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Human Resources Terms and Glossary

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360-Degree Feedback – A performance evaluation method through which employees receive feedback from multiple sources at different levels within an organization, generally including supervisors, peers and subordinates.
401(k) Plan – A tax-deferred retirement plan in which employers may match contributions by employees.
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Absenteeism – An employee’s failure to attend to his or her assigned workplace or duties as scheduled.
Access channel/candidate access channel - Any means by which a candidate can gain access to online recruiting functions or online staffing assessment tools. These may include job boards, corporate employment portals, kiosks, wireless handheld computers, hyperlinks that are embedded in emails, or URLs that are advertised using conventional channels such as billboards or newspaper ads.
Accidental Death & Dismemberment Insurance – Insurance that provides an employee with benefits in the event he or she loses life, limb or eyesight as the result of an accident.
ADA (Americans with Disabilities Act of 1990) – The federal law that prohibits employment discrimination on the basis of mental or physical disability or a disability perceived by the employer. Qualified individuals are those whose disability substantially limit a major life activity and can perform the essential functions of the job with or without reasonable accommodation.

ADEA (Age Discrimination in Employment Act) – The federal law that prohibits employment discrimination against individuals 40 years of age and older.

Adverse Employment Action – An employment decision that negatively impacts an employee, such as a demotion, termination, reduction in pay or status, failure to promote, or less-desirable work assignment or transfer.

Affirmative Action – A set of public policies and initiatives designed to ensure equal employment by eliminating past and present discrimination based on race, color, religion, sex or national origin.

Affirmative Action Plan – An employer plan or program implemented to demonstrate support and compliance with civil rights legislation, which is generally required of government contractors. An AAP typically states the organization’s current minority population as well as plans to increase minority and female hiring and promotion.

Affirmative Defense - Means of avoiding liability for a harassment or discrimination complaint so long as the following conditions are met: (a) the employer exercised reasonable care to prevent and promptly correct any harassing behavior, and (b) the employee unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise.
Age Discrimination in Employment Act – A federal law that prohibits employment discrimination against individuals 40 years of age and older.

Agency Shop – A workplace where all employees are required to pay to the union an amount equal to the customary initiation fees and monthly dues, even though the employee is not required to become a member of the union or follow union rules.

Alternate Work Arrangement – Alternate Work Arrangement: A work schedule that deviates from the traditional office workweek. Examples include job sharing, telecommuting and flextime.

Alternative Dispute Resolution – A forum, such as arbitration or mediation, for resolving disputes outside of the traditional court system.

Annual Report Form 5500 – A written summary of a retirement plan’s assets, liabilities, income and expenses that must be filed each year by certain pension, welfare and fringe benefit plans to satisfy annual reporting requirements under the Employee Retirement Income Security Act and the Internal Revenue Code. The report shows the aggregate administrative fees and other expenses paid by the plan.

Annuity – Periodic payments made to a pensioner during a fixed period of time or until death. Purchasing an annuity involves paying a lump sum or periodic payments to an insurance company that guarantees certain periodic payments will be made to the participant.

Applicant Tracking System (ATS) - An applicant tracking system (ATS) is a software application designed to help an enterprise manage its staffing process more efficiently. Applicant tracking systems are sometimes referred to as candidate management systems, although in reality the two are slightly different, since a true ATS functions at an enterprise level while a candidate management system is suitable for smaller-scale applications. An ATS can be used to post job openings on a corporate website or job board, screen resumes, and generate interview requests to potential candidates by email. Other features may include individual applicant tracking, requisition tracking, automated resume ranking, customized input forms, pre-screening questions and response tracking, and multilingual capabilities. It is estimated that roughly 50% of all mid-sized companies and almost all large corporations use some type of applicant tracking system. Most applicant tracking systems represent enterprise-level technology and require a reasonable amount of time and effort to be configured to map onto an individual organization's staffing process.

Apprenticeship – A combination of on-the-job training and related classroom instruction in which workers learn the practical and theoretical aspects of a highly skilled occupation.

Aptitude Test – A standardized test designed to measure the person’s ability to develop skills or acquire knowledge.

