Saver's Credit Can Spur Retirement Plan Contributions
Many employees are not aware of employer-sponsored retirement accounts, or individual retirement accounts (IRA), which could be costing those more money. Tax season is the best time for employers to educate their employees on how they can earn extra tax credits through their 401(k) plans. Read this blog post to learn more about how to educate employees on what retirement account opportunities that are available to them.
Many workers don't know that they're eligible for a tax credit by saving in an employer-sponsored retirement plan or individual retirement account (IRA)—and that could be costing them money. Tax time, however, is prime time for employers to inform eligible workers about the saver's credit.
The Retirement Savings Contributions Credit, or saver's credit, is available to low- and moderate-income workers who are putting money aside for retirement. But only 29 percent of workers with annual household income below $50,000 know about the saver's credit, according to the nonprofit Transamerica Center for Retirement Studies in Los Angeles, which surveyed nearly 6,000 employees last fall.
"Tax season is an ideal time to tell eligible workers how they can earn extra tax credits by saving through their employer's 401(k) or a similar retirement plan," said Catherine Collinson, president of the Transamerica Center. "The saver's credit might just be the motivator for those not yet saving for retirement to get started."
Scott Spann, a senior financial planner with Financial Finesse, a provider of workplace financial wellness programs in Charleston, S.C., said, "Saving for retirement is a challenge for many households in America. Special tax incentives help make the process of saving easier."
What Is the Saver's Credit?
Like other tax credits, the saver's credit can increase a taxpayer's refund or reduce the tax owed. Here's how it works:
The amount of the credit is a maximum of 50 percent of an employee's retirement plan contributions up to $2,000 (or $4,000 for married couples filing jointly), depending on the filer's adjusted gross income as reported on Form 1040. Consequently, the maximum saver's credit is $1,000 (or $2,000 for married couples filing jointly).
The saver's credit "is different than a tax deduction due to the fact that a tax credit is a dollar-for-dollar reduction of your gross tax liability, which is the total amount of taxes you're responsible for paying before any credits are applied," Spann explained.
The saver's credit also differs from the separate tax benefit of contributing pretax dollars to a qualified retirement plan, such as an employer-sponsored 401(k) or an IRA. "Many eligible retirement savers may be confusing these two incentives because the notion of a double tax benefit"—pretax contributions and an additional tax credit—"seems too good to be true," Collinson said.
Who Can Claim the Saver's Credit?
The credit is available to workers age 18 or older who have contributed to a company-sponsored retirement plan or an IRA in the past year and meet the income requirements shown in the table below. The filer cannot be a full-time student nor claimed as a dependent on another person's tax return.
Income Caps for Tax Years 2019 and 2020
For eligible workers, the amount of the available tax credit diminishes as adjusted gross income (AGI) rises. To help preserve the credit's value, income thresholds are adjusted annually to keep pace with inflation. Below are the AGI caps for tax year 2019 (for tax returns filed this year) and 2020 (for returns filed next year).
| 2019 Saver's Credit | |||
| Tax Credit Rate | Single Filers and Married, Filing Separately* | Married, Filing Jointly | Heads of Household |
| 50% of contribution | AGI not more than - $19,250 | AGI not more than $38,500 | AGI not more than $28,875 |
| 20% of contribution | AGI of $19,251 - $20,750 | AGI of $38,501 - $41,500 | AGI of $28,876 - $31,125 |
| 10% of contribution | AGI of $20,751- $32,000 | AGI of $41,501 - $64,000 | AGI of $31,126 - $48,000 |
| No credit | AGI more than $32,000 | AGI more than $64,000 | AGI more than $48,000 |
| 2020 Saver's Credit | |||
| Tax Credit Rate | Single Filers and Married, Filing Separately* | Married, Filing Jointly | Heads of Household |
| 50% of contribution | AGI not more than $19,500 | AGI not more than $39,000 | AGI not more than $29,250 |
| 20% of contribution | AGI of $19,501 - $21,250 | AGI of $39,001 - $42,500 | AGI of $29,251 - $31,875 |
| 10% of contribution | AGI of $21,251 - $32,500 | AGI of $42,501 - $65,000 | AGI of $31,876 - $48,750 |
| No credit | AGI more than $32,500 | AGI more than $65,000 | AGI more than $48,750 |
Deadlines for Retirement Contributions
"You must make eligible contributions to your employer-sponsored retirement plan or IRA for the tax year for which you are claiming the income tax credit," Spann said.
While 401(k) contributions for a tax year can be made only up to Dec. 31, those who are eligible but did not save last year can still make a tax year 2019 IRA contribution until April 15, 2020.
Filing for the Saver's Credit
Employers can advise eligible workers to take the following steps to claim the saver's credit, according to the Transamerica Center:
- If using tax-preparation software, including those programs offered through the IRS Free File program, use Form 1040 or Form 1040NR for nonresident aliens. Answer questions about the saver's credit, which may be referred to as the Retirement Savings Contributions Credit or the Credit for Qualified Retirement Savings Contributions.
- If preparing tax returns manually, complete Form 8880, Credit for Qualified Retirement Savings Contributions, to determine your exact credit rate and amount. Then transfer the amount to the designated line on Form 1040 (Schedule 3) or Form 1040NR.
- If using a professional tax preparer, ask about the saver's credit.
Financial planners advise having tax refunds directly deposited into an IRA to further boost your retirement savings.
The Transamerica Center has additional information, in English and Spanish, on its Saver's Credit webpage, along with a downloadable fact sheet.
IRS Free File Program Is Available
Another potentially overlooked opportunity for workers is the IRS Free File program, which offers federal income tax preparation software at no charge to tax filers with an AGI of $69,000 or less.
