How to offboard employees with care
How are your onboarding and offboarding programs? While many employers understand and accept the importance of having a great onboarding program, many lose sight of their offboarding program. Read on for more on how employers can offboard employees with care.
Employers understand the importance of onboarding new employees. A Glassdoor report found a strong onboarding process improved new hire retention by 82% and improved productivity by more than 70%.
Talent professionals place more emphasis than ever on creating positive employee experiences — and that pressure starts from an employee's first day. But should that same attention be given to an employee's last day? In a tight labor market, where referrals from former employees and "boomerang" employees are valuable sources of talent, HR might consider: What are the benefits of creating a strong offboarding process?
Offboarding: part of the employee life cycle
Onboarding has long been an important point in the employee life cycle, while offboarding has always been an afterthought, Jen Stroud, HR evangelist and transformation leader for ServiceNow, told HR Dive. But now, as the entire employee lifecycle is getting attention, offboarding is coming into focus, she said.
"If you have a great onboarding experience and you bring people to work for you and their employee experience and offboarding experience is poor, you spent a lot of money for onboarding that is wasted," she added.
Former employees, particularly those who left voluntarily, are ambassadors of your company's brand, Moses Balian, HR consultant at Justworks, told HR Dive. "A smooth and amiable offboarding is so valuable in maintaining employees beyond active employment," he said. "You never know when you want to rehire someone."
Offboarding may be fundamentally important to keeping potential boomerang employees feeling positive about the organization, maintaining good employer branding, establishing a network of former employees or helping current employees feel engaged despite co-workers' departures. Since offboarding is the final interaction a departing employee may have with an organization, how they're treated — good or bad — during that process can remain top of mind.
Offboarding involuntary separations respectfully
Employers may have a planned-out process for involuntary separations. Even if those employees are not the ones you'd rehire, they still should be treated with compassion, Angela Nino, founder of Empathic Workplace, told HR Dive in an interview.
"Planning for that is important, not just squeezing it into your day," Nino said. From making sure the conversation is done privately, determining if security or police will need to be on site, ensuring the employee has their personal belongings and can get to their car or has transportation home — these are important steps in the offboarding process. It's important that the termination conversation is not a shaming experience for the employee, Nino added. "Treat that person with respect and dignity, respecting the fact that [it is] about to be one of the worst days of their life."
With workplace violence as a concern, handling an involuntary offboarding process carefully is essential. "If you have been in HR, you know that the way that we treat someone on their last day of work or the way that we treat someone during a termination can be [the difference between] whether or not they bring a gun," Nino said.
But mitigating the potential of workplace violence needs to start before the termination meeting, David Moore, partner at Laner Muchin, told HR Dive. "I think it goes all the way back to the process and events leading to an involuntary separation," Muchin said. "Have we treated this person fairly? Have we given them notice of the performance or conduct issues? Have we given them fair opportunity to turn it around? Have we documented that to them so they're not able to say in their mind that 'no one told me that this was going to happen?'"
Offboarding voluntary separations: taking advantage of opportunity
An involuntary offboarding process may be prone to mistakes (i.e. benefits forms filled out and submitted), but a voluntary offboarding process is prone to missed opportunities, Balian said. Exit interviews for voluntary resignations are frequently a formality and employees don't feel their voices are heard. Balian noted that when he worked as in-house HR and conducted exit interviews, he would ask resigning employees, "are you running to or from?," to gauge their reasons for leaving. Combined with additional data gathered through surveys, this information may give HR an opportunity to identify and correct problems. Exit interviews also give employers a chance to show gratitude to the employee and interface with them on a human level, Balian said.
Just as a smooth onboarding process involves ensuring a new employee has a company ID, a workspace and appropriate equipment, a smooth offboarding process, whether for involuntary or voluntary reasons, makes sure those same details are planned for the outgoing employee, Moore said. Will the employee still receive a commission or bonus? When does the next paycheck arrive? Is severance offered? What is the benefits coverage?
Regardless of whether an employee leaves on their own or is terminated, the offboarding process can affect the employee's co-workers as well. If an employee has a poor offboarding experience and tells former co-workers, or if co-workers witness a poor offboarding process, it undermines the value the organization places on talent, Balian said.
It is critical not to think of offboarding as being in a silo or a one-off workflow process, Stroud said. "It is really about the lifecycle of an employee." Organizations that have the greatest impact have added offboarding processes to their considerations of employee experience, Stroud added. To initiate an offboarding process, start by examining the steps in the employee lifecycle and consider what actions are needed to create the best employee experience.
"All it takes is a little bit of time and investment and intention on behalf of your HR team," Balian said. "It doesn't cost anything except effort."
