices. If your handbook or policies are out of date, now’s the time to have them reviewed.

2. Administer and pay employees correctly – avoiding overtime pay by placing lower level employees on salary is the classic mistake. There are other ways that employers open themselves up to wage claims – or worse – lawsuits. For non-exempt employees: not providing breaks, comp’ing time off for overtime worked, and letting employees work through lunch. For exempt employees: having 50% or more of their duties fall below exempt level work. This erodes their exemption and they become overtime eligible –retroactively. Employment regulations under the FLSA are based on job duties, not titles, hours or preferences. If you have doubts about how your employees are classified (exempt or non-exempt) or how they are supposed to be paid under Federal and State law, it pays to get the facts.

3. “If it looks and acts like and employee…it’s probably an employee.” We see many employers who want to take on workers as independent contractors because they don’t want the headaches associated with hiring and paying employees, or they honestly believe the person qualifies as an independent. Either way, it can be very problematic. The IRS considers a person an employee based on a set of factors. If you set the rate of pay and the person’s work is part of the normal business of the organization, they are probably considered an employee. Penalties for unpaid payroll taxes and willful violation of this law are high –minimum $5000 for each misclassification. Other problems can arise with workers comp and claims for overtime/benefits. Bottom line: get clarification and hire employees legally from the beginning. Click here to access the IRS site for more details on employees versus independent contractors.

4. Hourly employees must be paid for all time worked. We frequently hear of employers whose non-exempt employees work off the clock – phone calls, texts, emails after hours, etc. We’re all getting used to working “on demand” with all the communication technology available. The problem is, that time can be compensable for an hourly “non-exempt” worker. Ensure your non-exempt employees know not to work off the clock without authorization and how to document all their time properly.

5. Screen thoroughly, hire properly. We ask these questions frequently in response to client concerns: “Did you get an employment application?” “Did they sign an offer letter?” “Did you interview thoroughly?” “Did you run a background check?” “Did you check references?” If the answers are all yes, this is a good sign. Many employee related problems occur because new hires weren’t screened thoroughly, or the terms and conditions of employment weren’t clear and agreed upon at the start. Smart hiring includes effective interviews, reference checks, employment applications and offer letters as well as paperwork pertaining to your policies and as required in California. In most cases, it is highly recommended you conduct background checks.

6. Educate supervisors. Do your supervisors know what to do if an employee is not performing well or complains of harassment? Many supervisors are promoted from line staff with little or no management skills or training. This can be a real disadvantage, especially over time. At a minimum, supervisors need to know how to coach, discipline, document and motivate. In addition, providing harassment training to supervisors is a legal requirement for employers with over 50 employees. There is a host of other aspects that a supervisor should have familiarity with, including workers comp, ADA, discrimination, and when to seek help from HR. It pays to invest in your supervisors’ training – they’re your first line of defense against problems, claims and lawsuits, and the key to your success with employees.

7. Get educated on how to complete I-9’s correctly. The odds of being audited for I-9 compliance are low but the penalties for incorrect documentation are high. Pretty much every I-9 audit we do reveals a lack of understanding about the employer’s responsibility with this form, though the updated form (available May 2013) is helping. It’s easy to complete I-9’s correctly if you know how to do it. We can help you how or you can start with a great free resource, the USCIS I-9 handbook.

Posted in HUMAN RESOURCES, Uncategorized

5 Most Common HR Mistakes Made by Start Ups

Copyright © August 2012 – The HR Matrix, llc – All Rights Reserved

by Brenda Gilchrist, CoFounder/Partner, The HR Matrix, llc

1) Giving away equity. The lure of giving away equity in exchange for services may not be the best solution for your start up –be greedy with your equity. One example is a local start up that had an outsourced CFO (a friend of the founder). The CFO offered to help prepare financial statements and provide future finance/business consulting in exchange for 10% equity in the business. Hmmmm….sounds tempting, yet, in this case, it was better in the long run to pay a finance expert a consulting fee in exchange for the services needed at the time. If the founder had given away the 10% equity, he would have been obligated to pay the CFO 10% of the future sale value of the company or buy that stock back at a much higher price. Based on the company’s projections, the 10% equity could have been valued in multi-millions of dollars, which is significantly more than the value the founder would have received in actual services. In addition, if the founder ever became dissatisfied with the CFO’s services, he would surely regret having granted the 10% equity. Be greedy and smart with your equity!

