HR and Payroll Glossary

A

ABA transit number: Established by the American Bankers Association (ABA), an ABA transit number is a nine-digit code to identify a bank and establish routing for electronic transactions.

Abate: In the HR industry, abate is when an agency grants a request to reverse, reduce or outright cancel a penalty charge.

Absent parent: An absent parent (aka “noncustodial parent”) is an individual who doesn’t live with or have custody of their child but is still required to provide financial support.

Absenteeism: Absenteeism refers to employees not coming to work for illness, personal matters or another reason. Companies may measure absenteeism to help calculate overall productivity and employee engagement.

Account balance: An account balance refers to the amount of funds in a particular account. For example, this could refer to all contributions made to a company’s state unemployment insurance (SUI) account (minus benefit deductions).

Accountability: Accountability is the willingness to accept responsibility for an action or behavior. A business may produce a corporate accountability report, for example, to demonstrate how it adheres to ethical and compliance obligations.

Accrual: An accrual is the total of assets, expenses, liabilities or earnings after determining the cash value, but before transferring it.

ACH credit: An Automated Clearing House (ACH) credit is a transaction in which an employer initiates a deposit into an account, like one that belongs to an employee. ACH credits usually begin a day before payday, if not sooner.

ACH debit: An Automated Clearing House (ACH) debit is a transaction that withdraws from an account, such as for an employer’s payroll taxes.

Acquiring company: An acquiring company is an organization that purchases or absorbs another business.

Acquisition: An acquisition is the process in which one company purchases or absorbs another.

Ad hoc: Ad hoc refers to an action that’s performed as necessary and for a specific scenario. For example, an ad hoc payroll process at one company probably won’t work for another business.

ADD North American Industry Classification System (NAICS) code: The ADD NAICS code is the standard used by federal statistical agencies in classifying businesses to collect, analyze and publish statistical data related to the U.S. business economy.

ADDIE model: A structure for employee learning that breaks training up across five steps: analysis, design, development, implementation and evaluation.

Additional claim: An additional claim is a supplemental notice of unemployment that’s filed after a set of claims within the same benefit year. Individuals must wait to file for at least one week between jobs. Each filing also requires proof of termination.

Address of record: The address of record is where a state or federal agency will send correspondence — like tax documents and unemployment information — for a specific individual.

Administrative procedure: An administrative procedure is a method agencies — not courts — use to support and enforce rules and orders.

Advance Earned Income Credit: The Advance Earned Income Credit (EIC) is a now repealed option that previously gave certain employees who completed a Form W-5 early payment if they were expected to be eligible for the credit.  

Advice number: An advice number is a code indicating a specific bank function. This is commonly found on direct-deposit slips.

Advice of credit: An advice of credit is used for a financial institution to notify an individual or entity that a letter of credit has been created.

Aid to Families with Dependent Children (AFDC): From 1935 to 1997, the AFDC was a federal assistance program designed to support low-income families. The AFDC was eventually replaced by Temporary Assistance for Needy Families (TANF).

Alien: An alien is someone who resides in the U.S. but doesn’t have citizenship.

Alimony: Alimony refers to financial support a court requires someone to provide, such as from one spouse to another during or after a divorce or legal separation.

Alliance: An alliance is when two businesses form a mutually beneficial relationship.

Allowable lien limits: Allowable lien limits refer to the maximum amount of an employee’s earnings that can be tied to a lien.

Allowance: An allowance is funding designated for a specific purpose, such as the money an organization gives its traveling employees for meals.

Alternate base year (ABY): An ABY is used by individuals who can’t file a valid claim for unemployment insurance benefits using a regular base period. Instead, an ABY is made up of the last four completed quarters.

Alternative dispute resolution (ADR): ADR is a way to resolve a disagreement without litigation.

Amended rate: An amended rate may be used by the state government to account for any change in the variables that determine an organization’s tax rate. This shift can occur from amended quarterly tax filings, new or adjusted benefits, a dispute of how a company’s original tax rate was calculated and more.

Amendment: As it relates to taxes, an amendment is a revised tax return that replaces a preexisting quarterly or annual tax return.

Americans with Disabilities Act (ADA): Effective since 1990, the ADA is a U.S. law that prevents employers from discriminating against employees who live with mental or physical disabilities.

Applicable large employer (ALE): ALEs are businesses that employ at least 50 full-time (or full-time equivalent) workers. This status is primarily used to determine which organizations are affected by the Affordable Care Act (ACA).

Applicant tracking system (ATS): ATS is software used to help businesses acquire talent, such as through automated job postings, streamlined candidate communication and more.

Applied for employer identification number: “Applied for employer identification number” is a status applied to employer tax identification numbers (EINs) that have been requested from an agency but are still pending.

Appraisals: Appraisals assess the value of something or how well an individual, such as an employee, performs.

Apprentice: An apprentice is someone who is actively learning a trade from a qualified individual. Apprenticeships are usually set for a specific period of time.

Arrearages: Arrearages can refer to any owed money that is past due, but they commonly relate to unpaid child support.

Assessment center: An assessment center is a standard of evaluation — often with tests and interviews — to measure employee performance and help businesses find the right people for certain roles.

Assignee: An assignee is someone who is entrusted with a specific task.

Assignment: An assignment is a job, task or request that is sometimes tied to a specific location, like a sales manager from one state temporarily filling in at a shop in another.

Assignment of support rights: An assignment of support rights is when an individual who received public aid gives their state the right to child support and related arrearages. Someone might do this in exchange for grants or other benefits.

Assimilation: Assimilation happens as an individual grows into a team, culture or organization.

Attrition: Attrition is the measurement of employees who have left an organization for any reason (termination, retirement, resignation, etc.).

Authority: Authority refers to the power an entity or individual has, such as agencies that are responsible for collecting state and local taxes.

Automated Clearing House (ACH): ACH is a digital network for quickly processing electronic transactions between financial institutions. ACH is commonly used by businesses that offer the option to pay employees via direct deposit.

B

Background check: A background check is when data is gathered and reviewed to determine the accuracy of a candidate’s experience and records during an employment screening.

Backup withholding: Backup withholding is tax withheld from interest payments to a customer’s bank account when no Social Security number is on file.

Balance-sheet approach: A balance-sheet approach is a method to set the salary and living allowances for employees on international assignments.

Balanced scorecard: A balanced scorecard is a system organizations use to measure the success of their strategies by looking at financial and nonfinancial areas.

Bank release date: The bank release date is the day the payroll tax debit is sent to the bank.

Bankruptcy: Bankruptcy is a legal proceeding to evaluate debts and assets. A personal bankruptcy may involve attachment of all or a portion of an employee's wages to satisfy outstanding debts.

Base period: A base period is the time frame usually consisting of the first four of the last five completed calendar quarters immediately before the beginning of a claimant’s benefit year.

Base period (employer): As it relates to employers, a base period is the period for measuring a qualified employer’s past experience with unemployment.

Base salary: Base salary is compensation that does not include tips, benefits, bonuses or commissions.

Behavioral interview: A behavioral interview is a process of interviewing to predict future performance based on how candidates acted in past work experiences.

Benchmarks: A benchmark is a basis for judging or measuring something.

Beneficiary: A beneficiary is someone who is eligible for benefits under a will, insurance policy, retirement plan or other contract.

Benefit accrual: A benefit accrual is the hours that are considered an employee benefit that are sometimes accumulated by the employee over a period of time (i.e., paid vacation, paid sick hours).

Benefit charge audit: A benefit charge audit is an audit process that verifies the validity of all charges, including that the maximum liability has not been exceeded, the weekly benefit amount has been properly calculated, the individual is eligible for benefits and sufficient earnings were reported.

Benefit charge statement: A benefit charge statement is a letter that informs an individual that an employer has filed an unemployment insurance claim. The benefit charge statement will show when the claim takes effect, as well as any charges an employer may expect.

Benefit charging: Benefit charging is when the account of an employer who is liable for an employee’s unemployment benefits is debited.

Benefit eligibility conditions: Benefit eligibility conditions are statutory requirements that must be satisfied by a person during each week of unemployment for which compensation or allowance payments are claimed before payment for the week is made.

Benefit Ratio Formula: The benefit ratio formula is three or more years of benefit charges divided by the taxable payroll of the same period, which equals the benefit ratio.

Benefit wage: A benefit wage is compensation for an employee based on tenure instead of only the hours they work.

Benefit wage formula: The benefit wage formula is three years of benefit wages divided by three years of taxable payroll, which equals a benefit wage.

Benefit wage ratio (BWR): A benefit wage ratio is a formula used by the state to calculate the Unemployment Insurance Experience tax rate. This formula is currently used in Delaware and Oklahoma.

Benefits: Benefits are compensation employees receive in addition to their base salary. Common benefits include health, dental and vision insurance, as well as time off and retirement plans.

Best practices: Best practices are the methods, processes or activities that have proven to produce outstanding results for an organization.

Beti®: Beti is Paycom’s self-building payroll experience that empowers employees to do their own payroll. It automatically flags errors, then guides workers to resolve them before payroll submission.

Biodata: Biodata, a shortened version of the term “biographical data,” is information about a person’s education, background and work history.

Biweekly: The term biweekly means once every two weeks. It is also a type of payroll period that can be used in the wage bracket method of withholding.

Blackout period: A blackout period is the brief time in which employees cannot access or change things regarding their retirement or investment plans.

Bonus: A bonus is compensation an employee receives in addition to an employee’s usual compensation for services performed.

Breakdown analysis: A breakdown analysis is analyzing and classifying information, such as data in a report.

Business Tax Credit for Employer-Paid FICA on Tips: Business Tax Credit for Employer-Paid FICA on Tips is a tax credit that is available to employers at food and beverage establishments — not to other types of tipped employment.

C

Cafeteria plans: A cafeteria plan (aka a “flexible benefits plan” per the IRS) lets employees choose from a “menu” of benefits, some of which may be covered by pretax deductions from a worker’s paycheck.

Calendar quarter: A calendar quarter refers to one of the four quarters (three-month periods) of the year, such as January to March, April to June, July to September and October to December.

Calendar week: A calendar week refers to the period starting on Sunday and ending on the subsequent Saturday.

Calendar year: A calendar year refers to the period that begins on Jan. 1 and ends after Dec. 31. A calendar year contains 365 days except on leap years.

Career development: Career development refers to the progress an employee makes through their professional career.

Career ladder promotion: A career ladder promotion is a form of advancement through preestablished positions. Unlike other internal growth opportunities, a career ladder promotion doesn’t require employees to formally apply and compete for an advanced role.

Career management: Career management is the process of monitoring and championing an employee’s professional development and advancement. Ideally, career management also aligns workers with organizational goals.

