Glossary
HR and payroll glossary
Plain-language definitions of the HR and payroll terms teams actually search for, each answered in one clear sentence and linked to the Capstan tool, guide or module that puts it to work. No jargon, no sign-up.
HR systems and software
HRIS An HRIS, a Human Resource Information System, is the software that holds your organisation's employee records and runs the core processes around them: people and org data, time off, documents, onboarding and reporting. HRMS An HRMS, a Human Resource Management System, is HR software that covers the core employee record and the wider set of modules built around it, from attendance and performance to recruitment and payroll preparation. HCM HCM, human capital management, is the broad category of software and practice for managing people across the whole employee lifecycle, from hiring through development and pay to exit, usually aimed at larger organisations. Applicant tracking system (ATS) An applicant tracking system, or ATS, is the software that runs a hiring process end to end: opening a role, collecting and sorting candidates, moving them through interview stages with scorecards, and making an offer.
Pay and payroll
Payroll Payroll is the process of working out what each employee is paid for a period, applying the statutory deductions and contributions that apply, paying the net amount, and filing the returns and forms that follow the pay run. CTC (cost to company) CTC, or cost to company, is the total annual amount an employer spends on an employee in India, taking in base pay, allowances, bonuses and the employer's own statutory contributions, which is why CTC is larger than take-home pay. Gratuity Gratuity is a lump sum an employer in India pays an employee who leaves after a qualifying period of continuous service, governed by the Payment of Gratuity Act, 1972, and calculated from the person's last drawn wages and years of service. Full and final settlement (FnF) Full and final settlement, or FnF, is the process of closing out everything owed between an employer and an employee who is leaving: final salary, payment for unused leave, recoveries and deductions, and any gratuity or other end-of-service amount.
Leave and time
Full-time equivalent (FTE) A full-time equivalent, or FTE, is a way of expressing the size of a workforce as the number of full-time positions it adds up to, where a part-time person counts as a fraction of one according to the hours they work. PTO accrual PTO accrual is the method by which paid time off builds up gradually over the year, with an employee earning a small amount of leave each pay period or month rather than receiving the whole annual allowance in one grant. Bradford Factor The Bradford Factor is an absence-measurement score that weights many short, separate absences more heavily than a single long one, on the theory that frequent unplanned absences are more disruptive than one continuous period off.
Global employment
Employer of record (EOR) An employer of record, or EOR, is a company that becomes the legal employer of your workers in a country where you hold no legal entity of your own, taking on the local contract, payroll and statutory obligations so that you can hire there. PEO (professional employer organization) A PEO, or professional employer organization, is a firm that co-employs a company's staff in the United States under a shared arrangement, so that it can run payroll, file payroll taxes under its own number and pool benefits across many small employers.
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