CEO and Investor, Rick Shepherd, says, “There are circumstances when giving away equity in a start-up makes strategic sense. The founders need to be cognizant, however, that they are using their equity as a currency when it is typically at its lowest value. If possible, the equity should only be given to partners that are creating long-term value and, if at all possible, not for low value-added functions or shorter-term projects and tasks.”

2) Bringing on a Partner. Before bringing on partners, think about the fact that you will be wedded to them (yes, it is like a marriage) until the partnership ends. Many partnerships go sour, resulting in one partner having to pay the other one off. I’m sure there are horror stories that you have heard about. It is often better to contract the person for their skills (as above), or hire the person through a temporary agency or as an employee versus bringing them on as partner. If there is a strategic and tactical reason to partner with someone, take your time defining what it would mean to be partners, before you become partners. Talk through the D’s first; what happens if a partner dies, ditches, divorces, or becomes disabled. How will the partners be paid? Will you be an “eat what you kill” partnership, meaning you don’t share revenue for business you bring into the company or products you sell? What types of expenses will you share? How much ownership does each partner have? 50/50? Will you each contribute the same amount to the expenses? It might be better to subcontract or employ the person before you decide to be partners.

Mr. Shepherd states, “With all the excitement of forming a new partnership, frequently some of the tough questions are not addressed. What happens when one partner wants to leave or is asked to leave the partnership? This process needs to be detailed in the partnership agreement at the beginning.”

3) Hiring your friends. Before hiring a friend, make sure your friend is actually the ideal candidate to bring into your start up. Before hiring anyone, think about the short-term and long-term talent and skills you will need to hit your goals. If you start to hire, be extremely diligent – employees can make or break your reputation, your brand and/or delay your start up from being successful. Conduct interviews to ensure your friends or anyone else you are thinking about hiring, actually have the skills you need and, even more importantly, they fit with your ideal culture and values.

“When hiring friends, the tendency is to hire fast and fire slow. This may result in the best candidate not being hired, potentially a difficult termination and the end of a friendship. In most cases, it is best to avoid hiring friends!” says Mr. Shepherd.

4) Weak hiring practices. Here are the most common hiring mistakes:
• Hiring out of desperation (the “warm body” syndrome) with little or no screening
• Not using a behavioral style interview
• Not taking the time to scrutinize the employment application
• Not checking references or, when needed, failing to run a background check

Past performance is the best predictor of future performance. [Click here to read “5 Keys to Successful Talent Acquisition"].

5) Trying to do HR yourself. Well-intentioned start-ups can get themselves into trouble if they don’t know what they’re doing. Don’t assume the state and federal government will let you plead innocence if you tell them you just didn’t know the employment laws that applied to your start up. Prior to hiring employees or bringing on independent contractors (1099’s), get the facts and do it right from the beginning.

You will need to understand and comply with the Fair Labor Standards Act (FLSA) rules (e.g., overtime) related to Exempt vs. Non-Exempt classification of employees. In many cases, as a result of failing to comply with FLSA rules, start-ups often are out of compliance with Meal and Rest period rules, which can lead to costly back pay and penalties. [For more information, read Exempt vs. Non-Exempt article]

Be careful when bringing on independent contractors (1099’s). The government wants its payroll taxes! So, unless and until your 1099’s meet the complicated IRS 20 factors test, they are technically considered employees.

States Mr. Shepherd, “Ignorance is not an excuse. Employment rules are complex and always changing. Work with a qualified HR consultant to ensure your compliance. A good HR consultant can address your needs and is typically more cost effective than paying your outside counsel.”

