Common HR Terms
Administrative Services Outsourcing (ASO)
Administrative Services Outsourcing (ASO) is an arrangement in which a company partners with a third-party provider to manage administrative HR functions such as payroll processing, benefits administration, compliance support, and HR operations while the organization retains employer responsibility.
Affirmative Action Plan (AAP)
An Affirmative Action Plan is a formal program designed to promote equal employment opportunity and address workplace discrimination through workforce analysis, hiring benchmarks, and outreach initiatives.
Affordable Care Act (ACA)
The Affordable Care Act is a federal healthcare reform law enacted in 2010 that expanded access to health insurance and established employer coverage requirements and reporting obligations for Applicable Large Employers.
Age Discrimination in Employment Act (ADEA)
The Age Discrimination in Employment Act protects employees and job applicants age 40 and older from discrimination in hiring, promotion, compensation, termination, or other employment decisions.
Americans with Disabilities Act (ADA)
The Americans with Disabilities Act prohibits discrimination against qualified individuals with disabilities and requires employers to provide reasonable accommodations that allow employees to perform essential job functions.
Applicable Large Employer (ALE)
An Applicable Large Employer is an organization with 50 or more full-time or full-time equivalent employees and must comply with ACA employer mandate requirements.
Applicant Tracking System (ATS)
An Applicant Tracking System is software used to manage recruiting processes, including job postings, candidate tracking, resume screening, and interview scheduling.
Attrition
Attrition refers to the reduction of employees through voluntary resignation, retirement, or other natural separations rather than employer-initiated termination.
Availability Analysis
Availability analysis evaluates the representation of women and minorities in the qualified labor market compared to an organization’s workforce. It is commonly used as part of affirmative action planning.
Background Check (Employment Screening)
A background check is the process of verifying a job candidate’s employment history, education, criminal records, and other credentials to support informed hiring decisions.
Behavior-Based Interviewing
Behavior-based interviewing evaluates candidates by asking them to describe past experiences to predict future job performance.
Benefits (Employee Benefits)
Employee benefits are non-wage compensation provided to employees, such as health insurance, retirement plans, paid leave, and wellness programs.
Bona Fide Occupational Qualification (BFOQ)
A Bona Fide Occupational Qualification is a legal exception that allows employers to consider certain protected characteristics when they are essential to the performance of a job.
Business Continuity Plan (BCP)
A Business Continuity Plan outlines procedures that allow an organization to continue operations during emergencies or disruptions.
Business-to-Business (B2B)
Business-to-Business refers to commercial transactions conducted between companies rather than between a business and individual consumers.
Candidate Screening (Screening)
Candidate screening is the process of reviewing resumes, applications, and qualifications to determine whether candidates meet the requirements for a role.
Candidate Sourcing (Sourcing)
Sourcing is the proactive process of identifying and engaging potential candidates through recruiting platforms, professional networks, and talent pipelines.
COBRA (Consolidated Omnibus Budget Reconciliation Act)
COBRA allows eligible employees and dependents to continue employer-sponsored health insurance coverage after qualifying events such as termination or reduction in hours.
Co-Employment
Co-employment is a shared employment arrangement between a company and a Professional Employer Organization where both parties share certain employment responsibilities.
Compa Ratio
Compa ratio compares an employee’s salary to the midpoint of the pay range for their role and is used to evaluate compensation competitiveness and internal pay equity.
Compensation and Benefits
Compensation and benefits refer to the full package of pay and rewards employees receive, including salary, bonuses, and benefits.
Contingent Worker
A contingent worker is a non-employee who performs services for an organization, such as independent contractors, consultants, or temporary workers.
Corrective Action
Corrective action is a structured process used to address employee performance or conduct issues and support improvement.
Cost-Per-Hire
Cost-per-hire is a recruiting metric that calculates the total cost associated with hiring a new employee.
Department of Labor (DOL)
The United States Department of Labor is the federal agency responsible for enforcing labor laws related to wages, workplace safety, and employment protections.
Diversity, Equity, and Inclusion (DEI)
Diversity, Equity, and Inclusion refers to workplace initiatives designed to promote representation, fairness, and an inclusive organizational culture.
Disparate Impact vs. Disparate Treatment
Disparate impact occurs when a neutral employment policy disproportionately affects members of a protected group. Disparate treatment refers to intentional discrimination against individuals based on protected characteristics.
Due Diligence (HR Due Diligence)
HR due diligence evaluates workforce risks, compensation structures, benefits obligations, and compliance issues during mergers, acquisitions, or organizational changes.