Arbitration – A means of submitting a dispute for final resolution to a neutral third party.

Area Rate Differentials – Differences in wage rates for the same job in different geographical areas that reflect cost-of-living differentials between those areas.
Assessment administration systems - An electronic (online) system that allows staffing professionals to configure and administer online staffing assessments. These systems allow users to accomplish tasks such as scheduling candidates for assessments, attaching links to online assessments to job postings, and tracking a candidate's progress in the selection process.
Assessment delivery systems - The system used to deliver assessment content to a candidate. Assessment delivery systems are usually web based; however, assessments can also be delivered via paper, phone (IVR), in person, kiosks, or wireless devices.

At-Will Employment – An employment relationship that either party, employer or employee, can end for any reason, or no reason at all, at any time with or without notice.

Attrition – The loss of personnel through resignation, retirement and death.

Attrition Rate – staffing metric in which the number of quits and terminations for the year are divided by the average employee population for the year.

Authorization Card – A document that indicates that an employee desires to belong to a bargaining unit of employees represented by a labor union.

Autonomy – Ability to make independent decisions to complete tasks.

Average Hourly Earnings – Hours worked per period divided into total wages paid for that period.
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Back Pay – Amount of money due an employee for periods prior to the current pay period and usually as an award for lost wages given through a court ruling or as a result of arbitration proceedings.

Background Check – Investigation into accuracy of information provided by job applicants. May include verifying employment history, education, criminal, credit and driving records.

Bargaining Unit – A group that represents employees in collective bargaining and representation elections between an employer and a union. A bargaining unit is determined by the National Labor Relations Board based on the commonality of interests among employees as well as other factors.

Base Salary – An employee’s wages before deductions, not including incentives or bonuses.

Benchmark – A fixed point of reference from which measurements can be made.

Benchmark Job – A job that is common across various industries, e.g., accountant or customer service manager.

Beneficiary – Individual who is either using or eligible to use insurance benefits under a contract.

Benefits Accrual – The accumulation of pension credits in a defined benefit pension plan according to years of credited service.

Bereavement Leave – Paid or unpaid leave for employees following the death of a relative.

Bona Fide Occupational Qualification – A job requirement that may relate to sex, religion, national origin or age but does not violate the law because it is necessary for the individual to perform the job.

Bonus – An award granted to employees at the discretion of management, usually based on personal and/or company performance.

Broadband – Salary structures that consolidate a large number of pay grades into a few broadbands. Often used to encourage movement between ranges of different jobs.
Bureau of Labor Statistics – The federal agency that provides labor survey, statistical and other data that is frequently used in human resources functions.
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Cafeteria Plan – A plan that offers flexible benefits under IRC Section 125.  Employees choose their benefits from a “menu” of cash and benefits, some of which can be paid for with pretax deductions from wages.
Cafeteria Style Benefits – A plan in which employees receive a menu of benefits. Typically carries a higher administrative cost.

Candidate management system (see also "Applicant Tracking System") - An application that allows staffing professionals to manage information obtained from job applicants and to use this information for administrative purposes. While these systems perform many of the same functions as applicant tracking systems, they are usually associated with functionality that is included with many online assessment platforms. This is in contrast to an ATS, which is usually a standalone system that functions at an enterprise level. A common difference between candidate management systems and applicant tracking systems is whether or not they are set up to transfer data to an organization's HRIS. Applicant tracking systems almost always provide this functionality, while many candidate management systems do not.

Candidate profiles - Information that summarizes an individual's suitability for a job relative to specific job requirements. Candidate profiles represent the output of many online staffing assessment systems. Typically, candidate profiles contain a graphical representation of a candidate's traits compared to the ideal range of these traits in terms of effective job performance. Many candidate profiles also contain detailed narrative information about a candidate's strengths and weaknesses relative to job performance requirements.

Cash Balance Plan – Defines the promised benefit in terms of a stated account balance.

Civil Rights Act – A federal law that prohibits discrimination based upon race, color, religion, sex and national origin in all terms and conditions of employment. The Act includes provisions for monetary damages in cases of intentional discrimination and clarifies provisions regarding disparate impact actions.

Claims Experience – Type and frequency of claims filed by insured employees used primarily to determine insurance premium rates.

Class Action – A lawsuit brought on behalf of one or more persons as representatives of a larger group of plaintiffs and designed to expedite court proceedings involving numerous individuals alleging the same violations.

Cliff Vesting – When employer contributions into a retirement/pension plan are fully owned by the employee after a period of 5 years.
Closed Shop – A workplace where a security clause in a collective bargaining agreement requires the employer to hire only union members and discharge any individual who drops union membership.
COBRA (Consolidated Omnibus Budget Reconciliation Act) – The
federal law that requires employers with 20 or more employees to provide certain employees and dependents the opportunity to purchase the same health care group coverage if specific qualifying conditions are met. Some states have enacted their own laws providing additional coverage for workers.
Collective Bargaining – Negotiations between representatives of organized workers and their employers to determine working conditions, such as wages, hours and rules.
Collective Bargaining Agreement – The end product of successful union-management negotiations, some clauses of which affect the employer, the union and the rights and duties of employees.
Commission – A fee or percentage of a sale of a product or service that salespeople receive in addition to or in lieu of salary.
Compensation – Payment for a service rendered.
Compensatory Time – Paid time off granted to an employee for working extra hours.  The Federal Wage-Hour law places severe restrictions on the use of compensatory time to avoid paying overtime, although special exemptions are allowed for public sector employees.
Competency/competency model - The term "competency" is often used in a variety of different ways. However, the most common definition defines a competency as a set of behaviors that influence organizational performance. For example, interpersonal savvy or relationship-building are common competencies. Competency models contain sets of competencies that identify key behaviors employees need to display in order to succeed in their roles.
Competency-based assessments - Assessments designed around the behaviors found in a competency model instead of around more "psychological" attributes, such as personality traits or abilities. Competency-based assessments often integrate multiple types of assessment methodologies in order to predict the various behaviors defined by a competency.
Competency-Based Pay – Payment for traits and characteristics rather than for specific skills or positions held.
Competency-based reports - Much like a "candidate profile," these are reports that describe a candidate's suitability for a specific job based on the likelihood that they will display the competencies that influence performance for that job.
Compressed Workweek – A schedule in which employees work the normal number of hours for a workweek but complete the hours in fewer than five days.
Constructive Discharge – When an employee resigns due to intolerable working conditions, to which he or she is subjected because of race, color, religion, sex or national origin, that a reasonable person would have no choice but to do the same.
Consumer Price Index – A measure of change in prices of certain basic goods and services published by the Bureau of Labor Statistics.
Contingent Worker – An individual who works on a temporary basis, as opposed to a regular, permanent employee.
Contribution – An amount an employer pays into a plan for participants, or an amount an employee pays into a plan for his or her benefit.
Corporate careers portal - The careers section of a corporation's website. It is estimated that over 90% of organizations that have a website have some form of a corporate careers portal. However, there are a wide range of functions and services associated with these portals. Many larger corporations rely on their corporate careers portal to establish their employment brand. Such extensive portals often include detailed information about a company's values as well as profiles of employees, games, and the opportunity to search and apply for jobs. Many of the larger online assessment vendors offer their customers pre-made, private label career sites that can be installed on a company's website with little effort.
Corrective Action – Measures taken to correct or prevent a behavioral or performance problem.
