Motivated employees, on the other hand, make for a strong team. They’re more productive than their unmotivated counterparts and have higher employee happiness, engagement, and satisfaction. 

Understanding how motivation works can be a game changer for your business. Read on to learn how motivated employees benefit your business, how to measure motivation, and five ways to boost employee motivation in the workplace. 

What is employee motivation?

Employee motivation is closely related to employee performance and engagement. Employee motivation is the energy, commitment, and enthusiasm employees bring to their role each day. 

In an ideal workplace, all your employees would be motivated when they come into work for their shifts. Motivated employees have higher productivity rates and go above and beyond to complete the job. 

If your employees aren’t as motivated as you’d like them to be, there is hope. Employee motivation is something you, as an employer, can positively influence with a wide range of motivational incentives. 

Types of employee motivation

If you’re working to improve employee motivation at your business, it’s essential to understand the difference between the two types of motivation—intrinsic and extrinsic. Not every employee will be motivated by the same things, so it’s important to understand how motivation works and how you can adjust strategies based on people’s preferences.

Intrinsic motivation

Intrinsic motivation is when an individual is motivated internally. They’re motivated by their emotions—happiness, pride, and satisfaction push them towards their goals. When you’re intrinsically motivated, you do things because of the positive feelings completing those things gives you.  

Praise and positive feedback are great ways to increase motivation for intrinsically motivated employees. 

Extrinsic motivation 

Extrinsic motivation is when an individual is motivated by external factors. Extrinsically motivated individuals are motivated by rewards, recognition, prizes, bonuses, and even deadlines. 

For extrinsically motivated employees, employee of the month, incentive programs, and bonuses are great ways to increase motivation. 

The benefits of highly motivated employees

No matter your business, you should strive to have a team with highly motivated employees. When your workforce is motivated, your business will experience benefits from that motivation. 

Increased employee engagement

Employees who report high levels of employee motivation also report high levels of employee engagement. Employees engaged with their work are more likely to be productive and save their companies money.

According to the Gallup employee engagement survey, engaged employees:

• Increase sales by 18%
• Increase profitability by 23%
• Increase productivity by 14%
• Increase organizational participation by 13%

There are three levels of employee engagement: actively disengaged (unhappy and intentionally causing issues at work), not engaged (checked out mentally from work), and engaged (works with enthusiasm). If you’re experiencing a lot of disengaged and non-engaged employees, finding a way to boost their motivation can help them re-engage at work. 

Better job performance

Highly motivated employees are likely more productive and effective in their roles than unmotivated employees. Because they’re motivated, they work hard to reach their goals, focus on completing their tasks, and generally do what they can to help the business succeed. Motivation also plays a role in which employees are willing to take on more responsibilities—those who are motivated in the workplace will jump at the opportunity. At the same time, less-motivated people may shy away from added responsibilities.

Positive work environment and company culture

Think of motivated employees as your business’s biggest cheerleaders. They work to make sure there’s a positive, happy atmosphere in the workplace. They go out of their way to help team members feel safe and happy at work. And they go above and beyond for customers.

Motivated employees feel connected to their jobs and the business. This positive outlook and driven nature can influence other motivated and unmotivated employees to jump on the bandwagon, creating a positive company culture with motivated employees.

Lower rate of employee turnover

The average annual turnover rate in the U.S. is 47.2%—nearly half of all American employees leave their jobs in any given year. With the price tag of replacing an employee sitting at approximately 30% of that employee’s first-year earnings, lowering your employee turnover rate is more important than ever. 

Boosting your employees’ motivation can help. Motivated employees tend to stick with a company longer than unmotivated employees. Also, motivated employees can help lower your employee absenteeism rates—employees who are motivated to work show up on time. 

How to measure employee motivation and engagement

The first step in building a strategy to motivate employees is setting a benchmark for employee motivation and engagement in your organization. Because you’re dealing with how your employees feel, it can be tricky to decide how you’ll quantitatively measure motivation in the workplace.

The best way to measure employee motivation is through employee surveys. You should already be using employee surveys to gather insights from your employees on all things related to your business and their employment. By adding questions measuring their motivation and engagement in the workplace, you can set your benchmark and repeat the questions when ready to re-measure. 

These seven questions are a great place to start when building your employee motivation survey. And remember, you can add a few questions to a wider-reaching employee survey—it doesn’t have to focus only on motivation and engagement.

1. How motivated do you feel when you’re at work?
2. How inspired are you by your long and short-term work goals?
3. How happy do you feel when you come to work in the morning?
4. How would you rate your overall job satisfaction?
5. Do you feel you’re contributing to the success of the business?
6. Does your manager recognize your contributions?
7. How stimulating do you find your day-to-day tasks and responsibilities?

Employee surveys should be scheduled into your calendar. Make sure you’re doing them often enough to stay on top of how your employees are feeling but not so often that you overwhelm your employees. Consider an annual or bi-annual larger format survey with employee pulse surveys  every one to two months. An employee pulse survey is a short series of questions asked on a frequent basis to track responses to a specific issue over time. 

How to motivate an employee

There are lots of strategies to improve employee motivation. Employees are individuals, so what works for some may not work for others. Getting to know your employees to uncover what motivates them is always best—a tailored approach to employee motivation is always the best choice.

If you’re looking for a place to start, these five strategies are excellent motivation boosters.  

1. Recognize your employees for their hard work

It may sound simple, but taking the time to recognize your employees for the hard work they put into your business goes a long way. Recognition is a great way to show your employees you appreciate them and to motivate them to keep working hard. A 2023 survey found that for 37% of employees, more personal recognition would be the best motivator for them to produce better work more often. 

An employee of the month program is a great way to recognize your employees for the hard work they put into your business. But it doesn’t even have to be as formal as that. 

Some of the common ways to show your appreciation to your employees include:

• Internal employee shout-outs for good work
• Celebrate milestones like birthdays and work anniversaries
• Give handwritten appreciation and thank you notes
• Say thank you when employees do a great job

2. Offer an employee incentive program

Employee incentive programs use extrinsic motivation to encourage employees to achieve specific goals to receive a reward. The rewards and program set-up can come in many different forms, but the best programs re-engage and motivate employees to become more efficient and productive. 

Incentive programs increase employee motivation, engagement, and productivity. They’re an excellent way to reach extrinsically motivated employees—the promise of a reward or gift will help spur them into action.  

Some of the common employee incentives include:

• Monetary bonuses
• Wellness initiatives
• Fun gifts
• Company swag
• Additional paid time off
• Travel incentives
• Meaningful experiences

3. Give your team autonomy

When you give your employees autonomy, you provide them with control over their time and energy. Whether you’re offering flex schedules, shift bidding, or simply letting go of micromanaging, giving your employees autonomy shows you trust them. And that trust and autonomy add to motivation and overall job satisfaction. 

4. Work on your management skills

Regarding management skills, it’s important to be the best manager for your team. A good manager has a significant impact on employee motivation. When a manager shows employees they’re invested in their success and keeps open lines of communication, employees are more likely to be engaged at work and motivated to give their jobs their all. 

Hold one-on-one meetings with your employees and spend the time building positive relationships with everyone on your team. This is also an excellent way to learn what motivates your employees.

5. Ask for—and act on!—employee feedback

We discussed employee and pulse surveys, but one of the most effective ways to motivate employees is to ask them for feedback. You get the information right from the source by asking your team what would make work more meaningful. 

But for this to be effective, you’ve got to do more than listen to your employees. You must act on their feedback to capitalize on what motivates them. When you get feedback from your employees, give yourself a realistic timeline to make changes in the workplace. 

Give your team the tools they deserve

Another great way to motivate your employees is by giving them the tools they need to make their job easier. With Homebase, employees can clock in and out for shifts, access on-demand pay, and easily access and make adjustments to their schedules. You can also recognize your employees’ hard work in Homebase and send and receive employee surveys in the built-in team communication app. 

Get started today.

The post Employee Motivation: The Ultimate Employer Guide appeared first on Homebase.

Yet, how do you go about taking your love for cooking, parties, and travel, and actually, you know… start a catering business? 

