What HR Terms and Jargon Do You Need to Know?
No matter the field that you choose to work in, your colleagues will speak in a language and use words that are specifically meant to convey meaning quickly to all who hear them in the field. When you’re a member of the community, you appreciate the utility with which you can use HR terms and jargon to share your thoughts and needs.
Every profession has its own language or jargon. Human Resources is not an exception. Here are some of the HR terms and jargon that you might hear coming out of an HR manager’s mouth and what they really mean when they say them. This is HR jargon and terminology that you really need to know to communicate effectively with HR.
A Seat at the Table
Imagine a group of decision makers sitting around the table making a decision. Anyone who is there at the table has a “seat.” It’s just a description of who is invited to the meeting. HR often talks about having a “seat at the table” to emphasize that someone needs to be there to ensure the people perspective of any decision is taken into consideration.
Additionally, the term refers to a seat with the executive leadership in the executive conference room. This is where HR wants inclusion and input to decisions made that affect the strategic direction of the company and the successful deployment of the people to attain the goals. It is no longer enough for HR to implement decisions. HR wants that seat to participate as one of the group’s strategic decision makers.
Balanced Scorecard
This term, balanced scorecard, comes out of Harvard Business School, and as such, can be explained in either a very complicated manner or in this way: everything matters. You can’t just ignore your people and focus on the numbers. You cannot expect people to produce quality products if they are judged by the number of parts they produce.
The scorecard looks specifically at four different areas: Learning and Growth, Business Process, Customers, and Finances. Often, the HR business partner is heavily involved in the learning and growth portions of determining this scorecard for each senior person. In some organization, the administrative and customer focused jobs in the organization also report to HR.
Competencies or Core Competencies
These are generally the skills needed to do a particular job, but the reference is often a little fuzzier. Skills imply something concrete like—must know how to do financial modeling—while competencies can also include soft skills such as problem-solving abilities.
When HR managers talk about Core Competencies, they refer to the knowledge, skills, and abilities that are absolutely critical to the job. So, while it’s nice to have an accountant with good interpersonal skills, all accountants must first have the ability to work with numbers.
Corporate Culture
Every company has its own culture. Cultures can develop naturally without any effort, but often the HR department will attempt to build a specific culture. You’ll see mission statements and team building activities and a number of other activities that are designed to create a specific culture within the organization.
Good HR departments make weeding out bad managers (or training bad managers to become good managers) a priority in creating a good corporate culture. Bad HR departments focus on mission statements and then wonder why the culture is still toxic.
Downsizing, Reorganization, Restructuring, or Rightsizing
As a general rule, these all mean that a company is going to lay off a number of employees. It’s possible to reorganize and restructure and keep all of the employees, but in reality, if you hear discussions about company-wide reorganizations, freshen up your resume, because you might need it.
Family Friendly
Businesses often claim that they are family friendly when they have policies that are meant to support working parents. Benefits such as flexible schedules, on-site daycare, and generous sick leaves to care for yourself and your sick children are often cited as important aspects of a family-friendly business. HR departments are usually the ones who develop and implement such family-friendly policies.
Good HR departments recognize that what their employees want from their benefits is the most significant factor when determining the employee benefits to share. The benefits play a significant role in employee retention.
Gross Misconduct
If you do something that is so bad that the consequence is that the company immediately fires you, your actions were gross misconduct. For instance, if you set fire to the boss’s office, it doesn’t matter that you had a perfect performance appraisal the week before, the boss will fire you.
Gross misconduct is generally determined by company policy rather than by law. But, just because the employee handbook doesn’t say, no arson allowed, doesn’t mean that the company won’t fire you—and have you arrested—for that action. Hitting another employee is another example of gross misconduct as is stealing the company’s products.
Let Go
One of many euphemisms employers and employees use to say that an employee was fired. Now, of course, there are two main types of “fired.” The first is when an employee is terminated for business reasons unrelated to performance. This is generally known as a “layoff.”
The second is a true firing—when the employee has done something wrong. That something wrong can include poor performance as well as something more terrible like stealing. Another common term for firing an employee is employment termination or terminating the employment relationship.