Career planning: Career planning is the process of cultivating skills, networking and learning from mentors to ultimately grow in one’s field.

Career plateau: A career plateau occurs when an employee can’t advance through an organization, either due to performance, a toxic work culture, a lack of growth opportunities or another reason.

Cascading goals: Cascading goals are broad expectations set for an entire company that, as they disseminate through departments, transform into individual goals.

Case/docket number: A case/docket number is a court-assigned code that identifies a specific legal matter. For example, HR could use a case/docket number to find more context for an employee’s garnishment.

Caux principles: The Caux principles were established by the Caux Round Table, a group of global business leaders, to define how international organizations should operate to maintain a fair and ethical society.

Certification: A certification confirms that an individual or organization is qualified to perform a task or exemplifies specific values. Generally, a certification is awarded by an authority following a test, program, audit or another form of vetting.

Chain of command: A chain of command defines the reporting structure of an organization. For example, an employee may report to a supervisor, who reports to a manager, who reports to a department leader, who then finally reports to a C-level executive.

Change agent: A change agent (or “agent of change”) is an individual who intentionally causes an organization to shift. For example, a wellness coordinator may actively push for their company to become more inclusive.

Check digit (CD): A CD is a number added after a series of digits to help automated systems catch errors and changes.

Child support: Child support refers to court-ordered payments made by one parent to another to fund child care following a divorce or legal separation.

Child support withholding: A child support withholding is funding removed from an employee’s paycheck before payout to satisfy a court-ordered child support order.

Child wage withholding order: A child wage withholding order is a notice that tells an employer that — at a predetermined date — they may start deducting money from an employee’s earnings to address court-ordered child support.

Circular E: Circular E refers to the federal Employer’s Tax Guide. This document contains the IRS guidance for paying, fixing, reporting, depositing and withholding employment taxes.

City or local income tax: City or local income tax is any employment tax required by a city or local jurisdiction. Like state or federal taxes, city or local income taxes can shift based on earnings, exemptions, marital status and more.

Claim: In HR, a claim is often a statement made by a previous employee to secure unemployment benefits. Generally, claims are filed with state governments.

Claimant: A claimant is someone who has filed a claim for unemployment benefits.

Claimant fraud: Claimant fraud is any fabrication of facts in an unemployment claim to obtain benefits. For example, this could occur when an individual knowingly lies on their original claim or continues to accept benefits after they know they are no longer eligible.

Co-sourcing: Co-sourcing occurs when one company’s employees work for or in tandem with another organization. For example, employees for a construction company may temporarily lend their services to a large corporation that needs a new office building.

Coaching: Coaching is a style of professional development where an expert (or “coach”) gives pointed feedback and guidance to a team or individual so they can improve. Coaching can be used to support the broad requirements of a role or focused for a specific task or activity.

COBRA qualifying event: A COBRA qualifying event is any instance that triggers or extends insurance coverage for an employee, spouse or dependent. This can include divorce, death of a covered employee or a similar circumstance.

Code of conduct: A code of conduct is the set of rules everyone in an organization must follow. This guidance is typically informed by the company’s core values.

Codetermination: Codetermination is a business structure in which employees are held partially responsible for a company’s functions. For example, employees who elect their employer’s board members practice codetermination.

Collection agency: A collection agency is a firm responsible for collecting past-due debts. For example, a collection agency may file a lawsuit (or employ outside counsel to file a lawsuit) that eventually results in a judgment that can be used to establish a lien or wage garnishment.

Combined filing: A combined filing — as it relates to payroll — is a tax filing that covers more than one tax type, such as a state and city income tax.

Combined wage claim: A combined wage claim is a claim filed in one state that accounts for wages obtained in two or more states.

Commission: Commission is additional pay earned for an exceptional performance or by exceeding certain goals. For example, a sales representative at an auto dealership may earn commission based on each vehicle they sell.

Common ownership: Common ownership is when two or more parties have a right to property through marriage, partnership or an otherwise preestablished agreement.

Common pay agent: A common pay agent, or a certified professional employer organization (CPEO) program, is an option from the IRS that allows companies to consolidate tax returns and payments under a single federal employer identification number (FEIN). Ideally, this process facilitates clearer and easier tax management.

Common paymaster: A common paymaster is someone who serves a group of related corporations and is responsible for maintaining those corporations’ payroll. A common paymaster also allows for these related organizations to be considered a single employer to calculate Social Security and federal unemployment tax.

Commuter assignment: A commuter assignment is an international job that requires an employee to regularly travel to and from their home country. For example, a commercial sprinkler installer may reside in Mexico but regularly travel to their employer’s headquarters in California.

Compa-ratio: A compa-ratio (or “comparison ratio”) is a method of comparing an individual salary to others of the same role. A compa-ratio is calculated by dividing one employee’s salary by the midpoint salary range of identical positions.

Company culture: A company culture is the combination of the values, rules and environment of an organization. Unlike the code of conduct, a company culture is not something a business agrees upon and sets. Rather, it’s defined by the actions of everyone employed there.

Compensation: Compensation is everything an employee earns from their organization, such as their base salary, bonuses, commission, insurance and all monetary and non-monetary benefits.

Compensatory time: Compensatory time (or “comp time”) is paid time off (PTO) given to employees for working overtime. However, all businesses should verify with a licensed legal professional if they can award compensatory time in place of overtime pay. While it’s common with certain public sector jobs, it can be illegal to use compensatory time to avoid properly compensating employees.

Competencies: Competencies are the skills, knowledge and other qualifications needed to perform and excel in a certain role.

Competency model: A competency model is a set of competencies an organization’s leadership determines are necessary to succeed at a job. For example, a public school counselor should be exceptional at speaking with and understanding children.

Competency-based pay: Competency-based pay is a way of determining an employee’s salary based on the value their aptitudes and knowledge bring to a company.

Complaint: A complaint is a formal document filed with a court that outlines an injustice and proposes a remedy. For example, an individual may file a complaint in an attempt to legally recover a past-due debt.

Compliance: Compliance refers to a company’s need and ability to adhere to local, state and federal employment laws.

Computation date: A computation date is the timeframe an employer uses to determine a benefits contribution rate for a specific employee.

Consent agreement: A consent agreement is a formal contract outlining the relationship between two parties and their respective responsibilities. For example, a legal parent may enter a consent agreement to voluntarily pay child support.

Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA): COBRA in not insurance itself, but a federal law requiring certain employers to give workers and their families the option to temporarily extend health benefits lost under particular circumstances.

Constructive discharge: Constructive discharge (aka “constructive dismissal” or “constructive termination”) occurs when an employee leaves an organization due to direct or indirect hostility. Though it may seem like a voluntary choice, if toxicity compelled an employee to leave, that effectively could make it a constructive discharge and not a resignation.

Constructive receipt: A constructive receipt is a document that specifies if certain wages are subject to employment taxes and if an employee received their gross income.

Contingent worker: Like an independent contractor, a contingent worker is an individual who performs work for a company without being hired as an employee.

Continued claim: A continued claim is a document that details an ongoing unemployment claim. Effectively, continued claims serve as status reports for unemployment benefits.

Contract employee: A contract employee is a worker hired for an amount of time specified in an employment agreement. This agreement should specify their hours and compensation and grant the contract employee access to FLSA benefits.

Contractor payment: A contractor payment is any wages paid to a self-employed individual. This is typically followed by a Form W-9 (for when the work begins) and a Form 1099 (to summarize all taxable income), rather than a Form W-2.

Contribution report: In HR, a contribution report outlines the total taxable wages of an organization each quarter and calculates the amount owed for relevant taxes, such as a state unemployment fund.

Contributions — employer: Employer contributions refer to what a company pays to help fund a state unemployment program. The size of this contribution is determined by the company’s taxable payroll and its assigned unemployment tax rate.

Core competencies: Core competencies refers to the set of skills and aptitudes employees need to successfully perform their job duties.

Cost per hire: The cost per hire is the amount of financial resources needed to acquire a new employee. Costs could include advertising, referral payouts, travel expenses, job fair registration fees and more.

Cost-benefit analysis: A cost-benefit analysis is a detailed review of various options — such as forms of insurance coverage — to determine if the benefits of those selections are worth the financial cost. For example, hiring multiple on-site wellness counselors will add additional costs in payroll, but the move could prove worth it in terms of recruitment and employee retention.

Cost-of-living adjustment (COLA): COLA is an increase (or occasionally a decrease) in pay based on the local, state, national or global economy. For example, gradual rises in inflation may justify companywide raises.

Court-ordered deduction: A court-ordered deduction is any funds withheld from an employee’s paycheck as specified by a court, such as for a wage garnishment or child support.

Court-ordered support: Court-ordered support is a legal action in which a court requires an individual to make monthly payments for alimony or child support. The monetary value of this support is generally determined by the income of the individual the order is placed against.

Covered employer: A covered employer refers to any organization that must comply with a certain law. For example, a private-sector business with 50 or more full-time (or full-time equivalent) employees must adhere to the Affordable Care Act (ACA).

Covered employment: Covered employment refers to any worker who qualifies as an employee for an organization and, by extension, affects which laws the business must comply with.

Covered wages: Covered wages refer to any income an employee earns for which local, state or federal taxes may apply. Covered wages could also refer to a portion of an employees’ wages that a garnishment, child support or another court-ordered payment may affect.

Credentials: Credentials are any documents that prove a person is authorized and/or qualified to do certain work.

Credit elect: A credit elect is an option for taxpayers who have deposited more taxes than necessary, typically due to a tax estimate. In this case, the taxpayer may have the option to receive the overpayment as part of their annual tax return or apply the overpayment to the subsequent year’s taxes as a credit reduction.

Custodial parent: A custodial parent is an individual who has legal custody over a child and, by extension, may be the recipient of child support payments.

Custody: Custody is the legal responsibility a parent has over a child. In divorces and legal separations, primary custody is typically awarded to one parent.

D

Danger premium: A danger premium is additional pay one receives for working in dangerous jobs or places (i.e., environments that are hazardous or politically unstable).

Days to fill: Days to fill/Time to fill is the average number of days required to hire someone for an open job.

De Minimis Fringe Benefit: A De Minimis Fringe Benefit is any property or service, provided by an employer, that has a value so small that it would be unreasonable or administratively impracticable to account for it. This means it may be excluded from income.

Decision: A decision is the written opinion of a hearing officer or panel of judges, based upon testimony and documentation from the hearing, determining if a former employee is eligible to receive unemployment compensation benefits or if an employer is liable to pay benefits.

Dedicated HR: Dedicated HR is a human resources position that focuses entirely on HR responsibilities within an organization.