Free File opened on Jan. 10, 2020, for the preparation of 2019 tax returns. Eligible taxpayers can do their taxes now, and the Free File provider will submit the return once the IRS officially opens the tax filing season on Jan. 27.
For 2020, the Free File partners are: 1040Now, Inc., ezTaxReturn.com (English and Spanish), FileYourTaxes.com, Free tax Returns.com, H&R Block, Intuit, On-Line Taxes, Inc., Tax ACT, TaxHawk, Inc. and TaxSlayer (English and Spanish).
Here's how Free File works:
- Taxpayers go to IRS.gov/FreeFile to see all Free File options.
- They browse each of the offers or use a "look up" tool to help find the right product. Each Free File partner sets its own eligibility standards generally based on income, age and state residency. But if the taxpayer's adjusted gross income was $69,000 or less, they will find at least one free product to use.
- They select a provider and follow the links to their web page to begin a tax return.
- They complete and e-File a tax return if they have all the income and deduction records they need. The fastest way to get a refund is by filing electronically and selecting direct deposit. For taxes owed, they can use direct pay or electronic options.
Many Free File online products also offer free state tax preparation, although some charge a state fee. Taxpayers should read each provider's information carefully.
"The IRS has worked to improve the program for this year, and we encourage taxpayers to visit IRS.gov, and consider using the Free File option to get a head start on tax season," said IRS Commissioner Chuck Rettig.
Nearly 57 million returns have been filed through the Free File program since it began in 2003, and 70 percent of U.S. taxpayers (about 100 million people) are eligible for Free File, according to the IRS.
SOURCE: Miller, S. (10 January 2020) "Saver's Credit Can Spur Retirement Plan Contributions" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/remind-low-wage-earners-about-savers-credit.aspx
Organizations Will Need Data Analytics to Survive
Did you know: the use of data analytics can improve a company's overall performance. Data analytics can differentiate those companies that are going to be disrupted. Implementing technology is simple, but it is HR's responsibility for managing the technological change. Read this blog post to learn more about why data analytics is becoming a need for organizations.
SEATTLE—HR professionals play a critical role in getting their organizations to use data and analytics strategically to compete more effectively.
Jack Phillips, CEO and co-founder of the Portland, Ore.-based International Institute for Analytics, a research and benchmarking services firm for the analytics industry, urged attendees at the Society for Human Resource Management People Analytics conference on Jan. 14 to get focused on data.
"It's proven that the use of data analytics improves overall company performance," he said. "Organizations invest in many things, but budget dedicated to data and analytics is limited. It needs to be a top priority. The broad use of data and analytics will differentiate the companies [from those] that eventually are disrupted and disappear from the survivors."
And HR is key to the success of winning with data, from sourcing the necessary talent and applying analytics to HR functions to leading change management when adopting a data-driven mindset across the organization.
Implementing the technology is the easy part, Phillips said. Getting your workforce to truly adopt data analytics across the organization is harder. Ultimately HR is responsible for managing that transformational change.
Data Analytics Overview
The data analytics market is in full growth mode, accelerated by the explosion of cloud computing. The technology environment is moving so quickly that it is very hard to keep track of the increasing array and complexity of analytics technology available, Phillips said. But the top-performing companies are investing heavily in data analytics.
"If you are not paying attention through expenditure and [acquisition of] talent you will be behind," he said.
Phillips outlined a maturity model showing the sophistication levels of an organization's approach to analytics. Employers aiming to improve their data analytics function first need to assess where they currently are. Phillips' model includes those at the bottom stages who don't use any data to make business decisions and companies where data analytics may exist in silos without a structure for collaborating across business units.
Most employers likely exist in one of these stages, while many enterprise-level organizations are in the higher aspirational stages where the value of analytics is expressed, or they are data-oriented and use analytics with some internal coordination.
"Only one company we've studied [Amazon] has achieved near perfection as a data-driven company," Phillips said. "You don't come to a meeting without data [at Amazon]. No gut-based decision-making is allowed. Everything is driven by data."
Succeeding with Data
According to Phillips, the key ingredients needed to achieve higher levels of maturity as a data-driven organization include:
- People with data analytics skills.
- Organizational structure, processes and technologies in place for those people.
- Use of the data. "The highest performing companies have superior capabilities on the supply side and business leaders who use the insights that the data analytics teams are providing to drive the business forward," he said.
Another model he presented breaks down the elements that must be in alignment for companies to succeed with their analytics initiatives. "Without alignment, organizations run the risk of poor or limited results," he said. "To make real progress and become a data-driven organization, the capabilities and assets of these five elements must evolve and mature." The five elements are:
Data. It may seem obvious, but to provide meaningful analytics, data must be high quality, organized, reliable, integrated, and accessible. The raw material must be right.
Coordination. Companies must advocate a single and consistent perspective for analytics across the organization.
Leadership. Senior leadership should fully embrace analytics and lead company culture toward data-driven decision-making.
Targets. The organization should prioritize business targets against which it will apply its analytics. "Data and analytics without a targeted reason for it is worthless," he said.
Talent. Organizations require analytical talent that covers a range of skills from accomplished data scientists to rank-and-file employees who embrace being more analytical in how they do their job.
Employers must also understand rapidly emerging analytical techniques and technologies, Phillips said. The widespread adoption of open source tools has resulted in an explosion of analytical methods and techniques, and with the advent of big data, machine learning and cloud computing, creating an effective technology strategy for analytics is a critical ingredient for success.
HR's Role
Human resource professionals play an important part in getting their organizations up to speed and competitive with analytics, including sourcing the right qualified talent—a difficult task in a labor market lacking the requisite skills—and investing in data analytics for its own functions.