SOURCE: DeLoatch, P. (9 April 2019) "How to offboard employees with care" (Web Blog Post). Retrieved from https://www.hrdive.com/news/how-to-offboard-employees-with-care/552053/
The talent textbook: 4 ideas for giving better feedback
Managers enjoy giving good news during a review, but how can reviewers take the sting out of negative feedback or even constructive criticism? Read this blog post from HR Drive for four ideas on giving better feedback.
"You got a promotion! You get a raise!" It's almost as fun for managers to say it as it is for employees to hear. Giving good news during a review is easy, but how can reviewers take the sting out of constructive — or negative — feedback?
Coaching an employee who needs to improve or who isn't quite ready for more responsibility, higher pay or leadership opportunities is perhaps the most difficult aspect of performance management, so in this installment of the Talent Textbook, we'll offer four guiding principles from experts for giving better feedback.
Many talent experts today recommend retiring the annual performance review and replacing it with frequent feedback instead. Unlike annual reviews, continuous feedback sessions can lessen anxiety for managers and workers both, making the conversations less formal and more focused. They can help send the message that the company culture is one of listening and responding to workers' needs — and they help talent pros and managers minimize the risk that workers will be dissatisfied with or surprised by the discussion.
"That feedback should be coming constantly," said Jim Flynn, CHRO at Sitel Group. "Everyone should know where they stand constantly."
Flynn believes that frequency transforms the feedback session into a chance to reflect and recalibrate on priorities and goals. It can also ensure that workers are aware of their progress toward a pay increase, promotion or increased responsibility because their manager has reminded them more recently.
For Jodi Chavez, group president professional staffing group at Randstad Professionals, Randstad Life Sciences, focusing up frequently keeps managers better informed about workers' desires and expectations, potentially preventing turnover and keeping the feedback session from devolving into a bidding war.
"If an employee has a desire and a belief that they want this promotion or to be in that role, there can be instances where you won't be able to undo their desire to leave," she said.
"It can be easier if you catch that earlier on in the process — so constant communication, so they know what you're looking for and you can keep coaching them, is important. It only becomes an issue when no one knows that it's a desire until later in the process."
Just as you wouldn't assess business goals and objectives only once a year, talent pros should expect to assess people often to curb employee disappointment, Flynn said, and this is especially true for employees early on in their careers.
#2: Give a heads up and an open ear
There's still stress for talent pros and managers even when preparing to deliver feedback in a more casual session: Will they feel insulted? Will they disengage afterwards? The fears are relevant, so that's why the way reviewers deliver feedback matters as much as the frequency.
Chavez and Flynn agree that managers and talent pros should begin conversations with what they're going to cover in the session. They can continue to be transparent with workers by providing the reasoning behind the feedback and their expectations for the future, Flynn said.
"I think the old sandwich approach, employees see through that," Flynn said, referring to the tactic of "sandwiching" a criticism between two compliments. "I would rather be more upfront and honest, and that should be the manager's approach to everything."
In that same realm, honest feedback should never come with bias or malice attached. Jeannie Donovan, VP of HR at Velocity Global, wrote in an email to HR Dive that "clear is kind" when it comes to constructive feedback. Whether the manager is discussing goal setting or areas that need improvement, the employee's pay grade or their potential for a future promotion, Chavez said the same principle applies: stick to the facts and strive for objectivity.
"For new talent managers, I think it's important to stay very factual and to hear the employee," she said. "Don't lead with false promises, just very cut and dried — 'The role that you're in and the experience that you have puts you at this level [of pay.]'"
That's not to say that a manager should shut down further discussion, Chavez said. Discussing an employee's strengths and listening to their desires can help them visualize a realistic and reachable future for themselves within the organization.
"It's really important to sit down and talk about the positive things that the employee brings to the table — it's a non-defensive position to put the employee in," Chavez said. "Try to understand what is important to them, and let them tell you. 'I may not be able to be a supervisor, but I'd still like to learn more about how to manage people' — once you know that as a manager, giving them pieces that help fulfill that helps them stay engaged."
#3: Support your managers
Talent pros should focus on workers when they consider their feedback best practices — but managers need their attention and expertise, too. As Flynn put it, "sometimes you have to carry cold water warmly" when delivering feedback, and managers need encouragement, support and guidance from talent pros to pull it off.
"A good HR business partner should understand when those difficult conversations could be occurring," he said, noting that this partnership goes both ways. "If a manager is aware that it might be a tough conversation, it's always a good idea to give your HR business partner a heads up so they can be attuned."
