Best Practices for Human Resource Management

A. Employment Practices

1 Minimum. No practice in place. Use newspaper ads and word of mouth to fill open positions. Recruit only when openings are available.
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5 Typical. Usually recruit only when openings are available but also keep ongoing relationships with trade schools and headhunter services.
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10 Superior. Constantly recruiting and maintaining database of employment candidates with desired qualifications. Utilize numerous resources including trade schools, job fares, recruiting firms, and encourage employees to seek out other individuals with potential for excellent performance.

2. Behavioral Profiling and Pre-employment Testing.

1 Minimum. Do no pre-employment testing or evaluations of any kind. Most hiring decisions are ''gut'' decisions.
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5 Typical. Some applicants are given IQ tests or other form of skill assessment. Test results are not critical hiring determinates.
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10 Superior. All employees are tested and profiled. Specific skill assessment tests are used for sales, clerical, and technical positions. Positions are only filled by candidates who are emotionally, behaviorally, and intellectually qualified.

3. Defining Job Functions.

1 Minimum. Only a few positions have written job descriptions. Often, these are produced only when an employee requests them or when the company is making an effort to terminate an unwanted employee.
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5 Typical. Department managers have some form of written job description or list of responsibilities. Functions are seldom reviewed or used for performance evaluation.
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10 Superior. Each position within the company is defined. Functions and responsibilities are clearly set forth in writing. The relationships between functions are mapped out. Written descriptions are frequently reviewed, updated, and used when evaluating performance.

4. Initial Interviewing.

1 Minimum. Only the supervisor or manager interviews the candidate. Each interviewer asks his own questions. There is no specific training regarding the legal issues surrounding applicant screening.
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5 Typical. Interviews are conducted by more than one person. All candidates are interviewed at least twice prior to hiring. Interviewers have been made aware of legal requirements.
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10 Superior. All candidates are interviewed at least twice. Interviews are conducted by all level of employees who have been trained in interviewing techniques, as well as, legal issues. Interviewers meet to discuss each candidate before a hiring decision is made.

5. Background Investigations.

1 Minimum. Hiring supervisor or manager may check references at own discretion.
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5 Typical. The person responsible for the hiring always checks references. A record is kept of the references contacted and responses.
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10 Superior. References are checked independently by at least two people. Questions are scripted and responses are recorded and kept on file. Credit histories and public records are checked for positions responsible for handling cash. Additionally, candidates for F&I, department manager and above are investigated by an outside service.

6. Drug Testing.

1 Minimum. No drug testing is done.
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5 Typical. Usually those applicants who will be driving company and customer vehicles are required to complete a pre-employment drug test. No continuous testing is done.
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10 Superior. Drug testing is a condition of employment for all applicants. In addition, continuing and random drug testing of present employees is a standard policy.

7. Employee Records.

1 Minimum. Department managers who are aware of minimum state and federal requirements keep employee files.
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5 Typical. One person is responsible for maintaining employee records in a central location. A check list of required documents is kept with each file.
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10 Superior. The Human Resource Manager maintains employment records. In addition to minimum state and federal requirements, vacation schedules, benefit elections, training and career development histories, job descriptions, disciplinary records, and performance evaluations are also maintained and administered.

8. Exit Interviewing.

1 Minimum. Either no exit interviews or limited interviews are completed only if the termination is expected to result in a potential legal liability.
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5 Typical. Exit interviews are conducted informally at the discretion of the supervisor or manager and in cases where potential legal liability is expected.
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10 Superior. A formal exit interview procedure is conducted, whenever possible, for all terminations. When possible, the interview is attended by the Human Resource Director. All department managers are trained in appropriate interview procedures. The result of the interview is recorded and maintained with the employee records.

B. Training Practices

9. Specific Job Training.

1 Minimum. Training is conducted one-on-one usually by a co-worker with the same position, or the person leaving the position. Technicians are trained to minimum factory requirements. There is no training budget or plan.
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5 Typical. In addition to on-the-job and technical training, sales and computer training is made available. Dealership generally participates in off-site programs sponsored by manufacturers. There is no specific training budget or plan.
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10 Superior. The Human Resource Director or Training Manager administrates a training budget and plan. Inside and outside training resources are used. Employees participate in developing training plans and are expected to complete their annual training requirements.