"HR lags behind other business functions when it comes to using data analytics," Phillips said. "Sales, marketing and finance tend to outpace other parts of the business."
HR should be assertive with leadership when advising on budget and staffing for data analytics positions and in creating and managing a workplace culture that values innovation.
"The top performing companies treat their data analytics function as a product, with design thinking and intentional product management," Phillips said.
One positive for employers who may be overwhelmed by implementing a data analytics function is that best practices are easily transferable. "There are many things that you can just copy," he said.
SOURCE: Maurer, R. (15 January 2020) "Organizations Will Need Data Analytics to Survive" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/technology/pages/organizations-will-need-data-analytics-to-survive.aspx
Beware the Legal Pitfalls of Managing Unpaid Interns
With many college students and recent graduates trying to start a career, their first step to getting introduced to what their degree can hold for them is working as an intern to learn different roles and to learn how a business operates. The U.S. Department of Labor (DOL) has raised concerns regarding what makes an intern an "employee" or a "trainee". Read this blog post to learn more about the guidelines that pertain to bringing an intern or a "trainee" into the workplace.
A college student or recent graduate is eager to make an impression. So is the early-in-career professional who’s been laid off by another company. You placed them both in an unpaid internship program because you want to give your company a chance to evaluate them as future employees. What could go wrong?
At job sites across the United States, interns not paid or earning less than minimum wage are given all sorts of jobs: answering phones, loading paper in the copiers, managing company social media campaigns.
But, federal guidelines released by the U.S. Department of Labor (DOL) in April 2010 raise concerns that employers might decide to provide fewer internship opportunities. The guidelines, which apply to “for-profit” private-sector employers, define what makes an intern an “employee” as opposed to a “trainee.” If a court or government agency decides that interns’ work qualifies them as employees, the company could face penalties that include owing back pay; taxes not withheld; Social Security; unemployment benefits; interest; attorneys’ fees; plus liquidated damages, defined by federal law as double the unpaid wages.
Six Standards
The DOL’s Wage and Hour Division lists six factors to use in determining whether an intern is a trainee or an employee under the Fair Labor Standards Act (FLSA).
- The training, even though it includes actual operation of the facilities of the employer, is similar to what would be given in a vocational school or other educational institution.
- The training is for the benefit of the trainees.
- The trainees do not displace regular employees, but instead work under their close observation.
- The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded.
- The trainees are not necessarily entitled to a job at the conclusion of the training period.
- The employer and the trainees understand that the trainees are not entitled to wages for the time spent in training.
If all of the factors listed above are met, then the worker is a “trainee,” an employment relationship does not exist under the FLSA, and the act’s minimum wage and overtime provisions do not apply to the worker.
Federal and state labor departments are cracking down on unpaid internships “due to a concern that paid jobs are being displaced and to increase payroll tax revenues,” says employment lawyer Terence P. McCourt of Greenberg Traurig in Boston.
With so much at stake, it’s a good time for HR professionals to review their companies’ internship policies to ensure that they are in compliance with government requirements.
Legal Exposure
The DOL standards state that most nonexempt individuals “suffered or permitted” to work must be compensated for the services they perform for an employer unless certain conditions are met. In general:
- The internship program must be similar to training that would be given in an educational environment, such as a college, university or trade school.
- The intern and the employer must both understand that the intern is not entitled to wages.
- The company must receive no immediate advantage from the internship and in fact may find its operations disrupted by the training effort.
- The intern must not take the job of regular employees.
Unpaid Programs on the Rise
Despite the risks, unpaid internships appear to be on the rise. In a May 2010 survey by Internships.com, an online clearinghouse for companies and would-be interns, two-thirds of the more than 300 college and university career center professionals who responded said that overall internship postings on their campuses increased from 2009 to 2010. However, more campuses reported lower numbers of paid internships than those reporting increases.
“Unpaid internships do appear to be on the rise,” says attorney James M. Coleman of the labor and employment law firm Constangy, Brooks & Smith LLP in Fairfax, Va. Whether the rise is in “reaction to the difficult economy and an effort to save on labor costs is not completely clear.”
Companies can protect themselves by having the college intern ask his professor for academic credit for the internship. Employers should coordinate with an intern’s school to determine requirements mandated by the educational institution, experts say.
An internship is more likely to be viewed as training if it provides interns with skills that can be used in multiple settings, as opposed to skills that are specific to one employer’s work environment.
Interns should be “allowed to observe aspects of the employer’s operations, such as job shadowing, without needing to perform services at all times,” McCourt says. He adds that an intern should not supervise regular employees or other interns, and the company should define the arrangement clearly and in writing, specifying that there is no expectation of a job offer at the conclusion of the internship.
HR professionals and lawyers say it may be useful for companies to keep written records of what an intern expects to gain from an unpaid program. Attorney Oscar Michelen of Sandback & Michelen in New York City suggests preserving memos, e-mails and other documentation covering what each intern does, such as attending scheduled training sessions and luncheon meetings with regular employees, and what type of training and supervision will be provided.
SOURCE: Taylor, S. (17 January 2020). "Beware the Legal Pitfalls of Managing Unpaid Interns" (Web Blog Post). Retrieved from https://www.shrm.org/hr-today/news/hr-news/pages/managingunpaidinterns.aspx
New employee retention tool has four legs and goes 'woof'
The term "a dog is a human's best friend" can get thrown around, but what if dogs lead to increased productivity and less stress? Read this blog post to learn how allowing dogs at work can benefit employee productivity.
There are so many reasons to allow dogs in the workplace, from increasing production and morale to decreasing absences.