Fret not. We’ve got you covered with the 10 essential steps to starting a catering business, from how to find your niche, to market research, to the hiring tools you’ll need to market your brand new business. 

How to start your own catering business 

The catering industry resulted in $12 billion in revenue in 2022, and increased in size by 16%. That’s a lot of money—uh, opportunity—up for grabs for you to start a small business in catering. It’s important to think about the kind of catering business you want and find the rhythm that suits you and your customers. Do you want to run your business from your home? Rent out commercial space? Run things yourself? Hire staff? 

We know: it’s a lot to consider. Luckily, we made a handy list:

Pro:

• Flexible working schedule where you decide your own hours 
• Able to choose your own working location
• Control over the clients you work with
• Choosing your own level of growth 
• More control over customer retention rates

Cons:

• Customer satisfaction is crucial, and can float or sink your business
• Potentially repetitive work
• Usually working evenings and weekends

It’s important to look at the catering business from all angles before diving headfirst into it. If you’re still here and ready to build your business, we’ve got 10 important steps to consider before starting. 

1. Find your niche

When thinking about starting any business, ask yourself what you want to offer and why.

Some questions you may want to consider on your path to finding your culinary lane: 

• What’s your specialty? 
• What type of food will you serve? 
• Who is your main clientele?
• What size of functions work best for you? 

From there you can narrow down and discover what catering business model may work for you: 

• Event-style: In this model, you may have courses to serve or hor d’oeuvres to pass around.  
• Family-style: This is a lot less laborious because it allows you to serve dishes on a long table à la family style.
• Off-premise: This model is great for drop-offs and delivery that require little service from staff. 

2. Conduct market research

Once you’ve decided on the type of food you’re going to make, as well as the catering model you’re likely to do, the next step is to conduct market research. 

Market research is essential to your business, whether you’re starting a catering company or a veterinary practice (though it’s best not to confuse the two). Every budding entrepreneur needs to map out competitors, customers, needs, and more before their business even begins to take shape.

For a catering business, it might be good to: 

• See the competition. Research other catering businesses in your neighborhood or city, what they offer, where they are, and who their primary customers are. This will help you when trying to differentiate yourself from your competitors.  
• Talk to family and friends. Your nearest and dearest are a great resource for first-hand info on catering successes (and failures) to help you craft yours.
• Read a lot of reviews. Where caterers went right or really wrong is going to be apparent in company reviews. Folks are far more likely to leave a negative review rather than positive so keep that in mind. Constructive feedback, however, is a gift! 

3. Create a business plan for your catering company

Once the essentials that form the foundation of your catering business are complete, you’re ready to start work on a business plan. 

A business plan is going to explain to potential loan officers, investors, and yourself, really, what the business is, how you intend to run it, market analysis, what you offer, and how profitable you’ll be after the first year and onwards toward three or five years.

Business plans are fairly standardized across many types of industries. You can use a template to create your own. But for a catering business, there’s the unique aspect of food. This goes back to your culinary niche: who are you serving, and what kind of food are you bringing them? 

Include as many details as possible about your intended audience. Your specialty, for example, may be a culturally-specific cuisine from your own ethnic background or heritage because of the success you’ve seen serving at your family functions. Say it’s Jamaican food. You could serve a  broader community underserved in that cuisine. This is where you’d note that specificity down, and why it’s important to your overall business. 

4. Finance your catering business

Start-up costs vary from business to business, but an optimal range for catering is somewhere between $10,000 and $50,000. Catering can be done out of your home and part-time, which means you can start small. If you intend on having more equipment and using a food truck or a brick-and-mortar space, then your costs go up. 

To finance your catering business, you have a few options: 

• Personal or business loans
• Business line of credit
• Grant
• Personal savings
• Crowdfunding
• Angel investors

5. Research licenses, permits, and insurance for catering businesses

Before launching right into your catering business, you’ll need to investigate licenses, permits, and insurance required to operate. These will vary state-to-state, but the most common licenses and permits are: 

• Zoning permit
• Business license
• Health permits

In addition to these, it’s worth looking into business insurance to cover any liabilities for your business. For catering, this coverage is a safety for expensive items like cooking equipment, and can cover any claims that resulted in food poisoning, injury, or property damage. 

6. Find the right location for your catering business

Your business plan likely outlines this, but location is important. If you’ve decided to remain at-home, then you won’t need to seek out additional help like a real estate agent. You will, however, need to know your state’s rules about selling food from your home. These differ state-to-state but, generally, you’ll need a food vendor’s license to be able to sell homemade goods. 

If you’re opting for a bigger catering business, seek out real estate help for the perfect commercial spot for you. You’ll need to consider: 

• Layout, such as where the kitchen is and where storage will be
• Competition nearby
• Cost of rent
• Access to parking for transportation

7. Order your equipment and supplies

Now we’re into the nitty gritty of your catering business: what supplies and equipment do you need for success? 

Some typical start-up catering items include: 

• Insulated food pan carriers
• Chafers and chafing dishes
• Serving equipment like trays, utensils, stands
• Countertop induction cookers
• Additional food storage, like a freezer or extra fridge
• Dinnerware, flatware, and glassware
• Uniforms for yourself and any staff
• Catering vehicle

8. Hire catering staff 

As you know, catering can be a lot of work: so you know you’re going to need help to plan, cook, and serve your best meals. If hiring employees is in your business plan and allocated in your finances, that’s a great first step. Next, you’ll need the right tools to hire your catering staff. 

Homebase has everything your catering business needs to hire the right folks for support. From posting job listings, to streamlining applicants, to getting all of their hiring and onboarding documentation ready, Homebase makes hiring easy for you so you can keep focusing on growing your business. 

9. Market your catering business

The day is here! It’s time to market your catering business. 

Getting the word out for a new business can seem intimidating, but it doesn’t have to be—at least not with the right tools, strategy, and help in place. Word-of-mouth is extremely valuable: you want your customers to hype you up as much as possible.

But without knowing what they say and when, here are a few more options to you can control when it comes to marketing:

• Create a website that you constantly tend to with fresh copy and menus
• Partner with local businesses and charities to expand your reach 
• Use social media and tailor content specific to the platform and your voice (i.e. don’t indulge in a TikTok trend if it’s really not your thing)
• Invest in a good food photographer to get the best angles of your favorite meals 

10. Get the right tools to run your catering company 

With the essentials of your company in place, you’ll need the right tools to ensure your budding catering business thrives. 

Consider using the following:

• A point-of-sale system for your customers
• Social media scheduler for your posts
• Email marketing and automation to send notes to your customers 
• Homebase for hiring, scheduling employees and tracking their hours, and payroll 

The post How to Start a Catering Business in 10 Steps appeared first on Homebase.

There are big differences in how different states approach PTO. This handy guide will delve into these variations, ensuring you have the latest information at your fingertips. That way you can get back to employee scheduling without you or your team worrying about the status of their PTO.

How do paid time off laws differ by state?

Paid time off (PTO) laws differ by state mainly in two aspects: whether employers are required to offer PTO to everyone on the payroll and the rules regarding the payout of unused PTO. 

Some states mandate paid sick leave or PTO, while others do not have any specific requirements. Additionally, certain states require employers to pay out accrued but unused PTO upon an employee’s termination, whereas others leave this to the employer’s discretion. These variations create a diverse legal landscape across the U.S. regarding PTO policies.

Is PTO required by law?

The requirement for employers to provide PTO varies across states. While there is no federal mandate requiring private employers to offer paid leave, several states have instituted their own regulations. This disparity means that PTO policies can be vastly different depending on where a company operates.

What is a PTO payout?

A PTO payout refers to the practice of compensating employees for their unused paid time off. This policy can take various forms, such as paying out upon termination or at the end of a calendar year. Whether a company must provide a PTO payout often depends on state law and the company’s internal policies.

When do you have to pay out PTO?

The obligation to pay out PTO hinges on state law and the employer’s PTO policy. Some states mandate that unused PTO be paid out at the end of employment, while others leave this decision to company policy.

What are the paid time off laws in my state?

We’ve summarized state PTO law below, as well as which states pay out unused sick leave or vacation pay when an employee ends their employment.