Deductions: A deduction is an amount subtracted — pre-tax or after tax, depending on the type of deduction — from an employee’s paycheck. Deductions must be authorized by the employee before they can be withheld from their paycheck.

Default: A default is failure of a defendant to file an answer, response or appeal in a civil case within a specific number of days after being served with a summons and complaint.

Default judgment: A default judgment is a decision made by the court when a defendant fails to respond to a summons and complaint.

Defendant: A defendant is a person against whom a civil or criminal proceeding has been initiated.

Deferred compensation plan: A deferred compensation plan is an employee benefit plan, authorized by the IRS, which allows employees to invest a percentage of wages to tax-deferred savings plans rather than receive the amounts as immediate compensation. The most common deferred compensation plan is a 401(k) plan.

Defined benefit plan: A defined benefit plan is a retirement plan that shows exactly how much money they will receive on a specific date (usually the day they retire).

Delinquent account: A delinquent account is an employer’s account for which any quarterly contribution and wage reports and/or unemployment taxes have not been submitted to the state agency by the assigned due date.

Dependent: A person claimed as a dependent is: a child of the employee who is either under 19 or a full-time student under 24, or a child of the employee who is a full-time student over 24 who is reasonably expected to receive less than $3,000 of income during the taxable year, or permanently and totally disabled and receives income for services performed at a sheltered workshop operated by a charity or government; a citizen, national or resident of the United States, or a resident of Canada or Mexico, or an alien child adopted by and living with a United States citizen abroad; and is either: (1) a child, grandchild, stepchild, parent, grandparent, stepparent, brother, sister, stepbrother, stepsister, in law, aunt, uncle, nephew or niece of the employee, or (2) a member of the employee’s household for the taxable year and have the employee’s home as his principal place of abode; and is not filing a joint return.

Determination: A determination is an official decision by the Employment Security Department about the unemployment claim of someone or the tax status of an employer.

Direct deposit: A direct deposit is the electronic transfer of an employee’s net pay directly into a financial institution’s account designated by the employee to avoid receiving a physical paycheck.

Disability insurance (DI): DI is a financial compensation plan from the government and/or an employer to support employees disabled due to illness or injury.

Disposable income: Disposable income is earnings minus deductions required by law to be withheld.

Disqualification: A disqualification is when state law specifies claimants are disqualified from benefits for a definite or indefinite period.

Diversity: Diversity is a combination of various types of people working together, often of different cultures, races, generations, genders or religions.

Document retention: Document retention is managing employee data and records as required by an organization or rule of law.

Doing Business As (DBA): DBA refers to the name under which an individual or business operates.

Downsizing: Downsizing is a decrease in a company’s workforce to increase efficiency and profitability.

Duration of benefits: A duration of benefits is the number of weeks a claimant may receive benefits like health insurance.

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Earned income credit (EIC): The EIC is a refundable tax credit granted by the federal government. The EIC primarily applies to low- to moderate-income employees and couples, especially those with dependents.

Earnings allowance: In HR, an earnings allowance is the total income an employee can earn without any reduction in the unemployment benefits they could receive.

Electronic Federal Tax Payment System (EFTPS): The EFTPS is a free, federal tool designed to simplify paying owed and estimated taxes securely and electronically. The automated system is available 24/7 online or by phone.

Electronic funds transfer (EFT): An EFT (aka “direct deposit) is a method of digitally moving money from one account to another, such as for an employee’s paycheck.

Eligibility determination: An eligibility determination is the process of qualifying an employee or individual for a certain type of legal benefit, like unemployment benefits.

Eligible: Eligible is a status given to employees and individuals who qualify for a certain benefit.

Employee: An employee is a person who works for an organization and requires a Form W-2 due to the hours they work per week. Similarly, most employees have taxes withheld from their gross pay.

Employee benefits: Employee benefits are perks, payments, coverage and programs organizations offer their employees to help ensure their quality of life and enhance their well-being, such as health insurance and retirement plans.

Employee engagement: Employee engagement is overall measurement of how much an organization compels, motivates and ultimately satisfies the people who work there.

Employee handbook: An employee handbook is a company’s document that contains procedures and policies workers are expected to follow.

Employee leasing company: An employee leasing company is an organization that contractually lends workers to other companies. While leased employees may perform services for the businesses they are lent to, they are still considered employed by the employee leasing company.

Employee retention: Employee retention is the measurement of how well a company keeps its people.

Employee Retirement Income Security Act of 1974 (ERISA): The ERISA is a federal law that sets requirements for retirement plans in the private sector. The law primarily outlines the federal tax implications of these arrangements.

Employee Self-Service®: Employee Self-Service is Paycom’s employee experience that connects workers with the data that matters to them most.

Employee stock ownership plan (ESOP): An ESOP is a taxable benefit that allows employees to contribute money to a company in exchange for shares.

Employee turnover: Employee turnover is the measurement of how many workers leave an organization. This can be the result of termination, resignation or retirement.

Employee unemployment insurance contribution: Employee unemployment insurance contributions refer to the taxes required by certain states and are withheld from an individual’s pay to support a state’s unemployment program.

Employer: An employer is an entity that employs workers to produce goods or perform a service. “Employer” is often used interchangeably with “business,” “organization” and “company.”

Employer branding: Employer branding is the practice of highlighting the employee experience in recruitment marketing materials. The purpose of employer branding is to showcase an organization as a desirable place to work.

Employer of choice: An employer of choice is a company that has earned a positive, industry-leading reputation for the way it treats, values and compensates its employees.

Employer Tax Identification Number (EIN): An EIN is a 9-digit number administered by a state that the IRS references and is required on all documentation sent on behalf of an organization to the IRS. In certain areas, the EIN is synonymous with a company’s Federal Employer Identification Number (FEIN).

Employer with majority of wages: An “employer with majority of wages” is an unemployment insurance designation that informs how a company is charged. This specifically references how an employer that paid the most wages during a certain period is also charged for all applicable benefits.

Employer-allowed fee: An employer-allowed fee is a fee a company deducts from an employee’s pay to process a lien. The extent of this fee — or whether it can be collected all — is specified by state law. Employers should confirm if they can collect this fee with a licensed legal professional before applying it to any employee.

Employer-paid benefits: Employer-paid benefits are coverage and perks — such as health insurance or on-site wellness advisors — that aren’t deducted from an employee’s salary.

Employment at will: Employment at will refers to a job arrangement in which a worker can resign — or be terminated — at any time and for any reason. The phrase “at-will states” refers to states where this practice is allowed.

Employment branding: Employment branding is the process of revamping a company’s image so it can be perceived as an employer of choice. This could involve reevaluating workplace culture, enhancing a total rewards program and more.

Employment classifications: Employment classifications refer to categories workers are placed within based on their pay, job duties and overall responsibilities. Employment classifications often relate to compliance requirements and include common designations like full time, part time, seasonal, intern, exempt and nonexempt.

Empowerment: Empowerment is the process of giving employees more agency in their work and control over their career trajectory. Empowered employees may also feel a higher level of engagement at work.

Enforcement: Enforcement is the way in which an agency or government compels businesses and individuals to comply with applicable laws. For instance, the IRS may enforce the payment of federal taxes through fines, interest, audits or other penalties.

Equal Employment Opportunity (EEO): EEO refers to U.S. laws that protect the rights of employees and enforce fairness and equity in employment practices. EEO laws are enforced and maintained by the Equal Employment Opportunity Commission (EEOC).

Equity compensation: Equity compensation is noncash payments that reflect stake in a company. Restricted stock options are an example of equity compensation.

Equity partnership: An equity partnership is an agreement in which an individual or group receives partial ownership of an organization, typically by financially supporting it.

Essential functions: Essential functions are the duties employees must maintain to perform a certain job.

Ethnocentric staffing orientation: Ethnocentric staffing orientation is the practice of recruiting valuable employees and leaders from the country, state or region where the hiring company is headquartered.

Excluded deductions: Excluded deductions are pulled from an employee’s gross pay prior to taxes, liens or garnishments. Before assuming a certain deduction is excluded, employers should verify with a licensed legal professional since tax laws vary between states.

Excluded earnings: Excluding earnings are wages that may not be taxed or garnished. Similar to excluded deductions, the laws that define excluded earnings vary among states.

Exempt from withholding: Exempt from withholding is an employee status that excludes an individual’s income from local, state or federal taxes. Additionally, this status doesn’t necessarily mean an employee is free from every tax — such as the Social Security tax — but a specific deduction.

Exempt-level employee: An exempt-level employee is an employee who works whatever amount is necessary for the requirements of their job without qualifying for overtime pay.

Exit interview: An exit interview is a meeting conducted after an employee has submitted a resignation notice — but often before their actual last day — to understand the employee’s overall experience and gather feedback for improvement. For example, if an employee states they’re leaving for poor management in an exit interview, it could spur HR to look into a new leadership training program.

Expatriate: An expatriate is an employee who moves from their home country to work in a position at a different country. In most cases, the expatriate is still a citizen of their home country.

Expatriate assignment: An expatriate assignment is a position that requires an employee to move to another country.

Experience rating: An experience rating determines an employer’s SUI tax rate. The calculation is influenced by how likely a company is to produce unemployment, workers comp and other employment-related insurance claims. A higher rating means a company may present a higher risk of turnover and may be taxed at a higher rate depending on state law.

Experience rating record: An experience rating record is every factor a state agency retains to calculate an employer’s experience rating.

Experience tax rate: An experience tax rate relies on an employer’s experience rating to outline how an applicable business should be taxed for SUI benefits. This rate is typically determined by a company’s ability to keep employees over a specific period and is often evaluated annually. Some states, however, may assign a new rate sooner, such as quarterly or upon eligibility.

Extraterritorial laws: Extraterritorial laws are a country’s requirements that still apply to citizens of that country when they travel — or even live — outside of it. Extraterritorial laws generally override local laws that may otherwise exempt the applicable citizen.

Extraterritoriality: Extraterritoriality is when a citizen from one country is exempt from certain laws of the country where they live and work. For example, “diplomatic immunity” granted to diplomats is a form of extraterritoriality.

Extrinsic rewards: Extrinsic rewards are financial benefits, grades, prizes or verbal recognition awarded for certain work, actions or overall performance.

G

Gap analysis: Gap analysis is a process that helps organizations or people compare their actual performance with their potential performance.

Garnishee: With regard to payroll, a garnishee is an employer that receives an order requiring withholding from an employee’s wages to satisfy a debt.

Garnishment: A garnishment refers to a lien placed on an individual’s income.

Garnishment Administration: Paycom’s Garnishment Administration software handles the calculations, payments and record-keeping associated with garnished wages.