Providing tools or suggestions for approaching reviews can help managers to execute conversations with employees with clarity and mutual understanding. For example, Donovan coaches her managers on the "stoplight exercise," which can be helpful when an employee is making a case for a promotion. She said that managers can take a pen to the job description for the role their charge would like to be promoted into — highlighting current responsibilities in green, responsibilities they have a slight grasp of in yellow and tasks they've never touched in red.
"This is a straightforward way to identify strengths, weaknesses, and gaps to assess readiness for that promotion. Further, if this exercise yields gaps, the results indicate where exactly to focus on growth," she wrote.
Donovan echoed Flynn's belief that managers and talent pros should partner in the feedback process, and that debriefing afterwards is as critical for retention as it is for employee satisfaction.
"Have that second set of eyes to be aware and look for signs of disengagement or other harmful behavior," said Flynn. "Some managers are hands off, so if they've had that difficult conversation make sure you're maintaining that personal connection and increasing your frequency of touch."
#4. Shift the focus forward
The last thing constructive feedback should sound like is a lecture. Reviewers should reiterate that the feedback is in service of plan to get that employee a promotion, salary bump, conference excursion, a chance to lead an internal workshop or whatever the goal is in the future, Chavez said.
"They should feel positive about what they have contributed and what they can continue to contribute," she said. "[It's about] what you can do to help foster that growth for them."
Flynn's approach is similar, keeping the conversation productive and goal-oriented: "I probably spend 25% of the time talking about past performance, and goals reached and past behavior, but I like to focus more on what are the strengths, what are weaknesses and where the potential is."
With the future in mind, Chavez points out that a transparent, frequent and collaborative review process could prevent promising talent from leaving down the road. It can even have ripple effects across an organization, according to Donovan, who saw that workers had a clearer vision of their goals when she transitioned to more continuous feedback.
"As a result of our laser-focus on more frequent performance conversations, our employees have a roadmap of what needs to be done and when, and this approach lends itself to higher productivity and a general sense of purpose across the board," Donovan wrote.
SOURCE: Fecto, M. (10 April 2019) "The talent textbook: 4 ideas for giving better feedback" (Web Blog Post). Retrieved from https://www.hrdive.com/news/the-talent-textbook-4-ideas-for-giving-better-feedback/552276/
HR’s newest mission: Building a culture of trust
How can employers build employee trust? Fifty-eight percent of people report that they trust strangers more than their own bosses, according to a Harvard Business Review survey. Read this blog post to learn more.
NEW YORK -- In an environment of workplace uncertainty and change, building or even just maintaining trust can be a herculean task for employers.
Indeed, 58% of people say they trust strangers more than their own bosses, according to a Harvard Business Review survey. Trust is a critical component to creating a happy and effective workplace, Andrew Ross Sorkin, co-anchor of CNBC’s “Squawk Box,” said Tuesday at CNBC’s @Work Talent and HR event in New York City.
So how can HR professionals build employee trust? It begins with getting them to believe they have their employees’ best interests at heart.
“I don’t think we’d ever be satisfied until everyone felt that way,” said Jayne Parker, senior executive vice president and CHRO at the Walt Disney Company. “We do a lot of research to look at this because we know how important trust is.”
About 30% of workers aren’t happy with their jobs, according to a recent CNBC/SurveyMonkey survey. Factors contributing to an employee’s sense of work satisfaction are pay, opportunity, autonomy, recognition and meaning, Jon Cohen, SurveyMonkey’s chief research officer, said during another session at the event.
“Workers want to trust their managers and believe they want them to succeed,” Cohen said. “Of the employees who don’t trust their boss, two-thirds said they’d consider quitting.”
With a company the size of Disney, developing teams and building trust within those individual units can translate to overall company trust. Disney has worked hard, Parker said, to make sure employees can say, “I trust the person I work for. I trust they’ll treat me with sincerity.”
Indeed, 65% of employees who don't trust their direct supervisors to provide them opportunities to advance their careers have considered quitting their jobs in the last three months, according to the survey, which was discussed at the event. Conversely, just 17% of people who trust their supervisors "a lot" to advance their career have considered quitting.
SurveyMonkey asked 9,000 U.S. workers whether they were satisfied with their jobs; 85% of respondents said they were “somewhat satisfied” with their work. However, these results shouldn’t give employers comfort, says Cohen. Those employees still have plenty of reasons to look for new jobs — uncertainty being one of them.
“The happiness people report at work is real, but the anxiety is real too,” Cohen says.
Disney recently closed its $71.3 billion deal to acquire large swaths of Fox’s entertainment segment. As such, there is insecurity within the offices of both entertainment giants, Parker explained.
As the closing date approached, reports started circulating that employees of both companies were expecting layoffs. In a situation like this distrust starts to emerge and people begin to ask “backstabbing questions,” Parker said. Employees want to know who will have their back. It’s up to the employer to be as transparent as possible and be honest that there will be changes made.