Cost per Hire (CpH) – staffing metric which is calculated by dividing the recruiting costs by the number of positions filled. CpH = Recruiting Costs/Number of Positions.  Recruiting costs can include recruiter expenses (such as recruiter salary, benefits, overhead) , applicant expenses (such as travel and testing), direct fees (ads, job fairs, electronic job board postings), relocation expenses and signing bonuses.
Cost-of-Living Adjustment (COLA) – An adjustment in wages that represents a variation in the cost of living, typically tied to the consumer price index.
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Dashboard reporting - In an online staffing assessment system, this is a set of screens that provide users with comprehensive information about multiple applicants relative to the requirements of the job for which they are applying. Most dashboard systems utilize layered reporting in which high-level information is presented in initial screens but more detailed information can be accessed via clicking through various pieces of information about each candidate. This type of reporting is usually provided by more technologically advanced staffing assessment systems.
Death Benefits – Amount payable to a pension plan or insurance policy beneficiary after the death of the insured individual.
Desertification – The loss of a union’s right—frequently by election—to act as the exclusive bargaining representative of bargaining-unit employees.
Deductible – Amount a covered employee must pay for medical expenses before a medical plan will reimburse for covered expenses.
Deferred Compensation – The postponement of a wage payment to a later date.  Usually describes a portion of wages set-aside by an employer for an employee and put into a retirement plan on a pretax basis.
Defined Benefit Pension Plan – Retirement plan that uses a formula (generally based on an employee’s salary and length of service) to calculate an employee’s retirement benefits and is not funded by employee contribution to the plan.
Defined Contribution Pension Plan – Retirement plan with benefits determined by the amount in an employee’s account at the time of retirement; depends on the amount of the contributions as well as the gains or losses on the account.  The account may be funded by contributions from both the employer and the employee.
Demotion – To place an employee in a lower ranking position typically due to poor performance or a violation of a company policy or procedure.
Department of Labor – Division of the government to which the Wage and Hour Board reports.  The Wage and Hour Board oversees employment and labor laws.
Direct Deposit – The electronic transfer of an employee’s net pay directly into financial institution accounts designated by the employee, thus avoiding the need for a paycheck.
Disability – The standard used to determine benefits under workers’ compensation or other disability insurance programs or to determine coverage under the Americans with Disabilities Act (ADA). As used in the ADA, disability is defined as a mental or physical impairment that substantially limits one or more major life activities, a record of such an impairment, or being regarded as having such an impairment. State definitions may differ.
Discipline – To take an adverse action against an employee in response to his or her poor performance or a violation of a policy or procedure.
Discrimination – An adverse action taken against an employee based on his or her membership in a protected class.
Dislocated Worker – A worker who has been permanently laid off or has received a notice of termination or layoff from employment due to no fault of their own.
Disparate Impact – A discriminatory effect on a protected class caused by an employment practice or policy that appears to be neutral on its face.
Disparate Treatment – When an employee receives less-favorable treatment than others for discriminatory reasons, such as race, religion, national origin, sex or disability.
Duty to Bargain – The requirement that while a collective bargaining agreement is in existence, an employer avoids unilateral changes to the work terms and conditions governed by the agreement, except those which the agreement has left to the discretion of management.
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E-recruitment - Using the Internet to conduct recruiting practices.
Early Retirement Incentive Program – A strategic policy to encourage employees to retire where eligible employees can voluntarily retire with a one-time monetary incentive in addition to a full pension.
EEO-1 Report – The Equal Employment Opportunity Information Report is an annual report filed with the Joint Reporting Committee, comprised of the EEOC and the OFCCP, by employers subject to Executive Order 11246 or to Title VII of the 1964 Civil Rights Act. The report details the race, sex and ethnic composition of an employer’s workforce by job category.
EEOC (Equal Employment Opportunity Commission) – The federal agency responsible for administering and enforcing: Title VII of the Civil Rights Act of 1964; the Age Discrimination in Employment Act; the Equal Pay Act of 1963; the Americans with Disabilities Act; and the Civil Rights Act of 1991.
Electronic recruiting agents - Web-based applications that allow users to automatically search the web to find resumes of candidates who are qualified for a specific position. These are used by recruiters to identify and retrieve information that they can use to make contact with viable job applicants.
Employee Assistance Program – An employer-sponsored program designed to assist organizations in addressing productivity issues and employees in identifying and resolving personal concerns that may affect job performance.
Employee Referral Program – A policy that use monetary incentives to encourage current employees to solicit job applicants by word of mouth among acquaintances.
Employee Stock Option Plan – A compensation plan, generally for upper level employees, that allows the employee the opportunity to purchase company stock at a fixed price.  The employee typically vests in the options over a five-year period; they also expire after a fixed period of time.
Employer Identification Number – Employer’s account number with the Internal Revenue Service.
Employment At-Will – An employment relationship that either party, employer or employee, can end for any reason, or no reason at all, at any time with or without notice.
Employment brand - The message an organization sends to candidates regarding what the company is like as an employer. The employment brand permeates recruitment messages sent by the organization, including their web-based recruitment process. Staffing assessment tools also affect a company's employer brand. If candidates perceive assessments as unpleasant or non-job relevant, they are likely to be less favorably disposed toward the company as a potential employer.
Employment Cost Index – Published quarterly by the Bureau of Labor Statistics, this index reflects changes in the cost of labor.
Equal Pay Act – The federal law prohibiting discrimination on the basis of gender in compensation for substantially similar work performed under similar conditions.
ERISA (Employee Retirement Income Security Act) – The federal law that sets minimum standards for pension plans in private industry.
Exempt Employee – While this term can refer to anyone not covered as an employee under a certain law, it generally means those employees who are exempt from the minimum wage, overtime pay, and certain recordkeeping requirements of the Federal Wage-Hour Law (FLSA).
Experience Modification Factor – A workers’ compensation figure used to estimate the risk of work-related injury and illness and to determine an employer’s contribution amount.
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Fair Labor Standards Act (FLSA) – The federal law that establishes general wage and hour standards for companies that have at least two employees directly engaged in interstate commerce and have annual sales of at least $500,000. The basic requirements of this federal law are the payment of minimum wage; overtime for time worked over 40 hours in a workweek; restrictions on the employment of children; equal pay and recordkeeping.
Family and Medical Leave Act (FMLA) – Law guaranteeing 12 weeks’ unpaid leave to most employees to care for newborn or newly adopted children, or to deal with a serious illness or injury suffered by the employee or an ailing child, spouse, or parent of the employee.
Federal Income Contribution Act (FICA) – Combined taxes levied for social security and Medicare.
Federal Unemployment Tax Act (FUTA) – Requires employers to pay a certain percentage of their employees’ wages (up to a maximum wage limit) as a payroll tax to help fund unemployment compensation benefits for separated employees.
Fiduciary – Someone who exercises discretionary control over the assets of another party and has a responsibility to that party.
Flexible Spending Account (FSA) – An arrangement that allows an employee to have pretax dollars deducted from wages and put into an account to pay for health insurance deductibles and co-payments and dependent care assistance (there are separate accounts for medical and dependent care assistance FSAs).
Flextime – An arrangement in which employees set their own starting and finishing times within company parameters.

Forms - Can refer to both paper and electronic forms that assist with the demographic change processes in Payroll and HR. Job-Applications.com - Find hundreds of online applications and printable job forms.
Form 5500 – A written summary of a retirement plan’s assets, liabilities, income and expenses that must be filed each year by certain pension, welfare and fringe benefit plans to satisfy annual reporting requirements under the Employee Retirement Income Security Act and the Internal Revenue Code. The report shows the aggregate administrative fees and other expenses paid by the plan.
Full-service assessment system - System that supports a wide range of assessment tools and candidate management features.
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Gain Sharing – A formal incentive-pay system in which employees are rewarded as a group for improving productivity and identifying and implementing cost-saving techniques and practices.
Garnishment – A legal proceeding authorizing an involuntary transfer of an employee’s wages to a creditor to satisfy a debt.
Geographic Differentials – Variances in compensation for the same job based on cost-of-living changes from one geographic area to another.
Graded Vesting – When employer contributions into a retirement/pension plan are fully owned by the employee after a period of 7 years; the employee vests 20% each year beginning with the third year.
Grievance – A formal expression of a complaint. It may be a single or multi-step process used to challenge an employer’s or union’s alleged violation of a collective bargaining agreement or the National Labor Relations Act (NLRA).
Grievance Procedure – A method by which a grievance is expressed to management and resolved through internal policy and action.
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H-1B Visa – A nonimmigrant visa that professionals with at least a bachelor’s degree or its equivalent in work experience may be eligible for if the position requires such a degree. Employers must demonstrate that these professionals are paid at least the prevailing wage for the job.
Health Care Financing Administration – The division of the federal Department of Health & Human Services responsible for overseeing Medicare and Medicaid.
Hiring recommendations - A specific recommendation to help staffing personnel make decisions based on the match between a candidate's assessment results and job performance requirements. These systems express hiring recommendations in very simple terms such as percentage values or red, yellow, and green lights.
HMO (Health Maintenance Organization) – An organization that provides an agreed-upon set of health maintenance and treatment services for a prepaid fixed sum.
Human Resources Forecasting – Anticipating and planning for future staffing needs as a part of your strategic plan.
Human Resources Information System – Enterprise-level software systems designed to support management of human resource data (e.g. payroll, job title, candidate contact information). Some of the larger HRIS platforms include SAP and Peoplesoft.
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I-9 Form – A form issued by the Immigration and Naturalization Service to verify employment eligibility.
Incentive – Rewards given to employees in addition to their base wage that are intended to induce action or provide motivation.
Incentive Stock Option – A stock option plan that gives an employee the opportunity to buy the employer corporation’s stock at a fixed price for a certain period of time, and that offers favorable tax treatment if certain conditions are met.
IRA (Individual Retirement Account) – A special retirement-savings arrangement that permits individuals to save up to $2,000 of pre-tax income every year and defer taxation on that money until it is withdrawn.
IVR (interactive voice recognition) assessment - Assessment system that collects information from candidates using an automated telephone system. Candidates typically access these systems using a 1-800 number. Candidates answer questions either by using the telephone keypad or by speaking to a computer designed to recognize specific voice responses.
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Job Analysis – A process used to establish and document whether employment procedures such as training, selection, compensation and performance appraisal are related to a specific job position. It includes the review of job descriptions and specifications, such as the skill and background necessary to perform the responsibilities of the job. This process is also called job or position evaluation.
Job board - A website or part of a website that allows job seekers to view available jobs posted by a variety of organizations. Once applicants have identified a job that they are interested in applying for, the job board provides them with a way to send critical job-related information (such as a resume) to the employer. Many job boards have a variety of additional services to help job seekers manage their careers and their ongoing job search processes.
Job Sharing – When two part-time employees share the same full-time job.
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Knockout questions - Specific questions on an assessment instrument that are used as independent criteria for qualifying or removing candidates for consideration for a position during the pre-screening or qualifications screening phase of the hiring process. For example, a question asking candidates if they can provide eligibility of their right to work in the United States might be used as a knockout question. A company might decided that if a candidate does not answer "yes" to this question, he or she will no longer be considered for the position regardless of how the candidate performed on the rest of the assessment. Knockout questions should be used very conservatively and only to assess very clearly defined, highly objective qualifications.


