Hitting the Magic 50 Employee Mark Part 3 – Performance Management, Compensation/Benefits, and Human Resources Staffing

Over the past several weeks I have been sharing a series covering the changes to make and the things to consider when your company grows to 50 Employee. This is the third in the series. I welcome your comments and questions if there is anything you hoped I would cover that I have not.

Read Part 1 – Hitting the Magic 50 Employee Mark Part 1 – What You Need To Think About?

Read Part 2 – Hitting the Magic 50 Employee Mark Part 2 – More Formal, More Frequent Communications.

Performance Management & Goal Setting

Companies who have not yet instituted a formal performance management system are likely to set this as an important goal once they hit fifty employees. In the past goal setting may have occurred quite successfully on the back of a napkin while chatting around the lunch table with everyone. However, at 50 employees this strategy becomes ineffective. There are likely at least three reporting layers by this time – senior management, management/supervisory and individual contributors. The goal setting system, by necessity, must get more formal so that everyone is on the same page and supporting the same goals. The same goes with performance feedback. Employees deserve feedback and the more employees there are the more helpful feedback is to keep everyone motivated and moving in the same direction.


At fifty employees you will see changes in health plan offerings as fifty member groups is often a differentiation point for plan offerings and pricing. Incentive plans tailored to different levels or job classes tend to be implemented around this time. Formal salary analyses are occurring more regularly. Where the company previously had one engineer they may now have three or more. Internal as well as external salary equity comes in to play now. At fifty employees, companies who do not already have a formal recordkeeping system will want to begin investigating their options. It becomes very difficult to track employee changes on an excel spreadsheet. Most payroll services offer a human resources module and there are many cost effective HRIS (human resource information systems) on the market for smaller employers.

Human Resources Staffing

As you have read through this blog, you may already have come to the conclusion that many, if not most, companies that hit the 50 employee mark begin considering the addition of a Human Resource professional to help with the challenges of reaching this exciting benchmark. For some companies it takes the form of hiring an internal part or full time Human Resources professional. For others it means contracting with an external provider to provide project expertise or mentoring for an internal staff member.

2 responses to “Hitting the Magic 50 Employee Mark Part 3 – Performance Management, Compensation/Benefits, and Human Resources Staffing”

  1. Good morning Renee,

    FLMA and AAP are the laws that come into play when you hit 50. There are a litany of laws that take effect prior to this. Following are those at the federal level but you should check state and local employment laws where you do business to understand what else you may need to be compliant with. Thanks for the comment!

    Employers with 1+ Employees:
    Fair Labor Standards Act (FLSA)
    Employee Polygraph Protection Act
    Immigration Reform & Control Act (IRCA)
    Equal Pay Act
    Federal Income Tax Withholding
    Uniformed Services Employment & Re-employment Rights Act
    Federal Insurance Contribution Act (FICA)
    National Labor Relations Act (NLRA
    Consumer Credit Protection Act
    Labor Management Relations Act
    Uniform Guidelines for Employment Selection Procedures
    Employment Retirement Income Security Act (1974)

    Employers with 11+ Employees
    The Occupational Safety and Health Act of 1970

    Employers with 15+ Employees
    Civil Rights Act of 1964
    Civil Rights Act of 1991
    Pregnancy Discrimination Act
    American with Disabilities Act
    2008 Amendments to the ADA
    Genetic Information Nondiscrimination Act (GINA)

    Employers with 20+ employees
    Age Discrimination in Employment Act of 1967
    Consolidated Omnibus Budget Reconciliation Act (COBRA)

    Employers with 50+ employees
    Family Medical Leave Act (FMLA)

    Employers with 100+ employees
    Worker Adjustment Retraining Notification Act (WARN)

    For Employers with Federal Contracts
    Executive Order 11246 ($10,000+)
    Executive Order 11246 – Affirmative Action Plan (50+ employees and $50,000 in government contracts)
    Vietnam Era Veterans’ Readjustment Assistance Act ($25,000+)
    Section 503 of the Rehabilitation Act of 1973 ($10,000+)
    Drug Free Workplace Act of 1988 ($25,000+)

    Other Miscellaneous
    Sarbanes Oxley Act (SOX)
    Health Insurance Portability and Accountability Act

What are your thoughts? Let's discuss: