Deferred payment at Voonik: HR Compliance

Voonik , an online fashion brand has deferred the payments for its 200 employees by 3 months. As reported by Money Control, Voonik’s CEO and Co-Founder Sujayath Ali said those who will quit the company will get a month’s salary as the severance package. He added the company “is currently one or two months away from EBITDA (earnings before, interest, tax, depreciation, and amortisation) profitability.

Subir Chatterjee, Compensation and Benefit Head says, ” Help me to understand this better. The founder deferred the salary to achieve EBIT? So far I know salary is part of operating expenses, don’t they have to book the salary as future liability? Operating Earning comes much before EBIT.”

Pratik Vaidya, MD Karma Management added, “Very few organisation understand the value of human capital & asset rather than treating as Operating expense. Audited Companies that defer salary and other incentive payables & sheepishly roll back in future when their employee leave”.

Subeer Bakshi, CHRO Bajaj Allianz reflects, “Agree that it’s going to be problematic, but it’s a well-intentioned alternative to lay-offs. That’s laudable, and I hope the employees buy in!”

What impact would this have on HR compliances to be maintained in the company. How would the EPF contribution, ESIC if any, other Retirals and tax deduction be managed by the employer in such a situation?

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Balancing Judgment and Discernment

The frugality of the situation and their inter-changeability remains the driving force to strategy. Even though, it is defined, as a set of planned actions over a period, to achieve the desired result.  Organization mirrors this, as the business target to reap the profit. The business goal percolates to every function, over arching with one organization goal. HR functions identify the people factors in this goal. The strategy set for the year drills down to individual functions connecting the business units. Connecting different requirements put the functions on the same page. For instance, the broad-banding of a strategy, such as building agility, would echo for recruitment with greater in-house expertise, where as payroll may require errors free, as its prime target.A case as shared as below in ‘Concern’, surfaces the tip of an Ice berg, with the challenges in Strategic HRM. This is a part and a parcel of talent management. Every organization aims to hire the best talent and retain them with best compensation. Hitherto, the gap between perception and reality edges employee dissatisfaction.

Concern: Recently we have hiked the salary of one of our employee after reviewing her overall performance. However, she is not happy with it.  She is been expecting more. Every day she reminds to negotiate an increase in her salary. Please help on how to handle this situation.

The case facts:

  • The compensation planning allocated hikes to each grade and rank, attenuated by the performance standards.
  • The employee is presented with the hike , which do not match the expectations.
  • Ordeal of negotiations for another hike lengthens decision making.

Looking glass

Logical thinking coupled with practical situations brings in the solution.  Three dimensions that attributes to strategy are as discussed below:

  • Goal Setting: The objective may be defined, as being the market leader by the next financial year. This is calculated in terms of business target. Mostly it’s an increase in the market share through either takeovers or increase in the production. This configures the goal setting for each function. HR functions for such a growing firm would strategise to designate responsibilities, to facilitate the expansion.
  • Budget Allocation: The sum total of the spending is divided into investment in terms of benefits and other operational expenses. Compensation is identified as the value returns on the services received from the talents. This is chiefly governed by the business requirement such as higher spending on research, leading to planning for larger markets share, amid higher supply chain. The HR budge would impact with an alignment to the market is weighed to offer a competitive compensation.
  • Leadership alignment: The backbone of the success to planning lies in the hands that delivers it. The leadership team designated to set the strategy and prepare budget are accountable for the business units.  The talent planning may be chaired by a CHRO , however the insinuations are contributed by the business leaders. Communication overarching the environment balances the transparency, strengthening trust.

Balancing Act

Judging a situation with logical findings would require a non-attached discernment. In our member’s case, different implications from three dimensions as discussed had lead to the dissonance. The disbursement of the hike matched the top-down judgement, but missed on the discernment.

Future of work
Future of Work
  • Individual perception of performance and result: A contribution by an employee is valued. It results with rewards when they were aligned to the organizational goals. Dashboards and performance scorecards actualise with grades for each contribution, to ensure the alignment. However, the gap of expectations widen when the employee in question weighs every contribution for a material reward. A pat on the back received for managing an expert escalation would culminate to incentive, if that escalation results with client retention and revenue returns. The excellence of the employee would be best utilized by an higher level responsibility, when appropriate.
  • Communication: The guidance to an employee reverberates intently, with the shared views and thoughts from it leader with appropriate feedback. Transparency calls for its price. It pushes the leadership to share the confidential often sensitive information. This rings the choice to jump the boat or follow the captain.

Pen-ultimately, the priorities of choosing and aligning will glue the individual to the entity. Solution to the decision maker remains in acknowledging the human concerns with judicial treatment through strategies and communication. Employee championship is intertwined with business partnering through change management and administrative expertise.

If you have any HR Query or any query on Future of Work, Employee Engagement, Talent management, Women Empowerment, Retention or Business Strategy please write to me in here. Looking forward to learn more while finding solutions for you.

Nabomita is the Founder to Nabomita.com. She is the Top 100 Women Achiever Awardee, awarded by Government of India , TEDx Speaker, Quoted on ForbesUS, one of the Top 20 HR Influencer in Social Media as declared by SHRM India and one among the Top 100 Technology Influencer in India. Connect with her on @nabomita_smiles , Facebook Page and Google+

This article have been published on Business manager , October issue 2015. This issue covers different areas of Strategic Management.

Women as driver to growth in the age of driverless cars !

Where does women stand, in the age financial meltdowns, geo-political differences and AI? 1 robot out of 4 factory workers in Maruti. The numbers looks even more interesting in totality with 2400 robots at Manesarand 5000 facility. Are we still competing with men for jobs and seats at Premier Institutes? Where does this lands us especially when women have lesser access to education and finances?

India ranks 87th in Global Gender Report 2016 with highest participation of women in education and health sector. Does this set any target for us?  The report further showed that the highest level of penetration remains in the Education and Health sector with fewer women in Technology and Policy making !

With equal participation we can add upto 28 trillion by 2025 which is equal to a combination of US & China’s economy . So what do we need to build this equality ? What are the building blocks that can affect growth ? Law and order , financial independence and education?

These are few laws worldwide that instils sexism so deep that imagining equality remains light years away! When we restrict women legally how does it impact her participation socially rather financially?

 

World Economic Forum reports women remain unpaid for 50% of her productive time at work. How does this add up to her pay?

Global gender index shows Iceland, Finland and Norway tops the chart and not the leading economies! Why is it so? Is it the access to education and policies at work that makes it happen? Few days back when Maternity Benefit act was amended in India, we had people worrying about women no longer being hired. Norway offers 44 weeks of maternity leave. No wonder they have 47% of women participation in Public sector and 26% in the private sector! When we have family friendly policies at work, we are no longer forcing a women to choose between family and work

This tweet sums up the support , policies, access to education and finances that we need! Here we have an young woman as a pilot to Air India taking the same official commute with her mother who works as an air hostess! This organisation isn’t a nimble-foot startup. It is not a super funded private company with loads of money to spend. Yet, that’s how strongly they have been balancing diversity.

40 economies that participated in Global Entrepreneurship monitor reports women Entrepreneurship rate rose by 13% whereas it was 5% for males. However in India , the perceived opportunity for women is 41% compared to their male counterparts. Anusha, who celebrated her 25th Birthday recently pitched her second startup to me. And she is not in Bangalore or Mumbai but in Vishakhapatnam. Her first startup is running successfully in association with Andhra Pradesh Government. According Deloitte report, Millennial women are bridging the gender pay gap. Are we planning anything to bridge the financial gap for the ageing women workforce too?

Where does the empowerment needs to happen? Anuja Shukla, head of Google for entrepreneur runs a project on her on own where she gets girls from age 8-15 to code. Revathy Roy , founder Hey Didi , formerly Vira Cabs, have trained more than 10000 women from socially backward classes to drive. She created employment for them through her startup. She empowered them to own their vehicles and earn out it, offering loans from banks with no collateral. Urvashi Neogi runs her profitable Event Management firm, Biz Integration with her Geographically based team. She doesn’t need a 9-to-5 at an office with face time from her team members.

Here’s a research by Adobe on Future of Work which says, future lies in collaboration and diversity of skills. So what does this imply? In the age where commitment to the work and the speed of delivery remain the only measure at work, do we still need the archaical work design? Would the jobs of tomorrow offer women more potential to deliver? Will the organisations of tomorrow have the bandwidth to build the leaders of tomorrow irrespective of gender?

If you have any HR Query or any query on Future of Work, Employee Engagement, Talent management, Women Empowerment, Retention or Business Strategy please write to me in here. Looking forward to learn more while finding solutions for you. This have been re-blogged from nabomita.com

Nabomita is the Founder to Nabomita.com. She is the Top 100 Women Achiever Awardee, awarded by Government of India , TEDx Speaker, Quoted on ForbesUS, one of the Top 20 HR Influencer in Social Media as declared by SHRM India and one among the Top 100 Technology Influencer in India. Connect with her on @nabomita_smiles , Facebook Page and Google+

How long would you wait for that job offer?

“So I applied for a job in late November and had three interviews throughout the month of December. They all went really well and I was even referred to by a well respected employee of the company. I was in contact with the HR coordinator throughout the process and said she will have more information for me before the holidays (Christmas and New Years). Unfortunately I never heard back. So I emailed her after the first week in January and she apologized and said she was out of the office…fine, no big deal. But then she said she will have something for me at the end of the week. So about two hours went by and she then tells me she got off the phone with corporate and she won’t have anything until the end of the month, but if I can wait they will have “good news” for me. I was a little disappointed because I now have to wait another 3 weeks, but I really want the job so I told her that I’m very interested in the position and I’m willing to wait. 

So the end of the month comes and still no response. I emailed her again kindly asking if there is an update and she emailed back saying they will have more information later in the week or early next week. It’s now early next week and I still haven’t heard from the company.

Are they stringing me along or should I just keep being patient?”

The answer looks straight into our eyes! When you are being communicated and yet not offered the role, it says more about the decision making capabilities of the firm. Every Job Opening have a closing date mentioned on it. The Hiring Manager are well aware of it. No job remains opens endlessly. Any requirement is supposed to be closed within 45-60 working days, at the most.

Gone are those days when companies could hire for to build the internal resource pool. No talent in the current economy can remain unbilled for long. Hence, every requirement have a monetary return mentioned on it. Any delay in closing the Job Offer can extend the monetary impact, leading to a loss. The preference remains on getting the talent billable as early as possible.

The disparity in views among the hiring managers can lead to an absence of clarity in communication. It can arise from various situations right from being able to decide on which candidate to hire to when to close the offer. Ideally, Business Managers prefer interviewing newer candidates till the final week, whereas HR Managers tend to close it early.

Last but not the least reason for holding a role is the Business Manager back-trackking on the role, even after informing the candidate to resign from their existing jobs. This is the worst phase where no Hiring Manager wants to be. However, uncertain Business Units tend to raise a job requirement and close it abruptly without hiring any candidate. This kind of experience affects the brand of the employer. Few firms may extend an offer with different role to retain the candidate. But then, thats the prerogative of few!

As a candidate, it’s hard when you have been waiting for a role and it never reaches you. That’s the risk you need to mitigate while switching jobs. Don’t place all your eggs in one basket. Explore few options before you resign and then zero down on the role. Eliminate employers with fuzzy communication, no matter how much you may want the role or how good it may sound initially! A strong job requirement gets closed as early as possible. This says a lot of about the company culture too. Any employer who creates a ‘Candidate Experience’ during hiring would care for their careers too! Money remains the highest motivator, till you realise the need for values. The deal breaker gets crystal clear when you know whom to trust your career with!

Wishing you a great career ahead!

If you have any HR Query or any query on Future of Work, please write to me in here. Looking forward to learn more while finding solutions for you.

Nabomita is the Founder to Nabomita.com. She is the Top 100 Women Achiever Awardee, awarded by Government of India , TEDx Speaker, Quoted on ForbesUS, one of the Top 20 HR Influencer in Social Media as declared by SHRM India and one among the Top 100 Technology Influencer in India. Connect with her on @nabomita_smiles , Facebook Page and Google+

An Odd task of preparing a Compensation Report for a small firm

“I’m the HR Executive to a small to mid-sized firm. I get asked a lot of odd tasks. Today topped the cake.

Management decided full time employees are taking way too many of their paid sick days. They also wanted to know the pay, benefits, down to every incentives offered to such talent bands. I suppose they want to be armed with some information regarding what other employers in the area offer. So they have me cold-calling Companies, consultancies and other employers with similar talent pool to get a consensus. 

It’s been pretty difficult getting this information, which is pretty much confidential. I was wondering what your opinions were on this task in general, is it really useful to them to know what other employers are offering? Is there another way I could go about getting this type of information?”

Congratulations on this initiative. No matter how odd this task may sound, it will empower you with valuable information with regards to compensation and benefits. Let this be your very first Compensation Benchmark activity at a small and a manageable scale!

To begin with there are reports on Compensation with bands and designation for every sector published by Aon Hewitt, Mercer to name a few. Top firms such as Willis Towers Watson and Michael Page can offer insights on the design. But then, these reports are costly. A salary survey would offer a comparative data on where the pay structure within your firm lies. Glass door and Payscale would offer you a broad over view to the pay range . If you research enough in the comment section for each firm you might be able to even gauge how far the benefits implemented. Job advertised on LinkedIn Monster , Naukri and IIM Jobs can share more data on the existing opening.

Segregate the data for every band, level, and designation in your firm and compare it to what your competitors are paying. Stay focussed on your region unless you have a Pan-Indian presence or hire out-station candidates. Factor in the education level and experience in years required to deliver the job. The standard of living for the cities where your firm have a presence needs to be considered.

Once you have your report ready, validate it within your HR network. Confidentiality is important, hence respect someone’s choice of not responding to you. You may try and validate the data through the employees to the firms in your sector.

Once you have every single data validated by at least 3-5 individuals from each firms, you should be good to present the report to the Management Team at your firm.

Be prepare with questions on valid the data is and how do you make it relevant within your firm. Prepare a plan to suggest the changes that needs to be made to optimise your current pay structure and benefits. Suggest a few measures to be taken during implementing the new plan. In case you are not completely aware of the Minimax calculation , consider involving an external consultant or an expert. Wish you all the best !

If you have any HR Query or any query on Future of Work, please write to me in here. Looking forward to learn more while finding solutions for you.

Nabomita is the Founder to Nabomita.com. She is the Top 100 Women Achiever Awardee, awarded by Government of India , TEDx Speaker, Quoted on ForbesUS, one of the Top 20 HR Influencer in Social Media as declared by SHRM India and one among the Top 100 Technology Influencer in India. Connect with her on @nabomita_smiles , Facebook Page and Google+

Managing Exit: Withdrawing a verbal resignation

“I own a midsize company and today I had a senior staff member resign to me as soon as he came in. I accepted his resignation and asked him to hold tight as I gathered my thoughts on next steps. 2 hours later he said he was withdrawing his resignation.

Can I accept his verbal resignation? I don’t want to keep him around any more as he explained to me that it was time for him to move on and that he felt it was time for a change. 

I think something happened to his other opportunity and is trying to backtrack. I’m certain he will keep looking for another job anyway.”

What would you do if you were caught up in a similar situation? It’s easy to decide an yes or no , but let’s look into the process , before you decide.

A resignation requires the submission in writing. It needs to be clearly stated why the resignation have been tendered. The employer needs to then start processing the conversation. First of all, as soon as you receive a resignation, please issue a letter sharing the resignation have been received and it is under due consideration.

Then arrange for a detailed discussion with the resignee and your HR Team. You may or may not include the reporting manager depending on the request of the resignee. Often the employee submitting such a request has some grievances which needs to be heard in isolation. Incase the employee is fine, organise a meeting with the Reporting Manager and the HR Business Partner.

Understand in details, why the employee is resigning and how would the knowledge transfer happen. Make sure the duration for release, transfer or responsibilities and sharing of every information is agreed and signed off.

In case an employee doesn’t want to serve the Notice Period, please share the process. If as an employer you allow them to buy-out , please explain the calculation and the final number that the employee needs to pay.

Once the resignation process has moved to the acceptance stage by the employer, share if you have any implication on resignation withdrawal. Clearly state beyond which point can the resignation still be re-considered. Draw a timeline, such as if the Notice Period is 3 months long, define the period for re-consideration will lats till end of the first month.

Plan your talent accusation during the Notice Period. In case you can’t hire or the employee do not want to serve the notice period allocate the responsibility to a team member and initiate the Knowledge Transfer.

The Exit process on the final day needs to have every area signed off including handover or responsibilities, duties and any Office property assigned to the employee. Seal the process with Release Certificate.

Once you have a rock solid process in place, your employees would know there are little chances of diversions. This kind of an elaborate timeline would allow you to re-think your own decision on releasing the employee. You will be able to weigh every cost of a new hire to training your existing employee. Restructure is easy, when you are sure of the result you want to achieve.

Hence, every room for verbal back tracking will be avoided! Decide for yourself, if you want to release an employee who wanted to resign, or hold on to someone who has realised you are far better than his options? At the end of the day every employee would leave your firm, someday or the other. Its up to you to optimise the talent and the time you have with them!

Recommended: Why should your pay remain secret , Future of work , Open Door 

 

Will Maternity Bill affect hiring women?

With barely two days to the Amendment to the Maternity Bill , we have raging debates in the media with Deccan Chronicle and Scoopwhoop raising the burning questions. Will this put a check on hiring women? Would taking six months off from the work, make a women talent irrelevant?

Canada and Norway offers 50 and 44 weeks as Maternity Benefit respectively. Did that stop the employers from hiring women? Census reveals that by 2014, women made up almost half (47%) of the entire Canadian workforce! Same for Norway, where the women workforce make upto 47% in public and 26% in private sector according to a study released in 2008! Since the number of jobs and talent entering the workforce have increased, can we expect a bigger number by now? But then these are countries other than India. So let’s take a look at what is going to challenge hiring Women in the workforce:

  1. It’s anybody’s guess that the employer would hesitate from hiring a woman in the child-bearing age because of the added cost.
  2. The needs of a six-month old baby would be only slightly less than a three-month old one.
  3. So suppose the man is getting at least half as many offs as the woman is getting, won’t the employer be less biased against women?

Here’s my question to the employers. If you choose not hire women to save on your six-months salary, will that help your attrition cost too? Given the fact that women, especially when they start a family looks for stability, hence are way more loyal to men who would job-hop at the drop of a hat, would that still make hiring women costly? As an employer does it makes sense to hire a competitive talent who won’t resign for the next few years, for the conducive environment that you are building? More importantly, doesn’t the men in the same firm remain productive just because their wives were taking care of the child at home? And somehow the employers hiring those women are readily bearing the cost!

Secondly, the needs of the baby cannot be categorised so broadly. We live in a world where there are nuclear families. Not every woman can hire a nanny or house help to take care of the baby as she is away. Compared to earlier days, the support-system is down to the parent who needs to meet every demand for raising a child. How does then it makes sense to narrow the timeline for an infant? Especially in a country where mall nutrition in babies does not remain specific to any economic group.

Finally, were men waiting for the bill to be passed so that they can wash off their hands from the responsibility of an infant-care? In a country where ‘Dads changing nappies because Moms need to attend a business meeting’ is a luxury to few, how much does this Bill change the behaviour?

Back in the days, where the IT Parks suddenly tightened the rules on women security, there were similar doubts raised towards hiring women. Did that stop the number of women in the workforce grow? Similar costs were calculated down to every dime with the increase in hiring security personnel and adding video cameras for round the clock surveillance. Every challenge brings in a new solution, such as rise in the number of women cab drivers since the Uber incident.

What fuelled the change where fears met solutions? Did we hear the rise in the telecommute way back in 90’s? Inspite of the adoption of this work design, the resistance remains as the companies can afford huge work spaces to accommodate every employee. FaceTime and cubicle will remain in vogue till we have socio-economic changes disrupting them.

The Bill clearly mentions the option for Telecommute. However, that is being ignored largely, as the adoption of such systems will take time to become a norm. In the view of emerging work format, how does the Bill look like in the future? Would it allow a women to plan her career and family in parallel? If a woman needs to remain out of workforce for a declared duration, does that allow her to be up-skilled and plan for greater responsibilities? It would call for sponsoring such growths within the company. Is n’t the woman who is taking a break for child care, a wife to a man who could remain productive to his employer, just because she was at home?

Cyclic unemployment is norm, thanks to the repeated business cycle changes that we have experienced. This goes same for men and women. Losing a job due to diminishing revenue or policy changes no longer stops a career. Even men have to up-skill, relocate and network to find a new job! Companies have openly acknowledge hiring talent out of workforce.

In case such measures are not enough to meet the employment required, we have Gig Economy offering interesting jobs to build a promising portfolio.

Every benefit offered turns into a hygiene factor even before we know. How soon would this 26 weeks turn into a norm with no one even discussing about them, we will wait to see!

If you have any HR Query or any query on Future of Work, please email me nabomita@nabomita.com . Looking forward to learn more while finding solutions for you.

Recommended reading: Maternity Benefit , Diversity  , We Are Equal , Future of Work

Maternity Benefit Bill Amendment : A dream come true for Women in the Workforce !

Lok Sabha passed the Maternity Bill yesterday. This is a major leap for the nation where the women workforce is increasing by manifolds. With this amendment, India trailblazers, Canada and Norway with 50 and 44 weeks respectively!

The landmark initiative by Ministry of Women and Child Development, Government of India offers the best gift to working women in India. The labour force participation rate (LFPR) in India is around 40%, but for females, it is only 22.5%. The gap in male-female LFPR is such that the LFPR for rural women above 15 years is only 35.8%, while for rural males it is more than double at 81.3%, according to a 2015 research paper by the government policy think tank NITI Aayog. Women and Child Development Minister Maneka Gandhi called it a “momentous step” and thanked her colleagues for supporting the Bill. She further said that, “I am very, very happy that we have made history today. This will help thousands of women and lead to much healthier children.”

This bill essentially includes these following points:

  1. The number of weeks for the Maternity Leave gets increased from 12 to 26 weeks for the first two children post which it would be 12 weeks.
  2. Every organisation with 50 or more employees or 30 women, will need to have a Creche
  3. Women are offered 4 visits to Creche daily during working hours.
  4. Maternity leave of 12 weeks to be available to mothers adopting a child below the age of three months as well as to the “commissioning mothers”. The commissioning mother has been defined as biological mother who uses her egg to create an embryo plant.
  5. The employer may permit a woman to work from home if it is possible to do so.
  6. Every establishment will be required to make these benefits available to the women from the time of her appointment.

Read the complete amendment in here

Maternity Benefit Bill Amendment 2016

If you have any HR Query or any query on Future of Work, please email me info@nabomita.com . Looking forward to learn more while finding solutions for you.

Nabomita is the Founder to Nabomita.com. She is the Top 100 Women Achiever Awardee, awarded by Government of India , TEDx Speaker, Quoted on ForbesUS, one of the Top 20 HR Influencer in Social Media as declared by SHRM India and one among the Top 100 Technology Influencer in India. Connect with her on @nabomita_smiles , Facebook Page and Google+

Recommended reading: Diversity , We Are Equal  , Future Of Work

Photo credit: Ministry of Women and Child Development

Why should your pay remain a secret?

‘Pay Secrecy’ one of the best kept secret by the HR , which the world comes to know otherwise!

We have tons of research to support how it adversely affects your performance when you get to know how much your undeserving co-worker is getting paid. Is that the only truth ?

Does secrecy breeds trust or transparency? Why as an employer would you want to hide when you have a policy for equal employment and promote equal pay? Is the information of how much an employee draws worth sharing openly within the company or even public domain? In the times of Glassdoor and Payscale, how secret is your pay to your employees?

We can understand the ugly situation of explaining every employee why one is paid more than other, inspite of in-equal education or experience is sticky. More importantly your view of weighing a potential may not remain equate how your employees measure them. But shouldn’t that remain self-explanatory in a result-driven world?

How did Whole Foods manage to make the information salaries open? That too since 1986? They managed to let every employee view how they are stacked up and not loose them? Or run into low-productivity? Why are the talent working in their company behaving differently and not raising a storm in a tea cup with their questions on entitlement ?

In India, Public Sector organisation have grades declared with the pay range. Talents joining such an organization have the exact information on how the hikes would work for them and their peers. Even the timeline to all such hikes remains declared.

When Buffer declared their salaries on the web the number of job applicants grew effortlessly. SumAll followed the lead, with the firm creating transparency within the 40 member team.

With Gig Economy growing through platforms that allow a talent to bid for the gig, how far does the pay remains a secret? When end-result is the only measure, shouldn’t pay remain obvious? If merit is the only edge, how difficult is it to explain potential?

If you have any HR Query or any query on Future of Work, please email me info@nabomita.com . Looking forward to learn more while finding solutions for you.

Recommended : Future of Work , If Bots are taking away your jobs should they pay your taxes too