Off the Cuff: Evaluating and Compensating Production Employees, Part III

The issues an employee review must address boils down to answering the seven key questions an employee will want and need to know about his performance.
Feb 4, 2008

By Mark L. Venit, MBA

In the previous installment of this series, we explored implementing an Employee Review System that you can use to evaluate employee performance. Let’s turn now to scheduling employee interviews and what specific issues you should address.

Review Scheduling
Creating a meaningful employee review system means having a game plan about how it’s going to work and what will be asked of and told to employees. It also means having a basic understanding of fairness and professionalism. When should evaluations be conducted? My recommendation is decidedly quarterly.

Once a year is too long and unfair to the employee. Set a quarterly timetable and keep to it (e.g., the first week of the quarter, the mid-point, etc.). It should take no more than 15 minutes, though there’ll be appropriate exceptions.

Given the limited time allotted, reviews should be done on company time, on company premises and one-on-one in private. The employee is entitled to confidentiality except for the fact that the evaluation will be placed in his personnel file for future reference.

Clearly state that the purposes of the review are 1) to convey information, 2) facilitate communications between employer and employee, and 3) give the employee a progress report that in the eyes of management details his/her performance and employment status.

Emphasize that while employee evaluation scores are certainly an important component of assessing a wage rate, the review, itself, is not what management considers as the proper time and place for awarding raises. Explain that future raises will be based on skill levels, skill tests, length of service, the degree of compliance with company policies and any other company-specific criteria.

The “Seven Questions”
If an employee could plan for the review and figure out what he/she wants to know about his/her performance and status, here are the seven telling questions he/she would articulate:

 1. How am I doing?
 2. What must I do to improve my behavior or performance?
 3. Do I have a chance for advancement? (Though not everyone is interested in this).
 4. How will I be helped to improve?
 5. What changes in the company or in the business climate are likely and how will I be affected?
 6. What is expected of me by my next review?
 7. By what criteria will my performance be evaluated?

The correct answers to Questions 1 through 6 are simply the truth, as explained by the manager conducting the review.

The answer to No. 7 is vis-à-vis the establishment of a system of skill levels classifying each employee as a Level 1 Screen Printer or Embroiderer, Level 2 Screen Printer or Embroiderer, Level 3 Screen Printer or Embroiderer, and so forth.

In Part IV, which will appear in the Feb. 19, 2008, edition of the Impressions Newsletter, we'll look at how to create a compensation system that's based primarily on skills.
 
Mark L. Venit, MBA, is president of Apparel Graphics Institute Ltd., Ocean Pines, Md., which provides management and marketing consulting and proprietary research to apparel graphics companies throughout the Americas and Europe. He is also the chairman of ShopWorks Software LLC, a provider of industry-specific business software. Venit teaches pricing, strategic marketing, salesmanship and other business management topics at the Imprinted Sportswear Shows. You can reach him at markvenit@cs.com.

Click here to read "Evaluating and Compensating Production Employees, Part I."


Click here to read "Evaluating and Compensating Production Employees, Part II."

Off the Cuff: Confidentiality Agreements
Confidentiality agreements protect more than your assets. Just as importantly, they protect your customers.
Some of you might recall a column I published last November that addressed how to keep contract customers out of your production area in order to protect your work. This week's column looks at the other side of the same coin -- employee confidentiality agreements. These are legal agreements that are intended to keep your employees from talking about who's placing orders, for what quantities and dollars, what's being produced and who the end-user might.
September 15, 2008

Off the Cuff: How to Charge for Rush Service
Charging for rush service is justifiable, but be sure to outline  policies upfront and inform your customers.
The issues of whether and what to charge for rush service are common in the decorated apparel industry and there are valid arguments on all sides. Most companies feel they’re entitled to some degree of additional compensation for going our of their way to accommodate a rush order, for bumping other customers a notch or two back in the production line and for having to deal with the potential hazards of doing something faster than necessary. Oh, and the more sanguine reason: you can, if you choose, stick it to ’em when they’re on the ropes.
August 29, 2008

How to Profit from the Tax Write-Off for Conventions and Trade Shows
Thanks to Uncle Sam, you can deduct certain trade show and conference expenses from your income tax filing. Learn what’s deductible — and what’s not.
Imagine an enjoyable — and educational — vacation with Uncle Sam picking up part of the tab. That's right, every decorated apparel business, the owner and employees of that business (even someone who is a shareholder/employee), can legitimately claim an income tax deduction for the expenses paid or incurred in attending trade shows, conventions and meetings.
August 18, 2008

Tax Breaks for Education — What Every Decorated Apparel Business Owner Needs to Know
Embroiderers, screen printers and promotional products distributors can profit from breaks in the tax code to educate their employees and themselves.
Finding, hiring, training and retaining “smart” workers have long been key factors in the success of small businesses, including decorated apparel companies. Lawmakers have also recognized the importance of a smarter workforce and created a number of educational and training-related tax breaks and incentives. Those tax benefits allow every commercial embroidery, screen printing and promotional products business, large or small, to offer training and education as a “fringe benefit.”
August 04, 2008

Economic Stimulus Package Offers Tax Break for Equipment Buying
Decorators interested in expanding their business or replacing old equipment can rejoice in the new round of government incentives designed to help small business owners.
Earlier this year, Congress passed, and the President signed, the Economic Stimulus Package of 2008, a $168 billion economic “rescue” package that included rebates for taxpayers and tax breaks for businesses. In addition to those tax rebates, the heart of the package, there also were tax breaks for businesses such as decorated apparel operations — breaks retroactive to the beginning of 2008!
July 21, 2008