Genetic testing: Genetic testing is an analysis of inherited factors (usually by blood test) of alleged parents and child that can help prove or disprove that a particular person fathered a particular child. In HR, genetic testing can potentially help lower health care costs by identifying early diagnoses and treatment. Under Title VII, it is illegal for an employer to discriminate against an employee or potential employee on the basis of genetic testing.

Geocentric staffing orientation: Geocentric staffing orientation is the practice of choosing the best employees for a job, regardless of where they are from or where the job is located.

Global ethics policy: A global ethics policy is an outline of how a company expects employees to behave around the world, often intended to prevent corruption.

Global organization: A global organization is a company that views the world as one market and does not divide it into separate markets by country.

Global staffing: Global staffing is the process of finding the number and type of employees an organization needs worldwide and searching for the best candidates.

Global team: A global team is a group of employees working on the same project who are located in different countries or come from different cultures.

Glocalization: Characteristic of a company that “thinks globally, but acts locally”; when a company has a strong presence both in its own country and around the world.

Goal limit: A goal limit is the total amount due to satisfy a lien or garnishment.

Graphic rating scale: A graphic rating scale is a method of giving employees a numerical rating for having specific traits.

Greenfield operation: A greenfield operation is the start-up of a new business operation, usually in a new location.

Grievance: A grievance is a cause of distress that can lead to an official complaint.

Grievance procedure: A grievance procedure is a process that employees must follow when they want to officially express their concerns about work-related issues to their employer.

Gross wages: Gross wages are the total earnings paid to an employee before taxes and deductions.

Group term life (GTL): GTL is employer-provided life insurance coverage.

H

Hardship premium: A hardship premium is extra payment or benefits an expatriate receives on assignment in a country with harsh living and working conditions.

Head count: A head count is the number of employees an organization has on its payroll.

Headhunter: Headhunter (aka “executive search firm”) is an informal term for an employment recruiter.

Headhunting: Headhunting is the practice of recruiting employees from one company to work at another company.

Health care benefits: Health care benefits are company-sponsored medical plans that help employees pay for the cost of doctor visits, hospitalization, surgery and more.

Health Insurance Portability and Accountability ACT (HIPAA): HIPAA is a U.S. law that protects workers’ health benefits and medical privacy.

Hearing: A hearing is a formal administrative procedure held before an administrative law judge. A common example in HR involves the appeals section of a state unemployment agency, where it accepts testimony and documents relating to the separation of a former employee (claimant) from their work.

High quarter formula: A high quarter formula is a benefit formula using an individual’s highest quarter of wages in the base period to calculate a weekly benefit amount.

High-potential (HIPO) employees: HIPO employees are workers who have the capacity to grow into higher levels of leadership within an organization.

Higher authority appeal (HAA): An HAA is the higher of two administrative authorities provided by state unemployment compensation laws to make decisions with respect to appeals.

Highly compensated employee (HCE): An HCE is an employee who is an owner or officer of a business or whose salary exceeds a certain amount.

Hostile work environment harassment: Hostile work environment harassment is any situation in which a co-worker or co-workers create an uncomfortable work environment by discriminating or harassing another based on an inherent characteristic protected under Title VII, such as race, gender or gender identity, age, religion, sexual orientation, or disability.

HR audit: An HR audit is an assessment of the strengths, weaknesses and development needs of HR required for organizational performance.

HR business partner: An HR business partner is typically a senior role in HR that works closely with an organization to develop strategies and achieve business results.

HR partner: An HR partner is a manager or department that has a relationship with HR to help reach organizational goals and maximize employees’ potential.

Human capital: Human capital is an employee's knowledge, talents and skills that add value to an organization.

Human capital strategies: Human capital strategies are methods and tools for recruiting, managing and retaining key employees.

Human resources (HR): HR focuses on implementing organizational strategy, as well as recruiting, managing performance and providing direction for the employees who work in an organization.

Human resources development (HRD): HRD is an area of HR that trains employees and gives them the skills necessary to do their jobs now and in the future.

Hybrid structure: Hybrid structure is an organizational model combining different operational, functional, product and geographic structures — such as remote work or flex schedules.

I

I-9: The Form I-9 (aka “Employment Eligibility Verification”) is used to verify the identity of and eligibility for an individual to legally work in the U.S.

ID number: An ID number is a code that identifies a person or entity, such as a taxpayer when filing an annual return.

ILO conventions: ILO conventions are employment standards that can become international law after a certain number of governments have accepted and agreed to follow them.

Immigration and Naturalization Service (INS): The INS was an agency under the U.S. Department of Labor charged with enforcing immigration laws. The agency was dissolved in 2003.

Immigration Reform and Control Act of 1986 (IRCA): The IRCA is a federal law that prohibits businesses from intentionally hiring or recruiting any individual who is unauthorized to work in the U.S. This law requires employers to verify the identity and employment eligibility of all regular and temporary employees.

Impound: Impound is the act of assuming custody over property (such as a vehicle, documents or finances) due to noncompliance or a legal violation.

Imputed income: Imputed income is benefits employees receive that aren’t part of their earnings but could still be attributed as a taxable non-cash benefit. Examples of imputed income include health insurance for dependents and personal use of a company vehicle.

In-basket exercise: An in-basket exercise is a prioritization test used to vet an applicant or existing employee for a management position.

Incentive: An incentive is a bonus or additional perk given to inspire and motivate employees.

Independent contractor: An independent contractor is a self-employed worker who does work for a company under a contracted, as-needed basis. Independent contractors are not considered employees, and thus don’t receive the same rights.

Individual retirement account (IRA): An IRA is a tax-deferred retirement account for individual employees.

Inducement: Inducement is a specific benefit used to incentivize performance. A company-sponsored trip to award high sales would be a form of inducement.

Inpatriate: An inpatriate is an employee working outside their home country but within the country of their employer.

Insourcing: Insourcing is the act of delegating work to a team or an employee within the same organization, rather than outsourcing it to separate entity.

Instant rewards: Instant rewards are perks and bonuses given to employees as soon as they achieve a specific goal or metric, like for reaching a specific sales milestone or finishing a certain amount of training.

Interim: Interim typically refers to a period between two stages of a process, such as the time between filing taxes and receiving a confirmation they were accepted. However, certain laws may require interim reports or deposits to be made quarterly or annually that outline business operations over a specific timeline.

Internal equity: Internal equity is the process of ensuring roles within a company that hold similar value are also equally compensated.

International assignee: An international assignee is an employee who moves outside their home country to perform a job elsewhere, like an American construction worker helping build new bridges in London.

International Labor Organization (ILO): The ILO is a division of the United Nations responsible for the enforcement of human and labor conventions, as well as investigations into possible violations.

International organization: An international organization is a business that operates in multiple countries.

Interstate combined-wage claim: An interstate combined-wage claim is used by former employees who are covered by unemployment laws in multiple different states. This does not mean that the individual qualifies for all unemployment benefits of every applicable state, but it does help determine which benefits they should legally receive.

Intrinsic rewards: Intrinsic rewards are nonmonetary — or even immaterial — benefits that come from someone’s work. An intrinsic reward can be as simple as feeling good about helping someone in need.

Inverse chronological order: An inverse chronological order is commonly used as a benefit charging method in which the most recent employer is responsible for sponsoring benefits until their liability ends. This approach also requires benefits to be prorated, rather than charging all applicable organizations at once.

Invoice: An invoice is a document that reflects a transaction between two parties. It may detail the specific work or goods that were provided in the form line items.

Invoice address: An invoice address is the legal address of the entity that purchased or agreed to purchase the goods and services outlined in the invoice.

J

Job analysis: Job analysis is a study of the major tasks and responsibilities of roles to decide their importance and relation to other positions in a business.

Job competencies: Job competencies are the skills and behaviors that can help an employee succeed in a specific role.

Job description: A job description is a document describing an employee’s work activities in a specific role.

Job family: A job family is a group of jobs based on the type of work performed, skills, education, training and credentials.

Job matching: Job matching is the use of objective skill assessment data combined with relevant knowledge and experience to determine the ideal role for an employee.

Job preview: A job preview is a strategy for introducing job candidates to the realities of the position, both good and bad, before making a hiring decision.

Job ranking: Job ranking is a job evaluation method that compares roles to each other based on their importance to the organization.

Job requisition: A job requisition is a procedure used to hire a new employee to fill a position.

Job rotation: A job rotation is a way to develop employees by giving them different jobs to perform.

Job shadowing: Job shadowing is the process of learning a new job by observing another employee work.

Job specification: A job specification is a description of employee qualifications necessary to perform a specific role.

Job-content-based job evaluation: A job-content-based (aka “point factor”) job evaluation is a way of estimating how much employees should be paid based on what they do in a specific role.

Joint account (common rate group): For businesses, a joint account is an account of two or more separate entities in the same industry who share a common unemployment insurance tax rate. Joint accounts are formed with the primary goal of achieving a lower overall tax rate for the members.

Joint account analysis (Common Rating Evaluation): A joint account analysis is the summary of an account formed when employers combine the components of two or more unemployment insurance experience rated accounts to arrive at a joint account tax rate. It includes recommended grouping(s) and estimated savings opportunities.

Joint venture (JV): A JV is when two or more organizations work together and share risks and rewards.

Jurisdiction: A jurisdiction is the legal authority that a court has over certain people and types of cases in a defined geographical area.

Jurisdiction legal name (JLN): Jurisdiction legal name is the SIT/SUI legal name, or name that a state agency has on record, for a company that is different from a federal name.

K

Key performance indicator (KPI): KPI is a measurement an organization uses to track progress and determine what is needed for improvement.

Key talent: Key talent are employees who perform work extremely well and, as a result, are highly valued by their organization.

Kidnap and ransom insurance: Kidnap and ransom insurance reimburses losses experienced by business and individuals due to kidnapping and/or extortion in high-risk areas of the world.

Knowledge management: Knowledge management is the method of gathering, documenting and disseminating information with the goal of improving performance of both employees and the organization.

L

Labor union: A labor union is an organization of employees — usually representative of an industry or establishment — that forms with the intent to secure better wages, improved working conditions, greater opportunities and more.

Lag quarter: A lag quarter is the period between a base period and the start of a new benefit year. A lag quarter can also refer to the time between filing a claim, such as for unemployment, and when the stipulations of the claim begin to take effect.

Layoff: A layoff is the process of furloughing or terminating employees for reasons unrelated to any individual worker’s performance. For example, an acquiring company may lay off unneeded staff from the acquired business.

Leadership: Leadership is the act of managing, influencing and inspiring individuals toward a shared goal.

Leadership pipeline: A leadership pipeline refers to the way in which employees develop into leaders, as well as the levels those specific leaders assume. For example, a specialist may become a team leader, who then becomes a manager, then a director and so on.