10. Leadership Training.

1 Minimum. No leadership training programs are in place.
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5 Typical. Dealer or General Manager acts as informal mentor for subordinates whom are deemed worthy.
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10 Superior. All managers and supervisors are exposed to on going managerial development programs. Participation in management and leadership training is a requirement for advancement.

11. Career Tracking.

1 Minimum. Employees are responsible for their own career planning.
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5 Typical. A few selected employees, usually family members are groomed to become the dealer successor.
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10 Superior. Career tracking is available to all employees who seek it. Requirements and milestones for experience, training, performance, and professional accomplishments are laid out and those achieving them are eligible for advancement to the positions of their choice.

12. Orientation.

1 Minimum. Manager or co-worker takes the new employee around the facility and introduces him to those other employees he need to know to perform his job.
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5 Typical. Someone in the office assists the new employee with the completions of employment forms, gives them a copy of the Employee Handbook, and explains the company’s benefits program. The employee’s manager introduces him to some of the other managers and the other people in the department.
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10 Superior. The company has a complete mandatory orientation program designed to indoctrinate all new employees into the corporate culture. This program is led by the dealer principal and includes all members of the senior management team.

13. Performance Evaluations.

1 Minimum. There is no formal system for performance evaluation. Written evaluations are completed, on an exception basis, and used only to report poor performance or to record disciplinary actions.
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5 Typical. Performance evaluations are prepared for some employees and are used in conjunction with changes in compensation plans or job responsibilities.
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10 Superior. Performance review is a continuous process affecting all employees. Evaluations are used in a positive fashion to improve productivity, morale, and culture. The review process is constantly monitored and modified to keep pace with changing human needs.

14. Policy Training and Education.

1 Minimum. Policies are created as dictated by circumstance.
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5 Typical. The company maintains an Employee Handbook. The employees are encouraged to read the Handbook. The Handbook is often used to enforce disciplinary actions.
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10 Superior. Policy awareness is part of employee orientation. All managers and supervisors are continuously trained in the area of employer responsibility, fair employment practices, discrimination, harassment, and rules for termination.

C. Compensation and Benefits

1 Minimum. No personnel headcount or expense budgeting is done. Department managers generally confer with dealer prior to adding personnel or adjusting compensation. Payroll is prepared manually, and paychecks are distributed weekly.
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5 Typical. Personnel expenses are occasionally reviewed by dealer/comptroller. Out-of-line conditions are discussed with department managers but no budgeting is done. Payroll is prepared manually. Pay may be distributed by electronic funds transfer.
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10 Superior. Annual personnel headcount and expense budgets are prepared and monitored. Electronic time clocks and other automated systems are used to prepare payroll. Pay is distributed by electronic funds transfer.

16. Pay Plan Administration.

1 Minimum. Dealer or department managers determine and negotiate pay plans on an individual employee basis. There is no central review process.
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5 Typical. Pay plans are reviewed and approved by dealer/comptroller. Plans are written and part of the employee’s file. Plans are periodically reviewed for adequacy of compensation.
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10 Superior. The Human Resources Department administers all pay plans. Plans are continuously reviewed for equity, competitiveness, and motivation effectiveness. Plans are analyzed by the Comptroller’s Office for affordability and budgeting purposes.

17. Benefits and Administration.

1 Minimum. Comptroller is responsible for keeping health insurance and workman’s compensation insurance in force. Employees pay majority of cost. Benefit package is minimal and only occasionally reviewed by dealer.
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5 Typical. Comptroller administers the benefit programs. Employees pay less than half of the costs. Negotiates contracts with providers and determines benefit levels. May have dental and eye care coverage. Minimum life and disability coverage is available at cost to employee. Dealership sponsors a 401K program but does not contribute.
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10 Superior. Human Resource Department administers program. Full benefits package is offered including contributions to 401K Plan. Dealership may also have an Employee Stock Ownership Plan. Employees are constantly advised of the benefits available which are usually superior in the market.