EEO-1 Survey
The EEO-1 Survey is an annual workforce demographic report submitted to the Equal Employment Opportunity Commission by certain employers to support the enforcement of federal anti-discrimination laws.
Employee Assistance Program (EAP)
An Employee Assistance Program provides confidential counseling and support services to employees for personal or work-related challenges.
Employee Engagement
Employee engagement measures the level of commitment, motivation, and emotional connection employees feel toward their organization.
Employee Referral Program
An employee referral program encourages employees to recommend candidates for open roles, often offering incentives when referrals are successfully hired.
Employee Retirement Income Security Act (ERISA)
The Employee Retirement Income Security Act establishes federal standards for employer-sponsored retirement and health benefit plans.
Employee Value Proposition (EVP)
An Employee Value Proposition defines the unique combination of culture, compensation, career opportunities, and benefits offered by an employer.
Employment at Will
Employment at will allows either the employer or employee to terminate employment at any time for any lawful reason.
Equal Employment Opportunity Commission (EEOC)
The Equal Employment Opportunity Commission enforces federal laws that prohibit employment discrimination.
Equal Pay Act
The Equal Pay Act requires employers to pay men and women equally for performing substantially similar work.
Essential Job Functions
Essential job functions are the fundamental duties an employee must be able to perform in a position.
Exempt vs. Non-Exempt Employee (FLSA Classification)
Under the Fair Labor Standards Act, exempt employees are not eligible for overtime pay, while non-exempt employees must receive overtime compensation when working more than 40 hours in a work week.
Exit Interview
An exit interview is conducted when an employee leaves an organization to gather feedback and identify potential workplace improvements.
Fair Labor Standards Act (FLSA)
The Fair Labor Standards Act establishes minimum wage, overtime pay, and child labor standards.
Family and Medical Leave Act (FMLA)
The Family and Medical Leave Act provides eligible employees with job-protected, unpaid leave for specific family and medical reasons.
Flex Time (Flexible Work Schedule)
Flex time allows employees to vary their work hours while still completing required work schedules.
Flexible Spending Account (FSA)
A Flexible Spending Account allows employees to set aside pre-tax income to pay for eligible healthcare or dependent care expenses.
Full-Time Equivalent (FTE)
Full-Time Equivalent is a measurement used to represent the number of full-time employees based on total hours worked.
Gender Wage Gap
The gender wage gap refers to the difference in average earnings between men and women in the workforce.
Genetic Information Nondiscrimination Act (GINA)
GINA prohibits employers from requesting or using genetic information when making employment decisions.
Grievance
A grievance is a formal complaint raised by an employee regarding workplace treatment, policies, or conditions.
HIPAA (Health Insurance Portability and Accountability Act)
HIPAA protects sensitive healthcare information and regulates how employee medical data is handled.
Human Capital
Human capital refers to the collective skills, knowledge, and abilities of an organization’s workforce.
Human Capital Management (HCM)
Human Capital Management is a strategic approach to recruiting, managing, and developing employees.
Human Resources (HR)
Human Resources is the organizational function responsible for workforce management, recruiting, employee relations, compensation, and compliance.
Human Resources Business Partner (HRBP)
An HR Business Partner works closely with leadership to align HR strategies with business objectives.
Human Resources Information System (HRIS)
An HRIS is software used to manage employee data, payroll, benefits, recruiting, and HR processes.
Human Resources Outsourcing (HRO)
Human Resources Outsourcing involves delegating HR responsibilities to an external service provider.
Internal Revenue Service (IRS) – Employer Identification Number (EIN)
The Internal Revenue Service assigns an Employer Identification Number to businesses for tax reporting and identification purposes.
Involuntary Termination
Involuntary termination occurs when an employer ends an employee’s employment due to performance issues, misconduct, or layoffs.
Job Analysis
Job analysis identifies the duties, responsibilities, and requirements of a position.
Job Description (JD)
A job description outlines the responsibilities, qualifications, and expectations associated with a role.
Job Evaluation
Job evaluation determines the relative value of jobs within an organization to establish fair compensation structures.
Key Performance Indicators (KPIs)
Key Performance Indicators are measurable metrics used to evaluate organizational or employee performance.
Knowledge, Skills, and Abilities (KSAs)
KSAs refer to the competencies required to perform a job effectively.
Labor Force
The labor force consists of individuals who are employed or actively seeking employment.
Labor Relations
Labor relations focus on the relationship between employers, employees, and labor unions.
Leadership Development
Leadership development refers to programs and initiatives designed to build leadership capabilities within an organization.
Leave of Absence (LOA)
A Leave of Absence is an approved period of time away from work while maintaining employment status.