Learning curve: A learning curve is the time and effort it takes an individual to achieve the basic understanding needed to adequately perform a task.

Learning effectiveness model: A learning effectiveness model is a method of analyzing employee training and development programs to determine how effective the initiatives are in reaching business objectives.

Learning management software (LMS): An LMS is an electronic development experience that delivers, tracks and reports on employee training.

Leave of absence: A leave of absence is a period away from work granted by an employer or required for legal reasons, such as military deployment.

Legal father: A legal father is an individual who is legally recognized as a male parent of a dependent.

Legal mother: A legal mother is an individual who is legally recognized as a female parent of a dependent.

Leniency error: A leniency error is when an employee is incorrectly overly appraised for the quality of their work.

Leverage: Leverage is the act of applying minimal effort to bring a higher return, such as using automated payroll software to reduce manual HR labor.

Liability date: A liability date refers to the time when a business covered under a state unemployment insurance law must start paying taxes and reporting relevant wages.

Liaison: A liaison is an entity (typically a designated person) who serves as a communicator between different people, teams or organizations. For example, a large company may hire a liaison to smooth communication between the C-suite and upper management.

Lien basis: A lien basis determines how much of an employee’s pay is susceptible to a garnishment, which varies depending on the order and applicable law.

Lien notification: A lien notification is a legal advisory or document that outlines the terms of a lien or tax levy.

Lien type: A lien type defines what the lien is and its relative priority. For example, a certain state may require past-due child support to be paid before it allows a separate garnishment for a credit card debt to begin.

Lien/levy: A lien (or levy) is an administrative freeze or attachment placed on a bank account for the purposes of collecting a debt, such as from a court order or for past-due taxes.

Lived in: Lived in refers to the city or state where a worker lives.

Local income tax: Local income tax is a tax withholding that’s determined by a local law specific to a city or county.

Local tax rate: A local tax rate refers to the specific percentage of earnings covered by a local tax law.

Local withholding rate: A local withholding rate refers to the entire percentage of earnings covered by local laws.

Localization compensation strategy: A localization compensation strategy is a salary model companies use to ensure international employees receive comparable pay for the same work as a local employee.

Location experience rating: A location experience rating (aka a department experience rating) is an analysis to determine a tax rate based on benefit charges for specific teams, areas and departments to ensure unemployment costs are properly attributed.

Long arm statute: A long arm statute is a portion of law that grants a state authority over an individual who resides in another state.

Long-term assignment: A long-term assignment is a role in a different location that requires an employee to work and reside there for an extended period — usually more than six months.

Long-term disability (LTD): LTD is a benefit that covers all or some of the salary and medical expenses associated with extended leave for an employee’s illness or injury.

Lookback period: A lookback period refers to July 1 to June 30 of the previous tax year. A lookback period is used to determine an employer’s tax rate for the current tax year.

Lower authority appeal: A lower authority appeal refers to the actions of the lower of multiple courts — such as how a circuit court relates to state’s supreme court — as it relates to appealing unemployment laws.

Lump-sum compensation: Lump-sum compensation is earnings paid entirely at once, rather than through a regularly occurring salary. For instance, an artist may receive lump-sum compensation for a mural they painted.

M

Management contract: A management contract is an agreement between two parties in which one performs the leadership and supervisory duties of the organization, such as how a local property manager may handle relations with a renter on behalf of the property owner.

Mandatory benefits: Mandatory benefits are offerings (like health insurance) that employers are required to offer employees under state or federal law.

Manpower: Manpower is the number of workers an organization employs.

Market salary survey: A market salary survey is an analysis of the median wage of identical roles in the same industry.

Market-based job evaluation: A market-based job evaluation is a strategy that compares the average wages and benefits of similar or identical jobs across the industry.

Marketplace: A marketplace is the digital or physical location where a business operates, such as a website or a brick-and-mortar storefront.

Mass partial unemployment: Mass partial unemployment is when several employees are furloughed or endure a reduction of hours for the same reason, such as their employer downsizing or adjusting to an event that disrupts operations.

Mass separation notice: A mass separation notice is a report an employer may send to a state outlining the reason for mass layoffs, which could be required in response to the state receiving a wave of similar unemployment claims.

Matrix structure: A matrix structure is a management approach in which an employee reports to more than one person, such as a supervisor and a team lead.

Maximum benefits payable (MBP): MBP (aka maximum benefit amount or MBA) refers to the max amount of benefits an employee can earn in a benefit year.

Maximum potential benefit amount: The maximum potential benefit amount an individual may be eligible to receive in state or federal unemployment benefits.

Maximum potential duration: Maximum potential duration refers to the total number of weeks an individual is eligible to receive state or federal unemployment benefits.

Maximum weekly benefit amount (MWBA): The MWBA is the total amount an individual may receive in a single week from state or federal unemployment benefits.

Medicaid program: The Medicaid Program is a federal program that provides wellness support to families below a certain income threshold.

Medical support: Medical support refers to guidance that specifies what monetary benefit an employee receives from their health insurance.

Medicare: Medicare is a federal health insurance option for people 65 and older, certain people living with disabilities and those with End-Stage Renal Disease (ESRD). Medicare is divided into three parts: hospital insurance, medical insurance and prescription drug coverage.

Mentoring: Mentoring is when one individual — who is usually older and more experienced — shares knowledge with someone who is newer to their field or craft. Reverse mentoring, however, swaps these roles, giving more experienced professionals a chance to learn from emerging talent.

Merger: A merger is when two or more organizations legally unite, combining resources and workforces. All relevant state agencies must be notified of a merger. In fact, a merger could have a significant impact on an organization’s experience rating and, thus, the rate of its state unemployment tax. A divestiture analysis examines the experience ratings of all entities involved in the merger, potentially yielding savings for the combined company. However, every state handles the transfer of experience ratings differently. Consult a licensed legal professional before making assumptions.

Merit increase: A merit increase is a raise awarded to an employee for meeting or exceeding the expectations of their role.

Merit rating: A merit rating is a qualification given to businesses for the purposes of state unemployment insurance. When an organization first forms, the applicable state may require it to go through a period of liability. Once completed, the state will provide the company with its official merit rating.

Minimum wage: The minimum wage is the lowest hourly wage a company can pay its employees, as dictated by state or federal law.

Mission statement: A mission statement is a succinct description of what an organization does and the goals it seeks to achieve. For example, Paycom’s mission statement is “to simplify life for employees and help our clients succeed.”

Missouri Compensation (MO Comp): MO Comp is a tax break given to employers in Missouri for paying withheld income tax early or on time.

Mobility: Mobility refers to the option for an employee and their family to move from one location to another for work.

Mobility premium: A mobility premium (aka “moving bonus”) is additional wages paid to an employee to help justify their relocation for a work assignment or position.

Monetary determination: A monetary determination is a notice — usually related to unemployment benefits — that clarifies if an individual qualifies to receive certain compensation under a government program. A monetary determination may also outline the specific compensation the relevant individual can expect to receive.

Moonlighting: Moonlighting is when an individual assumes additional employment beyond their full-time or primary job.

Most recent bona fide work: Most recent bona fide work refers to the last job a former employee accepted that was agreed upon in good faith, typically with the intent that the employment agreement would continue indefinitely between the employee and employer.

Most recent employer: A most recent employer is the last or current organization an individual was employed by. For the purposes of unemployment benefits in certain states, a most recent employer may be qualified by how long, and to what extent, an individual performed work for it.

Motivation: Motivations are the reasons that inspire individuals to work toward a specific cause, such as employees working toward their company’s goals.

Multi-jurisdiction: Multi-jurisdiction is a way to describe legal matters that pertain to parties across multiple different jurisdictions, such as separate states and countries. For example, a multi-jurisdiction lawsuit entails a claim that has alleged validity across all jurisdictions it relates to. Multi-jurisdiction laws also allow for the production of multiple W-2s at year-end for employees who worked in multiple states over a calendar year.

Multicultural: Multicultural is a way to describe organizations or groups composed of many different ethnicities, demographics and backgrounds.

Multinational organization: A multinational organization is a company that has its headquarters in one country but often conducts operations or maintains offices, stores or other facilities in separate countries.

N

National Automated Clearing House Association (NACHA): NACHA is a banking industry trade association that promotes the rules and operating guidelines for electronic payments through the Automated Clearing House Network.

Negative reserve balance: Negative reserve balance is the result of unemployment insurance benefit charges against an employer's reserve account exceeding the contributions paid.

Negative wages: Negative wages refer to prior quarter adjustments to an employee’s wages input in the current quarter that result in negative quarter-to-date (QTD) wages for the employee.

Nepotism: Nepotism is the practice of people of influence hiring or appointing their relatives or friends to positions in an organization, even though they may be less qualified than other candidates.

Net pay: Net pay is the part of an employee’s wages remaining after all deductions have been subtracted (i.e., taxes, health insurance, benefits, etc.).

New account coordinator: A new account coordinator manages new accounts and may be responsible for communicating with clients, working with sales and marketing, and managing account budgets.

New employer/non-merit rate: A new employer or non-merit unemployment insurance rate is a rate, fixed by legislation, that remains effective unless a regulatory change increases or decreases the rate or until the employer has met the state’s requirements to qualify for a merit rate based on its unemployment experience.

Nil: Nil refers to returns filed with no reported liability.

Non-cash fringe benefits: Non-cash fringe benefits are benefits provided to employees in a form other than money, and they may be taxable or nontaxable (i.e., a company car, health or life insurance, parking).

Non-charged benefits: Non-charged benefits are unemployment insurance benefits paid to claimants but not charged against a base year employer.

Non-sufficient Funds (NSF): NSF is a status referring to a bank account lacking the proper amount of funds required to cover a debit, which results in an incomplete monetary transaction.

Non-trust asset: A non-trust asset is anything held by an organization other than segregated assets, derived assets and recovered assets.

Noncustodial parent: A noncustodial parent is a parent who does not have primary custody of a child, even if they live with them part-time, but is responsible for financial support.

Nonexempt status employee: A nonexempt status employee is an hourly employee who is protected by the wage and hour laws of their state or the federal government by the Fair Labor Standards Act. This requires employers to pay at least a certain minimum hourly wage rate and a premium rate for overtime work.

Nonmonetary determination: A nonmonetary determination is a decision made by the initial authority based on facts related to an issue under specific conditions, including when present, past, or future benefit rights of a claimant or claimants are involved; when identifiable documents show the type and disposition of an issue, the material facts considered, and the legal result; and when the determination, if it involves the denial of benefits, is issued in the form of a written determination notice to the claimant.

Nonmonetary issue: A nonmonetary issue is an act, circumstance or condition potentially disqualifying an individual from their benefits rights under state law.

