Written Testimony of Camilla Velasquez, Justworks

Meeting of 5-18-16 - Promoting Diverse and Inclusive Workplaces in the Tech Sector

Good afternoon. Thank you for the invitation to participate in today's meeting. My name is Camilla Velasquez, and I am Head of Product and Marketing at Justworks.

Justworks helps entrepreneurs across all 50 states take care of their team through a simple, turnkey online product for payroll, HR, and benefits. Based in NY and founded in 2013, with thousands of employees under our umbrella, Justworks believes in leveling the playing field, and offering the best large company benefits for small businesses-so they can provide the care their team deserves and compete for top talent. The ultimate goal is to free entrepreneurs to focus on what matters: building their business and creating a great place to work. In my position at Justworks, I work with startups (amongst other types of companies)-many of which are in the technology sector-and see the challenges they face as they seek to grow their businesses.

Today I will share my observations and recommendations on how small tech startups can balance many competing demands and obligations while seeking to promote diverse and inclusive workplaces.

Early Stage Startup Environment

During the first few years of a startup, the company is mostly focused on hiring, and staying alive. Founders are looking for likeminded talent to build and distribute their product, and are very rarely focusing on compliance, regulations, and the like. The fear looms, but most founders assume they'll deal with those issues if and when their startup begins to take off. Once a first round of funding comes in, a founder seeks to get their ducks in a row and looks for services (like Justworks) to make sure their payroll, taxes, and legal filings are up to date and complete. This is when they're securing things like Workers Comp, business insurance, basic benefits for their team (if funding allows), statutory disability, and other necessary insurances they might have skipped out on when first getting started.

After the first round of funding, basic HR / people operations is still a luxury, though, and it's rare to see a true HR representative hired until a few years into the business. Hiring and antidiscrimination trainings are rarely happening because of the need to remain lean? in fact, it can be quite late in a company's timeline before these trainings happen.

Finding Solutions

Because startups are so often focusing on their ideas, they don't feel they have the bandwidth to focus on HR issues. Enter Justworks. Justworks and other HR tech platforms can make hiring and HR turnkey and affordable, using software and modern modes of servicing and communication. We're creating the layer between small businesses and all the constituents in the financial, regulatory and benefits worlds. We bring businesses under one umbrella, like a cooperative, so each new company can benefit from the infrastructure we've already built at little marginal cost. Imagine starting a business, and adding employees in any state at the push of a button. Having your HR managed for you, but also passing the data and information back to you so you can make informed, legal decisions in a cost effective way.

Justworks is a startup's outsourced HR provider that files and complies on their behalf, but also sends them back data and information to keep them informed on how to remain compliant in the future. We help anticipate and flag what might become a future compliance issue by learning from other companies under our umbrella. For example, our technology makes it possible to alert companies as different laws become applicable, like the EEO requirements after reaching 15 employees, and remind companies to carefully assess their practices. The more we see and learn from each existing member company, the more each new company in our network benefits. In this way, we've created a network HR business.

Startups often employ very young employees right out of college, without a lot of training and experience, as part of their first employees. Because a startup isn't providing this core foundation of training, and it's not until later that an experienced HR professional comes in (if ever), early employees can go a long time without understanding how to manage their potential biases and how their behaviors and employment practices might be prohibiting inclusion. The next round of employees might have more experience, and they expect the existing employees to have adequate training and understanding when in fact they don't. It's important for startups to continuously take stock of the entire employee base and reset trainings and expectations to make sure everyone is on the same page.

Startups should use a service like Justworks, or join networks where they can learn from each other before making mistakes by navigating these waters on their own. They should acknowledge openly the trade-offs being made at the early stage by not hiring or tending to HR needs, and supplement for lack of HR through cost effective ways (like a comprehensive one day EEO training on anti- harassment and prohibitions on discrimination based on age, race, color, sex, religion, national origin, disability, and genetic information).

Lessons Learned as a Startup

Justworks is itself a startup, and we have learned from our own experience. Justworks uses data to understand our own processes-everything from the hiring pipeline through performance (and termination if applicable), to continuously improve our people operations. We use multiple software providers that provide data and analytical tools for this, like greenhouse, and combine this data for a holistic view.

We hold hiring trainings for all new hiring managers. These trainings include modules on understanding inherent biases, as well as knowledge of the laws related to equal opportunity. The trainings are full days and allow all employees involved to share stories and feedback. Most founders can afford this training for themselves or their hiring managers, but the opportunity to make these trainings available to member companies through video or other on demand channels is something Justworks is exploring.

Recommended Best Practices

• Make EEO compliance and diversity and inclusion initiatives a priority as early as possible-building it into the company culture fabric early will ease challenges in the future.
• Use cost-effective resources such as expert consultants and free government resources like the EEOC during the early lean stages.
• Hire and promote mindfully even when growing rapidly.

Conclusion

In conclusion, there are increasingly new simple and affordable and non-time intensive HR products coming available on the market. Startups shouldn't have to make the tradeoff between building their businesses and being compliant.