While the following information is accurate at the time of publishing — and useful as a quick guideline — we recommend looking at the most up-to-date official state sources.

What are my state’s PTO laws?

Only 16 states have specific PTO laws. These are:

1. Arizona: Employers are required to provide paid sick leave.
2. California: Employers are not mandated to provide PTO but must pay out unused PTO upon termination.
3. Colorado: Paid sick leave is required with specific rules on accrual and usage.
4. Connecticut: Paid sick leave is required; no specific PTO laws.
5. Illinois: Certain cities have sick leave requirements.
6. Maine: Employers are required to provide paid leave, accruable over time.
7. Maryland: Paid sick leave is required.
8. Massachusetts: Mandatory paid sick leave.
9. Michigan: Paid sick leave is required.
10. Nevada: Employers are required to provide paid leave, including PTO.
11. New Jersey: Paid sick leave is required.
12. New York: Specific sick leave laws apply; no state-mandated private employer PTO.
13. Oregon: Paid sick leave is required.
14. Rhode Island: Paid sick leave is required.
15. Vermont: Paid sick leave is required.
16. Washington: Paid sick leave is required.

The other 34 states don’t have any specific policy on whether or not employers offer paid sick leave or vacation.

What are my state’s laws on PTO payouts?

States fit into several categories when it comes to PTO payouts.

20 U.S. states require companies to pay out the value of an employee’s unused earned paid time off when they end their employment: 

• California
• Colorado (also payout on unused sick pay)
• District of Columbia (Possible payout)
• Illinois
• Indiana
• Louisiana
• Maine
• Maryland
• Massachusetts
• Minnesota
• Montana
• Nebraska
• New Mexico
• New York
• North Carolina
• North Dakota (Possible payout)
• Ohio (Possible payout)
• Rhode Island
• West Virginia (Possible payout)
• Wyoming (also payout on unused sick pay)

Why do more states have PTO payout laws than PTO laws?

An executive summary is an overview of your construction business plan. Think of it as the CliffsNotes version of your business plan—it gives

The discrepancy between states with explicit PTO laws (16) and those with explicit laws on PTO payouts (20) can be attributed to the different aspects of PTO legislation that states choose to regulate. Here’s a breakdown to clarify this:

• Explicit PTO Laws: Some states have specific laws that mandate PTO or paid sick leave. These laws typically dictate whether employers must offer paid time off and outline the conditions under which this time must be accrued and used. The 16 states mentioned in the previous response fall into this category.
• PTO Payout Laws: A different set of states might not mandate that employers provide PTO but have laws governing the payout of accrued PTO upon an employee’s termination or resignation. These laws address whether employers are required to pay employees for their unused paid time off when they leave the company. This is a separate issue from whether employers must offer PTO in the first place.

So, a state may not require employers to provide PTO (thus not being counted among the 16 with explicit PTO laws) but could still have laws that dictate what happens to accrued but unused PTO when an employee leaves. This scenario explains why more states might have laws regarding PTO payouts than have laws mandating PTO.

This distinction is important because it demonstrates the complexity and variety of PTO-related legislation across different jurisdictions. Employers and employees should be aware of both the provisions for PTO accrual and use, as well as the regulations concerning payout of unused PTO in their specific state.

State PTO: the bottom line

PTO laws in the United States vary significantly from state to state.

While some states have explicit requirements for employers to provide PTO or paid sick leave, others do not mandate it at all. Additionally, the approach to PTO payout upon termination is equally diverse, with certain states enforcing payout laws and others leaving it to employer discretion.

This variety underscores the importance for both employers and employees to stay informed and understand the specific PTO regulations relevant to their state, ensuring compliance and fair practice.

The post Paid Time Off Laws by State appeared first on Homebase.

Also known as the 2-3-2, the Pitman schedule can help you meet your business needs while protecting your employees’ health and wellbeing.

What is the Pitman schedule and who uses it?

The Pitman schedule is a shift management system in which four teams work either fixed or rotating 12-hour shifts. Employees typically work two day/night shifts, followed by two rest days, and then 3 day/night shifts.

The Pitman schedule allows businesses to operate 24/7 without burning out their employees. It offers workers consistent, predictable schedules with sufficient time off between shifts, promoting productivity and employee satisfaction.

There are two variations, with both versions requiring four teams working 12-hour shifts:

1. The Pitman fixed schedule

On a Pitman fixed schedule, all four teams always work the same shifts, with no rotation. Two teams work day shifts and the other two teams work night shifts.

Day-shift or night-shift, employees work on the following schedule:

• Work two days
• Two days off
• Work three days
• Two days off
• Work two days
• Three days off
  

This is why the Pitman fixed schedule is commonly known as the 2-3-2 schedule. Employees have two days off followed by three working days, then two more days off.

2. The rotating Pitman schedule

On a rotating Pitman schedule, all four teams rotate between day and night shifts. For two weeks, one team works during the day while the other works at night. After two weeks, they rotate.

With the rotating Pitman schedule, employees also alternate schedules each week. 

In the first week, employees work the following schedule:

• Work two days
• Two days off
• Work three days
• Two days off

In the second week, employees work the following schedule:

• Two days off
• Work two days
• Three days off

The rotating Pitman schedule is also known as the 2-2-3-2-2-3 schedule (a mouthful, we know) because employees always work two days, have two days off, then work three consecutive shifts.

Industries that use the Pitman schedule 

The Pitman shift schedule requires enough employees to maintain a consistent schedule while managing absence and vacation coverage. This means it’s most commonly used by medium-large organizations that operate outside of a 9-5 workday. For example:

• Police forces
• Gas stations
• Emergency services
• Hospitals
• Customer care
• Manufacturing
• Dispatching

Pitman schedule example

This is what a 14-day Pitman schedule rotation might look like. Teams continue working the day or night shift for the next two-week rotation. In a rotating Pitman schedule, Team 1 and Team 3 would switch to the night shift, and Team 2 and Team 4 would switch to the day shift.

Advantages of the Pitman schedule

The Pitman schedule is popular because it offers a number of benefits for both businesses and employees. Here are some of the most common advantages:

Advantages for businesses

• 24/7 coverage: When your business needs round-the-clock staffing, the Pitman shift schedule ensures consistent staffing even during busy or high-demand periods. And because employees have predictable shifts with plenty of days off, you’re less likely to deal with absenteeism due to personal reasons
• Reduced overtime costs: With a 12-hour shift structure, employees often work fewer days per month than they would with a traditional 8-hour shift schedule. This means employees accumulate fewer overtime-eligible days per month, reducing your staffing costs.
• Improved employee satisfaction: With longer shifts, employees may have more days off and better work-life balance. A healthy work-life balance is critical for employee happiness and retention—a huge win. Employees with time for their personal lives are more likely to stay put.
• Increased productivity: Because employees on the Pitman work schedule tend to experience less burnout, they may be more focused and motivated when they’re on the job. Additionally, longer shifts mean less time spent transitioning between tasks, making it easier to complete work in full, further boosting productivity.

Advantages for employees

• Higher earning potential: Employees on the Pitman schedule receive their base wage plus an added percentage for the extra four hours worked on each shift. Because of the longer shifts, employees are able to earn more money without working additional shifts.
• More time off: One of Pitman schedule’s main benefits is that employees get more days off than they would working a standard shift, five days a week. Workers on the Pitman schedule get around 15 days off per month compared to a typical eight days. They also get every other weekend off work, which is why the Pitman schedule is sometimes called “EOWO.”
• A consistent schedule: Shift work is often criticized for its lack of predictability, making it tough for employees to schedule life outside of work. A Pitman schedule provides employees with set, consistent work hours so it’s easier to manage personal obligations, time with family and friends, rest, and other important commitments.
• Better sleep: With a minimum of 2 days off between shifts, employees have more time to adjust to changing sleep patterns. This can make it easier to establish good sleeping habits and contributes to better overall health and stress levels.
• Reduced commute time: Longer shifts mean fewer days on the job and less time spent traveling to and from work. Employees save money on transportation costs and stress less about a daily commute. 