Nonmonetary redetermination: A nonmonetary redetermination is a decision made under statute, regulation or well-defined policy specifically requiring the reopening of a nonmonetary determination prior to the administrative appeal stage; it affirms, reverses or modifies a determination.

Nonprofit or government entities: Nonprofit organizations, state and local government entities, and political subdivisions are exempt from the Federal Unemployment Tax Act (FUTA) under Internal Revenue Code Section 501(c)(3) but are still covered by state unemployment laws.

Nonqualified plan: A nonqualified plan, in regard to employee benefits, is an employer plan that does not meet IRS qualification requirements.

Nonresident alien: A nonresident alien is a person from a foreign country working in the U.S. who does not pass either the “green card” or “substantial presence” residency test, but is subject to federal income tax on their U.S. income.

Nonresidential parent: A nonresidential parent is a parent who does not live with or have custody of a child but is responsible for financial support.

Not applicable (N/A): N/A means something isn’t relevant for a certain context. For instance, a single employee with no children may type “N/A” into a request for dependent info during open enrollment.

O

Obligation: An obligation is typically a requirement or debt, such as child support, to be paid by the responsible parent.

Obligee: An obligee is the person or agency to whom payments are owed (i.e., the custodial parent in a child support order).

Obligor: An obligor is a person who is legally obligated or required to pay a lien or garnishment. An employee who is subject to withholding is an obligor.

Occupational Safety and Health Act (OSHA): OSHA is a law requiring employers to provide employees working conditions that are free of known dangers.

Official Bank Check (OBC): OBC can be either a cashier’s check or a certified check. Banks provide official checks to their customers wishing to pay creditors with a check not drawn on the credit of those customers.

Offset: An offset is the sum of money taken from a parent’s state or federal income tax refund or other government-administered payment to pay child support or another court-ordered debt or charge.

Offset credit: An offset credit is a credit for FUTA tax that may be granted to employers who pay state unemployment tax.

Old Age Survivor and Disability Insurance (OASDI): OASDI provides monthly benefits to qualified retired and disabled workers, their dependents and survivors of insured workers.

On-the-job experience: On-the-job experience is the skills and knowledge a person gains from day-to-day work.

On-the-job training (OJT): OJT is acquiring knowledge, skills and competencies while participating in daily work.

Onboarding: Onboarding is the process of teaching new employees organizational policies, procedures and culture in addition to their job responsibilities.

One-day deposit rule: A one-day deposit rule is the requirement that taxes must be deposited by the close of the next banking day from any employer who accumulates an employment tax liability of $100,000 on any day during a monthly or semiweekly deposit period.

One-on-one meetings: One-on-one meetings are person-to-person communications (i.e., a conversation between an HR manager and an employee.)

Order: An order is the ruling of a magistrate, judge or empowered administrative officer.

Organizational chart (org chart): An organizational chart is a visual representation of how authority and responsibility are assigned within an organization.

Organizational development (OD): OD is a planned process using principles of behavioral science to improve how an organization runs.

Organizational structure: Organizational structure is the way employees and processes are categorized as departments or functions in an organization, as well as a description of reporting relationships.

Other compensation (other comp): Other compensation is any additional earnings, other than wages, declared on a person’s annual tax document and reported on a Form 1099.

Overhead: Overhead is the direct cost associated with operating a business, such as rent, salaries, benefits, equipment, technology, etc.

Overpayment: An overpayment is an amount of benefits paid to a person who is not legally entitled, regardless of whether the amount is later recovered.

Overtime: Overtime is the hours worked by nonexempt employees that exceed maximums set by federal or state law that must be compensated at a premium rate of pay. (Overtime can also refer to the premium itself.)

Overtime premium: The federal overtime premium is the amount equal to 150% (aka “time and a half”) of an employee’s regular rate of pay multiplied by all overtime hours worked.

Ownership interest: Ownership interest is the percentage of a company or business that a person or entity owns.

P

Part-time employee: A part-time employee works less than 40 hours per week, receives hourly pay and qualifies for Fair Labor Standards Act (FLSA) benefits.

Part-total unemployment: Part-total unemployment is any week in which an individual works less than 40 hours due to a lack of work, earns less than their weekly benefit amount and is not attached to their regular employer.

Partial claim: A partial claim is typically filed by an employee, with assistance from their employer, for any week in which the claimant worked reduced hours and did not earn an amount equal to or more than their weekly benefit.

Partial unemployment: Partial unemployment refers to workers who are attached to their regular employer but experience a reduction in weekly hours, through no fault of their own, and earn less than their weekly benefit amount. Claims for partial unemployment are typically filed by the employer.

Paternity judgment: A paternity judgement establishes a child’s legal father.

Pay for performance: Pay for performance (aka “performance-related pay”) is a payment model that incentivizes and rewards employees for certain results, behaviors or goals.

Paycom’s Performance Management tool: Paycom’s Performance Management tool helps organizations increase the efficiency and consistency of the performance review process while reducing the administrative burden of completing employee assessments.

Payee: A payee is a person or business receiving a payment.

Payroll cycle: A payroll cycle is the amount of time between each payday. If a company pays its employees on a weekly basis, every seven-day period represents a new payroll cycle.

Payroll Tax Management: Paycom’s Payroll Tax Management tool helps organizations simplify compliance by automatically debiting payroll taxes, depositing them on their due dates and remitting relevant filings.

Payroll variation (Alaska): Alaska uses a payroll variation plan based on quarterly wage declines.

Peers: Peers are people who share a similar status or are equal in age, background or profession.

Peg balance: Peg balance is the minimum balance required in a bank account.

Penalty: A penalty may be applied to an employer or individual who fails to meet a compliance obligation. For example, an organization that misses a tax deadline could receive a fine for each day the obligation remains outstanding.

Pending: Pending refers to something that has not yet happened or resolved. For example, after an employee reports an expense — but before it hits their paycheck — it could be categorized as pending reimbursement.

Per diem: Per diem refers to allowances given to employees to cover business- or travel-related expenses. It can also mean the amount of money an employee is paid per day.

Performance appraisal: A performance appraisal is a process of evaluating an employee’s effectiveness.

Performance management: Performance management is a continuous method of measuring an employee’s progress and rewarding or correcting their performance based on set goals.

Performance review: A performance review (aka “performance appraisal”) is an evaluation of an employee’s performance and development in conjunction with their manager and HR.

Performance standards: Performance standards are established behaviors and results that an employer expects an employee to meet.

Performance-based pay: Pay linked to how well an employee meets and exceeds expectations; better performance results in more pay.

Period of employment: A period of employment begins on an employee’s first day of work and extends through their last day of work prior to termination.

Permanent assignment: A permanent assignment refers to a worker’s regular or permanent position in a company.

Perquisites: Perquisites (aka “executive perks” or “fringe benefits”) are non-cash benefits awarded to employees of certain positions (i.e., company car, club membership).

Phantom stock arrangement: An employee enjoys the financial benefits of owning company stock but is not the actual owner in a phantom stock arrangement. In other words, an employee who owns phantom stock doesn’t possess a piece of the organization but may still receive any resulting profits.

Piece rate: Piece rate (aka “piece work” or “piece-rate pay”) is a system that pays employees a fixed rated for each unit of production.

Placement: Placement is the process of assigning an employee to a position.

Plaintiff: Plaintiff is the person who initiates legal action.

Planned Absence: A planned absence is when an employee gives notice or asks permission in advance to miss work (i.e., paid time off, vacation, FMLA).

Pooled account: A fund in which all contributions are mingled and undivided so organizations can more effectively manage financial resources.

Potential duration: Potential duration is the number of weeks of total unemployment a claimant may receive benefits in a benefit year or period of eligibility under the provisions of a state or federal unemployment compensation program.

Power of attorney (POA): A POA is a legal document that authorizes an individual to make decisions about another person’s finances, property or medical care.

Pre-note: A pre-note (aka “pre-notification”) is a zero-dollar test transaction used to validate an employee’s bank information (i.e., direct deposit).

Predecessor company: The entity that existed prior to a partial or total transfer of a business.

Premium: A premium is the amount of money an individual or business pays for an insurance policy.

Prevailing wage: Prevailing wage is the average wage paid to similarly employed workers in a certain location.

Private support: Withholding that is the result of a private agreement between parties or requested by the employee and often paid to a third party; for example, a trustee, bank, attorney or estate. A phrase in a support order such as “agreement between the court and listed parties” identifies a private support order. This lien type has a low priority; it takes precedence over employee wage assignments and other voluntary deductions only.

Professional employer organization (PEO): Companies sometimes use a PEO to outsource fundamental processes, such as HR.

Progress review: A progress review evaluates an employee’s progress toward goals and identifies areas for improvement.

Promotion: A promotion elevates an employee to a higher rank and usually includes an increase in responsibility and pay.

Property right: A property right is the legal ownership someone has over something. In HR, a worker may have “property” over the rate of pay, estimated hours and benefits they earn based on the employment agreement the individual originally signed.

Prorating: In payroll, prorating refers to paying an amount less than an employee’s estimated hours. This could occur when an employee takes unpaid leave. Rather than pay a salary equivalent to their typical pay, HR may omit earnings — such as for an eight-hour shift — to account for the employee’s absence.

Purged: Purged refers to something that is removed or expunged. For example, companies may purge certain employment data if it’s no longer needed for compliance purposes.

Q

Qualified Employer: A qualified employer is an employer eligible for a calculated tax rate based on meeting two requirements: employment during certain specified periods and timely payment of taxes.

Quarter (QTR): A quarter is one of four three-month periods ending on March 31, June 30, September 30 or December 31, into which the financial year is divided.

Quarter-to-date (QTD): Quarter-to-date is a timeframe that covers all organizational activity from the start of the current quarter to now or a previous date specified when the data is collected.

Quarterly Contribution and Wage Reporting: Quarterly contribution and wage reporting is a tax report filed during April, July, October and January for the previous calendar quarter. It includes gross payroll, taxable payroll, non-taxable payroll, state unemployment insurance (SUI) tax rate and SUI taxes due.  Certain states’ reporting will include or require information regarding supplemental taxes, surcharges, credits, penalties and monthly employee counts.  This information is used by the state agency to determine future SUI tax rates. The federal government may also use this data for statistical purposes in labor reporting.

R

Raise: A raise is an increase in pay that is often based on an employee’s performance.

Range penetration: Range penetration is a compensation metric that compares an employee’s pay to the total salary range for their role or similar position.

Reasonable accommodation: A reasonable accommodation is an adjustment to job, hiring process or work environment for an individual with a disability.

Receivable: Receivable refers to an outstanding balance owed to a business for services or goods rendered.