About the author: Brenda Gilchrist is the Principal/CoFounder of the HR Matrix, llc. Brenda has started three companies, one of which she recently sold. Brenda has been awarded the North Bay Business Journal’s Women in Business “Entrepreneur” award and also their Forty under 40 award. She is co-chair of the Mentor program at the Sonoma Mountain Business Cluster a North Bay iHub incubator located in Rohnert Park, CA. The HR Matrix, provides start-ups with expert advice and consultation to hire right, to find talent that fits with their culture and help companies to understand and comply with complicated state and federal employment laws.


Talent Shortage or Shortage of Creative Talent Strategies?

Talent Shortage or Shortage of Creative Talent Strategies?
By Brenda Gilchrist

A lot of people are blaming the lack of talent on the “shortage of critical skills in the U.S.” I think most of the perceived shortage is based on a shortage of creative talent strategies. In an era of high unemployment, many, employers expect immediate plug-and-play candidates, new employees who come prepared with the skills and training to be productive immediately upon entering the workplace. Some employers blame the school systems for not educating students with the critical skills employers need.

The employers that blame the lack of resources on the “talent shortage” might look in the mirror and ask, “What have I done lately to create a strategic talent pool for my organization?

Employers need to utilize creative talent strategies to grow their own talent pools. It is up to employers to build a creative talent pipeline.

Ways to create strategic talent strategies:

- Redesign jobs and job descriptions; be open to bringing in talent from different industries and be willing to train the candidates on the skills they don’t have.

- Internal Training programs; Develop in-house training programs to train candidates to your specifications. Outcome: loyal, committed, trained employees.

- Internships; develop partnerships with schools and programs. Collaborate with schools to develop curriculum and experiences for students that will inspire and teach students about the jobs you want to fill in the future. Invite students into your company and/or send your employees into the classroom to teach or speak.

- Recruit Creatively; if you are only running craigslist ads to find talent, then you are only reaching less than 1% of your overall talent market. Get creative with your recruitment marketing strategies.

- Build a brand; become an employer of choice. Market internally and externally the benefits of working at your company. Create a branding campaign to market your company. Building a brand needs to start internally to ensure you are creating a work environment that your employees will rave about – you can’t be an employer of choice if you don’t have an engaged workforce.

- Support the Community; people want to work for companies that support a good cause and give back to the community. Plus it is good press.

About the author: Brenda Gilchrist is the cofounder of The HR Matrix, a full spectrum Human Resources, Organization Development and Search firm. Brenda has extensive Talent Acquisition experience in start-up to mature companies. Contact Brenda Gilchrist at 707-526-0877 x11 to help you assess your talent acquisition strategy.


2012 – Employment Laws; things to know and what to do

It is that time of year again – new employment laws for 2012 are here. Here is a highlight of the new laws and things that employers should start doing to comply. If you have questions regarding compliance, we are here to help. Contact Brenda Gilchrist at 707-526-0877 x11 if you have any questions regarding compliance with the new laws.

1. Give Employees Required EITC Notice with W2; verify that your payroll company is handling this properly for you.

2. Credit Checks; if you are running credit checks on applicants/new hires, be careful when and how you use credit checks. Don’t run credit checks on applicants and/or candidates unless you meet the legal requirements and it is applicable to the job requirements.

3. Group Health Coverage in place for up to 4 months of Pregnancy Disability Leave (PDL applies to employers with 5 or more employees); SB 299 requires all employers with five or more employees to continue to maintain and pay for health coverage under a group health plan for an eligible female employee who takes Pregnancy Disability Leave (PDL) up to a maximum of four months in a 12-month period. The benefits are at the same level and under the same conditions as if the employee had continued working during the leave period.

4. Willful Misclassification of Independent Contractors; Do you have any 1099′s/Indepedent Contractors? If so, the state has increased the penalties for employers that willfully misclassify an employee as a 1099. It is important employers understand their risk if they engage 1099′s. SB 459 provides new penalties between $5,000 to $25,000 for the “willful misclassification” of independent contractors. Willful misclassification is defined as: “avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor.”