The employee may not happily skip off after this conversation, but they can have a better understanding of what is going on, easing the tension of the situation.
“We spent the past year focusing on sincerity and authenticity,” Parker said of the merger. “We have to be honest that there is going to be change in the company.”
SOURCE: Schiavo, A.; Webster, K. (3 April 2019) "HR’s newest mission: Building a culture of trust" (Web Blog Post). Retrieved from https://www.benefitnews.com/news/hr-mission-to-build-a-workplace-culture-of-trust?brief=00000152-14a7-d1cc-a5fa-7cffccf00000
How to Develop an Attitude of Gratitude Towards Employees
Are you planning on boosting employee engagement this year? A strong employee recognition program can help set your company apart in today's tight labor market. Read this blog post from SHRM to learn more.
Many companies plan to boost employee engagement in 2019. With benefits for both employees and employers, the strategy is easy to understand. What’s more, a strong employee recognition program can set your company apart in a tight job market.
Indeed, we find that demonstrating pride in our employees leads them to take pride in our company. A human-centric approach creates a company culture that puts workers first. Employees are more likely to trust (and feel trusted by) companies that recognize their value.
Putting employees first can also pay big dividends to the bottom line– a strong connection exists between employee trust and company performance. Companies with high degrees of worker trust consistently outperform in terms of productivity, innovation and retention. Happier employees also contribute to a positive company culture.
That positive culture can stretch far beyond the office walls. When job seekers research your company on social media and third-party review sites – something nearly everyone does these days – they will see positive feedback from your employees. This sets your company apart from the crowd and can help attract top talent to your organization.
Creative ways to show you care
When you recognize the value your employees bring, you demonstrate the company’s values of gratitude and appreciation. Don’t just assume employees already know you think they are amazing, show them. Here are some ideas to help you acknowledge employee contributions:
- Reserve a designated “thank you” time during staff meetings – This provides a chance for managers and team members to express gratitude towards each other.
- Implement a weekly email “shout-out” campaign – Spread recognition of top performers to the entire firm on a weekly basis.
- Recognize individual successes with quarterly awards – Prizes for notable achievements and employees who consistently give 110 percent cannot be overvalued.
- Provide special well-being perks to all – Ideas include reimbursing employees for fitness classes, books or purchases of apps that promote healthy living. Provide periodic yoga classes, chair massages or meditation sessions.
- Plan special team celebrations after wrapping up a big project – Consider generational differences and crowdsource ideas so employees get something they really want.
- Arrange annual team retreats packed with fun activities.
When companies celebrate their employees, everyone wins. Employees are happier. There is less burnout and turnover. We have seen a myriad of bottom-line benefits from on-going employee appreciation programs at Indeed. Recognition truly transforms workers, teams and companies.
SOURCE: Wolfe, P. (4 April 2019) "How to Develop an Attitude of Gratitude Towards Employees" (Web Blog Post). Retrieved from https://blog.shrm.org/blog/how-to-develop-an-attitude-of-gratitude-towards-employees
What Employers Need to Know About Successful Second Chance Hiring
With today's unemployment rate at the lowest it's ever been, many companies are beginning to explore untapped talent pools and unlikely candidates. Continue reading this blog post from SHRM to learn more.
Between the First Step Act bill being passed and SHRM's efforts towards Getting talent back to work, there are a lot of discussions opening up around second chance hiring. Before, it was pretty standard to assume that if you checked that box of "have you been convicted of a felony," you weren't going to get the job.
Today, our unemployment rate is the lowest it's ever been - forcing companies to explore untapped talent pools and unlikely candidates. As the Founder of a staffing agency for second chances, this makes me very excited. But it also frightens me.
I have worked with inmates, felons, and people in recovery over the past five years by helping them find their passion and meaningful employment. It is not as simple as making a decision to hire people with a criminal background. With this being such a hot topic, I thought I'd give a few tips for those considering hiring people with a criminal background.
1. Non-violent drug charges aren't always the safest bet.
I hear it all the time. And usually people who have never been arrested or spent time in prison. They talk about just hiring people who have non-violent drug charges. In my personal experience, those are usually some of my more difficult cases. A lot of people with non-violent drug charges have one of two addictions: 1. making fast money OR 2. doing drugs. Relapse for either of these are more likely if an individual isn't seeking proper treatment or counseling. A job opportunity alone isn't always enough to keep someone on the right path. I have noticed that my best employees are the most unlikely and most overlooked: Those who lost the most. AKA: People who spent time in prison for harsher charges such as assault, robbery or murder.