Onboarding
When you’re hired, you have a lot of paperwork to fill out. This is the very basic step that is done for all new employees and in some cases, this is the entire “onboarding” program.
Some companies have elaborate onboarding programs that involve cultural integration and building a general company knowledge base. The goal of all onboarding programs is to bring new employees into the company and get them working effectively—as quickly as possible. The ultimate goal is to build a positive relationship that enables you to retain the employee.
Talent Management
Talent=people, management=management. When HR people talk about talent management, they are really just talking about making sure that they recruit, train, manage, develop and retain the best people.
Sometimes talent management programs don’t include everyone in the organization, but only the high potential employees and current leaders. Both management and HR departments are involved in developing and implementing a talent management system.
80/20 Rule
This terminology is used in many different situations, but in HR, it typically means that 80 percent of the problems are caused by 20 percent of the employees. HR departments may also speak of “frequent fliers.” These are employees who seem to have problems with everything and everybody and take up a great deal of HR time. They take up HR time disproportionately to better-performing employees—the employees that the HR staff would rather spend their time developing.
Other terms
Affirmative Action
Also : Positive discrimination.
Carried out on behalf of women and disadvantaged groups and members of such groups are placed in dominant positions.
Appraisal / Performance planning
A total approach to managing people and performance. Involving setting performance aims and expectations for the organisation, departments and individuals employees.
Attrition
A term used to describe voluntary and involuntary terminations, deaths, and employee retirements that result in a
reduction to the employer’s physical workforce.
Autocratic Leadership
Leader determines policy of the organisation, instructs members what to do/make, subjective in approach, aloof and impersonal.
Behavioural Based Interview
An interview technique which focuses on a candidates past experiences, behaviours, knowledge, skills and abilities
by asking the candidate to provide specific examples of when they have demonstrated certain behaviours or skills as a means of predicting future behaviour and performance.
Behavioural Competency
The behaviour of the employee which is the subject of measurement and appraisal in terms of whether or not the behaviours shown by an employee are those identified by job analysis/competency profiling as those contributing to team and/or organisational success.
Benchmarking
A technique using quantitative or qualitative data to make comparisons between different organisations or different sections of the organisations
Bereavement Leave
A specific number of paid days off following the death of an employee’s spouse, parent, child grandparent or in-law so that the employee may attend funeral proceedings, etc.
Broadbanding
A pay structure that consolidates a large number of narrower pay grades into fewer broad bands with wider salary range.
Bumping
The practice of allowing more senior level employees whose positions have been slotted for elimination or downsizing the option of accepting an alternative position within the organisation, for which they may be qualified to perform and which is currently occupied by another employee with less seniority.
Change Management
The deliberate effort of an organisation to anticipate change and to manage its introduction, implementation, and consequences.
Clean Slate
A scheme to limit the effect of an individual’s convictions in most circumstances (subject to certain exceptions) if the individual satisfies the relevant eligibility criteria.
Coaching
A one-to-one process between a manager and subordinate, whereby the former will ‘train’ the latter. See also Mentoring.
Collective Bargaining
The process by which employer will negotiate employment contracts with union.
Competency-based pay
Competency based pay is a compensation system that recognises employees for the depth, breadth,
and types of skills they obtain and apply in their work. Also known as skill based and knowledge based pay.
Compensation
Compensation for injury to an employee arising out of and in the course of employment that is paid to the worker or dependents by an employer whose strict liability for such compensation is established by statute. Where established by statute, workers’ compensation is generally the exclusive remedy for injuries arising from employment, with some exceptions. Workers’ compensation statutes commonly include explicit exclusions for injury caused intentionally,
by willful misconduct, and by voluntary intoxication from alcohol or illegal drugs.
Competencies
‘An underlying characteristic of a person’ ‘motive, trait, skill, aspect of one’s self-image or social role, or a body of knowledge’.
Competitive advantage
‘People are the source of competitive advantage’. Other systems in an organisation can be copied but not the people in the organisation.