And while financial institutions have not traditionally offered such an employee benefit, there are plenty of banks and fintechs that are leading the way in the industry.
For example, JPMorgan Chase not only allows dogs into its branches, but it also hands out dog treats. Wells Fargo is another company with a great pet policy. In fact, Wells Fargo has a host of dogs that have been part of various offices throughout the years.
Other companies are going the extra mile, and providing dog parks on-site or dedicated walking areas for their four-legged colleagues. The online small-business lender Kabbage is well known for its laid-back work culture, including casual dress code, beer on tap and a dog-friendly policy.
Perhaps one of the most pet-friendly companies is Redtail Technology, which is named after the founder Brian McLaughlin’s dog. Not only does the company encourage people to bring their dogs to work, it also has a dog park, and a Slack channel for employees to message each other when they’re about to take their dog out for a play.
Still skeptical about this approach? Here are five scientifically backed reasons that allowing dogs into the office can benefit employees.
First, allowing people to bring their pet along with them to work actually helps to decrease stress for not just them, but everyone in the workspace. Washington State University found that petting a dog for just 10 minutes can help to reduce stress.
Playing with or petting a dog can increase the levels of oxytocin, a stress-reducing hormone; and decrease the levels of cortisol, a stress hormone.
A team of researchers at Virginia Commonwealth University carried out a study that compared three groups of employees: those who brought their dogs to work, those who had dogs but left them at home those who didn’t own a dog. The lead of the study, Randolph Barker, said that "the differences in perceived stress between days the dog was present and absent were significant. The employees as a whole had higher job satisfaction than industry norms."
Second, when staff bring their dog to work, they will need regular walks throughout the day, which will encourage people to be active. Being physically active not only gives people the satisfaction that naturally comes with exercise, but it will also increases productivity.
Each time someone exercises, new mitochondria produce more energy known as ATP. This gives people more energy physically and for the brain, which boosts mental output and productivity.
Third, workplaces that allow dogs into their offices usually find that employees are more cooperative with each other, and that they have better working relationships. Dogs increase morale and bring a more fun and positive outlook to office life, which encourages people to be friendlier to each other.
Dogs are a common interest between many different people from all walks of life, so having some common ground can help people to connect. Central Michigan University found that when a dog is in the room with a group of people, they are more likely to trust each other and collaborate together effectively.
Fourth, actively encouraging staff to bring their pet to work will foster a really good relationship between employer and employee. It will help to make employees feel valued and increase the likelihood they'll stay long term at the company.
The more satisfied people feel in their job role, the less likely they are to search for work elsewhere, making employee retention rates higher, according to one study.
Fifth, allowing staff to bring their pet to work increases their job satisfaction and reduces stress, which in turn will mean that they are less likely to become ill and need time off work. This can have an added effect on other employees in the business too. With the positive, stress-reducing nature that dogs bring to an office, people will be less likely to take time off.
With such benefits already working for some financial companies, hopefully others will start to catch up with these pet-friendly policies soon.
SOURCE: Woods, T. (09 January 2020) "New employee retention tool has four legs and goes 'woof'" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/pet-friendly-policies-as-employee-retention-tools
5 talent trends to watch in 2020
Although 2020 is a new year, talent may still seem comparable to previous years' trends. In 2020, employers can expect to see talent management move into a more proactive role. Read this article to learn about the five talent trends to watch for in 2020.
2020 may herald a new year (and decade), but today's talent trends will likely seem familiar.
Employer branding, diversity and inclusion, empowering managers and developing employees all remain priorities for talent pros. For example, HR Dive identified "talent acquisition panic" as one of the driving forces of 2019 — and while recruiting won't necessarily remain in a panic state, most experts agree that it will be a strategic focus for all company leaders in 2020.
But experts also said that certain trends may rise in importance in the new year, and five, in particular, will likely stand out.
Talent management will move from reactive to proactive
The workforce now encompasses a large swath of employees, independent contractors and even robots, requiring a new approach, Michael Stephan, Deloitte's US human capital leader, told HR Dive in an interview. "It's going to change the way HR business partners approach … workforce planning," he said. "Not just how many heads you need, but 'where is the best place to access this particular talent?'"
That means employers will need to move from reacting to talent needs to anticipating them, Mark Brandau, principal analyst at Forrester, told HR Dive. "Most organizations look at it from a reactive perspective and not enough time is done on planning," he said.
Expect more proactive talent strategies that encompass tech's undeniable impact on work. Kristen Ruttgaizer, director of human resources at Igloo Software, agreed that employers will have to put more effort into initiatives that draw candidates in over time, such as solid employee experience.
Diversity and inclusion efforts provide a good example of what this shift may look like, as a successful D&I initiative requires that an employer address "the entire employee life cycle," according to Randstad US's report on 2020 trends. Talent is no longer about simple efficiencies; it's now a driving force for C-suite decision-making, Stephan explained.
Contingent hiring will be more integrated
While employers may no longer be in panic mode about talent acquisition, the rise of contingent worker hiring has complicated recruiting by introducing a new variable: When you need more help, do you hire an employee or bring on a contractor?
Employers are "trying to figure out the workforce ecosystem or strategy that cuts across the different sources," Stephan said. "They realize how important figuring out that ecosystem is to that future strategy. They're in rapid investment mode."
In other words, recruiters are starting to press third-party vendors to provide offerings that would allow them to see both employee and contractor availability from the same place, Brandau said. "Why aren't they in the same place and with a nod toward skills?" he said.
Some of this transition also may include adopting development structures that create "gig-like" models within an employed workforce, WorldAtWork's CEO Scott Cawood said in his Top 7 Workplace Predictions emailed to HR Dive, giving workers opportunities to work on a project-by-project basis and understand how their career will develop in the long-term.
'Super jobs' will become more prevalent
Employee learning and talent management are more intertwined now than ever; learning was the No. 1 trend in one of Deloitte's 2019 human capital trend reports. But that push is driven in part by the looming talent shortage and heightening competition. As employers adopt tools that can do some of the work that talent would previously be hired to do — think robots in Amazon warehouses — they're also inadvertently creating "super jobs" that require skill sets that cross multiple domains, Stephan said.
"A package organizer now has to be an expert in robotic tech," he said. Someone who is managing fellow organizers may now have to combine those key leadership skills with minor capabilities in robotics. To make up that gap, employers began to lean heavily on employee development — but how does a company balance necessary development time without disrupting the work?
"People need to be able to do their job and have access to knowledge when doing their job," Stephan said. A global manufacturing company that works on elevators once had a 3,000 page manual, he explained. Now, employees can use an iPad to search for ways to resolve issues on the fly, educating the worker while keeping them productive.
"They're having to adapt to a really fast changing market," Brandau said.
It's not all tech-driven. The rise of super jobs also has forced employers to redefine leadership development and what it means to be a leader in an organization that requires each worker to have a broad swath of skills, Brandau added.
'Agility' will give way to 'adaptability'
Last year, "agility" was the buzzword of choice. But employers and experts have made a semantics shift toward "adaptability" as employers consider how to best prepare for the future of work.
"When you think of agility, you think of being able to bend an arm in a certain way," Brandau said. "But adaptability is an intelligence of...which way do I need to bend and why?"
The concept is not wholly different from agility, which requires an employer to be ready for the rapid changes descending upon the business world, but it does require an employer to more seriously consider how its people work and behave. "Adaptable is about living and breathing around networks," Stephan said.
A company's culture may need to adopt a philosophy about "failing fast and learning fast," he continued. After all, a workplace can't be "adaptable" if its people aren't ready — though Brandau predicts this will continue to be a hurdle for employers to overcome.
"You have to have a workforce that is ready to adapt to change. We hate change," he said. "Adaptive workforces thrive in change. How do you do this in real ways?"
Employers will have to use data to dive local — whether they're ready or not
To find talent faster, some employers have invested in data and "workforce sensing" to get a more accurate assessment of the local talent market. The pressure to do so — and quickly — has only risen in recent years as employers grapple with talent gaps. That data can inform the type of tech an employer needs or even a new location strategy, Stephan said. And that doesn't even account for HR's use of internal data to gauge employee experience.
Unfortunately, HR teams aren't exactly prepared for this deep dive, even if the branding around it has been centered on employee experience, Brandau said. "HR and these areas have not typically been very good at dealing with data," he added. "How are managers going to deal with an intelligent suite? They aren't ready for it."
Employers that want to improve their workforce sensing capabilities will need to invest serious time into understanding external data sources. Where are the "pockets of workforce capabilities"? "Our clients really aren't there yet," Stephan said. But this talent market might just push them there.
SOURCE: Moody, K. (08 January 2020) "5 talent trends to watch in 2020" (Web Blog Post). Retrieved from https://www.hrdive.com/news/5-talent-trends-to-watch-in-2020/570026/
Even HR executives have to reinvent themselves to survive
New trends, technology, and modern changes are creating concerns for the trained level of HR professionals. With different changes continuously entering companies, HR professionals are having to go through different pieces of training. Read this blog post to learn about HR professionals having to learn about new and modernized paces.
HR chief executives by and large are ill-equipped to meet the needs of the modern workplace, according to a new report of 500 top executives.
The irony is the HR profession is perhaps entering a golden age for HR leaders, as the role shifts beyond administrative and process-related functions to work that is at the very core of a company’s business strategy to keep top talent.
And yet because the workplace is changing so fast to adapt to technological and demographic shifts, the study by SHRM and another insurance company found that the role of HR hasn’t been able to keep pace to train the latest generation of HR leaders.
Because work functions are constantly in flux, training and development can no longer be considered episodic events but instead will require perpetual reskilling to stay relevant. The study noted that between 2003 and 2013, more than 70% of the Fortune 1000 companies changed and were replaced by nimbler firms.
Most HR executives or chief people officers, or CPOs, will need to reskill to stay relevant — and do so quickly, according to HR People + Strategy, the group’s network of business and thought leaders in human resources.
“As the pace of innovation and technology in the workplace accelerates, CPOs will need to reinvent themselves,” says the study’s co-author Suzanne McAndrew, the global head of talent of another insurance company. “With disruption on the horizon, organizations will require strong, visionary people leaders who can think through the people and talent strategy, and work with management on the business strategy.”
Most executives “are not prepared,” McAndrew says.
“We’re only going to get things done if we have the right people, the right talent in the right functions with the right goals,” Upwork CEO Stephanie Kasriel says in the study. “That to me is the role of HR, to ensure that we have the right people strategy in order to inform the business strategy.”
The study reviewed key changes shaping HR functions for human resources leaders and also found:
•Virtually all respondents (99%) believe HR executives must have the agility and courage to change, yet only 35% said today’s leaders are prepared to respond.
•More than nine in 10 respondents (94%) say it’s important to explore the development of future HR leaders, but only about a third (35%) agree that future staff are receiving the training they’ll need to succeed.
•Only one-third of respondents (36%) are prepared to think about how technology can be used to execute work in the future; only a quarter (26%) say they have the technical acumen to evaluate new technologies.
HR leaders can do five things to help drive change, including acting as an advocate for change and agility, developing digital technology to improve HR functions, using automation to foster new skills and reinvention for staff, focusing on workplace culture and leadership and elevating HR decision-making to include more analytics, the study found.
Alexander Alonso, chief knowledge officer at SHRM, noted that HR executives have the greatest potential to foster the evolution of enterprises by building up their own expertise to meet future workforce demands.
Respondents also recognize much progress is still needed with digital enablement and understanding how to apply digital technology and automation in the workplace. Only 42% had a favorable opinion of their organization’s progress when it comes to embracing technology that builds a consumer experience for employees.
“While CPOs don’t need to be technology experts, they must understand how changing technology can impact work and the workforce,” says Ravin Jesuthasan, a managing director at another insurance company and co-author of the study.
SOURCE: Siew, W. (08 January 2020) "Even HR executives have to reinvent themselves to survive" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/even-hr-executives-have-to-reinvent-themselves-to-survive
The Post-Holiday Funk Is Real
Getting out of the post-holiday funk is a difficult task in itself. After a holiday season filled with parties, breaks, food and time off, it can be hard to snap back into work mode. Here are a few things you can do to get out of that holiday funk:
Somewhere around the third week in December work in many offices starts to slow down. There are holiday parties. Customers and clients may be harder to reach. Energy and motivation wanes. And many of us sign off from work completely to spend the holidays with friends and family.
And then January arrives, and it’s time to get back in the swing of things. But, after being out for a week or two, it can be hard to snap back into work mode. If you’re feeling sluggish and unmotivated, you’re not alone. There are several reasons for this kind of the post-holiday funk — and, fortunately, there are things you can do to get out of it as well.
Focus forward
It’s common around New Year’s Day to look back at the past year. Research on construal-level theory suggests that the more distant you are from anything in time, space, or socially, the more abstractly you think about it. Getting out of the office and looking at the whole year leads you to think about your contribution and not just the tasks you did. This is natural and healthy. After all, your contribution in the last year was not the 16,471 emails you sent, but rather the relationships you solidified, the projects you oversaw, and the collaborations you continued as a result of those emails.
But while you’re likely to be proud of some things you accomplished, you may also be thinking about some of your failures. These are often the source of many people’s New Year’s resolutions.
Of course, noticing last year’s failures can be disheartening. And around the new year, you may end up in a cycle of thoughts about what you could have done differently in the past. This kind of rumination can actually heighten feelings of depression and anxiety, which sap your motivation.
When you get back to work, it’s important to start looking forward to the new year rather than back on the past one. Treat the goals you want to accomplish as new challenges and a source of energy not a penance for things you didn’t get done last year. Focusing on the future — and seeing new opportunities to succeed — can help you to generate the energy to get started.
Get specific
Your reflections on the past year might also lead you to commit to making changes. This is a good thing but not if your commitments are abstract, like “be more productive,” “get a new job,” or “become a better leader.”
In fact, these abstract goals can be paralyzing. They’re simply too big to make meaningful progress toward. Instead, turn your goal into specific actions that when added up lead to the desired outcome. This kind of specific plan is called an implementation intention. It requires that you break the general goal down into tasks that can be put on your calendar.
This specificity has two benefits.
First, it requires you to think through what actually has to be done to achieve the goal. You may discover that you don’t know all the steps or that some of the steps are ones that involve skills you need to learn. In that case, you might want to find a mentor or coach who can help you.
Second, being specific forces you to grapple with your densely packed schedule. One reason why people often fail to achieve important goals is that they cannot find the time to perform the tasks that would lead to success. When you try to add new actions to your agenda, you are forced to figure out what can be moved, delayed, or delegated in order to put you on the road to following through on your commitment.
Make the right social comparisons
A third possible source of post-holiday funk is social comparison.
Humans don’t evaluate things on an absolute scale. Instead, we assess our success relative to some standard. Often, we do that through the process of social comparison, in which we compare ourselves to someone else.
There are two kinds of social comparisons. Upward social comparisons involve comparing yourself to someone better off than you are along a particular dimension. For example, you might see a high-school friend who just got a promotion, or a college friend who just bought a car that you dream of owning some day. These comparisons tend to make you feel bad about yourself, because they highlight what other people have that you don’t, whether it’s money, social standing, or particular relationships. Downward social comparisons are comparisons to someone worse off than you. These comparisons generally make you feel good about yourself and your situation.
Unfortunately, both kinds of comparison can sap your motivation. Upward social comparisons can frustrate you, knowing that other people you know are more successful, happier, or wealthier than you are. Because of the way people curate their social media, if you just look at where people are taking vacations or what they post about their jobs, it’s easy to believe that most people are doing better than you are, which may lead you to feel like giving up.
When you make downward social comparisons, you feel better about what you have and what you have accomplished, but you aren’t motivated to continue pushing forward. Instead, it makes you satisfied with where you are and, often, complacent. The energy you need to motivate yourself comes from being dissatisfied with something about the present, along with developing a plan to get what you want.
You can’t stop yourself from making social comparisons, but you can explicitly manage those comparisons to motivate you. For example, you can find a close rival — someone who is doing slightly better than you are along some dimension, but whose performance is close enough to your own that you can see how you could take some actions to reach their level.
You can also make social comparisons to your past self. Take a look at your trajectory. Recognize that even if you haven’t achieved all of your goals, you have improved over time. Use that recognition of your own growth to spur you to keep working to reach new heights.
No one wants to start the year off in a rut. And yet many of us begin January too focused on the past and feeling bad about what we have yet to accomplish. With some small changes in your perspective, though, you can hit the ground running in the new year.