18. Benefit Cost Containment.

1 Minimum. Comptroller will shop insurance programs if costs increase too rapidly. Most cost increases are passed on to the employees.
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5 Typical. Dealer and comptroller constantly monitor the cost of benefits and renegotiate contracts regularly. Some cost increases are passed on to employees. Some safety programs are in place.
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10 Superior. Controlling benefit costs is a primary mission of the Human Resources Department. Self-insurance programs are in place wherever possible. Cost increases are fully funded by the dealership. Aggressive safety training and incentive based safety programs are used to reduce losses.

19. Pension and Retirement Planning.

1 Minimum. No retirement plan is in place. A 401K plan may be in place but no dealership contributions are made. Employees are on their own.
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5 Typical. Dealership has a 401K Plan or some other defined contribution plan. Training is conducted as required under ERISA and Department of Labor.
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10 Superior. Dealership offers full retirement and financial planning services from outside provider. Dealership makes full contribution to 401K or other defined contribution plan. All employees are trained and encouraged to fully participate in retirement plan.

D. Employee Relations

1 Minimum. Employees seldom meet for any purpose. Formal communication channels are top-down only. Informal dealer-to-employee communication is often used. There is no formal bottom-up communication channel.
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5 Typical. Employees are occasionally gathered for major announcements. Department meetings are held with some regularity but inter-department meetings are rare. There is no formal bottom-up communication channel. Newsletters may be used periodically.
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10 Superior. Formal channels exist for both upward and downward communication. Standing employee involvement committees are used to determine policies, policy enforcement guidelines, process design, and standards for execution. Inter-departmental forums are used regularly for customer up communication.

21. Policy and Procedure Enforcement.

1 Minimum. Few policies and procedures are written. Enforcement of rules is usually done on a “battle-field” decision basis. There is little or no consistency in the interpretation or enforcement of policy. Managers can terminate employees without prior consent of higher authority.
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5 Typical. Written policies are limited to those in the Employee Handbook. Department managers have compliance and enforcement responsibility for their departments. Application of rules may not be consistent across departmental lines. Terminations must have prior approval of dealer of general manager.
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10 Superior. The Human Resource Department determines and monitors all enforcement and discipline activities. All termination must have prior approval of the HR Department. Employee involvement groups are used to set standards of behavior and performance.

22. Counseling and Grievance Settlement.

1 Minimum. There is no procedure for employees to present grievances to management. Unhappy employees are terminated or otherwise punished.
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5 Typical. Dealer or General Manager has an “Open Door” policy but settlement of grievance can often be arbitrary and biased. Complaining employee has no assurance of a fair hearing and there could be retribution.
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10 Superior. Dealership has a written procedure for employee complaints. An employee involvement committee that has an active voice in the resolution process reviews all grievances. Employees are encouraged to air legitimate complaints without adverse consequences.

23. Safety and Hazardous Material Handling.

1 Minimum. Basic OSHA requirements are in place but not monitored.
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5 Typical. State and federal safety laws and requirements are generally understood and adhered to. The dealership’s insurance provider makes periodic facility and safety reviews and recommends corrective action. The dealership is in compliance with “Right to Know” regulations.
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10 Superior. The dealership has a standing safety committee charged with assuring continuous compliance with all state and federal regulations. Safety is considered a training issue. All accidents and job related injuries are investigated by an employee committee. Intervention programs are used to get injured employees rehabilitated and back to work.

24. Recreation and Recognition Programs.

1 Minimum. Recognition of achievement is limited to “Salesman of the Month” and factory sponsored reward programs. Employee gatherings outside of work are limited to Christmas or some other annual party.
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5 Typical. Employees are occasionally singled out and recognized for superior performance. All factory sponsored recognition programs are utilized. The company sponsors several company outings usually to include family members.
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10 Superior. The company regularly recognizes individual achievements and employment anniversaries. All employees have the opportunity to be recognized for meritorious service. Company gatherings include motivational business meetings as well as recreational outings.

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