Confidentiality agreement
An agreement restricting an employee from disclosing confidential or proprietary information.
Contingent workers
Employees who may be: casual labour, part-timers, freelancers, subcontractors, independent professionals and consultants.
Contract for services
An agreement with an independent contractor.
Contract of service
An employment agreement.
Core competencies
The skills, knowledge and abilities which employees must possess in order to successfully perform job functions which are essential to business operations.
Core Labour Force
A small group of permanent workers, for example, strategists, planners.
Corporate mission
The aims and objectives of an organisation.
Cost leadership
A strategy of becoming the lowest-cost producer in its industry.
Critical incidents
A method of avoiding the subjective judgements which are the feature of most ranking and rating systems. It is the keeping, by management, of a record of on-job incidents or behaviours which may be examples of [in]effective behaviour and used as background information for subsequent discussions and performance appraisals.
Customer capital
The relationships an organisation has with the people it does business with, including suppliers, ‘brand equity’ and ‘goodwill’.
Cyclical unemployment
A form of unemployment – rises in times of economic recession and falls in times of prosperity. Now shows signs of being able to withstand increased prosperity.
Delayering
The removal of hierarchical layers in an organisation.
Distance Learning
The process of delivering educational or instructional programmes to locations away from a classroom or site to another location by varying technology such as video or audio-conferencing, computers, web-based applications or other multimedia communications.
Disciplinary procedure
A procedure carried out in the workplace in the event of an employee committing some act contrary to terms of the
employment agreement. If the act is regarded as Gross Misconduct this may lead to Summary Dismissal.
Discrimination
The favouring of one group of people to the detriment of others.
Distributive bargaining
Related to the process of Negotiation. Known also as Competitive bargaining –
The parties are concerned with their respective shares of the benefits available and compete and conflict with each
other until one side wins an increased share at the expense of the other.
Due diligence
A critical component of mergers and acquisitions, it is the process by investigation and evaluation is conducted to
examine the details of a particular investment or purchase by obtaining sufficient and accurate information
or documents which may influence the outcome of the transaction.
Emotional Intelligence
Describes the mental ability an individual possess enabling him/her to be sensitive and understanding to
the emotions of others as well as being able to manage their own emotions and impulses.
Employee Relations
A broad term used to refer to the general management and planning of activities related to developing, maintaining, and improving employee relationships by communicating with employees, processing grievances/disputes, etc.
Employee retention
Organisational policies and practices designed to meet the diverse needs of employees, and create an environment
that encourages employees to remain employed.
Empowerment
The process of enabling or authorising an individual to think, behave, take action, and control work and decision-making in autonomous ways.
Ergonomics
The measurement of physical characteristics of the human body and the development of equipment to fit them, so that strain on the body is reduced.
Equity theory
Based on the notion that people are motivated by a desire for fairness, that is, to be treated fairly and will compare their
own efforts and the rewards of others in the organisation with a view to judging the fairness of their treatment.
Exit Interview
An interview between a member of staff of the organisation that an employee is leaving to ascertain the reasons for the employee leaving the organisation. Should not be carried out by employee’s immediate superior. Used for possible changes.
Extrinsic rewards
Two forms : Money and non-money rewards. Examples : job enrichment, job enlargement, personal and working relationships with colleagues and supervisors and managers.
Fixed Term Employment An employee and an employer may agree that the employment of the employee will end at the close of a specified date or period or on the occurrence of a specified event or at the conclusion of a specified project.
Freedom of association
The right to belong to a union.
Functional job analysis
The preparation required for the construction of a job description. It is necessary to collect data on the job to be advertised.
Generations
Baby Boomers –The term used to describe those individuals born between 1945 and 1970.
Generation X – The term used to describe individuals born between 1965 and 1980.
Generation Y – The term used to describe individuals born between 1985 and the present.
Generation I – The term used to describe children born after 1994 that are growing up in the Internet age.
Goal Setting
The process of setting and assigning a set of specific and attainable goals to be met by an individual, group or organisation.