Disadvantages of the Pitman schedule

As with any shift management system, the Pitman schedule has its challenges. Here are some of the common disadvantages of this schedule:

For businesses

• Not suitable for all industries: The Pitman schedule requires enough employees to make four teams that cover all shifts, vacations, and absences—all while maintaining a consistent schedule. At least two people per team is recommended, but realistically you’ll need more. The Pitman schedule may not make sense for very small businesses with limited staff.
• Difficult to find employees: A lot of employees prefer working longer shifts in exchange for more time off. But for many people,12-hour shifts equal burnout. Using the Pitman shift schedule at your business may decrease your pool of potential candidates and make it harder to fill open positions.
• Tougher to find coverage: Because employees are already working long hours, they may prefer not to take overtime when asked. This can make it more difficult to arrange for sick coverage or vacation leave. 

For employees

• Long shifts: Despite the extra days off, 12-hour shifts can still be exhausting. When employees are tired, it can lead to poor performance and an increased safety risk—especially when they’re nearing the end of three consecutive 12-hour shifts.
• Health issues: While the Pitman schedule’s predictability may help with healthier sleep habits, it still has the potential health risks that come with shift work. Research shows that consistently working long hours can lead to fatigue, low mood, heart issues, and other health problems.

The Pitman schedule is designed to reduce the impact of shift work, but it’s still important to care for your employees’ health with adequate breaks, areas for night-shift workers to nap, and any other health-related benefits you can offer. 

How Homebase can help you create and manage a Pitman schedule

Do you think the Pitman schedule might be right for your business? Here’s how Homebase can help you build and manage your new schedule:

Just drag and drop. Build your Pitman schedule in minutes with one of our scheduling templates or the drag and drop feature in our work schedule maker. Since the Pitman schedule repeats, simply copy your schedule over to the next pay period as far into the future as you like.

Manage and share from anywhere. With an online employee scheduling app like Homebase, you can share your schedule instantly and send updates from any location. With built-in team communication tools, you and your employees are always in the loop—a huge bonus when your team doesn’t work a standard week. 

Keep your labor costs in check. Homebase makes sure you only pay for the shifts you scheduled by preventing employees from clocking in early and sending you alerts when employees approach overtime limits. You can also break down your labor costs by hour, department, or role and optimize all aspects of your scheduling.  Create your Pitman schedule quickly and easily with Homebase today. Get started for free.

The post What Is The Pitman Schedule and Is It Right For Your Business? appeared first on Homebase.

These systems can also bolster security by restricting access to your systems or property to authorized personnel only. Our curated list below showcases the top biometric time clocks of 2023, each designed to enhance time tracking and workplace security.

But they’re not for every business (and every budget). They can be expensive, complex, and expose you to legal and compliance risk.

So we’ve also outlined the pros and cons of using a biometric time clock system and provided an alternative option: the time clock you can get right now — for free — courtesy of us here at Homebase (see below!).

What is a biometric time clock?

In simple terms, biometric time clocks use facial, fingerprint, or palm recognition for employees to record their attendance, primarily to prevent “buddy punching” where one employee clocks in for another. This helps you get more accurate time tracking data to pay your employees more accurately.

These tools make it impossible for buddy punching to occur because somebody would need to use somebody else’s biometric data to cheat the system. Which is more James Bond than John from Accounts Payable.

Pros and cons of biometric time clocks

There’s a multitude of time clocks out there when looking for a small business time clock, so it’s worth considering if you need a biometric time clock or if a free option might be more appropriate.

To help you figure this out, let’s look at the pros and cons:

Pros

Small businesses should consider using biometric time clocks for several compelling reasons:

1. Enhanced accuracy in timekeeping: Biometric time clocks use unique physical identifiers, like fingerprints or facial recognition, ensuring that the employee clocking in or out is indeed the person they claim to be. This precision eliminates the common issue of “buddy punching,” where one employee clocks in for another, thereby ensuring more accurate payroll processing.

2. Reduced time theft: Biometric systems effectively prevent time theft – instances where employees get paid for time they haven’t worked. By requiring physical presence for clocking in and out, these systems guarantee that time records accurately reflect worked hours.

3. Improved security: Many biometric time clocks also serve as access control systems, allowing only authorized personnel to enter certain areas of the business premises. This added layer of security is especially valuable for small businesses handling sensitive information or valuable assets.

4. Streamlined payroll processing: With accurate time records, the payroll process becomes more streamlined and efficient. Automated data collection reduces the likelihood of errors associated with manual time entry and calculation, saving time and reducing administrative burdens.

5. Compliance with labor laws: Accurate tracking of employee hours helps small businesses comply with labor laws and regulations regarding overtime and mandatory breaks. This compliance is crucial for avoiding legal issues and potential fines.

6. Ease of use and integration: Modern biometric time clocks are generally user-friendly and can integrate seamlessly with existing payroll and HR systems. This integration simplifies various aspects of workforce management, from scheduling to payroll processing.

7. Long-term cost-effectiveness: While the initial investment in a biometric time clock system may be higher than traditional timekeeping methods, the long-term savings from reduced time theft and administrative efficiency can be significant for a small business.

In summary, biometric time clocks offer small businesses a reliable, secure, and efficient method of tracking employee time, leading to improved operational efficiency, enhanced security, and better compliance with labor laws.

Cons

While biometric time clocks offer several benefits, small businesses should also be aware of their potential drawbacks:

1. Initial cost and maintenance: The upfront cost of purchasing and installing biometric time clocks can be significant, especially for small businesses with limited budgets. Additionally, these systems may require ongoing maintenance and updates, incurring further expenses. A platform like Homebase, which utilizes a mobile app rather than complex biometric system hardware, presents a more cost-effective option with reduced complexity.

2. Privacy concerns: The use of biometric data raises privacy issues. Employees might be uncomfortable with their personal data, such as fingerprints or facial recognition scans, being collected and stored. This discomfort can impact employee morale and trust.

3. Legal and compliance risks: There are legal implications involved in collecting and storing biometric data. Businesses must comply with various privacy laws and regulations, which can vary by region. Non-compliance can lead to legal challenges and huge fines.

4. Technology limitations and failures: Biometric systems can sometimes fail to recognize legitimate users due to various factors like dirty hands, injuries, or technical glitches. Such failures can lead to delays and frustration among employees. Imagine a cleaning team locked out of the building by a faulty scanner or an employee who failed to correctly clock in being underpaid and frustrated.

5. Dependence on power and internet: Most biometric systems require a stable power supply and internet connection to function effectively. In areas with frequent power outages or unstable internet, this dependence can be a significant drawback.

6. Incompatibility with certain work environments: In some work environments, like construction sites or kitchens, conditions such as dirt, grease, or wear and tear can affect the functionality of biometric scanners, making them less reliable.

7. Accommodation for disabilities: Some employees may have disabilities that make it challenging to use certain types of biometric systems, necessitating alternative arrangements and potentially complicating the timekeeping process.

8. Risk of data breach: Storing biometric data increases the risk of a data breach. If biometric information is compromised, it poses a significant security risk, as unlike passwords, biometric data cannot be changed.

Understanding these challenges is crucial for small businesses when deciding whether a biometric time clock system aligns with their operational needs, budget, and values.

Homebase: the best biometric time clock alternative

Homebase’s approach to time clock management focuses on addressing time theft concerns while prioritizing employee privacy and legal compliance. Here are the key benefits highlighted on their page:

• Prevention of time theft and buddy punching: One of the primary advantages of Homebase’s system is its ability to significantly reduce buddy punching and time theft. This ensures employees are physically present at work to clock in, eliminating the possibility of clocking in for each other​​.
• Privacy-conscious alternatives: Homebase offers privacy-friendly options such as geo-fencing, PINs, and photo capture. These features allow for accurate time tracking without collecting sensitive biometric data like fingerprints or iris scans, thus avoiding privacy risks​​.
• Convenient and accessible time tracking: The system turns common devices like phones, tablets, computers, or POS systems into time clocks. This flexibility empowers employees with easy access to schedules and paid time off (PTO) information directly from their devices, making time tracking accessible and user-friendly​​.
• Legal compliance: Homebase emphasizes the legal aspect of time tracking, providing a solution that mitigates legal risks associated with biometric time clocks. They also address the need for compliance policies and obtaining informed consent from employees regarding data collection and usage​​.
• Industry suitability: While biometric time clocks offer additional security for sensitive industries like defense contracting, they are less practical in environments like restaurants or construction sites where dirt and debris can impact the accuracy and usability of biometric scanners​​.