2. People who spent time in prison are great manipulators.
Manipulation is a skill best learned in prison. Inmates are very resourceful and know how to get what they want. This is why the formerly incarcerated individuals who are reformed make amazing sales people, debt collectors or call center representatives. But we won't always have a reformed person with a change of heart sitting across from us as we are interviewing for a position. Even your greatest "people-reading" employee can be tricked into making the wrong hire if they are not educated on what to look for and what to ask in the interviewing process. Making the right second chance hire can grow your business tremendously but only if you make strategic hires and give the right second chances to the right people. Not everyone wants to change and we have to accept that as a possibility for responsible hiring.
3. Second chance hiring isn't charity.
When people talk about giving a second chance, it always sounds very charity or philanthropy-like. While I'm glad these discussions are happening, I'm disappointed people speak about second chance hiring like it's a favor to someone. It's actually a favor to your company to bring in a hungry, hard-working, loyal employee that will be grateful you gave them a chance. Growing a team of second chance employees can literally grow your business faster. Your second chance hires will go the extra mile, stay late and come in early. Not for a raise or recognition, but to help grow the company that helped grow them. An organic tea company came to us to make their first official second chance hire a year ago. Today, they've hired 70 people who have a criminal background.
When I first started my company, a for-profit staffing agency for second chances, people thought I was crazy. (I am, proudly) But it seemed like a far-fetched goal to bank on the success of felons. I knew how effective second chance hiring would be, so instead of starting a non-profit and spending my time raising money, I wanted to raise men and women through meaningful job placements. I have seen first-hand the successes and failures when it comes to helping people coming out of prison find employment. My biggest fear is that we are going to successfully create an awareness for second chance hiring and see poor results because of lack of education or tools. This could hurt the reputation of what we are trying to do and hurt the reputation of people who really do deserve real opportunities and have transformed their lives.
SOURCE: Garcia, C. (4 April 2019) "What Employers Need to Know About Successful Second Chance Hiring" (Web Blog Post). Retrieved from https://blog.shrm.org/blog/what-employers-need-to-know-about-successful-second-chance-hiring
This post is the first in a series for Second Chance Month, which highlights the need to improve re-entry for citizens returning to society and reduce recidivism. One of the primary ways to do this is by providing an opportunity for gainful employment. To sign the pledge and access the toolkit with information on how to create second chances at your company, visit GettingTalentBacktoWork.org.
Making the Case for Pay Transparency
Is your organization increasing pay transparency? According to this article from SHRM, pay transparency is a strategic move that delivers measurable business benefits. Read this blog post to learn more.
Recommending to senior leadership that your organization increase pay transparency can be a difficult sell for HR professionals. However, pay transparency is a strategic move that delivers measurable business benefits – and it’s an issue on which HR should lead.
It is important to understand that most executives in America today rose through organizational ranks that viewed compensation as a private matter. Few within organizations had access to salary information, and even fewer talked about it. As a result, many leaders still believe it is appropriate to dissuade or prohibit employees from discussing their own compensation with other employees.
Yet we now understand these outdated cultural norms have contributed to the wage gap for women and minorities, among other negative outcomes. Pay transparency can help close those gaps and produce benefits for both employers and employees.
For example, providing employees with pay ranges for their current position and those positions in their career path sets realistic expectations. This is crucial, as many employees hold unrealistic expectations based on internet salary searches for job titles that often do not account for or accurately reflect important factors such as experience level, geography, company size, actual tasks and responsibilities, or other types of compensation. These unrealistic salary expectations create serious challenges, including employee disengagement, low morale and retention problems.
Clearly communicating your company’s pay ranges facilitates an open dialogue about how those ranges are set, when and why they change, and how employees can move up within them. These discussions in turn increase mutual trust and engagement and foster productive compensation communication — all of which help retain employees, which is especially important in today’s tight labor market.
Increasing pay transparency also helps businesses attract and retain a more diverse workforce, which numerous studies have demonstrated translates into better business results. Sharing compensation data advances this effort by ensuring women and minorities have a clearer picture of the going rate for their skill sets, education, experience and performance. While many factors contribute to pay gaps, women and minority groups may have accepted lower compensation in the past because they could not access the information necessary to determine what they should be making based on what they bring to the table.
While recommending greater pay transparency to senior leadership in your organization may seem daunting, it is an important discussion to have and a compelling case for HR professionals to make. In a highly competitive labor market, businesses that make the right strategic move of increasing pay transparency will ultimately attract and retain the best talent and come out ahead of those that do not.