Good faith bargaining
A duty to conduct negotiations where two parties meet and confer at reasonable times with open minds and the intention of reaching an agreement.
Grievance
A complaint brought by one party to an employment contract against another party.
Group dynamics
The social manner in which people interact with each other within a group.
Gross misconduct
An act committed by any personnel likely to lead to Summary Dismissal.
HR Audit
A method by which human resources effectiveness can be assessed. Can be carried out internally or HR audit systems are available.
Hierarchy of needs
A psychology theory ascribed to Abraham H. Maslow in which he proposed that people will constantly seek to have their basic needs (sleep, food, water, shelter, etc.) fulfilled and that such needs ultimately determine behaviour.
HR information systems
A discrete (confidential) computerised information system for HR purposes.
HR Management
The management of human resources within an organisation.
HR planning
The activity of planning human resources usually in connection with the overall strategic planning of the organisation.
Human Capital
The collective knowledge, skills and abilities of an organisation’s employees.
Incentive pay
Additional compensation used to motivate and to reward employees for exceeding performance or productivity goals.
Independent contractor
A person who works for him/herself but has a contract for services with another person/organisation.
Individual employment agreement
The legal relationship between an employee and employer.
Induction
The process of introducing a new employee into the organisation.
Industrial relations
The study of theories and practices in the workplace relationship.
Intangible rewards
Non-monetary re-enforcers such as praise given to an employee in recognition of a job well done, or a particular achievement.
International Labour Organisation
An organisation set up by the United Nations to establish, amongst other matters, conventions on practices in the workplace.
Intrinsic reward
A reward given to an employee for achievement of a particular goal, objective or project.
ISO 9000
Developed by the International Organisation for Standardisation (ISO), it is a set of standards for quality management systems that is accepted around the world. Organisations that conform to these standards can receive ISO 9000 certification. The standard intended for quality management system assessment and registration is ISO 9001. The standards apply uniformly to organisations of any size or description.
Job analysis
The preparatory stage for writing job descriptions.
Job Description
A written description of a job which includes information regarding the general nature of the work to be performed,
specific responsibilities and duties, and the employee characteristics required to perform the job.
Job evaluation
Used for compensation planning purposes, it is the process of comparing a job with other jobs in an organisation
to determine an appropriate pay rate for the job.
Key Result areas
Used to establish standards and objectives, key result areas are the chief tasks of a job identified during the job evaluation process.
KPIs
‘Knowledge, Skills and Abilities’ – Key Performance Indicators. Tasks that have been agreed between an employee and line manager/HR with an expectation that they will be completed satisfactorily in the time agreed or as an ongoing task.
KSAs
Knowledge, skills and abilities – the personal attributes that a person has to have to perform the job requirements.
Labour Market
A geographical or occupational area in which factors of supply and demand interact.
Labour force mobility
The willingness of potential employees to travel or move to where work is offered.
Labour force participation
A rate at which the number of people in the labour force is divided by the number of people of working age x 100.
Leadership
The process, by which an individual determines direction, influences a group and directs them toward a specific goal or organisational mission.
Leadership Development
Formal and informal training and professional development programmes designed for all management and executive level employees to assist them in developing the leadership skills and styles required to deal with a variety of situations.
LIFO
In the event of a redundancy situation occurring, the system of ‘last in first out’ is regarded as the most equitable method of choosing those who should be made redundant.
Lump sum payment
A fixed negotiated payment which is not typically included in an employee’s annual salary. Often times given in lieu of pay increases.
Matrix organisation
An organisational structure where employees report to more then one manager or supervisor.
Mediation Services
The process of intervention by a specialist in an employment dispute.
Mentoring
A one-to-one process between an outside trainer and an employee, whereby the former will ‘train’ the latter. See also Coaching.
Minimum wages
The lowest level of earnings of employees set by Government.
Mission Statement
A statement illustrating who the company is, what the company does, and where the company is headed.
Motivation
The reason(s) why a person works at a particular job and for a particular organisation. Subject to various theories relating to the way they do things.