Overall, Homebase offers a balanced solution that combines effective time theft prevention with a strong commitment to privacy and legal compliance, making it a viable option for various business types and industries.

4 best biometric time clocks for small businesses

As mentioned, there are a lot of biometric time clocks out there, many of them offering very similar features. To simplify things, we’ve rounded up four of the best.

1. Crown Security Products

Crown Security Products offers a range of biometric time clocks suitable for various business environments. Here are some of the advantages:

• Versatile range of products: From basic fingerprint time clocks to advanced models with RFID technology, Crown Security caters to different business needs and sizes.
• Durable and reliable: Their biometric time clocks are designed to be waterproof, scratchproof, and dustproof, making them ideal for environments like construction sites and manufacturing plants.
• Efficient data transfer and reporting: With options like USB and TCP/IP network transfer, these time clocks facilitate easy data management. Additionally, their software can generate a variety of statistical reports, aiding in efficient payroll and time management​​.

2. ClockIt

ClockIt’s biometric time clocks offer a blend of innovative technology and user-friendly features. Key benefits include:

• Tamper-proof and accurate: By using unique biological characteristics for identification, ClockIt ensures the accuracy of clock-in and clock-out records, effectively preventing buddy punching.
• Enhanced security and privacy: With a strong focus on security, ClockIt ensures that biometric data is never shared or transmitted, using state-of-the-art encryption for data protection.
• Real-time monitoring and reporting: The system allows for real-time monitoring of employee attendance and offers advanced reporting capabilities, enabling quick and accurate timesheet calculations for payroll processing​​​​.

3. Buddy Punch

Buddy Punch’s cloud-based time tracking software combines the convenience of mobile compatibility with the security of biometric features. Its key benefits include:

• Photos on punch feature: This unique biometric feature requires employees to upload pictures of themselves when they clock in, enhancing the accuracy of timesheets and preventing time theft.
• Advanced tracking features: Buddy Punch includes features like IP address locking, geofencing, and GPS tracking, offering a comprehensive solution for monitoring employee attendance and location.
• Integrated time clock system: Beyond biometric verification, Buddy Punch handles PTO tracking, scheduling, and payroll, making it an all-encompassing system for small business time management needs​​.

4. Allied Time

Allied Time’s biometric time clock solutions are tailored for a range of business sizes and types, offering efficient and secure time and attendance tracking. Here are the key benefits:

• Accurate and secure time tracking: Allied Time’s systems use advanced biometric technology like fingerprint and palm recognition to ensure accurate employee time tracking. This technology makes it almost impossible for employees to clock in for one another, hence reducing time theft and “buddy punching.”
• User-friendly and versatile: Designed for ease of use, these time clocks are compatible with various business environments, from retail to construction, and can be easily integrated into different workplace settings.
• Cost-effective solutions: With a range of models and pricing options, Allied Time offers biometric time clocks that are affordable for small businesses, providing a cost-effective solution for accurate time tracking and security.

Each of these biometric time clock solutions offers unique features and advantages, catering to the different needs and preferences of small businesses. From enhancing security and accuracy in time tracking to providing comprehensive reporting and data management, these tools can significantly contribute to the efficient operation of a small business.

Making the right timekeeping choice for your business

As we wrap up our exploration of the best biometric time clocks for small businesses in 2023/24, it’s clear that these tools offer more than just a futuristic touch to your workplace. They are practical solutions to some of the most pressing issues in employee management: accurate time tracking, security, and compliance with labor laws.

However, it’s crucial to weigh the pros and cons carefully. The upfront costs, maintenance requirements, and potential privacy concerns associated with biometric time clocks are significant considerations. For businesses where the environment or budget constraints make biometric solutions less feasible, alternative timekeeping methods like Homebase’s free time clock offer a viable solution.

Ultimately, the choice depends on your specific business requirements, budget, and the importance you place on aspects like security, accuracy, and legal compliance. By carefully considering these factors, you can select a timekeeping solution that not only aligns with your operational needs but also enhances your overall business efficiency and employee management.

The post 4 Best Biometric Time Clocks for Small Businesses for 2024 (and One Great Alternative) appeared first on Homebase.

If you don’t calculate MAGI properly, you could miss out on tax deductions and credits that save you major money. You’ll also need to be familiar with the concept to answer employees’ questions and give them the information they need around tax season. 

The good news is that understanding MAGI doesn’t have to be complicated. We’ll break down everything you need to know about modified adjusted gross income, so you can feel confident you’re filing correctly and leveraging tax savings — and be ready to answer any questions from your team.

What is MAGI?

Modified adjusted gross income is an important Internal Revenue Service (IRS) tax calculation that determines your eligibility for certain deductions, credits, contributions, and more.

Let’s start by looking at adjusted gross income (AGI) before getting to the “modified” part.

AGI is your total taxable income minus above-the-line deductions, like student loan interest you’ve paid or your health savings account (HSA) deductions. 

Your modified adjusted gross income is your AGI with certain items added back in. To turn AGI into MAGI, you need to add in certain types of income you previously deducted, like tax-exempt income from interest or muni bonds, excluded contributions to an individual retirement account (IRA), and excluded foreign earned income.

MAGI gives the IRS a clear picture of the actual income available to you in a given year before certain deductions or exemptions are applied. They use this number to decide on accurate thresholds for different tax credits and benefits. 

For many people, MAGI is the same as AGI, but that’s not always the case so it’s important to make sure you’re calculating MAGI correctly.

Why is MAGI important for small business owners?

As a small business owner, paying close attention to your MAGI situation is vital. 

If you’re a sole proprietor or pass-through entity without corporate taxation, your business income passes straight to your personal tax return, which means thresholds for deductions based on student loans and retirement contributions are linked to your personal MAGI figure.

For example, your MAGI can be used to determine what percentage of your retirement contribution is tax-deductible. 

If you have a workplace retirement plan, like a 401(k), you can only claim certain deductions for your contributions to a traditional individual retirement account, based on your MAGI.   

Here’s what that looks like for a single individual (or head-of-household filer) in 2023. 

• MAGI of $68,000 or less: You can deduct the full amount of your IRA contributions
• MAGI between $68,000–$78,000: You can deduct a reduced amount. 
• MAGI of $78,000 or more: You can’t deduct IRA contributions.

If you don’t accurately calculate your MAGI, you could end up over-contributing to IRAs or claiming credits and deductions you don’t qualify for, which could land you with fines and interest charges. 

Aside from IRA contributions, AGI and MAGI affect other factors, including: 

• Whether you can claim student loan interest deductions
• Whether you’re subject to net investment income tax (NIIT)
• Eligibility for certain child tax credits and adoption credits
• Eligibility for healthcare deductions and/or income-based assistance programs like Medicare, as well as premiums for Medicare Part B and prescription drugs

Small business owners need to be aware of MAGI to make informed decisions, plan their taxes, and make sure they’re claiming the right deductions and benefits. 

While employers aren’t responsible for calculating MAGI for employees, understanding the concept can help you answer your team’s questions and provide them with the right information to make their own calculations. You’ll likely need to give your people records of gross wages paid, health insurance contributions, retirement plan contributions, and reimbursed business expenses. 

That’s where a full-service payroll tool can save you time while keeping you compliant with labor laws. Homebase calculates payroll directly based on timesheets and sends the correct payment records to employees, your state, and the IRS. You can use Homebase to automatically process tax filings and issue 1099s and W-2s so you and your people have everything you need to file with ease.

How to calculate MAGI, step by step

Use these three steps to make MAGI calculations simple — and make sure you don’t miss anything. 

1. Calculate your adjusted gross income

Remember, your AGI is your total taxable income minus above-the-line deductions. So first you need to know your total income.

This includes revenue sources like: 

• Net business income
• Capital gains
• Taxable portfolio income (interest, dividends, etc)
• Rental real estate income
• Royalties
• Any other taxable income

Add all of these up to determine your total taxable income for the year.

Then, subtract any above-the-line deductions like:

• Half of self-employment taxes paid
• Health savings account contributions
• Retirement account contributions
• Student loan interest paid
• Alimony payments

What’s left is your adjusted gross income or AGI.

2. Add back certain excluded income to your AGI

For your MAGI, you have to add back in certain income that was excluded from your AGI. 

This includes:

• Foreign earned income 
• Foreign housing 
• Tax-exempt interest on state and municipal bonds
• IRA contributions

Add back any of these items that apply to you to get your MAGI. 

3. Check your MAGI against current thresholds

Once you’ve calculated your MAGI for the tax year, cross-reference the number against the current thresholds to see how it impacts your deductions, credits, contribution limits, and exemptions. These differ depending on whether you’re a single filer or file jointly with a spouse, as well as other factors, so you’ll need to look at how the regulations apply in your particular case. 

Pay particular attention to the most recent guidance on: 

• MAGI-based deduction limits for individual retirement accounts (where the filer also has a workplace retirement plan)

• MAGI cutoffs for claiming student loan interest 

• MAGI thresholds for Medicare and other health program eligibility

• MAGI brackets that determine whether you pay net investment income tax  (NIIT)

If your MAGI falls within the eligibility range for certain credits and deductions, be sure to claim them. If your income exceeds the MAGI limits set, make sure you remove any relevant contributions — or decrease them to the allowed amount — before filing, so you avoid penalties. 

Staying on top of modified adjusted gross income

Understanding how MAGI works and how to calculate it empowers small business owners to file their own taxes and provide relevant information to their employees. 

But digging through spreadsheets and manually calculating payroll is a stressful, time-consuming process. 

Homebase offers a complete, easy-to-use tool for small businesses to automate payroll, track time, comply with HR best practices and labor laws — and more. 

With Homebase, you’ll have clear records of your own income details and be able to provide your people with all the information they need to calculate MAGI and file their taxes. Homebase automates tax reporting and generates the W-2/1099 forms you need for both employees and contractors. 

What’s more, you can use the Homebase time clock to build out accurate timesheets and integrate the data directly into payroll, avoiding manual errors in transferring figures.

Homebase’s payroll, compliance, and operational solutions can help your small business tackle calculations with confidence.

The post MAGI Explained: The Ultimate Guide For Small Businesses appeared first on Homebase.

But as a Florida business owner, you need to understand how much you should be paying your employees, as well as be aware of the frequent changes made to minimum wage rates in your state. 

That’s why we created this article: To serve as a guide to everything you need to know about minimum wage in Florida. Plus, we give you tips on how you can ensure you’re always staying compliant when running payroll. 

Understanding minimum wage laws in Florida

They don’t just exist for the sake of existing — minimum wage laws are in place to protect workers from unfair low pay. Each state has its own minimum wage laws, which vary depending on factors like average rent and cost of living. 

In Florida, for example, the minimum wage is higher than the federal minimum wage of $7.25 per hour. There are also no local jurisdictions in Florida with their own minimum wage rate, meaning employers are required to pay the same wages to employees in Jacksonville as they would in Key West. 

Note that these minimum wage rates are applicable to non-exempt employees. The Fair Labor Standards Act (FLSA) outlines which employees are exempt from minimum wage, such as farmworkers, employees who work in fishing, and staff at certain seasonal and recreational establishments. 

There are also different minimum wage rates for employees under the age of 20, as well as students. Plus, tipped workers are subject to a different minimum wage than staff who don’t receive tips. 

If you have both exempt and non-exempt employees working for you, staff that receive tips, or young and student workers, it can be hard to keep track of the wages each of your team members are owed.

That’s why it’s important to use a payroll tool like Homebase that automatically calculates the correct wages and taxes for all your staff, no matter what their role or age. 

Current minimum wage rates

As of September 30, 2023, the minimum wage rate for standard hourly workers in Florida is $12 per hour. However, that rate isn’t applicable to all employees. Take a look at the differences for tipped employees, staff under the age of 20, student workers, and employees who work overtime hours:  

As you’ll note, employers with tipped workers are allowed to take a $3.02 tip credit, meaning they can pay their tipped employees, like waitstaff and bartenders, less than $9 per hour.

And, as we mentioned above, there’s no variation in minimum wage across the state of Florida — rates are the same regardless of which county or city you operate in. 

Recent changes and updates

Florida’s minimum wage rates have been steadily increasing over the past few years. That’s because back in 2020, residents voted to raise the minimum wage to $15 per hour by 2026. 

Rates have increased every year since 2021, when the minimum wage was below $9 per hour, and will continue to increase until September 30, 2026, when the minimum wage reaches $15 per hour. At that point, the minimum wage will increase annually in line with inflation rates. 

So while the Florida minimum wage was $11 per hour before September 30, 2023, it is now $12 per hour. This increase also applies to tipped employees (who previously received $7.98 per hour and now receive $8.98) and overtime wages (which were previously $16.50 per hour and are now $18). 

The importance of complying with and implementing minimum wage laws (and how to do so)

Complying with labor laws isn’t just the right thing to do: It’s necessary if you want to avoid costly consequences. Employees who don’t receive the wages they’re entitled to can take legal action against their employer in an attempt to gain back lost wages, plus attorney fees and damages. 

Plus, if an employer is found to have intentionally or repeatedly violated these wage laws, they may face civil penalties, fines, and even imprisonment. That’s why it’s so essential to keep accurate records of hours worked and wages paid, always ensuring you’re up-to-date on the latest regulations. 

Here are some steps you can take to ensure you’re always complying with minimum wage and overtime regulations.

Stay up to date with the latest changes

Labor laws are in constant flux — for example, the Florida minimum wage increases each year. So to avoid any consequences, stay up to date on any new regulations or modifications to existing laws. 

A tool like Homebase, with its HR and compliance feature and compliance toolkit, can help you do this. That’s because we notify you when labor laws change in your state or at the federal level, and help you ensure you’re correctly following national, state, and local regulations. 

Use a payroll tool that helps you stay compliant

If you’re still manually tracking payroll, it’s hard to keep track of what wages each employee is due and make sure you’re paying them the right amount. That’s why you want to use a tool like Homebase that automates your payroll process and ensures employees are getting the correct wages. 

The platform instantly converts timesheets into wages and hours so you don’t make any mistakes when running payroll. Plus, you can assign certain wages to certain employees, ensuring your tipped workers are getting the right amount, as well as keep track of overtime hours and make sure your people are being compensated fairly. 

Keep accurate records of hours worked and wages paid

If an employee dispute arises, it’s important to have proof of payroll and time cards. So be sure you keep accurate records of the hours your employees have worked, as well as how much you paid them. 

Homebase helps you do this by storing all your timesheets and payroll records so they’re available to access whenever you need them. This helps you stay FLSA compliant and is a useful source of data when forecasting expenses and setting profit targets. 

Stay compliant and pay your people the right wages with every paycheck

With annual fluctuations in minimum wage rates in Florida, you need to be on top of the latest updates to ensure you’re paying your people the right amount. Throw tipped workers and overtime pay into the mix, and things can get complicated. 

Payroll may not be the simplest part of your job, but it doesn’t have to be cumbersome or stressful either. When you use the right tool, running payroll can become a simple process that you don’t have to think twice about. 

Homebase helps you save time on payroll with its user-friendly automation features. That means no more manual data entry, and no more errors. Plus, we help you ensure you’re always paying employees what they’re owed, meaning you can stay compliant and avoid any legal issues. 

The post Your Guide To Florida Minimum Wage: What Small Businesses Need To Know appeared first on Homebase.

If you’ve got a small business based in New York, you’ve come to the right place. We’ll outline the current minimum wage rates in New York State, Long Island, Westchester, and New York City, as well as discuss any upcoming changes and suggest how Homebase can help with your payroll and HR and compliance needs. Let’s get going.

Current New York minimum wage rates

Let’s get straight down to it and break down what the minimum wage rate currently is in New York State as well as a few specific New York State regions according to the Department of Labor:

*Tipped service employees have a variety of jobs, but the common thread is that customers give them tips to show appreciation for their services. Some examples include hair stylists, estheticians, massage therapists, tour guides, chauffeurs, and hospitality workers.