Reciprocity: Reciprocity is an agreement between multiple states that allows an employee to work in one state and live in another without having to pay state taxes in both.

Reconciliation: Reconciliation is the process of comparing two sets of financial records to confirm they are correct. For example, payroll reconciliation ensures that the amount paid to an employee matches the company’s expense records (i.e., benefits, wages, deductions).

Records retention schedule: A records retention schedule defines the length of time an organization must retain certain documents and when they should be destroyed.

Recruitment: Recruitment is the process of finding and hiring qualified candidates for a specific job.

Redeployment: Redeployment is the process of moving an employee to a different role or location, often to avoid layoffs.

Reduction in Force (RIF): RIF occurs when a company permanently eliminates certain positions.

Redundancy: Redundancy is the reduction or termination of employees for reasons unrelated to job performance.

Reference check: A reference check is when an employer verifies a job applicant’s skills, experience and education by contacting their references and previous employer.

Referral program: A referral program is a recruiting technique that rewards employees for referring candidates to open roles.

Regular compensation: Regular compensation is the wages or base salary an employer pays an employee for services performed over the course of their employment.

Reimbursable employer: Some nonprofit organizations, political subdivisions and governmental entities are considered reimbursable employers because they make payments in lieu of contributions to a state unemployment fund.

Reimbursement: Reimbursement is repayment for money already spent. For example, an employer will reimburse an employee for costs incurred while on the job (i.e., mileage, travel).

Relocation: Relocation is when an employer moves an employee from one location to another for their job.

Relocation services: An employer provides relocation services to help employees move (i.e., home-finding assistance, moving services, tax and legal advice).

Reopened claim: A reopened claim is the first claim filed for unemployment compensation benefits after a break in claim series during a benefit year caused by any reason other than intervening employment (i.e., illness, unavailability, failure to report).

Reorganization: A reorganization occurs when a company changes or rearranges its structure or business model, usually to improve efficiency and profitability.

Replacement check: A replacement check is issued when a check is lost, destroyed or never received.

Replacement planning: Replacement planning is a talent strategy that identifies suitable replacements or backups for unexpected vacancies. It is typically reactive, whereas succession planning focuses on leadership development.

Reporting Agent (RA): An RA is a company or individual — like Paycom — that is authorized to prepare and execute payroll taxes on behalf of a taxpayer.

Reprimand: A reprimand is a written or verbal warning given to an employee by their employer following misconduct.

Requalification: A process by which a claimant may reestablish eligibility for unemployment insurance through reemployment following a determination of ineligibility and a period of disqualification.

Reserve account: A reserve account is a non-transactional account that is used to accumulate funds for a future purpose.

Reserve balance: The sum of all contributions made to an employer SUI account minus benefit charges. Monies in the account are not refundable to the employer.

Responsibility: A responsibility is a day-to-day duty that an employee performs as part of their job description.

Retroactive pay: Retroactive pay (aka “retro pay”) is compensation added to an employee’s paycheck for work they already performed during a previous pay period. It applies to regular and overtime hours.

Return on Investment (ROI): ROI is a metric used to evaluate the profitability of a purchase or investment. For example, it can be used to measure the overall value of HR and payroll software.

Returned item: A returned item is when a bank declines a financial transaction, typically due to insufficient funds or incorrect information.

Reversal: A reversal is an attempt to retrieve erroneously deposited funds. Employers can reverse an incorrect payroll direct deposit if they meet certain conditions set by the Automated Clearing House (ACH).

Revised rate: A revised rate is issued when the original rate has been altered or modified to make it more accurate.

S

Sabbatical leave: Sabbatical leave is when an employee takes an extended break from work — often paid — to travel, study or rest.

Salary: Salary is a fixed payment, typically paid to an employee for work performed on a biweekly or monthly basis.

Salary range: Salary range is the minimum and maximum amount of pay for a position.

Salary-exempt employees: Salary-exempt employees refer to workers who earn an annual salary and are not covered by the minimum wage and overtime pay requirements of the FLSA.

Sarbanes-Oxley Act: The Sarbanes-Oxley Act (aka “SOX”) was enacted in 2002 to prevent and punish corporate accounting fraud and corruption. It also established whistleblower protections for employees who report fraud.

Screening tool: A screening tool is used during the hiring process to help assess a candidate’s job suitability.

Seasonal company: A seasonal company (aka “seasonal business”) only operates during certain seasons (i.e., summer camp, Halloween retailer). This means they do not process payroll in every quarter of the calendar year.

Section 125: Section 125 (aka “cafeteria plan”) of the IRS Code is an employer-sponsored benefit plan that allows employees to choose between cash and a variety of nontaxable benefits.

Selection: Selection is the process of choosing the best candidate for a position.

Self-assessment: A self-assessment is an employee’s evaluation of their own performance.

Separation ratio: Separation ratio (aka “turnover rate”) is the number of employee separations during a month divided by the average number of employees on payroll.

Separation record: A separation record is a document outlining the reasons for an employee’s departure from a company.

Settlement date: A settlement date is the day a trade or derivative contract is finalized, meaning the payment is made and ownership is transferred.

Severance pay: Severance pay is compensation given to employees who have been laid off by their employer.

Shift differential: Shift differential is extra compensation for employees who work outside normal business hours (i.e., nights, weekends).

Short-term disability (STD): STD pays a portion of an employee’s salary when they are unable to work for a short period of time due to injuries not related to work (i.e., illness, medical procedure).

Situational interview: A situational interview is when an interviewer asks an interviewee how they would respond to hypothetical scenarios.

Social Security: Social Security is a federal insurance program that provides retirement benefits, survivor benefits and income for those who cannot work due to a disability.

Social Security Administration (SSA): The SSA is a U.S. government agency that administers Social Security, assigns Social Security numbers and runs the Supplemental Security Income program.

Social Security Number (SSN): An SSN is a unique nine-digit identifier assigned to U.S. citizens and other residents in the format 000-00-0000 to track taxes and earnings.

Sole proprietorship: Sole proprietorship refers to a business that has just one owner.

Sourcing: Sourcing is a recruiting technique that proactively identifies qualified candidates.

Split payroll: Split payroll is the process of splitting an employee’s salary between their home-country currency and local currency.

Spousal support: Spousal support (aka “alimony”) is the money that one spouse pays to the other spouse after a legal separation or divorce.

Staffing: Staffing is the ongoing process of recruiting, evaluating and hiring people for specific positions.

Stakeholders: Stakeholders are individuals, groups or organizations with an interest, or stake, in a business (i.e., customers, suppliers, investors, employees).

Stale-dated checks: Stale-dated checks have not been cashed or deposited within a specified amount of time (typically six months) and are often void.

Standard contribution rate: The standard contribution rate is the basic rate from which variations are computed under the experience-rating provisions of a state’s unemployment compensation law.

Standard Industrial Classification (SIC) code: SIC codes are four-digit numbers assigned to employers to identify the industry they belong to. Established in 1937, SIC codes have since been mostly replaced by the North American Industry Classification System (NAICS).

Startup: A startup is a recently established business.

State Disability Insurance (SDI): SDI provides short-term disability benefits to employees who are unable to work due to an illness or injury.

State Income Tax (SIT): SIT is a state-mandated tax on employee wages.

State Parent Locator Service (SPLS): A SPLS is a state-provided service designed to locate noncustodial parents and establish/ensure paternity, visitation and child support.

State Unemployment Insurance (SUI): SUI is a quarterly tax paid by employers to a state unemployment agency.

State Unemployment Insurance identification: A State Unemployment Insurance identification number is assigned to employers by a state agency to track related functions and reporting.

Statement of payment: A statement of payment is a document showing information about an employee’s dates of employment, hours worked, earnings, deductions and any other relevant taxes.

Statutory benefit: A statutory benefit is one that an employer is legally required to provide.

Stay interview: A stay interview is conducted with active employees to understand what keeps them at their company and what can be done to improve and continue their employment.

Stock option: A stock option is a benefit that enables employees to buy or sell stock in their company at a specified price for a limited period of time.

Subject to: Subject to means that the compensation or wages are taxable.

Subsidiary: A subsidiary is a business or corporation owned or controlled by another company.

Successor: A successor acquires all or part of another business.

SUI exempt: SUI exempt companies are not required to pay State Unemployment Insurance tax.

SUI reimbursable: SUI reimbursable employers reimburse the state for unemployment claim benefits paid to former employees instead of making quarterly contributions. This typically applies to certain nonprofits, religious organizations and government employers.

SUI surcharge: An SUI surcharge is an additional fee assessed by a state unemployment agency to replenish funds or pay back loans.

Supervisor: A supervisor is a person who oversees, or supervises, employees and their work.

Supplemental wages: Supplemental wages are compensation given to employees in addition to their regular pay (i.e., commission, bonuses).

Support order: A support order requires a certain percentage of an employee’s wages to be withheld for child, spousal or medical support.

Surcharge: A surcharge is an additional fee or tax.

T

Talent management: Talent management is the method of attracting, recruiting and onboarding new employees. This also includes the techniques an employer uses to develop and retain their current workforce.

Talent pool: A talent pool is a database of resumes or a collection of qualified workers that a company can search to recruit individuals for a certain role.

Targeted selection: Targeted selection is the evaluation of a candidate’s previous job-related behavior to gauge and predict future performance.

Tax: Tax is an amount of money that a government requires an employee or employer to pay, based on their income, profit and more to cover the cost of public services.

Tax audit: A tax audit is a review of a business or individual tax return to ensure they have accurately reported and paid their taxes.

Tax bill: A tax bill is a document that itemizes the taxes a business or individual must pay to a government or legal body.

Tax bracket: A tax bracket (aka “marginal tax bracket” or “tax rate”) refers to a range of individual or business incomes subject to taxes.

Tax levy: A tax levy is the legal seizure of a portion of an employee’s wages to satisfy a debt with the IRS.

Tax Rate Analysis: This analysis compares the tax rates of two or more years. The tax savings/loss is calculated for the current year or the cumulative of two or more years.

Tax rate notice: A tax rate notice is issued to employers each year by the governing state agency. It indicates the unemployment tax rate for the year period, which is typically calculated using a calendar year. However, certain states follow a fiscal year period.

Taxable: Taxable refers to the wages or amount of compensation subject to a certain tax type and used to determine how much is owed.

Taxable fringe benefits: Taxable fringe benefits are reported on an employee’s W-2 and considered part of their compensation. Generally, an employer withholds income tax on these benefits from a worker’s usual pay for the period the benefits are paid or considered paid.

Taxable payroll: Taxable payroll is the sum of an organization’s taxable wages subject to the provisions of applicable laws.

Taxable wage base: The taxable wage base is also known as the Social Security wage base. This is the maximum amount of an employee’s earned income that’s subject to state unemployment tax, federal unemployment tax and Social Security tax.

