Rethinking the Modern Accumulation of Technology
In an article from SHRM.org, Natalie Kroc addresses how technology is impacting security measures.
Original post from SHRM.org on June 16, 2016.
It wasn’t the latest gadget or platform or program that the speakers discussed at a recent conference session on how to keep teleworkers and remote workers connected. Instead, it was the most basic of modern technologies that kept being stressed:
E-mail. An Internet connection. Maybe a webcam (though this proved controversial).
“I am a Millennial, and I … primarily communicate through e-mail,” said Greg Caplan, founder and CEO of Remote Year, a year-old startup that has brought together a group of 75 people to travel the world while holding down various remote jobs. Caplan believes that, for work purposes, e-mail is still king.
The other panelists at the Telecommuting, Remote and Distributed (TRaD) Works Forum, held June 9-10 in Washington, D.C., agreed that the simplest of technologies can successfully keep offsite employees connected. TRaD refers to the different kinds of offsite employees: Telecommuters are those who work from home sometimes, remote workers do their entire jobs from home and a distributed workforce is when an organization doesn’t have a physical location so its employees all work remotely.
Employees who work offsite only need “an Internet connection. Anything else we can work around,” said Carol Cochran, director of people and culture for Boulder, Colo.-based FlexJobs, a job search site that focuses on telecommuting, part-time and other flexible work opportunities. FlexJobs was a co-host of the forum.
Organizations may want to consider providing their remote workers a cellphone with Internet capabilities as a backup. This all but guarantees that employees will be able to work—even if they are having difficulties with their home Internet connection.
A chat function can be useful as well, if the work that employees are doing would benefit from the ability to reach out and have real-time conversations.
Many organizations that employ remote workers have the routine of a “daily huddle” or something similar, wherein employees are expected to check in at the start of the day, whether in a brief meeting or by writing their day’s plans in a shared document.
When an organization’s workforce is made up of remote or teleworking employees, or a mix of offsite and onsite workers, it’s especially important to use the time when everyone gets together effectively. Meetings should be “30 minutes, if not 15 minutes, instead of an hour,” Cochran said. If certain employees are inclined to speak for long periods of time, establish a time limit—and then stick to it.
Video: Love It or Hate It
“I hate video,” Cochran said. “I’m really reluctant to put it on, it’s so awkward.” FlexJobs uses it only rarely, and even then it’s often for social occasions. Cochran said she has found that workers become preoccupied knowing they are being viewed on screen, and worry about their hair and clothes and background surroundings.
This was a point of fierce contention among the panelists and forum attendees alike, though. Some organizations believe that video is essential, and that any initial awkwardness that employees may feel will disappear with habitual use.
Alex Konanykhin, CEO of Transparent Business, a platform that aims to help companies that employ teleworkers and freelancers, offered a solution: Get the organization’s leaders to work from home—and to exercise right before the meeting. When they dial in, they should be in full post-workout gear, including messy hair or a baseball cap. “All it takes is one time” of seeing that, he said, to have a workforce that can be comfortable with being on screen.
Video is a way of giving voice to remote workers and “making them feel part of the organization,” he added.
For those organizations that decide to incorporate webcams into the remote-worker experience, the panelists had some advice:
- Don’t keep the webcams on all day—turn them on at specific times, such as for meetings or training sessions.
- Suggest to employees who express reluctance that they may want to purchase a simple screen or backdrop to place behind them so that their home surroundings will not be visible on screen. This also may help to convey a more-businesslike feel.
- Consider making video an option, not a requirement, for meetings.
- Finally, if the organization’s video capabilities prove to be less than ideal—and repeatedly involve technical snafus such as the video shutting off or freezing, then stop trying to make video happen.
Adopt New Tools Cautiously
The speakers had their individual favorites among newer technologies, such as messaging app Slack, electronic signature platform DocuSign, Google Drawings for collaborating on charts and diagrams, and Zoom for streamlining remote communications. However, the panelists also derided many new offerings as being unnecessarily confusing and others for seeming to be more about entertainment than practical application.
Tools that are adopted by an organization need to be fully embraced by both remote and onsite workers, the speakers agreed. “When you take on a tool, you have to have a very clear expectation of how it is to be used,” Caplan said. “And that’s just culture.”
That said, it’s important for organizations to pick their tools wisely. Each new tool should represent an improvement from whatever employees were using before to accomplish a particular task. And while entertainment shouldn’t be a priority, each new tool should make employees’ jobs easier, the panelists said.
“Why do people love Facebook?” asked Konanykhin. “It’s instant gratification.” Employees expect the same ease of use and sense of satisfaction with the tools they use for work.
Natalie Kroc is a staff writer for SHRM.
See the original article here.
Source:
Kroc, N. (2016, June 16). Rethinking the modern accumulation of techonology [Web log post]. Retrieved from https://www.shrm.org/ResourcesAndTools/hr-topics/technology/Pages/Rethinking-the-Modern-Accumulation-of-Technology.aspx
Ninth Circuit Holds that Cash Payments Made in Lieu of Health Benefits Must Be Included in Regular Rate for Overtime Purposes Under FLSA
A ruling from the Ninth Circuit Court may impact your cash benefit offerings. See the article below for more insight.
Original Post from ThinkHR.com on July 7, 2016
On June 2, 2016, the Ninth Circuit Court of Appeals, in Flores v. City of San Gabriel, held that the City of San Gabriel willfully violated the Fair Labor Standards Act (FLSA) by failing to include cash payments to police officers for unused medical benefits allowances when calculating their regular rate of pay, which ultimately resulted in a lower overtime rate and an underpayment of overtime.
In Flores, the City provided a flexible benefits plan to its employees under which the City furnished a designated monetary amount to each employee to be used for purchasing medical, vision, and dental benefits. While employees were required to use a portion of these funds to purchase vision and dental insurance, employees with access to alternative medical coverage (for example, through a spouse) could decline to use the remaining benefits and opt for a cash payment instead. The cash payment would then be added to the employee’s regular paycheck. The City did not consider the value of that cash payment when calculating the employees’ regular rate of pay and resulting overtime rate. A group of current and former officers sued, claiming they were underpaid for overtime hours worked because the cash provided to employees in lieu of benefits should have been used in calculating their overtime rate.
The primary issue was whether the City’s cash-in-lieu payments were properly excluded from the employees’ regular rate of pay. The Ninth Circuit held that cash payments made to employees in lieu of health benefits must be included in the hourly “regular rate” used to compensate employees for overtime hours worked. The City argued that the cash-in-lieu payments were not payments made as compensation for hours of employment and were not tied to the amount of work performed for the employer, and therefore were excludable under 29 U.S.C. § 207(e)(2) from the regular rate of pay as are payments for leave, travel expenses, and other reimbursable expenses. The Ninth Circuit disagreed, finding the payments were “compensation for work” even if the payments were not specifically tied to time worked for the employer.
The Ninth Circuit also rejected the City’s argument that its cash in lieu of benefit payments were properly excluded pursuant to § 207(e)(4) because the payments were paid directly to employees. Section 207(e)(4) excludes from the regular rate of pay “contributions irrevocably made by an employer to a trustee or third person pursuant to a bona fide plan for providing old age, retirement, life, accident, or health insurance or similar benefits for employees.”
Note: This decision only affects those employers located in the Ninth Circuit. The Ninth Circuit includes Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington, and Guam.
See Original Article Here.
Source:
Unknown (2016, July 7). Ninth Circuit Holds that Cash Payments Made in Lieu of Health Benefits Must Be Included in Regular Rate for Overtime Purposes Under FLSA [Web log post]. Retrieved from https://www.thinkhr.com/blog/hr/ninth-circuit-holds-that-cash-payments-made-in-lieu-of-health-benefits-must-be-included-in-regular-rate-for-overtime-purposes-under-flsa/
Top 10 catastrophic claims for self-funded employers
Great read on what may impact your self-funded plan by Jack Craver. See results from the study below.
Original Post from BenefitsPro.com on July 13, 2016
There are a range of illnesses that can prompt a self-funded employer to make a claim on their stop-loss insurance policy, but a new study by Sun Life Financial Inc. finds that a majority (53 percent) of the $5.3 billion in such claims paid by insurers from 2012 to 2015 came from 10 ailments.
The study shows the incredible impact of cancer. All types of cancer account for more than a quarter of all stop-loss claims, with breast cancer alone accounting for 13 percent of the total reimbursements.
Claims that exceeded $1 million continue to be rare — only 319 during the four-year period — but they account for nearly a fifth of the total reimbursements.
They have also steadily increased every year, from 60 in 2012 to 107 in 2015. The number of claims exceeding $2 million, however, has not risen steadily, jumping from two to 20 in 2013 but then dropping again in the subsequent two years.
"By highlighting the conditions that create catastrophic claims and providing insights into trends influencing high costs, we can help employers anticipate what they'll see when self-funding and raise awareness about the importance of cost-containment resources and stop-loss insurance,” says Brad Nieland, vice president of Sun Life Financial’s stop-loss division, in a press release.
Here are the top 10 ailments associated with self-funded employer claims:
10. Septicemia
A condition that arises when the body reacts violently to an infection, damaging critical organs in the process and in the most severe cases leading to septic shock, septicemia resulted in $54.7 million in reimbursements between 2012 and 2015, or 2.4 percent of the total.
9. Respiratory failure
Pulmonary collapse or respiratory failure was the ninth leading claim for self-funded employers, resulting in $55 million in reimbursements from stop-loss insurance policies. Risk factors for the condition include binge-drinking, smoking, and working in an environment that leads to inhalation of chemicals that irritate the lungs, all issues that employers can have a hand in improving.
8. Cerebrovascular disease
Most commonly manifested through a stroke, cerebrovascular disease or blood brain vessels prompted $57.4 million in reimbursements between 2012 and 2015, for 2.4 percent of the total. Although strokes are the fifth leading cause of death for Americans, but two-thirds of stroke patients are over the age of 65, suggesting the burden of caring for stroke patients falls mostly on Medicare, rather than employers.
7. Congestive heart failure
The condition that afflicts roughly 2 percent of the adult population and 5 percent of those age 60-69 resulted in $57.8 million in reimbursements from catastrophic insurance policies in 2012-15, accounting for 2.5 percent of the total.
6. Transplants
Transplants are becoming more common than ever, but the good news is that the operations are not as likely to force catastrophic coverage. While transplants increased 65 percent between 2012 and 2015, the total amount of stop-loss reimbursements paid because of transplants only ticked up 0.7 percent compared to 2011-14, to $62.2 million.
5. Premature births/low birth weight
Babies that are born prematurely and have to undergo long hospital stays in incubators or other treatment can prompt astronomical costs for patients and their employers. From 2012 to 2015, employers received $75 million in reimbursements related to such costs incurred by employees, or 3.2 percent of the total.
4. Congenital anomalies
The top claim that specifically relates to a condition at birth, congenital anomalies prompted $96.3 million in reimbursements from 2012 to 2015, holding relatively steady from the 2011 to 2014 period. That accounts for 4.1 percent of total reimbursements.
3. Chronic renal disease
Employers received $156 million from claims related to severe disease of the kidneys, accounting for 6.7 percent of the total. That is a 1 percent decrease from the 2011 to 2014 period. While the costs of treating the condition have decreased 21 percent in the past four years, the disease remains common and costly nonetheless. According to some estimates, chronic renal failure as much as 10 percent of the population, but it is the later stages of the condition that are the most severe and the most costly, often resulting in kidney transplants.
2. Leukemia/lymphoma/multiple myeloma
The second family of cancers is the No. 2 claim for catastrophic insurance. Its financial impact is great, but much smaller. Employers received $188 million between 2012 to 2015 from stop-loss reimbursements related to these conditions, accounting for 8.1 percent of total claims nationally. The value of such claims has remained steady in recent years.
1. Malignant neoplasm
The leading type of cancer is by far the leading reason that employers make claims on their stop-loss policies. These types of cancer accounted for 18.5 percent of all stop-loss claim reimbursements from 2012 to 2015, the study found, totaling a whopping $429 million. That represents a 0.9 percent increase over the 2011 to 2014 period.
See Original Article Here.
Source:
Craver, J. (2016, July 13). Top 10 catastrophic claims for self-funded employers [Web log post]. Retrieved from https://www.benefitspro.com/2016/07/13/top-10-catastrophic-claims-for-self-funded-employe?ref=hp-in-depth&page_all=1&slreturn=1468939510
Feds reveal how to handle tax treatment of wellness rewards
Did you get the Wellness Program notice from the IRS? Jared Bilski outlines how the new memorandum may impact your wellness benefits in the article below.
Original Post from HRMorning.com on June 10, 2016
Most HR pros are focused on ensuring their wellness rewards meet the strict requirements of the ACA and the ADA. But the IRS just reminded employers there are other considerations as well.
Via its Office of Chief Counsel, the agency just released a memorandum on its views of the tax treatment of rewards under employer wellness plans.
Note: IRS memoranda don’t constitute formal advice. However, they do give employers a good understanding of how the agency views compliance topics.
Cash, cash-equivalent rewards
The memorandum confirms that certain tax rules apply to employer-sponsored wellness program. Coverage — including health screenings and other medical care — provided by an employer-sponsored wellness program is generally excluded from an employee’s income under specific sections of The Tax Code. But cash rewards or cash-equivalent rewards earned as a result of a wellness program are a different story.
According to the IRS, if an employee earns a cash reward under the program, that reward must be included in the employee’s gross income under Code Section 61 and is a payment of wages subject to employment taxes.
In addition, if an employee earns a cash-equivalent reward that isn’t excludible from his or her income — e.g., the payment of gym membership fees — the fair market value of that reward will be included in the employee’s gross income and is a payment of wages subject to employment taxes.
Additional clarifications
A few additional clarifications in the IRS memorandum:
- If employers reimburse all or a portion of the premiums paid by the employee through a cafeteria plan for the company’s wellness plan, those reimbursements will be included in the employee’s gross income and are payments of wages subject to employment taxes.
- Although some non-cash benefits may be excludible as de minimis fringe benefits (e.g., a T-shirt for a company wellness plan), cash fringe benefits generally aren’t eligible to be treated as excludable de minimis fringe benefits.
Find the original article here.
Source:
Bilski, J. (2016, June 10). Fed reveal how to handle tax treatment of wellness rewards [Web log post]. Retrieved from https://www.hrmorning.com/feds-reveal-how-to-handle-tax-treatment-of-wellness-rewards/
ACA Puts Employers Between A Rock And A Hard Place
A great article by Greta Engle on the upcoming challenges with the ACA.
Original Post from SHRM.org on July 8, 2016
The value of employer-sponsored health care recently has come under scrutiny from lawmakers as they look for solutions to reduce the federal deficit and alternatives to the Affordable Care Act (ACA). If you’re not a political junkie like me, let me provide some context.
Historically, one of the largest subsidies for health insurance comes from employment-based coverage. That’s because the federal tax system provides preferential treatment for health care coverage that people receive from their employers. Employers’ payments for health coverage are excluded from income and payroll taxes. And, most times, employee contributions are also excluded from income and payroll taxes.
There are many benefits of employer-sponsored health care coverage that Congress and specifically House Speaker Paul Ryan, who has commissioned a Task Force on Health Care Reform, should realize. For starters, the ability to offer health benefits sets an employer apart and can be a strong driver in a retention or recruitment strategy. American workers in today’s climate have an expectation of health care as part of their compensation package (remember the good old days when you were considered to have a professional job if your employer provided health benefits?) and employer-sponsored health benefits costs are pretax deductions. Additionally, flexible spending accounts (FSAs) and health savings accounts (HSAs) provide another savings tool for employees to avoid out-of-pocket expenditures coming from a household budget. These are just a few of the benefits.
While the ACA includes some provisions that should be applauded, as they’ve increased access and coverage, there are some provisions that have had an adverse effect—especially on employers. We’re now beginning to realize the costs associated with the ACA, and, in particular, how our economy has been impacted. Some Americans are now working part time or having their hours cut by employers seeking to avoid providing coverage under the full-time mandate of a 30-hour workweek. Then there’s my favorite topic: the excise tax, or “Cadillac tax,” that was delayed until January 2020. To avoid the anticipated tax, many employers have restructured their health benefits offerings or increased workers' deductibles and co-pays.
When the excise tax goes into effect in 2020, employers will most certainly experience higher deductibles and increased out-of-pocket costs—resulting in employers dropping group health plan coverage. This tax MUST be repealed; at the very least, significant changes must be made to avoid those financial consequences to employees. Some of those changes include eliminating HSAs and FSAs from the calculation; removing the employee portion of premium contributions; and basing inflation on the national health care inflation trend rather than the Consumer Price Index, which was 1.5 percent for 2013.
Tinkering with the tax treatment of employer-sponsored health care is not a great idea, especially since more than 175 million Americans currently enjoy this benefit. Instead of targeting employer-sponsored health benefits, lawmakers should consider other financial options.
Employers and employees should be paying attention to this critical issue. The Task Force on Health Care Reform is on the fringes of recommending some tax implications that can shatter a business, threaten individuals’ financial stability and jobs across the U.S., and put employers between a rock and a hard place!
Originally posted on the SHRM Policy Action Center Blog.
Source:
Engle, G. (2016, July 8). ACA puts employers between a rock and a hard place [Web log post]. Retrieved from https://blog.shrm.org/blog/aca-puts-employers-between-a-rock-and-a-hard-place
Put Down Your iPhone! The Biggest Hurdles to Employee Engagement
David Goldstein digs into what are the biggest challenges in getting employees engaged. See what his findings are in the article below.
Original Post from SHRM.org on July 5, 2016
As a company that works with HR leaders and executives who are looking to build stronger teams within their organizations, naturally, employee engagement is a topic that is near and dear to us. It’s a term that’s been buzzing over the past couple of years as organizations search high and low for the perfect formula to decrease turnover, increase enthusiasm and maximize productivity amongst employees.
With countless views on ways to increase employee engagement abound, we wanted to take a look at the other side of things and identify specific barriers that business owners and managers are facing. We surveyed 500 small-mid sized business owners and managers across the US and asked them to identify the number one challenge when it comes to getting employees engaged. These respondents either own or manage a business with fewer than 100 employees. Here’s what they said.
1. (31%) GETTING EMPLOYEES OFF THEIR PHONES
Turns out, when it comes to small businesses, forget the more complex problems of increasing engagement amongst virtual workers or getting multigenerational workers to integrate into cohesive teams. Owners and managers at small businesses face a much simpler problem: getting employees to put down their phones! Is it really a surprise that the majority of respondents reported this as their biggest challenge?
Mobile devices have turned us into screen-addicts, averting our eyes and attention at a startling rate. This is an especially big problem when we begin to look at low wage jobs and positions in rural areas. Small business owners and managers that are making less than $24,000 themselves a year, or those living in rural areas, were the most likely to list it as their biggest employee engagement problem (44%).
Young business managers also find it most difficult to get workers off their phones with 34% of 18-34 year olds reporting it as their largest roadblock to employee engagement. Workers phones are consistently integrated into both personal and work life so it’s hard to incentivize workers to step away from the device and into a conversation with fellow employees. Especially when 74% of employers report that their organization use or plan on using a BYOD program (bring your own device), the odds of getting distracted with social media or unrelated apps get higher and higher.
Finally, women managers and small business owners (34%) were more likely than men (28%) to note that getting employees off their phones was the biggest challenge in getting them engaged. One potential solution to this problem that HR teams can leverage? Embrace employees’ device addictions rather than trying to cure them. For example, utilizing mobile scavenger hunts or mobile-friendly engagement surveys can help build a compromise and solution to the over-used phone issue. And if that doesn’t work, you can always just create a policy.
2. (24%) HIGH TURNOVER & GETTING NEW HIRES ENGAGED
Losing employees more frequently in the worker-friendly job market and having to get new employees engaged more often is also a considerable issue for small business owners and managers. It’s most pressing in rural areas (29%), where it’s probably harder to find new talent that fits with an organization.
Turnover rates as a barrier to employee engagement were of most concern to managers and business owners in the midwest and south regions, and of least concern to those in the northeast.
That’s one reason it’s important to factor company culture into the interview process to ensure the fit is right. Then, get creative with the flexibility options for your employees. In other words, give your employees reason to stay. Then work on their engagement from there.
3. (23%) GETTING MULTIGENERATIONAL EMPLOYEES ENGAGED
The third most pressing issue for small business owners and managers is the battle between Boomers, Gen X’ers and Millennials being waged within multi-generational workplaces.
Generational differences can be a stumbling block that hinders employee engagement within an organization. On one hand, you have 45% of Baby Boomers & Gen X complaining about millennial’s lack of managerial experience while, on the other hand, you have millennials who just want flexibility and fun.
It was interesting to see that getting multigenerational employees engaged was actually the most pressing employee engagement issue (28%) for respondents that were 35-44 years old. These folks find themselves toeing the line between the two diverging generations in the workplace.
So what’s the best thing to do in this situation? Find common ground. Satisfy both sides by creating activities that everyone can partake in. Food and laughter are pretty effective across generational lines. So is getting outdoors in the summer!
4. (22%) GETTING REMOTE AND VIRTUAL WORKERS ENGAGED
While the trend of remote working was the least pressing challenge for respondents, there were groups that found it more challenging than others. Managers and owners that earn more than $150,000 a year (presumed to be working within larger organizations) found it to be the biggest hurdle to achieving employee engagement (43%).
While sweet in the sense that it breeds more freedom for workers around the world, its lack of in-person interaction can become a bitter challenge for many companies seeking strong employee engagement. In fact, 65% of remote employees report that they have never had a team-building session.
To address this issues, owners and managers may want to embrace the small talk and chit-chat online. When workers aren’t in the same office they don’t have the interactions that allow them to truly relate to each other on a personal level. Opening up internal communication platforms like Slack and HipChat, and encouraging workers to express themselves outside of work dialogue (hello GIF’s!) is important.
Another idea? Coffee Shop Days! While remote workers and work-from-home freelancers may appreciate their time outside the office, they can become bored and lonely. If you have workers on your team working remotely, consider suggesting a Coffee Shop Day once a month where you have managers work alongside the remote team members for the day. Finally, there are actually virtual team building and engagement activities out there that stimulate a day in the life of a virtual team.
See the full article and infographic here.
Source:
Goldstein, D. (2016, July 5). Put down your iPhone! The biggest hurdles to employee engagemet [Web log post]. Retrieved from https://blog.shrm.org/blog/put-down-your-iphone-the-biggest-hurdles-to-employee-engagement.
Use It or Lose It: Are your employee's taking advantage of their PTO?
Are your workers taking advantage of their PTO? It is important for you employee's to de-stress and take a break to continue to be sucessful. Ensure your employees are taking the time off they need to keep a happy and healthy workfoce.
According to a Forbes article, only 25% of Americans take their paid vacation. The article also gives insight as to how not taking vacation can impact your overall effeciency in the workplace.
It’s not healthy to keep working without a break. Vacation recharges our internal batteries, gives us perspective on what we do and fuels creativity and energy. Vacation also promotes creative thinking, expands our cultural horizons and sharpens cognition, especially if we can travel to another country. “Traveling shifts us from the solipsistic way we operate every day,” Joan Kane, a Manhattan psychologist, told me a when I did a story on vacations a few years ago. “It promotes a sense of well-being and gets you thinking in different ways. It can be life-altering.”
In the article The common workplace practice that’s costing employers billions by Cort Olsen, gives more understanding of why employees do not always take the time offered.
Having diligent, hardworking employees is every employer’s dream, but it can come at a cost. Studies have shown that employees who sacrifice their vacation time to maintain their work flow could be costing an employer more than it would to have one or two employees out of the office for a couple of weeks’ vacation time.
According to the U.S. Travel Association, employees who choose not to use their paid time off could potentially cost an employer close to $52.4 billion annually due to lost revenue, employee termination or resignation, and hiring and training replacements.
“When you look at a manager or someone in a leader capacity, we run into situations where managers don’t want to be out of the office or away from the team because they feel like they need to be available,” Sciortino says. “Some people who are not in a leadership position may be the only one who does a certain task, so they know if they are not there then the work is not going to get done.”
To combat this problem, employers need to train employees to be backups for other employees who are responsible for a specific task in the event that person is out of the office for a period of time, she says.
“From an employer’s perspective, we want our teams to take PTO, because turnover is costly,” Sciortino says. “You can lose employees because they are feeling burnt, and obviously rehiring and retraining people for positions frequently can be costly on their organization.”
Another costly issue employers face when employees do not use their vacation time is paying out that unused time. Claire Bissot, managing director for CBIZ, says she is against any employer that allows employees to be paid out for not using their vacation time at the end of the year.
Read the full article from Forbes.com here.
See the full article from Employee Benefit Adviser here.
Sources:
Adams, S. (2014, April 7). Only 25% of americans take their paid vacation [Web log post]. Retrieved from https://www.forbes.com/sites/susanadams/2014/04/04/only-25-of-americans-take-their-paid-vacation/#ea0d8c22c5cf
Olsen, C. (2016, June 7). The common workplace practice that's costing employers billions [Web log post]. Retrieved from https://www.employeebenefitadviser.com/news/the-common-workplace-practice-thats-costing-employers-billions
Retirement income calculators: What to know about their projections
Nick Thornton outlines how retirement income calculator are not all the same. Do you have the guidance of a trusted expert?
Original Post from BenefitsPro.com on June 24, 2016
Not all retirement income projection tools are the same.
In fact, the modeling tools, which are becoming default features on recordkeeping and retail advisory platforms, generate wildly varying interpretations of how retirement savings will translate into income when the golden years arrive.
A new study from Corporate Insight, a provider of research and analytics to the financial services industry, surveyed 12 income-modeling tools — six from recordkeepers’ platforms, and six from retail advisory providers.
What the company found could call into question the value of some modeling tools in their existing form.
For retirement needs analysis, the Consumer Price Index isn't enough.
Analysts at Corporate Insight created a hypothetical saver profile: A single, 40-year old male New York resident who makes $100,000 a year and defers 10 percent of his income to a defined contribution plan, which has a balance of $100,000. His employer match is 3 percent. His 401(k) is allocated to suit his moderate level of risk tolerance, and he anticipates drawing a $1,500 a month Social Security benefit upon retiring at age 67.
Those factors, and others, were in put into the calculators, with a goal to replace 85 percent of income in retirement.
What came out was a variance in projections that amounted to nearly $30,000 in annual income, in the case of the greatest discrepancy.
$6,013 a month vs. $3,772 a month
MassMutual’s Retirement Planner tool, which is part of its recordkeeping platform, projected Corporate Insight’s hypothetical saver’s monthly income at $6,013. TIAA’s Retirement Advisor tool, a part of its recordkeeping platform, estimated the same input data to generate $3,772 a month.
The average monthly projection for the 12 modeling tools was $4,792.
No two calculators generated the same projected income.
But the Principal’s Retirement Wellness Planner, Prudential’s Retirement Income Calculator, and WealthMSI’s Retirement Planner 1, the tool of the plan rollover specialist that was acquired by DST in 2015, projected incomes within $88 of one another.
Gap analysis component
Nine of the 12 analyzed tools feature a “gap analysis” component, which compares current retirement income projections to a predetermined income replacement goal.
That analysis — measuring how an investor’s savings tendencies measure against the set goal — provides valuable context to income projection modeling, say Corporate Insight’s analysts, “and should be incorporated into the results of all retirement planning tools,” according to the report. MassMutual, the CalcXML 401(k) income calculator, and Capital One’s Retire My Way tool do not offer the gap analysis.
The nine tools that do offer gap analysis base their conclusions on vastly different income replacement rate goals.
For instance, Principal’s tool sets a monthly income replacement goal of about $9,000 for Corporate Insight’s hypothetical saver, the highest among the tools. TIAA set the lowest monthly income replacement rate goal, at about $4,900. The average income goal is set at about $6,600.
6 reasons for variation in the projection models
Corporate Insight identified six factors that led to the wide variation in modeling projections: taxes, inflation rates, salary growth, Social Security benefits, investment returns, and age —including expected retirement age and life expectancy assumptions.
Among those variables, assumptions on investment returns were the greatest reason for the wide discrepancy in projections, according to Corporate Insight.
Some of the calculators only permit one investment return assumption, meaning income projections don’t account for lower returns on less risky portfolio allocations after retirement.
Capital One assumes a pre- and post-retirement return of 7.35 percent for investors that select a “moderate” asset allocation strategy. Its tool projects the third highest monthly income at roughly $5,500, despite the fact it does not account for Social Security income or increased salary deferrals as income grows throughout a saver’s career.
Principal’s tool assumes a life expectancy of 92 years, and a 7 percent pre and post-retirement investment return.
The Merrill Lynch and WealthMSI tools apply more modest post-retirement return expectations, at 4.7 percent and 4 percent, respectively.
Part of the explanation behind MassMutual’s highest income projection is that the tool provides a non-adjustable Social Security benefit estimator, which offered a high benefit relative to Corporate Insight’s hypothetical saver’s earnings history, the analysts said.
Betterment and TIAA’s projection tools offer the lowest incomes at $3,791 and $3,772, respectively, largely because they are the only among the surveyed calculators to account for taxes and estimate projections in post-tax amounts, Corporate Insight’s report said.
Takeaways for sponsors and participants
While becoming a common feature, income replacement projection tools are still a relatively novel concept, and are likely to evolve as utilization increases.
Drew Way, senior retirement analyst at Corporate Insight and lead author of the study, said the data suggests sponsors and participants need to regard the tools as more of a guide than an exact predictor of retirement income.
“The biggest takeaway from this study is that individuals using retirement planning calculators need to be mindful that the underlying assumptions the tools employ can have a profound impact on both the results and the goal recommendations,” Way told BenefitsPro in an email.
"It's important, then, to at least know the assumptions a tool is using and to understand that it’s not meant to provide a 100 percent accurate analysis of an individual's level of retirement readiness,” he added. "Instead, the tools are meant to give users an approximation of where they stand with regard to achieving their retirement goals, and to equip them with the knowledge to then make appropriate actions to help them achieve those goals.”
Ready the full article at: https://www.benefitspro.com/2016/06/24/retirement-income-calculators-what-to-know-about-t?ref=mostpopular&page_all=1
Source:
Thornton, N. (2016, June 24). Retirement income calculators: What to know about their projections [Web log post]. Retrieved from https://www.benefitspro.com/2016/06/24/retirement-income-calculators-what-to-know-about-t?ref=mostpopular&page_all=1
Is your culture keeping up with your growth?
Found a great read on the shift in culture within organizations by Ranjit Jose.
Original Post from SHRM.org on July 5, 2016
The other day, I grabbed coffee and caught up with a friend who is Founder & CEO of a fast growing startup here in San Francisco. The last time we had spoken, his company had around twenty employees. But over the last year, they have been growing at a torrid pace and are now at more than a hundred employees. While this has been an amazing ride for him, the growth has come with its own special brand of challenges. And according to him, the top one has been the question of how to maintain the great culture they have built through the tough first few years of the company.
His story reflects one of the key challenges most growing companies face: ensuring that the original corporate culture develops at the same speed as the business. Corporate culture is defined as “the beliefs and behaviors that determine how a company's employees and management interact and handle outside business transactions.” A corporation’s ideologies and actions are not explicit but rather become clear over time.
At young companies like my friend’s, the founders and early employees are the ones that create the culture and company values. As long as the company is small, it is very easy to ensure that the culture is well sustained. However, as soon as the company starts expanding, and as new employees start filling the ranks, most businesses witness a dissipation of the workplace methods and beliefs previously practiced if the culture is not intentionally managed.
Here are a few chief signs that your flourishing company’s culture is in danger.
Lack of openness
As a company expands, it becomes challenging for the employers to keep in continuous and thorough contact with their employees. It is far easier to get feedback from a small team; when newer employees expand these original teams, the culture of open communication and direct feedback begins to dissolve.
This is often in part due to the previous workers’ unfamiliarity with the newly hired staff. Dr. Keith Denton, from Missouri State University, explains that when this lack of confidence exists, employees “are more likely to be evasive, competitive, devious, defensive or uncertain in their actions with one another."
With the absence of openness between team members, the initial trust that is developed at the foundation of a startup slowly dissipates. Make sure that you have mechanisms and tools in place to ensure that a thriving open environment is maintained.
Isolated Employees
Your employees should all be working together for the common goals of the company. Employees can reach common goals through department collaboration, regular team and general discussions, socializing, and consistent motivation.
When a company expands, contact between employees from different departments start becoming less frequent, and workers may feel as though their opinions and feedback are not heard. The Catalyst Research Center for Advancing Leader Effectiveness surveyed 1,500 people from six different countries and discovered that workers feel important when they “ feel that they both belong…[and] are unique.” Understandably, when the number of workers grows, employees may witness a decrease in attention and feel as though their opinions are drowned in the monotone of their many colleagues.
When this happens, they do not feel like a valued team member and may begin to isolate themselves to just get their job done. To prevent this, ensure that you have structures in place to encourage and promote interaction between employees across departments and seniority levels.
Cliques
Another sign that your corporation’s culture is not growing at the same speed as your workforce is the formation of cliques. Cliques form when employers are not in touch with all employees; workers with similar beliefs and behaviors begin to group together instead of maintaining the corporation's previously overarching culture.
David Parnell, for instance, a communication coach, legal recruiter, and author of In-House explains that forming groups is innately human: “minimal group paradigm studies have shown us to form groups within minutes in a novel situation, and if there are no salient reasons for doing so, groups will even form based on irrelevant criteria such as shirt colors.” To illustrate this, one CareerBuilder survey found that 43% of surveyed employees admitted to having a “work clique.”
More often than not, these subdivisions start with staff who have previously worked together. When the new staff enter the workplace, due to the differences in experience, familiarity, and opinions, the workforce divides further into varying groups, and a uniform employee culture begins to break down.
To ensure that the overall corporate culture is not compromised by the beliefs and actions of smaller groups, it is important that companies have methods of hearing from both experienced and newer employees so that a uniform intra-corporate culture is better circulated.
How to strengthen company culture alongside growth
A big part of safe-guarding your culture is ensuring your people are engaged across the whole organization. And in order to keep employees engaged, growing corporations must first strengthen their internal communications by giving their workforce a channel to consistently give their opinions and feedback. If employees know that their input is heard and respected by their company, they will invest more into the relationships with their co-workers. They will also feel heard and valued engendering a deeper connection with the organization, resulting in higher loyalty and retention.
Once you have opened up the ability to conveniently hear back from employees, it is important to track problems that arise, monitor engagement, and respond to any issues in a timely and strategic way. This will not only continuously improve your company, but show employees that their participation and feedback really matters, because it truly does!
All of this eventually serve to ensure that as you grow, your newer employees feel valued and as much a part of the team as the founding members. Recognizing any sense of disconnect with your people and acting to re-engage employees can ensure that, even as you grow, your culture grows with you.
Read the original article here: https://blog.shrm.org/blog/is-your-culture-keeping-up-with-your-growth
Source:
Jose, R (2016, July 5). Is your culture keeping up with your growth? [Web log post]. Retrieved from https://blog.shrm.org/blog/is-your-culture-keeping-up-with-your-growth
5 adjectives you want to hear job candidates say
Christian Schappel gives some great tips on hiring the right person for your company.
Original Post from HRMorning.com on June 22, 2016
It’s difficult to tell what kind of person someone is just by their resume. Heck, it can even be difficult to tell when face to face with the person. But there are some approaches that will do the trick.
Obviously, you want a hire who’s self-motivated, honest and trustworthy — in addition to having the background you’re looking for, of course.
While candidates will likely tell you they’re all those things if asked, it’s also likely they’re doing so because they know that’s what you want to hear (whether it’s true or not).
As a result, Dave Porter, managing partner at Baystate Financial in Boston, a company that holds its recruiters and managers accountable for the results of those they bring on board, says companies should ask candidates to describe their character.
Five words Porter says you want to hear candidates say that indicate they’re made of the right stuff:
- Honest
- Respectful
- Punctual
- Curious, and
- Accountable.
Whether or not you hear adjectives like these will tell you “how much the candidate cares about others and about doing the right thing,” Porter says in his book Where Winners Live: Sell More, Earn More, Achieve More Through Personal Accountability.
‘When nobody was looking’
Porter has another suggestion as well. Ask candidates this question: When in your life have you made a decision that you’re proud of — when nobody was looking?
If candidates take a while to answer, they’re likely not good fits for Baystate Financial. Porter says, candidates with integrity should have little trouble recalling situations — and the decisions they made in them — that reveal their true character.
In his book, Porter said one candidate, Leonard, told a story about finding a camera in the back seat of a Boston taxi. When the driver told Leonard he was going to keep the camera, Leonard refused to give it to the driver and instead took it to the taxi company’s lost and found. Leonard got the job.
Those are the kinds of stories you want to hear — along with adjectives like those described above.
Bad indicators
What you don’t want to hear, Porter says, are indicators the candidate has what he describes as an “all-about-me” attitude.
Some of those indicators could be dropping adjectives like:
- Carefree
- Fun
- Laid back.
However, describing themselves in those ways aren’t necessarily deal breakers. Those qualities can actually be good things, Porter says, when balanced out by professional attributes. But finding out whether that’s the case requires deeper probing.
Read the original article here: https://www.hrmorning.com/5-adjectives-you-want-to-hear-job-candidates-say/
Source:
Schappel, C. (2016, June 22). 5 adjectives you want to hear job candidates say [Web log post]. Retrieved from https://www.hrmorning.com/5-adjectives-you-want-to-hear-job-candidates-say/