**Tipped food service employees work specifically in the food and beverage industry and often depend on tips for a significant portion of their income. Some examples include bartenders, servers, bussers, and other waitstaff.

The above minimum wage requirements apply to the vast majority of employees in New York State. However, there are some specific exceptions, like:

• Professionals
• Outside salespeople
• Taxi drivers
• Some government employees (certain non-teaching employees are covered)
• Part-time babysitters
• Ministers and members of religious orders
• Volunteers, apprentices, and students working in non-profit institutions
• Students obtaining vocational experience

It’s worth noting that independent contractors or freelancers aren’t considered “employees” in a typical sense, so they aren’t covered by the above minimum wage requirements either. It’s up to them to negotiate their own rates with their clients.

Last, the United States has its own minimum wage requirements at the federal level. When there are differences between the federal minimum wage and the state minimum wage, the worker gets the higher rate. But it’s always best to talk to an accountant or human resources professional if you have any questions or concerns surrounding how much you should pay your small business employees.

Recent and upcoming changes to New York minimum wage rates

The minimum wage rate in New York has slowly increased over the past couple of years and is projected to continue rising. Basically, lawmakers are trying to ensure that the rate stays consistent with the rising cost of living while still making it feasible for business owners to keep up. For example, the general minimum wage rate for New York State rose from $13.20 per hour in 2021 to $14.20 per hour in 2022. It’s also projected to go up to $15 per hour on January 1st, 2024.

The minimum wage rate in New York City, Long Island, and Westchester is also planned to increase to $16 per hour as of January 1st, 2024. New York Governor Kathy Hochul has also recently announced that by 2026, minimum wage will rise to $17 per hour in New York City, Long Island, and Westchester, and $16 per hour throughout the rest of the state. After that, there will be annual minimum wage increases in accordance with inflation rates.

Why it’s vital for SMBs to keep up with changing minimum wage rates

There are two main reasons why it’s essential for your small business to stay up to date with shifting minimum wage regulations in the area where you operate:

1. Minimum wage rates impact both the way you run your business and your bottom line
2. Your business is legally required to comply with minimum wage requirements

Let’s break down what that really means for small businesses a little more closely.

Minimum wage rates impact your business operations and bottom line

If you’re a small business owner or manager, you’ve no doubt spent a fair share of time worrying about labor costs. Labor costs are how much employers have to pay employees (along with any applicable taxes and/or benefits) as a result of their work within a certain period.

So, it only makes sense that when minimum wage increases, your team members’ hourly rates increase, and so do your labor costs. Let’s say you own a small coffee shop and typically pay three employees minimum wage ($15 per hour) for a total of 120 hours of labor per week:

• 120 hours x $15 = $1800

In this simple example, your labor costs might be $1800 per week. But what if the minimum wage went up to $17 per hour?

• 120 hours x $17 = $2040

That might not seem like a huge difference, but it amounts to a $240 difference in labor cost per week, or up to $960 per month. That means your business would need to bring in an additional $960 per month to enjoy the same level of profitability it did before the minimum wage increase.

You’re legally required to comply with minimum wage regulations

This might seem obvious, but we feel obligated to emphasize the importance of keeping track of and abiding by state minimum wage requirements. Remember, you’re legally required to follow minimum wage regulations. That means if you don’t, you’ll have to deal with unpleasant and even legal consequences, like:

• Reputation damage — Put simply, if your small business doesn’t pay workers the minimum wage they’re entitled to, it won’t look good. Your reputation will suffer and you’ll get negative publicity in your community, which may lead to lost customers and opportunities. 
• Lost licenses and permits — If your business requires any licenses or permits to operate, your state may suspend or revoke them if you don’t abide by minimum wage requirements.
• Government audits — If the state suspects that your business isn’t complying with minimum wage regulations or knows that you haven’t in the past, they may audit you (or officially inspect all of your accounts). That’ll be equal parts frustrating, time-consuming, and expensive.
• Legal penalties — These include fines and back wage payments to underpaid employees.
• Lawsuits — Team members may sue you (and win) if you don’t pay them minimum wage. And if they win the lawsuit, you’d likely be responsible for all their unpaid wages, plus interest and their legal fees.
• Criminal penalties — This is reserved for very large sums of money or repeat offenses, but business owners and managers can face high fines or even jail time when they don’t pay employees what they’re due.

Homebase is the payroll and compliance partner your SMB needs

As you can see, there’s a lot more to New York minimum wage than meets the eye. It might currently be sitting at $15 per hour in New York City and $14.20 per hour in New York State, but it’s projected to grow yearly and even in accordance with inflation and metrics like the Consumer Price Index in the years to come.

Minimum wage might seem simple, but it can have serious implications for small businesses, especially when it comes to payroll, labor costs, and HR and compliance. If you feel concerned about that as a small business owner, an SMB-friendly team management platform like Homebase can help. Specifically:

• Homebase payroll is designed for hourly teams and makes it easy to adjust hourly rates and pay employees what they’re due correctly.
• Our labor cost control features help owners and managers proactively manage labor costs with clock in/clock out controls, use forecasting tools to build schedules, and break down costs based on factors like hour, department, and role.
• Homebase HR and compliance can alert SMB owners and managers about changing state and federal minimum wage requirements and provide access to HR experts should they need any specific questions answered.

Because Homebase is passionate about helping small businesses like yours thrive and succeed — without the administrative hassle.

The post New York Minimum Wage: What Small Businesses Need To Know appeared first on Homebase.

Homebase is here to answer all those questions and beyond. We’ll break down exactly what employment contracts are, as well as how they can work in your small business’s favor, even if you feel like your time is limited and your plate is already full.

What is an employment contract?

An employment contract is an agreement that an employer and an employee enter into when they start their working relationship.

They are typically formal, written documents that employers develop with the help of a lawyer, human resources professional, or HR tool and ask team members to revise and sign before their first day. However, especially in the small business world, employment contracts may be more informal or even verbal, though this isn’t recommended from a legal perspective. 

It’s also worth noting that in some cases, freelancers or independent contractors may have their own employment contracts that they ask their employers or clients to sign.

Some of the most common points included in employment contracts — though they can vary — are basic employee and employer information, job details, compensation information, benefits and perks details, employee schedule information, resignation and termination policies, and conflict resolution processes.

It’s also good for both employers and employees to know that not all jobs require employment contracts, and many don’t involve them at all. Historically, they’ve been most commonplace when team members are hard to replace or handle confidential information, or when employers want to clearly define responsibilities or have specific compliance requirements to consider. However, human resources professionals are recommending employment contracts more and more as they protect both employers and employees and help avoid misunderstandings and uncomfortable situations.

4 reasons your small business should use employment contracts

Now that you know what employment contracts are, let’s discuss what they can actually do for you and your small business. 

1. Better compliance with labor regulations

Because employment contracts are usually written documents that contain details about the working agreement and relationship between an employee and an employer, they prompt both parties to consider whether everything is consistent with applicable labor norms and regulations.

Plus, when small business owners develop employment contracts with the help of a human resources professional and/or lawyer, they make sure that the agreement complies with local, state, and federal labor laws.

Some common aspects of employment contracts that need to be compliant with labor regulations include:

• Wage laws, like minimum wage, overtime, and job misclassification
• Extended leaves of absence
• Employment termination
• Workplace safety violations
• Workers’ compensation
• Discrimination, harassment, and retaliation

Many small business owners don’t have the budget to hire a human resources consultant every time they need to write an employment contract, which might be why many SMBs don’t use employment contracts at all.

But there’s another option — a small business management platform like Homebase. Our HR and compliance tool not only provides customers with HR experts who can answer their questions and offer personalized guidance in the development of internal policies and documentation, but it’ll even notify them when relevant local, state, or federal labor laws change. That means you’ll never have to worry about your employment contracts getting out of date or irrelevant without you realizing it.

2. More clarity surrounding job expectations and responsibilities

Small businesses are notorious for scrappy mentalities. Owners and managers often have to wear many hats and fulfill several different roles like human resources manager, marketing manager, accountant, and beyond. However, that reality isn’t limited to owners and managers — it extends to team members as well. They often have to flit between different positions and help out wherever necessary. For example, a retail shop employee might spend an hour assisting customers on the floor, an hour at the till, and an hour taking inventory and organizing the back end.

While this is convenient because it helps SMB owners and managers optimize labor costs, gives them more flexibility in terms of shift swaps and covers, and often means that team members can get more done in a day, it can also lead to confusion about what people’s responsibilities really are. For example, a retail shop employee might have helped take inventory for a week while the team was understaffed and the manager was busy dealing with other issues, but that doesn’t necessarily mean the task is part of their regular duties.

This can also cause tensions in informal feedback or performance evaluation situations as team members may resent negative or lackluster reviews they don’t feel are fair. For example, if they get criticized for not doing tasks they didn’t think were a regular part of their position in the first place. That’s why clearly defining job expectations in employment contracts is so important for small businesses — it avoids these kinds of mix-ups and means staff members always have a clear source of truth to refer back to in terms of their responsibilities.

3. Increased professionalism and credibility as a great place to work

At the end of the day, your business will seem more professional and be more likely to develop a good reputation in your community as a desirable place to work if you use employment contracts and other formal documentation. Imagine the difference between these two situations:

• A recent hire shows up for their first day of work already having reviewed, clearly understood, and e-signed their work contract and read through a comprehensive employee handbook that outlined all of the company’s internal processes and policies.

• A recent hire shows up for their first day of work based on a vague verbal agreement after a brief job interview and a sticky note with their hourly wage and work schedule scribbled on it.

There’d be a big difference between those two new team members’ experiences with you as an employer, wouldn’t there?

4. Easier to enforce company policies in tricky situations

Even on the most harmonious small business teams, problems and tensions arise eventually. And they’re much easier to solve without the situation escalating when you can refer to formal documents like employment contracts that all parties read and signed at the beginning of their working relationship.

Let’s consider a couple of examples:

• You own a small cafe and hired a barista four months ago. She signed a simple employment contract that said that her work schedule would be from Tuesday to Saturday, 7am to 3pm. Now, she says she’s frustrated that she has to work every Friday and Saturday morning. She points out that other employees only work Monday to Thursday. As her employer, while you can try to find a compromise that meets her needs, your employment contracts put you in a much stronger negotiating position because just four months before, she agreed to work every Friday and Saturday morning.

• You manage a seasonal winter sports equipment shop that’s open between September and April and is particularly busy between December and March. All your seasonal team members signed employment contracts that said once they’d been working with the business for over a year, they were entitled to seven days of paid holiday while the store was open, other than in peak season between December and March. One of your employees is frustrated because you’ve denied their paid time off request for ten days in February. Again, while you should ideally find some kind of compromise with this team member, you’d be able to refer back to your employment contract and reiterate that you have your PTO policies in place for a reason and, therefore, should apply them equally to all staff members.

Pro tip: Want to learn more about how Homebase can help you manage your small business’s paid time off (PTO) admin? Check out this dedicated tutorial video.

You don’t need an HR team to develop an employment contract — just Homebase HR and compliance

As you can see, employment contracts are worth the effort — even for small business owners. While they require a time investment to develop and share, they can bring tons of benefits to SMBs. Namely, they help small businesses better comply with relevant labor laws, make job expectations and responsibilities more clear, increase professionalism, community reputation, and credibility, and help enforce internal policies and guidelines. 

Don’t make the mistake of assuming you’ll have to hire a human resources team or legal consultant in order to put together worthwhile employment contracts, either. Ultimately, they’re relatively straightforward documents that a small business management platform like Homebase is perfectly equipped to help you with. Specifically, our HR and compliance feature can provide you with access to a team of HR experts who can answer your questions, review your existing employment contracts, and even assist you in crafting yours and making sure it’s compliant. Best of all, our platform will alert you about changing labor laws and take other team management admin tasks like scheduling, payroll, and team communication off your plate, too.

The post Employment Contracts: What Small Businesses Need To Know appeared first on Homebase.

In December, employment activity on Main Street held steady compared to earlier in the fall. Headcount for hourly teams remained consistent, with little change in the rate of worker turnover and job creation.

For the first time in months worker wages have frozen after trending downward since August.

NOTEWORTHY

• Small business teams contracted more after Thanksgiving this year than in prior years, though December employment activity was in line with preceding months. Retail and entertainment saw the smallest dip.
• Job turnover and creation remained relatively consistent with prior months this year, indicating small businesses had the holiday headcount they needed.
• In December, hourly worker wages froze for the first time in months following a consistent downward trend in growth since August.

December employment activity held steady month over month

The monthly change in employees working and hours worked was bigger in December than in prior years, but held relatively consistent with prior months in 2023.

Employees working

(Monthly change in 7-day average, relative to January of reported year)

Hours worked

(Monthly change in 7-day average, relative to January of reported year)

Data compares rolling 7-day averages for weeks encompassing the 12th of each month; April data encompasses the subsequent week to account for Easter holiday. Source: Homebase data.

A regional view reveals the Eastern Seaboard saw biggest decline

Colder states in the Northeast had the greatest dip in hours worked, businesses open and employees working on Main Street in December.

Output by Region

Month-over-month change in core economic indicators, by Census region

Note: December 10-16 vs. November 12-18. Region classification – Midwest: ND, SD, NE, KS, MN, IA, MO, WI, IL, IN, OH, MI; West: NV, UT, AZ, NM, CO, WY, MT, ID, OR, WA, CA, HI, AK; Northeast: NY, PA, NJ, CT, RI, MA, NH, VT, ME; Southeast: MS, AL, TN, KY, NC, SC, GA, FL; Southwest: TX, OK, AR, LA.  Source: Homebase data.

Main Street saw varied employment activity in cities coast to coast

In descending order, Sacramento, Birmingham and St. Louis saw the biggest gains in employment activity, with Providence, Oklahoma City and Hartford bringing up the rear.

Output by MSA

Month-over-month change in core economic indicators, by metropolitan statistical area

Note: December 10-16 vs. November 12-18. Source: Homebase data

Across industries, employees working dipped below prior years

2023 saw a greater decline in employees working by industry than in 2022 and 2019. Retail and entertainment held steady month over month, as they worked to meet holiday demand.

Small businesses in the retail and entertainment sectors saw the most muted declines compared to the prior month (-0.2% and -0.4%, respectively). 

Home & repair businesses saw the greatest month over month drop off (-5.3%), a significant change from prior years. This could be due to more suitable outdoor working conditions in early fall than December.

Percent change in employees working

(Mid-December vs. mid-November, using Jan. ‘19, Jan. ‘22, and Jan. ‘23 baselines)1

1. December 8-14 vs. November 10-16 (2019); December 11-17 vs. November 6-12 (2022); December 10-16 vs. November 12-18 (2023). Source: Homebase data

Worker wage growth halted over the holiday season

December marks a wage standstill following a consistent downward trend in the rate of growth since August.

Avg. wage changes, m/m

Monthly change in average hourly wages across all jobs

Note: Data measures average hourly wages for locations that utilized Homebase to pay employees in both December 2022 and December 2023. Total incl. industries not depicted here. Source: Homebase Payroll data.

Main Street moved through the holidays with minimal turnover

The rate of jobs removed at small businesses was consistently low through all of fall. Hourly teams navigated the holiday season with relatively stable headcount.

m/m changes in average number of jobs removed

Monthly change in average jobs archived across all jobs

Note: Data measures average monthly change in total number of jobs removed, whether by voluntary or involuntary exit, from official employee rosters for companies active in any given month. Source: Homebase data.

Small businesses did most of their seasonal hiring in early fall

As consumers started their holiday shopping earlier in 2023 than 2022, small business owners also hired most of their seasonal workers in early fall with job creation dipping in December.

m/m changes in average jobs created

Monthly change in average number of jobs added across all jobs

Note: Data measures average monthly change in total number of jobs created in official employee rosters for companies active in any given month. Source: Homebase data.

Link to PDF of: December 2023 Main Street Health Report. If you choose to use this data for research or reporting purposes, please cite Homebase.

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