SOURCE: Ponder, L. (4 April 2019) "Making the Case for Pay Transparency" (Web Blog Post). Retrieved from https://blog.shrm.org/blog/making-the-case-for-pay-transparency-0
DOL Focuses on ‘Joint Employer’ Definition
On April 1, the U.S. Department of Labor (DOL) announced a proposed rule that narrows the definition of "joint employer" under the Fair Labor Standards Act (FLSA). Read this blog post from SHRM to learn more about this proposed rule.
The U.S. Department of Labor (DOL) announced on April 1 a proposed rule that would narrow the definition of "joint employer" under the Fair Labor Standards Act (FLSA).
The proposed rule would align the FLSA's definition of joint-employer status to be consistent with the National Labor Relations Board's proposed rule and update the DOL's definition, which was adopted more than 60 years ago.
Four-Factor Test
The proposal addresses the circumstances under which businesses can be held jointly responsible for certain wage violations by contractors or franchisees—such as failing to pay minimum wage or overtime. A four-factor test would be used to analyze whether a potential joint employer exercises the power to:
- Hire or fire an employee.
- Supervise and control an employee's work schedules or employment conditions.
- Determine an employee's rate and method of pay.
- Maintain a worker's employment records.
The department's proposal offers guidance on how to apply the test and what additional factors should and shouldn't be considered to determine joint-employer status.
"This proposal would ensure employers and joint employers clearly understand their responsibilities to pay at least the federal minimum wage for all hours worked and overtime for all hours worked over 40 in a workweek," according to the DOL.
In 2017, the department withdrew an interpretation that had been issued by former President Barack Obama's administration that broadly defined "joint employer."
The Obama-era interpretation was expansive and could be taken to apply to many companies based on the nature of their business and relationships with other companies—even when those relationships are not generally understood to create a joint-employment relationship, said Mark Kisicki, an attorney with Ogletree Deakins in Phoenix.
The proposed test aligns with a more modern view of the workplace, said Marty Heller, an attorney with Fisher Phillips in Atlanta. The test is a modified version of the standard that some federal courts already apply, he noted.
Additional Clarity
Significantly, the proposed rule would remove the threat of businesses being deemed joint employers based on the mere possibility that they could exercise control over a worker's employment conditions, Heller said. A business may have the contractual right under a staffing-agency or franchise agreement to exercise control over employment conditions, but that's not the same as doing so.
The proposal focuses on the actual exercise of control, rather than potential (or reserved) but unexercised control, Kisicki explained.
The rule would also clarify that the following factors don't influence the joint-employer analysis:
- Having a franchisor business model.
- Providing a sample employee handbook to a franchisee.
- Allowing an employer to operate a facility on the company's grounds.
- Jointly participating with an employer in an apprenticeship program.
- Offering an association health or retirement plan to an employer or participating in a plan with the employer.
- Requiring a business partner to establish minimum wages and workplace-safety, sexual-harassment-prevention and other policies.
"The proposed changes are designed to reduce uncertainty over joint employer status and clarify for workers who is responsible for their employment protections, promote greater uniformity among court decisions, reduce litigation and encourage innovation in the economy," according to the DOL.
The proposal provides a lot of examples that are important in the #MeToo era, said Tammy McCutchen, an attorney with Littler in Washington, D.C., and the former head of the DOL's Wage and Hour Division under President George W. Bush.
Importantly, companies would not be deemed joint employers simply because they ask or require their business partners to maintain anti-harassment policies, provide safety training or otherwise ensure that their business partners are good corporate citizens, she said.
Review Policies and Practices
Employers and other interested parties will have 60 days to comment on the proposed rule once it is published in the Federal Register. The DOL will review the comments before drafting a final rule—which will be sent to the Office of Management and Budget for review before it is published.
"Now is the time to review the proposal and decide if you want to submit a comment," Heller said. Employers that wish to comment on the proposal may do so by visiting www.regulations.gov.
"Take a look at what's been proposed, look at the examples in the fact sheet and the FAQs," McCutchen said. Employers may want to comment on any aspects of the examples that are confusing or don't address a company's particular circumstances. "Start thinking about your current business relationships and any adjustments that ought to be made," she said, noting that the DOL might make some changes to the rule before it is finalized.
"The proposed rule will not be adopted in the immediate future and will be challenged at various steps by worker-advocacy groups, so it will be quite some time before there is a tested, final rule that employers can safely rely upon," Kisicki said.
SOURCE: Nagele-Piazza, L. (1 April 2019) "DOL Focuses on ‘Joint Employer’ Definition" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/legal-and-compliance/employment-law/pages/labor-department-seeks-to-revise-joint-employer-rule.aspx
The HR tech disconnect: Are there too many digital tools?
According to a new survey of more than 500 HR employees, 87 percent of HR professionals reported that having tools that integrate with existing technology is key. Continue reading this blog post from Employee Benefit Advisor to learn more.
Investing in new technology that combines with current systems looks to be a priority for HR departments.
That’s according to a new survey of more than 500 HR employees from Reward Gateway, which found that 87% of HR professionals say having tools that integrate into their existing technology is key.
That priority is likely due to the fact that HR technology is siloed, the employee engagement technology company found. Many employers use separate platforms for tasks relating to employee communication, recognition, applicant tracking, onboarding and performance management.
More than a fifth of companies use 10 or more different systems and applications at work, and roughly 60% are using more than five systems every day. In addition, HR professionals spent 512 hours a year, nearly two hours a day, manually checking, responding to and keeping up with multiple HR applications, Reward Gateway says.
“Many companies have systems-of-record in place with up-to-date details on their employees,” says Will Tracz, chief technology officer at Reward Gateway. “Creating and maintaining data in other systems, outside of this, often takes time and is prone to error, particularly in fast-moving businesses.”
The new survey echoes similar findings, which indicate that while employers may be increasingly using HR tech, they may not be doing so efficiently. For instance, research from the Association of Executive Search and Leadership Consultants found that HR departments could be dropping the ball when it comes to using HR technology.
Karen Greenbaum, president and CEO of AESC told Employee Benefit News in November that total digital transformation is about more than just implementing new tech in the office.
“It’s not just, ‘Do they understand what artificial intelligence means,’ or what augmented reality means,” she says. “[It’s] ‘Do you really have an organization that can adapt to a new world?’”
Still, HR leaders are turning to tech solutions. Data from global talent acquisition and management firm Randstad Sourceright found that HR departments are going on a tech “buying spree.” The vast majority (92%) of those in the Randstad survey of more than 800 C-suite and HR leaders and 1,700 professionals believe that technology enhances the attraction, engagement and retention of talent.
Reward Gateway received similar responses. HR teams are hoping new tech will not only integrate with existing systems, but also help them achieve their goals, which include higher employee engagement, increased productivity and attracting talent.
SOURCE: Hroncich, C. (29 March 2019) "The HR tech disconnect: Are there too many digital tools?" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/hr-tech-disconnect-are-there-too-many-digital-tools?brief=00000152-146e-d1cc-a5fa-7cff8fee0000
A guide to managing employee website usage
With remote workers, employers need to be mindful of the types of websites their employees are accessing on company-issued technology. Continue reading for key considerations and best practices to review when properly managing employee website usage.
Whether employees are working from home, the coffee shop or the office, employers need to be mindful of the types of websites workers are accessing on their company-issued technology.
New accessibility creates greater flexibility, but employers need to be vigilant to ensure workers maintain the expectation of productivity and workplace privacy. Now more than ever, the workplace heavily relies on technology and companies must understand how to manage it to avoid risk.
Nowhere is the tension between technology and privacy rights more prevalent than in today’s workplace. At the forefront of this discussion is whether employers should block access to certain websites on company-issued technology. Here are key considerations and best practices to review when properly managing employee website usage.
Creating boundaries between work and personal affairs, without invading privacy. Employees typically emphasize that their private affairs should not be accessed by their employer. But the federal Electronic Communications Privacy Act (ECPA) states an employer-provided computer system is the property of the employer, so when an employee visits certain websites during typical office hours using company-issued technology, what is accessed by the employee becomes the employer’s business as well.
There is no denying that placing blocks on certain websites is an effective way to separate work and personal matters, maintain professionalism, protect the company’s security, respect company property and utilize work time appropriately. However, employers should beware of potential legality issues regarding privacy. For example, employees are given some protection from computer and other forms of electronic monitoring under certain circumstances.
Productivity distractions. Blocking certain websites will not prevent an employee from utilizing company time for personal reasons, but doing so reminds employees to have integrity, focus and discipline when it comes to using technology in the workplace. Some employees will use company-issued technology to visit a plethora of websites such as social media platforms, personal email accounts, instant messengers, financial institutions, sports, entertainment and music sites, as well as inappropriate websites. It is easy to become distracted with an overabundance of virtual activity at our fingertips, and blocking sites sends a serious message to workers that business technology and time is for business-purposes only.
Security of confidential company data and information. In today’s interconnected world, employers recognize the importance of protecting confidential company information. Employers often choose to block certain websites because of the risk of a security breach. Employers are concerned with the exposure of any release of its data, work products, ideas and information not otherwise disclosed to the public or its competitors. Blocking certain websites gives an organization an opportunity to decrease the risk of its confidential information being accessed by external influences.
What employers can do to be more transparent with staff
There are no foolproof methods to preventing an employee from using their work time for personal reasons or inadvertently exposing the company to security breaches.