Motivational theories
An attempt to explain how people are motivated, in the form of work behaviour and performance.
Mutuality of interests
Relating to Performance Management. Both employer and employee have a mutual interest in achieving organisational objectives.
Myers-Briggs Type Indicator (MBTI)
A psychological test used to assess an individuals personality type.
Negotiation
The process of discussion with a view to mutual settlement usually by the means of a conference.
Nepotism
Favouritism shown to relatives by individuals in a position of authority such as CEO’s, managers or supervisors.
Observation interview
The process of observing employees while performing their respective jobs or tasks used to collect data regarding specific jobs or tasks.
Onboarding
A relatively new term, it is more far reaching than historical orientation programmes. It links new employees with team members very early in the employment process and continuing after the traditional orientation programme ends.
OSH
Occupational health and safety – the law relating to the health and safety of personnel at work.
Organisational Culture
A pattern that emerges from the interlocking system of the beliefs, values and behavioural expectations of all the members of an organisation.
Organisational theories
The scientific management movement and human relations school were two early organisational theories. Both had impact on the development of human resources management.
Orientation
The introduction of employees to their jobs, co-workers, and the organisation by providing them with information regarding such items as policies,
procedures, company history, goals, culture, and work rules. Similar to Induction.
Outplacement
A benefit offered by the employer to displaced employees which may consist of such services as job counselling, training, and job-finding assistance.
Outsourcing
A contractual agreement between an employer and an external third party provider whereby the employer transfers responsibility and management for
certain HR, benefit or training related functions or services to the external provider.
Paid Parental Leave
Supported by legislation allowing [possibly later in 2000] 12 weeks paid leave which a new mother may share with her partner, funded by a payroll levy.
Pareto chart
A bar graph used to rank in order of importance information such as causes or reasons for specific problems so that measures for process improvement can be established.
Pay
Base pay is the fixed salary or wage which constitutes ‘the rate for the job’. It may be the only money remuneration an employee receives.
Peer appraisal
A performance appraisal strategy whereby an employee is reviewed by his/her peers who have sufficient opportunity to examine the individual’s job performance.
Peripheral Labour Force
Employees less critical to organisational success and can be expendable.
Performance Management
This is a process of identifying, evaluating and developing the work performance of employees in an organisation, in order that organisational objectives are more effectively achieved and understood by employees.
Personal grievance
A complaint brought by one party to an employment contract against another party.
Probationary Arrangements
Where the parties to an employment agreement agree as part of the agreement that an employee will serve a period of probation or trial after the commencement of the employment. .
Quality management
The process or system of ensuring that a product or service should do what the user needs or wants and has a right to expect. There are five dimensions to quality, design, conformance, availability, safety and field use.
Random Testing
Drug and alcohol tests administered by an employer which selects employees to be tested on a random basis.
Recruitment
The process of bringing into an organisation personnel who will possess the appropriate education, qualifications, skills and experience for the post offered.
Redundancy
The act of dismissing an employee when that employee is surplus to the requirements of the organisation.
Replacement charts
A summarisation in visual form the numbers of incumbents in each job or family of jobs, the number of current vacancies per job and the projected future vacancies. See Succession planning.
Remuneration
Remuneration includes any payment made under a contract for services.
Request for proposal (RFP)
A document an organisation sends to a vendor inviting the vendor to submit a bid for a product or, service.
Restrictive covenant / Restraint of trade
A contract clause requiring executives or other highly skilled employees to refrain from seeking and obtaining employment with competitor organisations in a specific geographical region and for a specified period of time.
Return on investment (ROI)
A ratio of the benefit or profit derived from a specific investment compared to the cost of the investment itself.
Right to manage The ‘right’ of management to make decisions and to run an organisation without interference from external or internal forces.
Risk management
The use of insurance and other strategies in an effort to minimize an organisation’s exposure to liability in the event a loss or injury occurs.
Salary
Is a term used most commonly to describe a base pay which is set at an annual rate and remains unchanged from one
pay period to the next, regardless of the number of hours an employee may work.