Taxpayer Identification Number (TIN): A TIN is a unique set of numbers used by the IRS to track and identify taxpayers. A Social Security number, individual taxpayer identification number and employer identification number are all forms of TIN.

Temporary employee: A temporary employee is hired for a limited period of time and may qualify for Fair Labor Standards Act (FLSA) benefits.

Tenure: Tenure is the act of holding a permanent position or role without the need for a contract renewal.

Third-party sick pay (3PSP): A disability insurance benefit, third-party sick pay (3PSP) enables employees on long-term medical leave to receive partial or full wage benefit payments. Employees receive payment through a state temporary disability plan, insurance company or union plan rather than their employer.

Time-to-fill: Time-to-fill is a recruiting metric measuring the average number of days it takes to fill an opening.

Tipped employee: A tipped employee works in an occupation in which they customarily and regularly receive more than $30 a month in tips.

Total compensation: Total compensation is the complete pay package an employee receives from their employer, including services, benefits, money and other perks.

Total rewards: Total rewards is a recruitment and retention strategy that refers to the combination of monetary and non-monetary benefits a company provides to its employees.

Tuition reimbursement: Tuition reimbursement is an employee benefit wherein a company covers some or all of the costs of an educational course completed by an employee.

U

Unemployment Compensation for Ex-Servicemembers (UCX): UCX is a federal program that provides benefits to former military.

Unemployment Compensation for Federal Employees (UCFE): UCFE is a federal program that provides benefits to federal employees who lost their job through no personal fault.

Unemployment compensation or insurance (UC or UI): Unemployment compensation is a program under which an individual who is unemployed through no fault of their own is paid weekly benefits based upon their past wages in employment covered by state or federal laws.

Uniform base period: A uniform base period is a timeframe that starts on the same calendar date for a new or transitional claim for all claimants.

Uniform benefit year: A uniform benefit year is a timeframe that starts the same date for all claimants in a state.

Uniform duration: Uniform duration is a provision of state unemployment compensation laws establishing the same number of weeks of coverage for all eligible claimants.

Uniform Interstate Family Support Act (UIFSA): The UIFSA is a national support law eliminating the possibility of two or more valid (and possibly conflicting) child support orders existing in different states for the same child. UIFSA allows the child’s home state to obtain personal jurisdiction over the noncustodial parent (to the extent permitted by the Constitution).

Uniform Reciprocal Enforcement of Support Act (URESA): The URESA is federal law that provides a mechanism for establishing and enforcing support obligations when the noncustodial parent lives in one state and the custodial parent and child (or children) live in another.

V

Values: Values are the lasting beliefs of members of a culture, group or business entity about what is good or desirable and what is not.

Variable pay plan: A variable pay plan is a policy that aligns compensation with performance. It may include profit sharing, incentives, bonuses or commissions.

Vesting: Vesting is an Employee Retirement Income Security Act (ERISA) guideline that stipulates employees must be entitled to their benefits from a pension fund, profit-sharing plan or employee stock ownership plan within a certain period of time, even if an individual no longer works for the applicable employer.

Visitation: The right of a noncustodial parent to visit or spend time with their children following separation or divorce.

Voluntary benefits: Voluntary benefits are extra benefits or discounted services offered to employees with little extra cost to the employer.

Voluntary contribution: A voluntary contribution is additional monies paid into an SUI account, other than quarterly payments.

Voluntary contribution analysis: A voluntary contribution analysis determines if a voluntary contribution is profitable for an employer. A substantial change in taxable payroll can affect the contribution analysis.

Voluntary Plan Disability Insurance (VPDI): VPDI is a state option allowing an employer and/or individuals to purchase private disability insurance in place of a state disability insurance (SDI) plan. This private insurance is administered by the employer or an insurance carrier.

W

W-2: IRS Form W-2 reports an employee’s annual wages and the taxes withheld. This form is used by the employee to file federal and state taxes.

W-3: IRS Form W-3 (aka “Transmittal of Wage and Tax Statements form”) summarizes a business’s total wages and tax withholdings. This form is sent to the Social Security Administration for filing.

W-4: IRS Form W-4 (aka “Employee’s Withholding Certificate”) is completed by the employee and indicates how much tax the employer should withhold from their paycheck.

Wage and separation report: When an employee files a claim for unemployment benefits, their state unemployment insurance agency requests a wage and separation report from their former employer to confirm the wages earned during a certain base period and reason for separation.

Wage assignment: Wage assignment is when a creditor voluntarily takes money from an employee’s paycheck to satisfy a debt.

Wage attachment: A wage attachment (aka “wage garnishment”) is a legal order that requires employers to withhold an employee’s wages and send it directly to a creditor to pay off a debt.

Wage band: A wage band (aka “salary band” or “pay band”) is the compensation range for a specific or similar role.

Wage base: Wage base is the maximum amount of an employee’s income subject to tax in a single calendar year.

Wage claim penalty: A wage claim penalty is issued by a state unemployment insurance agency against an employer who fails to respond timely to an unemployment claim.

Wage credits: Wage credits are wages earned by a person working in employment that is covered by unemployment.

Wage detail report: A wage detail report lists each employee who is currently employed with an organization. It is filed with state unemployment insurance returns on a quarterly basis.

Wage record: A wage record lists an employee’s name, Social Security number, wages and hours worked.

Wage report: A wage report is filed quarterly by the employer and lists each individual worker’s name, Social Security number, wages and hours worked.

Wage withholding: Wage withholding is an automatic payroll deduction of part or all an employee’s wages. It can be voluntary or involuntary and is used to fund things like Social Security, income taxes or financial obligations such as child support.

Wages: Wages are payment an employee receives in exchange for their labor.

Waiting period: A waiting period is the length of time an employee must wait before their coverage takes effect (i.e., insurance, unemployment).

Waiver: A waiver is the voluntary relinquishment of a right.

Webinar: A webinar (aka “web-based seminar”) is an online event. It is a live or on-demand presentation about a specific topic with the purpose of educating and informing the audience.

Week of partial unemployment: A week of partial unemployment is when an employee works less than regular, full-time hours for their employer due to a lack of work. This means that if the employee qualifies for unemployment, they will receive less than their full weekly benefit amount.

Week of unemployment: A week of unemployment is any week in which an employee is partially or completely unemployed.

Weekly Benefit Amount (WBA): The WBA is the allocated amount of unemployment benefits a claimant receives per week.

Weekly earnings allowance: A weekly earnings allowance is the maximum amount a claimant can earn without a reduction in their weekly benefit amount.

Weeks claimed: Weeks claimed is the weeks covered by intrastate continued claims and interstate continued claims taken for which waiting period credit or payment of compensation is requested.

Weeks compensated: Weeks compensated is the amount of weeks for which unemployment benefits are paid.

Wire transfer: A wire transfer is an electronic payment that transfers funds from one bank account to another.

Withholding allowance: A withholding allowance is an exemption that reduces the amount of income tax deducted from an employee’s wages.

Withholding rate: The withholding rate is the total amount withheld for a taxing jurisdiction.

Witness: A witness typically refers to an individual who testifies at a court hearing. This person provides testimony because they have seen, heard, perceived or have knowledge about the incident.

Work sharing: Work sharing is a reduction in hours and/or wages of a group of employees to avoid layoffs.

Work-life balance: Work-life balance is the amount of time a worker spends on professional activities compared to personal activities.

Work-life balance programs: Work-life balance programs are designed to help employees better balance their professional and personal lives.

Worked in: Worked in is the location in which an employee works.

Workers’ compensation: Workers’ compensation (aka “workers’ comp”) is a form of insurance that provides benefits and wages to employees who are injured or become ill on the job.

Workforce: Workforce refers to the number of people working for a single company or in a particular industry or geographical area.

Workforce analytics: Workforce analytics is the process of collecting and analyzing employee data to improve an organization.

Workforce planning: Workforce planning is the process of assessing, planning and forecasting an organization’s staffing needs.

Workforce rotation: Workforce rotation is the practice of shifting employees between jobs, times or locations within their organization.

Workplace: A workplace is a place where people work (i.e., office, factory, restaurant).

Y

Year-to-Date (YTD): YTD is the timeframe beginning at the first of the calendar or financial year until present time.

Z

Zero-based budgeting: Zero-based budgeting is a process that requires every budget item to be approved rather than only budget changes. In this style of budgeting, no reference is made to previous expenditures.

#

1096: The Form 1096 is filed by individuals to withdraw all funds from their retirement plan.

1099: The Form 1099 is an annual statement reflecting all non-employment compensation (like a 401(k) match) that must be reported on a personal tax return. This form can be administered to employees, contractors and other individuals.

1099-R: The Form 1099-R is an annual statement of disbursements and taxes from retirement or profit-sharing plans.

360-degree feedback: Also known as “multi-rater feedback,” 360-degree feedback is input gathered from internal and external resources. Basically, everyone an employee interacts with can contribute to 360-degree feedback.

3PSP: 3PSP is an abbreviation for “Third-Party Sick Pay.”

401(k), 403(b), 408(k), 501(c): These arrangements allow employees to place pre-tax earnings into a retirement plan. Contributions to these plans aren’t taxed until withdrawn.

403(b) Annuity: 403(b) annuity refers to an annuity or mutual fund that provides retirement income to tax-exempt employees (e.g., public school teachers and workers at religious institutions).

940: The Form 940 is an annual tax form that reconciles an employer’s payments for the Federal Unemployment Tax Act (FUTA). This form also presents an employer’s full unemployment tax liability and any credit for unemployment taxes paid to applicable states.

941: The Form 941 is a quarterly federal tax return that shows all taxable wages and taxes. It also presents all Federal Income Tax (FIT), Social Security and Medicare liabilities incurred during the quarter.

941 (PR): Like the Form 941, the Form 941 (PR) is a quarterly federal tax return that shows all taxable wages, taxes and liabilities for employers whose primary place of business is in Puerto Rico.

941 (Schedule B): The Schedule B is a supplement to the 941. It shows daily tax liabilities and must be filed quarterly if an employer has a daily tax liability of $100,000 or more. This requirement also applies to businesses that must deposit payroll taxes on a semiweekly schedule.

943: The Form 943, or the Employer’s Annual Return for Agricultural Employees, shows taxes, taxable wages and liabilities incurred monthly. This form must be filed if a business has $3,000 or more in liability for a given month.

943-A: The 943-A supplements the Form 943 and outlines daily tax liabilities.

945: The Form 945, or the Annual Return of Withheld Federal Income Tax, is filed annually to account for non-payroll earnings like IRAs, pensions, annuities, gambling winnings and backup withholdings.