The Ultimate List of HR Jargon You MUST Know

December 5, 20191:44 pm8576 views

One of the main challenges for new HR practitioners is to understand the jargon in which human resources professionals often use in their day-to-day responsibilities. Here is the list of HR jargon to learn that hopefully can usher you to become the perfect HR you always wanted to be. 


Abandonment rates – It is a measurement of the number of job applicants who do not complete their application. When applicants start the process and drop out, it is considered as a failure for an employer. 

Ageism – Discriminatory behaviour against employees on the basis of age. 

Apprentice – is someone who does an apprenticeship. 

Apprenticeship – A combination of on-the-job-training in conjunction with a formal study component. The wage of apprenticeship is paid at a lower rate, allowing a business to invest time and resources providing training and development. 

A seat at the HR table – A group of decision-makers sitting around a conference table making a decision, including executives leaders. 

Attrition or Termination at will – It is when employees leave the company voluntarily or involuntarily due to retirements, death, illness, or other reasons that result in a reduction to an employer’s physical workforce. The attrition is usually measured with a metric called attrition rate. 

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Back pay – Compensation for past economic losses caused by discriminatory employment practices. 

Balanced scorecard – It refers to management and measurement system which focus on four areas of learning and growth, business processes, customers, and finances. In a simpler term, it means “everything matters”, from employee to financial of a company. 

Behavioural competency – It is an essential quality and character traits of an employee which will determine where and in what position they are in. Commonly, this term revolves around people skills, managerial skills, and achievement skills. 

Benchmarking – It is a process of measuring a company’s or team’s performance through a variety of metrics which is useful to compare past and present development and/or compare the internal and external competition in order to measure if the improvement is needed

Brain drain – A highly educated and/or skilled labour. The term is popular amongst Australian HR. 

Broadbanding – It is a pay structure that places less emphasis on the hierarchy than job duties. Broadbanding encourages the development of a wide variety of employee skills and growth but comes with a significant decrease in promotion opportunities. However, the companies that enable broadbanding might have a larger range of potential salaries for any position in their organisation.

Bumping – A practice that gives established senior employees whose positions are to be eliminated. They are given the option to take other positions. It is done to retain institutional knowledge and experienced workers. 


Carve-out – Removing coverage for one element of an employee benefit provider to use a different vendor. 

Chilling effect – An effect of which is to discourage minorities, women, or persons with disabilities from seeking employment or advancement.

Confidentiality agreement – It is an agreement between employer and employees in which the employees might not disclose branded, patented or confidential information. 


Dismissal – Involuntary termination of an employee. 

Downsizing, reorganising, restructuring, and rightsizing – These are under the same meaning which often refers to the process of reducing the number of people employed by the firm. 

Due diligence – It is when HR should take a step to ensure compliance with laws and regulations. It is done to ensure that the company’s paperwork and documentation are up to date and compliant. 


EEO – Equal Employment Opportunity report that should be filled by both employer and employees to ensure equality in the workplace. 

Employee turnover – It refers to a number of percentage of workers who leave an organisation. 

Exit interview – It is a final meeting between management and employees leaving the company. It is done to find out reasons why employees are leaving, thus, the company can take further action to prevent turnover. 


Family-friendly – It refers to an organisation that supports working parents or single parents. 

Frequent fliers – It refers to employees who seem to have problems with everyone and everything that take up so much of HR time. 

Fringe benefits – Compensation other than wages. For example, leaves, life insurance, retirement benefits, etc.


Gag clause – A clause in a company agreement or work contract which restricts the sharing or dissemination of commercially sensitive information by staff. 

Glass ceiling – An artificial barrier to the advancement of women and minorities to decision-making positions. 

Grievance – It is a complaint brought by employees about an alleged violation of law or dissatisfaction with work conditions. 

Gross misconduct or Wrongful discharge – Unethical behaviour of employees that lead to termination regardless of performance or productivity because gross misconduct often danger company on a large scale.


Inboarding – This term refers to training or developing current employees in order to retain them in their current job. 


Job analysis – It is a process to determine the duties and skills required for a job and a person who must be employed for the job.  

Job rotation – A management training technique that involves shifting a trainee from one function to another job function to expand his/her knowledge and experience. This is often employed by an employer to best retain employees. 

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Key Performance Indicators (KPI) – Metrics that are critical to business success and those upon which the success of employees is judged. 

Key Result Areas (KRA) – It is a set of parameters or metrics to define a specific role or designation. It helps HR people to ensure that employee goals and objectives are aligned with those of the organisation. 

KSA – It stands for knowledge, skills, and abilities which are required for a particular position or role. 


Layoff – It is a situation in which there is a temporary shortage of work. Employees might no need to work but will be recalled when work is again available. 

Lump-sum payment – It is a single, large payment made to an employee. For example, employees who take a month of annual leave might be paid the entire month or wages in one transfer, rather than weekly. 


Merit pay – Remuneration which is linked to work output or performance. It is based on specific, achievable, measurable targets. 


Nepotism – It is a kind of favouritism or when HR prefer to hire relatives or friends for a position, even though others might be more qualified for it. 

Non-directive interview – An unstructured conversational style interview. The interview follows points of interest as they come up in response to questions. 


Onboarding – This term is used to refer to giving training to new hires, including how to do their paperwork, the responsibility they hold, and office rules which create a strong relationship between new hires and co-workers or their job. 

One-way interview – An interview technique which requires applicants to submit recorded answers to supplied interview questions. 


Qualification inventories – A manual or computerised records listing employees education, career, development, hobbies, skills, etc. to be used in forecasting inside candidates for promotion. 


Race code – A descriptive term used for reference when identifying a specific ethnic group. 

Reality shock – It is a result of a period that might occur at the initial career entry when new employee’s high job expectations is confronted with boring and unchallenging reality. 

Retention strategy – It refers to processes and policies used to make employees stay. 

Ring of defence – Temporary supplemental employees who are hired with the understanding that they might be laid off at any time. 


Strictness/Leniency bias – A problem that occurs when a supervisor has a tendency to rate all subordinate either high or low. 

Succession planning – It is when an employer needs to find, assess, and develop internal employees to replace a former leader who will soon quit. 


Talent management – It is an HR responsibility to make sure that they recruit, train, manage, develop, and retain the best people. 


Underwriter – An organisation which agrees to compensate a business or person for certain losses. 


Voluntary reduction in pay plan – An alternative to layoffs in which all employees agree to take time off to reduce employer’s payroll and avoid the need for a layoff. 


Wage drift – A gap between basic pay level for workers in a role and remuneration which is given to an employee. The drift occurs because of overtime or bonuses or unconscious biases of workers of certain ages and gender. 


360-degree feedback – It is used as a performance management technique wherein feedback is taken from all the stakeholders involved in order to obtain a holistic view of one’s performance. 

401(k) plan – One of the most expected retirement programs that allow employees to defer taxes as they save for retirement by placing before-tax dollars directly into an investment account. 

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