Selection ratio
The ratio of the number of people hired to the number of suitably qualified candidates obtained.
Six Sigma
Six Sigma is a disciplined, data-driven methodology used to eliminate defects and improve processes and
cut costs from manufacturing to transactional and from product to service.
Stakeholders
The term given to the situation whereby firms have a number of groups, each having their own set of interests, possibly conflicting with each other.
Strategic architecture
The core competencies that an organisation has.
Strategic HRM
The process of aligning human resources more closely to the strategic and operating objectives of the organisation.
Strategic Planning
The process of identifying an organisation’s long-term goals and objectives and then determining the best approach for achieving those goals and objectives.
Structural capital
The databases, customer files, manuals, trademarks etc that remain in a firm once employees go home. See Customers capital.
Succession planning
Involving identifying a potential candidate to replace core individual employees either known to be leaving the firm
at some point in the future and/or whose sudden departure would pose a risk to the operation of the firm.
Summary dismissal
The act of dismissing personnel immediately, usually because the person has committed some act of Gross misconduct.
Suspension
A form of disciplinary action resulting in an employee being sent home without pay for a specified period of time.
Tangible rewards
Rewards which can be physically touched or held (i.e. a gift certificate, gifts in the form of merchandise, or a savings bond).
Theory X & theory Y
Two conflicting assumptions which are behind thinking on human nature and human behaviour as related to the employee and the workplace.
360-degree feedback
An appraisal process whereby an individual is rated on their performance by people who know something about their work. This can include direct reports, peers, managers, customers or clients; in fact anybody who is credible to the individual and is familiar with their work can be included in the feedback process. The individual usually completes a self-assessment exercise on their performance, which is also used in the process.
Total Remuneration
The complete pay package awarded employees on an annual basis, including all forms of money, benefits, services, and in-kind payments.
Training and development
A process dealing primarily with transferring or obtaining knowledge, attitudes and skills needed to carry out a specific activity or task.
Training Needs Analysis
A method of analysing how employee skill deficits can be addressed through current or future training and professional development programs, as well as determining the types of training/development programs required, and how to prioritise training/development.
Turnover
Describes changes in the work force resulting from voluntary or involuntary resignations.
Unions
Groups of workers who have formed incorporated associations relating to the type of work that they perform.
Unjustifiable dismissal
The act of terminating an employee’s employment agreement for a reason that the Employment Relations Authority
or Employment Court regards as unjustifiable.
Wage curve
Depicts pay rates currently being paid for each job within a pay grade in relation with the rankings awarded to each
job during the job evaluation process.
Wages
Wages – is a term used most commonly to describe a base pay which is calculated on a hourly, daily or weekly basis.
Depending on whether the employment is permanent, temporary or casual, full time or part-time basis, or according to the requirements of the applicable employment agreement. The amount of wages will vary (usually) according to the number of hours the employee works.
Wage drift
The gap between the Collective Agreement rate and the rate actually paid. Evidence of geographical variations in wage levels.
Wellness programme
Programmes such as on-site or subsidised fitness centres, health screenings, smoking cessation, weight reduction/management, health awareness and education which target keeping employees healthy therefore lowering costs to the employer associated with absenteeism, lost productivity and increased health insurance claims.
Whistleblower
Whistle blower protection is contained in the Protected Disclosures Act 2000. The Act provides protection to employees against retaliation for reporting illegal acts of employers. An employer may not rightfully retaliate in any way, such as discharging, demoting, suspending or harassing the whistle blower. Employer retaliation of any kind may result in the whistle blower bringing a personal grievance against the employer.
Work-life Balance
Having a measure of control over when, where and how an individuals works, leading to their being able to enjoy an optimal quality of life. Work-life balance is achieved when an individual’s right to a fulfilled life inside and outside paid work is accepted and respected as the norm, to the mutual benefit of the individual, business and society.
Workplace Bullying
Persistent, offensive, abusive, intimidating or insulting behaviour or unfair actions directed at another individual, causing the recipient to feel threatened, abused, humiliated or vulnerable.