Learning Management System (LMS)
A Learning Management System is software used to deliver and track employee training programs.
Maternity, Paternity, and Parental Leave
- Maternity leave refers to time away from work granted to employees following childbirth.
- Paternity leave allows fathers or partners time away from work after the birth or adoption of a child.
- Parental leave is a broader term that includes leave available to either parent following the birth, adoption, or placement of a child.
Mission Statement
A mission statement defines an organization’s purpose and guiding principles.
Negligent Hiring
Negligent hiring occurs when an employer fails to conduct appropriate background checks and hires an individual who causes harm that could have been prevented.
Nepotism
Nepotism is the practice of favoring relatives in hiring or employment decisions.
Non-Compete Agreement
A non-compete agreement restricts employees from working for competitors or starting competing businesses for a specified time after leaving an employer.
Non-Disclosure Agreement (NDA)
An NDA is a contract preventing employees from sharing confidential business information.
Occupational Safety and Health Administration (OSHA)
The Occupational Safety and Health Administration enforces workplace safety regulations and standards.
Onboarding
Onboarding is the process of integrating new employees into an organization.
Organizational Change
Organizational change refers to strategic initiatives that alter company structure, culture, processes, or leadership.
Paid Time Off (PTO)
Paid Time Off is employer-provided paid leave employees can use for vacation, illness, or personal needs.
Pay Equity
Pay equity ensures employees receive equal pay for comparable work regardless of protected characteristics.
Performance Appraisal
A performance appraisal is a formal evaluation of an employee’s work performance.
Performance Improvement Plan (PIP)
A PIP is a structured plan used to help employees improve performance deficiencies.
Performance Management
Performance management is the ongoing process of evaluating and developing employee performance.
Professional Employer Organization (PEO)
A PEO provides outsourced HR services through a co-employment arrangement.
Protected Class
A protected class refers to individuals protected from discrimination under federal or state law.
Quid Pro Quo Harassment
Quid pro quo harassment occurs when employment decisions are conditioned on submission to unwelcome conduct.
Reasonable Accommodation
A reasonable accommodation is a workplace adjustment that allows employees with disabilities to perform their job duties.
Recruiting
Recruiting is the process of attracting, evaluating, and hiring employees.
Reduction in Force (RIF)
A Reduction in Force is a workforce reduction due to restructuring or financial conditions.
Religious Accommodation
Religious accommodation involves modifying workplace policies or practices to allow employees to observe religious beliefs.
Retirement Plan
A retirement plan is an employer-sponsored benefit designed to help employees save for retirement.
Right-to-Work State
A right-to-work state allows employees to work for unionized employers without being required to join the union.
SHRM (Society for Human Resource Management)
The Society for Human Resource Management is a professional association that provides resources, certifications, and education for HR professionals.
Situational Leadership
Situational leadership is a management approach in which leaders adjust their style based on the needs and readiness of employees.
Skills Gap
A skills gap occurs when employees lack the skills required to perform current or future job responsibilities.
Stay Interview
A stay interview is a conversation with employees designed to understand why they remain with the organization and what may improve retention.
Succession Planning
Succession planning identifies and prepares employees to fill key leadership or specialized roles in the future.
Talent Acquisition
Talent acquisition is the strategic process of identifying, attracting, and hiring qualified employees.
Time and Labor Management
Time and labor management refers to systems used to track employee work hours, scheduling, and attendance.
Title VII of the Civil Rights Act
Title VII prohibits employment discrimination based on race, color, religion, sex, or national origin.
Total Compensation
Total compensation includes an employee’s entire compensation package, including salary, benefits, bonuses, and incentives.
Total Rewards
Total rewards refers to the comprehensive set of compensation, benefits, career development opportunities, and workplace experiences provided to employees.
Turnover Rate
Turnover rate measures the percentage of employees who leave an organization during a specific time period.
Unemployment Insurance
Unemployment insurance provides temporary financial assistance to eligible individuals who lose their jobs through no fault of their own.
Unfair Labor Practice
An unfair labor practice is an action by an employer or union that violates labor laws governing employee rights.
Values Statement
A values statement outlines the core principles and beliefs that guide an organization’s culture and decision-making.
Vision Statement
A vision statement describes the long-term aspirations and future direction of an organization.
Voluntary Termination
Voluntary termination occurs when an employee chooses to leave a position through resignation or retirement.
Work From Home/Remote Work (WFH)
Work from home, or remote work, allows employees to perform job duties outside a traditional office environment.
Workforce Planning
Workforce planning is the strategic process of analyzing workforce needs and planning future staffing requirements.