SOURCE: Markman, A. (03 January 2020) "The Post-Holiday Funk Is Real" (Web Blog Post). Retrieved from https://hbr.org/2020/01/the-post-holiday-funk-is-real?ab=hero-subleft-3
Top 4 HR trends to watch this year
How can HR professionals better engage employees, improve an organization's brand, and maximize productivity and profitability? Their success will rely on HR departments staying nimble and leveraging technological advances to help reshape workplace practices. Here are four HR trends to watch this year:
HR professionals can no longer rest on their laurels. They are now looking to implement innovative strategies to better engage employees, improve the company’s brand both internally and externally, maximize productivity and increase the organization’s profitability.
So how can HR professionals go about making this happen? The success of HR will largely be based on staying nimble, evolving their organization’s policies and leveraging technological advances to ultimately reshape their workplace practices.
With that in mind, here are the top HR trends that will take center stage:
The gig economy and the importance of flexibility. The gig economy, which is comprised of individuals with short-term or temporary engagements with a company, is substantially important to employers. Here, workers are seeking increased flexibility and control over their work environments. Since many questions remain unanswered regarding worker classification issues and the application of existing laws in the gig economy, look for the Department of Labor to issue an opinion letter or guidance in 2019 detailing how a company may compliantly work within the gig economy and not run afoul of existing independent contractors.
Flexibility also is important for all employees — not just for the gig economy. While telecommuting and remote positions are not new, they are being emphasized again to better engage employees and increase retention metrics.
The tech effect on future of HR. The strategic and consistent use of workforce data analytics to predict and improve a company’s performance has exploded over the last several years, with additional momentum expected in 2019. While most HR professionals rely on metrics for basic recruiting and turnover rates, more in-depth analytics and trend spotting has become the norm.
Once trends are identified in, for example, turnover rates, an HR professional should have the tools to dive into the data and analyze root causes, such as the need for manager training, review of compensation strategies or a change in the company’s culture. Using predictive analytics in the HR space is helping companies make better informed, dynamic and wiser decisions based on historical data, as well as placing HR on the level of other data-driven company departments, such as finance and marketing.
The collection of this enormous amount of data also poses challenges and potential risks to companies, including negative perceptions among employees about how their data is being used, employee privacy laws and potential security breaches. Strong and comprehensive security policies, protocols and controls are necessary to ensure employers are keeping their employees’ data safe. In 2019, a steady flow of communications to employees regarding advanced security and usage policies is key to prevent data misuse or misunderstanding regarding how information is collected and used.
Artificial intelligence also will continue to be a significant focus driving improvement in the HR arena. Determining which data to collect, analyze and protect will provide opportunities for AI to assume a larger role in HR. Also, in some large organizations, AI already is being used for more than just automating repetitive HR tasks, such as onboarding new employees. The future of AI for most companies will include creating more personalized employee experiences as well as supporting critical decisions. From analyzing performance data to eliminating biases when screening candidates, AI will continue to be a pivotal HR tool.
Strategies for successful recruitment. Running an effective talent pipeline should be the objective of all hiring endeavors. Pipelining is consistently gaining traction as a recruitment tool for new employees. The concept employs marketing concepts to ensure that companies have a diverse group of strong recruits waiting to be hired. Pipelining reduces time to hire and leads to better quality candidates.
Health, wellness and adequate employee training. Another area of importance is multi-faceted wellness programs, which focus on an employee’s total well-being, from nutrition to financial wellness. These programs often include a comprehensive employee assistance program, training and activities during worktime. The training can focus on anything from physical health to development of employees’ knowledge base and technology-focused education. A greater emphasis also is being placed on workplace communication coaching, such as collaboration and negotiation, which are critical to success in the workplace.
Continued training and heightened prevention of sexual harassment and discrimination will be another trend this year. Organizations big and small must ensure that compliant policies are in place and employees are trained on the policies. Several states including California, New York, Connecticut and Maine already mandate that private employers must provide harassment training to workers, and the number of states requiring this training is expected to increase in the coming years.
SOURCE: Seltzer, M. (03 January 2020) "Top 4 HR trends to watch this year" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/top-4-hr-trends-to-watch-this-year
Are You Pushing Yourself Too Hard at Work?
Different seasons can bring in long hours, extensive work, and multiple deadlines that require a lot of attention. Are you pushing yourself too hard? It is important to know the difference between a temporary work crunch and an everyday "norm". Read this blog post for a few key signs of pushing too hard at work.
We all have intense periods at work where multiple deadlines converge, an important deal is closing, or a busy season lasts for a few months. During these times, we may work more intensely or longer hours, but we know that the situation is temporary, and we are able to keep work in perspective. Conversely, approximately 10% of Americans are considered workaholics, defined as having a “stable tendency to compulsively and excessively work.” Whether you are in the midst of a temporary work crunch, or if working all the time is your version of “normal,” there are some key signs that you are pushing yourself too hard. These include:
You aren’t taking time off. Consistently putting off vacations (including working over major holidays), regularly working all weekend, or dismissing the idea of an occasional day off is a sign that you are burning the candle from both ends. While only 23% of Americans take their full vacation time allotted, studies of elite athletes show that rest periods are precisely what helps them to perform at full throttle when needed, and the same is true for the rest of us. While extended vacations are helpful, smaller breaks, such as taking the weekend to recharge, carving out personal time in the evening, or having an occasional day off can also be an important part of having sufficient downtime to restore your energy and counter the drain of being “always on.”