Labor Management Relations Act – Also known as the Taft-Hartley Act, it gives employees the right to refrain from participating in union activities and prohibits unfair labor practices by unions.
Leased Employee – Employees of a leasing agency who are hired and trained for the client firm through the agency.  Withholding, depositing, and reporting responsibilities remain with the leasing agency.
Loss Ratio – The ratio of paid and incurred claims and expenses to insurance premiums.
Loss Reserve – Amount reserved to cover future unpaid claims incurred but not reported.
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Merit Pay – A method of compensation based on established company standards of performance.
Merit Raise – A raise based upon an employee’s performance rather than the length of service or cost of living
Minimum Wage – The lowest dollar amount that an employer can pay its employees per hour under federal or state law.
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National Labor Relations Act – The primary law governing relations between unions and employers in the private sector. The statute guarantees the right of employees to organize and to bargain collectively with their employers or to refrain from all such activity.
National Labor Relations Board – The independent federal agency that has two principal functions: (1) to determine through secret ballot elections whether employees wish to be represented by a union in dealing with their employers and if so, by which union; and (2) to prevent and remedy unfair labor practices by either employers or unions.
Niche job board - A job board that serves a specific industry or occupation. For instance, http://www.salesjobs.com/ is a niche job board that caters to sales professionals.
Non-Compete Agreement – An employment contract in which the employee agrees not to work for a competitor for a period of time once his or her employment terminates.
Nondisclosure Agreement (NDA) – An employment agreement that bars employees from disclosing or releasing an employer’s trade secrets and other proprietary information.
Nonexempt Employee – Employees who are covered by the minimum wage and overtime provisions of the FLSA.  They may be paid on an hourly or salary basis.
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Off-the-shelf assessments - Assessment tools that can be purchased and implemented with little or no customization. These are typically less expensive than tailored assessments and can be quickly deployed. Off-the-shelf assessments may not be as valid or efficient as tailored assessments because they are designed to predict general aspects of performance rather than focusing on the specific behaviors that drive success in a particular job.
On-boarding - The process by which a new leader is integrated into the organization.
Open Enrollment – The time span during which employees eligible for one or more health benefits programs may elect to participate in an offered plan.
Organizational Chart – A diagram charting the organizational structure and relationships between various positions.
OSHA (Occupational Safety and Health Administration) – The federal agency that enforces the Occupational Safety and Health Act and develops programs and policies to maintain safety and health standards and eliminate occupational injuries and illnesses in U.S. workplaces.
Out-of-Area Benefits – HMO benefits provided to plan participants when seeking health care from a provider outside the covered geographical limits.
Overtime – Hours worked in excess of maximums set by federal or state law that must be compensation at a premium rate of pay (e.g., under the FLSA, all hours worked over 40 in a workweek must be paid at no less than 1½ times the employee’s regular rate of pay.
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Paid Time Off (PTO) – A collective amount of time off available to employees that includes sick, vacation and personal time into a single time-off package.
Pay Grade – A class or rank in which various jobs of similar importance or difficulty are grouped.
Pension Plan – A retirement plan in which a fixed amount of money is paid to eligible employees after retirement.
Performance Appraisal –A periodic evaluation of an employee?s job performance that includes review of past performance, discussion of areas of strength and weakness, and future goals or actions. An essential part of employee performance management and evaluation. Appraisals should be presented both in writing and in a confidential discussion and allow for employee self-appraisal and acknowledgement of review.
Performance Share Plan – A stock grant plan in which an employee is offered stock options depending on certain goals being achieved. Stock recipients must pay personal service income tax on the fair market value of the stock at the time of issuance.
Performance Standard – An established minimum set for the successful fulfillment of a job against which comparisons and judgments of an employee’s actual performance record may be made.
Personnel selection - The process used to determine whether to make a job offer to a candidate.
Plan Administrator – The individual charged with administering an organization’s financial or retirement plans in accordance with state and federal law.
Point of Service Plan – A health plan that covers providers who are out of your network, usually with higher co-payments and/or deductibles
PPO (Preferred Provider Organization) – A medical-insurance plan in which members receive less expensive coverage by choosing health care providers approved by or affiliated with their plan.
Prevailing Wage Rate – Wage rate paid to employees in specific job categories for similar work in the same geographic location.  Used by companies under contract to the federal government.
Progressive Discipline – A process of increasingly severe disciplinary actions designed to ensure an understanding of job expectations, provide an opportunity to correct behavior, improve performance and assure due process. Poor performance is normally addressed through a pattern of pre-discipline and formal discipline that eventually leads to termination.
Protected Activity – An activity protected by federal or state law. Protected activities include complaining of discrimination, reporting safety violations, testifying on a coworker's behalf, etc.
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Qualifying Event – A job-related event that triggers application of a federal or state law or workplace policy. Relating to COBRA benefits, a qualifying event, such as job separation, leads to the employee’s right to claim continued health coverage under the employer’s group health plan.
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Realistic job preview (RJP) - A selection measure or step in a selection system that provides an applicant with realistic and accurate information about some of the more difficult aspects of the job. It is hoped that this realistic information will cause applicants who are not comfortable with the more difficult parts of a job to remove themselves from the selection process. Studies have shown that RJPs are an excellent way to help reduce turnover.
Recruiting - The process of attracting applicants for open positions.
Red-flag response - A specific response to a single item on an assessment instrument that is felt to be highly indicative of a potential candidate weakness. For example, a candidate who marked "yes" in response to a pre-screening question asking if they had ever been fired from a job might be marked as a red-flag response.
Reporting tools - Tools that allow clients to interpret and use the data collected via an assessment system. Information typically provided by reporting tools includes summaries of applicant scores on different assessments tools, number of applicants completing different assessments, passing rates broken down by different applicant characteristics, or EEOC statistics.
Resume capture - A functionality that allows a candidate's resume to be uploaded into a resume database maintained by a job board or corporate careers site.
Resume evaluation software - Software that uses artificial intelligence to parse (dissect) a resume and infer meaning from its contents. These systems are seen by some as an efficient way to reduce the amount of resources required to evaluate resumes in situations with large numbers of applicants.