5. Notice of Pay Details; if you hire employees, make sure you document their terms of employment in an offer letter. The state now requires that certain terms of employment are provided to employees in writing. If you haven’t been providing employees with offer letters, you can create “terms of employment” for existing employees and “offer letters” for new hires. If there is any change to the terms, employers must notify the employee, in writing, within seven calendar days of the changes, unless such changes are elsewhere reflected on a timely wage statement, such as a payroll stub. Although the new law only applies to nonexempt employees, we suggest you document offer letters for all new hires.

AB 469 requires employers to provide nonexempt employees, at the time of hire, a notice that specifies:
• The rate of pay and the basis, whether hourly, salary, piece commission or otherwise, including any overtime rate
• Allowances, if any, claimed as part of the minimum wage, including meal and lodging allowances
• The regular pay day designated by the employer as required under the Labor Code
• The name of the employer, including any “doing business as” names
• The physical address of the employer’s main office or principal place of business and any mailing address, if different
• The telephone number of the employer
• The name, address and telephone number of the employer’s workers’ compensation carrier

6. Written Commission Agreement; AB 1396 requires employers who have commission pay arrangements to put those agreements into a signed written contract. The written contract must set forth the method by which the commissions will be computed and paid. If the contract expires but the parties keep working under the expired contract, the contract terms are presumed to remain in effect unless superseded by a new contract or the employment relationship is terminated. The bill is effective January 1, 2013. Employers have the entirety of 2012 to bring their commission agreements into compliance.

7. Organ and Bone Marrow Donor Leave; SB 272 clarifies the implementation of California’s organ and bone marrow donor leave law (Labor Code sections 1508-1512). Existing law provides up to 30 days of leave in a one-year period for organ donation and up to five days of leave in a one-year period for bone marrow donation.

The new legislation clarifies that the days of leave are business days, not calendar days, and that the one-year period is measured from the date the employee’s leave begins. Existing law states that employers can require use of sick and vacation leave. The new legislation clarifies that employers can require the use of a specified number of earned but unused days for paid time off (PTO).

8. Genetic Information; SB 559 amends the Fair Employment and Housing Act (FEHA) to state that employers are prohibited from discriminating against employees on the basis of genetic information.

9. Gender Expression; AB 887 amends the Fair Employment and Housing Act to further define “gender” to include both gender identity and “gender expression” and to make clear that discrimination on either basis is prohibited. Current law only uses the term gender identity. AB 887 also amends Government Code section 12949 relating to dress codes to include that an employee must be allowed to dress consistently with both the employee’s gender identity and gender expression.

10. NLRB Notice; As of April 30, 2012, most employers are required to post the Notification of Employee Rights. This posting describes employees’ rights to organize a union (in detail). However, note that an employer will not be fined for failing to post the notice.

Short List of Things to do:

- Call your payroll company regarding the required EITC notices
- Don’t run credit checks on applicants/candidates, unless you are in compliance with the rules.
- If you have 5 or more employee, make sure you maintain health insurance for up to 4 months for the disability portion of the leave covered under Pregnancy Disability Leaves (PDL). If you have over 50 employees, you will have to comply with FMLA/CFRA and coordinate the leave laws.
- Conduct a 1099/Independent Contractor Audit to ensure you are properly classifying employees
- Offer Letters and Commission Agreements; make sure you provide new hires with offer letters and provide written commission agreements to employees that are paid commissions.
- Just be aware of 7, 8 and 9 above and educate managers and staff of overall discrimination laws and company policy.
- Chose whether or not you want to post the NLRB poster. Remember – there are no penalties if you don’t post it.

About the author: Brenda Gilchrist is the Principal/CoFounder of the HR Matrix, llc. Brenda and her team provide outsourced HR support, including onsite and virtual support, including HR audits, advice and consultation, handbooks, policies, employment programs, compensation design, performance management, payroll/HR systems, training and development and recruitment. Contact Brenda Gilchrist to discuss your HR needs at 707-526-0877 x11