You deprioritize personal relationships. When we focus exclusively on work for extended periods, it often comes at the expense of our personal relationships. During 2018, 76% of US workers said that workplace stress affected their personal relationships, with workaholics being twice as likely to get divorced. Not taking time to connect with friends and family can also be detrimental to our health. Research shows that strong social relationships are positively correlated to lifespan and that a lack of social relationships has the same effect as smoking 15 cigarettes a day. If you are not taking time outside of work to connect socially with others and have become increasingly isolated, such that social invitations have dried up because others assume you are not available, chances are you are too focused on work.
You’re unable to be fully present outside of work. Another sign you are pushing yourself too hard is that when you do leave the office and take time to be with the people you care about, you are not able to mentally turn work off and be present with them. In 2017, 66% of Americans reported working while on vacation. Jeff, a former client of mine who is a senior partner at his law firm, has never gone on vacation without his laptop. In addition, after making a point to spend time on the weekends to connect with his daughter, he confessed to constantly thinking about work and admitted that he couldn’t help but compulsively check email on his phone every few minutes. While it’s normal to think about work periodically, it becomes a problem when we’re not able to manage our urge to give into work-related distractions, slowly eroding our most important relationships. In his book, Indistractable, author Nir Eyal points out that these distractions make the people we care about “residual beneficiaries” of our attention, meaning they get what is left over, which typically not very much.
You’re neglecting personal care. This is not the occasional skipping a shower when working from home in your sweatpants. Failing to get sufficient sleep, missing meals or existing on a diet of coffee and energy bars, or abandoning exercise or personal hygiene for extended periods are all indications that you are in an unhealthy pattern of behavior. In particular, when we sacrifice sleep for work, we are effectively working against ourselves, as sleep deprivation is shown to impair higher-level cognitive functions including judgment, critical thinking, decision making, and organization. Likewise, skipping exercise puts us at a further disadvantage. Exercise has been shown to lower stress, improve mood and energy levels, and enhance cognitive function, such as memory, concentration, learning, mental stamina, and creativity. As a former investment banker who worked 80- to 100-hour weeks during more intense periods, taking breaks to exercise, eat, and even nap in one of the sleeping rooms provided onsite was critical to maintaining my health, stamina, and productivity.
You see your value as a person completely defined by work. Failure to see a broader perspective, both in terms of how you see your value as a person as well as how you see the importance of work relative to the rest of your life, can be a sign that you are pushing yourself too hard. This myopia is usually driven by deeply held limiting beliefs that create a contracted worldview. Elisa, the head of engineering at a tech company, pushed herself and her team incredibly hard. Her behavior was driven by a belief that “My value is what I produce.” To broaden her perspective, she asked others she respected about what they valued about her, as well as how they valued themselves. She was able to see not only that people valued her for other things like being a good friend, parent, or thought partner, but also that they defined their own value more broadly than their work. Sometimes, it takes a big life event, like the birth of a child or the death of a colleague or loved one, to shake someone out of this restricted perspective. Another way to broaden your perspective in the absence of these events is to have interests outside of work, which can be a good reminder that work isn’t everything.
While we all need to shift into high gear from time to time, keeping work in perspective with the rest of our lives, and taking care of ourselves and our relationships are key to achieving long-term success, both personally and professionally.
SOURCE: Zucker, R. (03 January 2020) "Are You Pushing Yourself Too Hard at Work?" (Web Blog Post). Retrieved from https://hbr.org/2020/01/are-you-pushing-yourself-too-hard-at-work
New drug plan would curb exorbitant pharmaceutical costs
California Governor, Gavin Newsom has proposed a pharmaceutical plan to cut costs of pharmaceutical prescriptions. It was suggested that using low prices obtained by the state, could help other buyers. Read this blog to learn about how California Governor is purposing an attempt to lower costs for California residents.
California’s governor unveiled plans to establish a state-run generic-drug wholesaler, as part of a series of measures that together would constitute one of the furthest-reaching attempts to curb pharmaceutical costs in the U.S.
Gov. Gavin Newsom on Thursday also proposed creating a single market that would allow drug buyers to pool their bargaining power to drive down costs. And Newsom suggested using low prices obtained by the state’s Medicaid program to aid other buyers, among other steps.
The most populous U.S. state, California has a history of using its economic muscle to try to influence national policy on everything from auto emissions to health care. The drug-pricing proposals, which in some cases appear to require new law, are likely to be opposed by a pharmaceutical industry that has formidable economic and legal wherewithal of its own.
“These nation-leading reforms seek to put consumers back in the driver seat and lower health care costs for every Californian,” Newsom, a Democrat, said in a statement.
The plans, released as part of the state’s proposed 2020-2021 budget, are almost certain to face substantial practical, political and legal hurdles. For example, the proposal to create a state-run drug label would rely on drug companies to supply inventory on a contract basis.
Companies could balk at that notion if it stands to further compress their margins. Major generic manufacturers, including Mylan NV and Teva Pharmaceutical Industries, have struggled to turn a profit on some widely used medications. For higher-cost generic drugs, there can be few competing manufacturers with the licenses to produce the pills for the U.S. market.
Creating a single buying pool could run into difficulties, as well. Newsom’s proposal says state programs, health insurers and private employers would band together as a sole buyer, and that drugmakers would have to offer their products at one price to the entire market.
But that could limit patient access to medications if pricing disputes lead drug companies to withhold their products. In Europe, negotiations between drugmakers and government health programs have resulted in some expensive drugs not being available, one of the trade-offs for the continent’s typically lower costs. It’s unclear if California could successfully hold together a large pool of independent buyers in the face of pressure from patients unable to access treatments.
SOURCE: Bloomberg News (09 January 2020) "New drug plan would curb exorbitant pharmaceutical costs" (Web Blog Post). Retrieved from benefitnews.com/articles/new-c-a-drug-plan-would-curb-exorbitant-pharmaceutical-costs