Salary Structure – The configuration of job grades and pay ranges created by an organization.
Screening - The processes of separating qualified candidates from unqualified candidates.
Selection - The act of choosing the candidates that best fits an organization's needs for a particular position.
Seniority System – A ranking based on length of service to an organization that leads to increased privileges.
Severance Package – A payment offered by some employers to terminated employees (usually those who are terminated through no fault of their own) that is designed to tide them over until new employment is secured.
Skill-Based Pay – A compensation system in which pay scales are set by skill level rather than job title.
Skills Inventories – A compilation of human capital in an organization, including a list of skills, attributes and credentials.
Social Security Disability Insurance – Federal disability payments made to qualified claimants who establish that they are totally unable to participate in gainful employment.
Sourcing - The act of finding candidates to apply for a job opening. Sourcing can be active or passive. In active sourcing, recruiters search databases and job boards to try and locate qualified candidates. Passive sourcing involves using resources such as print advertisements, careers pages, or job boards to help applicants find out about available job openings and compel them to apply.
Staffing - The process of acquiring, deploying and retaining a workforce of sufficient quantity and quality to create positive impacts on the organization's effectiveness. The process used to hire new employees into an organization.
Staffing assessment - Any tool or system that collects information from job candidates for the purpose of aiding hiring decisions.
Standalone assessment platform - An assessment system that is designed to function on its own, without being integrated with other technology platforms.
Static reporting - Reporting in which the results of staffing assessments are delivered via a PDF file or in an email. Static reports do not allow users access to varying levels of information about a candidate.
Subrogation – Right of an insurance carrier or employer to seek reimbursement of paid claims through third-party judgment or settlement of tort action related to an employee's claim.
Supplemental Unemployment Benefits – Employer plans that provide supplements to state unemployment compensation benefits.
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Third-Party Administrator – An independent organization that provides administrative services including claims processing and underwriting to employers and insurance companies.
Time to Fill or Time to Hire (TtF or TtH) – staffing metric which calculates the average number of calendar days between the date when the position was open (job order date) and to the date the position was filled (offer accepted).
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Unemployment Insurance – Amounts paid by an employer, on both the federal and state level, to provide income to terminated employees while they are trying to secure another job.  Three states have laws on their books that provide for employee contributions to the state unemployment fund.
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Variable Pay – Parts of an employees pay that may vary depending on either the employees or the employers performance, e.g., bonus, commissions, merit increase.
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W-2 Form – Wage and Tax Statement; employers must file a Form W-2 (to both the employee and the Social Security Administration) to report the total amount of wages paid and taxes withheld for each employee in a calendar year.
W-4 Form – Employee’s Withholding Allowance Certificate; federal (or an equivalent state or local) form on which the employee states the number of withholding allowances he or she claims.  The form is used by the employer to determine the amount of federal, state, and local income taxes to withhold from the employee’s compensation.
Workers’ Compensation – Payments required by state law when a worker suffers an industrial injury arising out of or in the course of employment, regardless of who was at fault.
Workers’ Compensation Insurance – Insurance that covers any injury or illness requiring medical attention that is incurred by an employee during the course of employment. Provision of workers’ compensation insurance benefits to an employee typically relieves an employer of further liability arising from the employee’s injury or illness.
Wrongful Termination – Illegally ending an employment relationship with an employee through violation of public policy, breach of contract or breach of the covenant of good faith and fair dealing.
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Years of Service – In reference to participation in a plan governed by the Employee Retirement Income Security Act (ERISA), 1,000 compensable hours completed by a plan participant during a consecutive 12-month period.
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Zero-Base Forecasting – Method of determining future staffing requirements by using an organization’s current staffing level as a beginning reference point.
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