Employees can still access many websites of their choosing through their personal technology. However, the aforementioned reasons are convincing enough for employees to take more accountability in using company-issued technology for business purposes only. An employer that endorses a policy and practice of business technology for business reasons sets a clear expectation for employees to remember and follow.
- Enforce a written policy that sets clear expectations for in-house and remote employees about not using company-issued technology to visit certain websites and explain the reason for such policies. Policies and procedures should be well-defined, widely communicated and reviewed at least annually.
- Inform new employees that certain websites are not accessible via company technology. Highlight the written policy for both new and existing employees. Again, explain the reason for this policy.
- Offer training and other educational opportunities that motivate productivity during times when work focus suffers.
- Work with the company’s internal IT department to ensure that websites are properly blocked.
Usually, when employers remain transparent with staff regarding why a policy exists, employees are more receptive. In general, employers are encouraged to consult with an experienced HR professional or employment lawyer to avoid any potential legality pitfalls in the workplace.
SOURCE: Banks, S. (11 March 2019) "A guide to managing employee website usage" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/a-guide-to-managing-employee-website-usage?brief=00000152-14a5-d1cc-a5fa-7cff48fe0001
Do paycheck advance apps improve financial health?
Do you allow your employees access to draw money from their paycheck before payday? Many apps now let workers have early access to their money. Read this blog post to find out more about paycheck advance apps and how these may improve financial health.
Fintechs that let workers draw money from their paycheck before payday through an app are having a moment.
Such apps, including Even.com, PayActiv, EarnIn, DailyPay and FlexWage, are designed for consumers who live paycheck to paycheck — roughly 78% of the U.S. workforce according to one study.
More than 300,000 Walmart employees, for example, use this feature, called Instapay, provided by Even and PayActiv. PayActiv, which is available to 2 million people, announced a deal with Visa on Thursday that will let people put their pay advances on a feeless prepaid Visa card.
Earnin, which lets consumers retrieve up to $100 a day from upcoming paychecks, received $125 million in Series C funding from DST Global, Andreessen Horowitz, Spark Capital, Matrix Partners, March Capital Partners, Coatue Management and Ribbit Capital in December. The Earnin app has been downloaded more than a million times.
In theory, such apps are useful to those who run into timing problems due to large bills, like mortgage and rent, which come due a few days before their paycheck clears. Getting a payday advance from an employer through an app can be less expensive and less problematic than taking out a payday loan or paying overdraft fees.
But do these programs lead to financial health? Or are they a temporary Band-Aid or worse, something on which cash-strapped people can become overdependent?
Volatile incomes, gig economy jobs
One thing is clear — many working poor are living paycheck to paycheck. Pay levels have not kept up with the cost of living, even adjusted for government subsidy programs, said Todd Baker, senior fellow at the Richman Center for Business, Law and Public Policy at Columbia University.
“That’s particularly evident when you think of things like home prices and rental costs. A large portion of the population is living on the edge financially,” he said. “You see it in folks making $40,000 a year, teachers and others who are living in a world where they can’t handle any significant bump in their financial life."
A bump might be an unexpected expense like medical treatment or a change in income level, for instance by companies shifting to a bonus program. And about 75 million Americans work hourly, with unstable pay.
“Over the last several decades, we’ve changed the equation for many workers,” said John Thompson, chief program officer at the Center for Financial Services Innovation. “It’s harder to have predictable scheduling or even income flow from your job or jobs. But we haven’t changed the way we pay, nor have we changed the way bills are paid. Those are still due every month on a certain date. This income volatility problem that many people experience hasn’t been offset by giving the employee control of when they do have access to these funds.”
Where on-demand pay comes in
Safwan Shah, PayActiv's CEO, says he has been working on the problems for consumers like this for 11 years. The way he sees it, there are three possible ways to help: by paying these workers more, by changing their taxes, or by changing the timing of when they’re paid.
The first two seem out of reach. “I can’t give more money to people; that’s not what a Fintech guy does,” Shah said. “I can’t invent money. And I can’t change the tax laws.”
But he felt he could change the timing of pay.
“I can go to employers and say, your employees are living paycheck to paycheck,” Shah said. “They’re bringing that stress to work every day. And you are suffering too, because they are distracted — a Mercer study shows employers lose 15 hours a month in work from these distracted employees.”
Shah persuades employers to let their employees access a portion of the wages they have already earned. His early wins were at companies whose employees frequently request paycheck advances, which generates a lot of paperwork. Employees can access no more than 50% of what they have already earned — a worker who has earned $300 so far in a month could at most get $150.
Employees pay $5 for each two-week period in which they use PayActiv. (About 25% of the time, the employer pays this fee, Shah said.)
PayActiv also gives users unlimited free bill pay and use of a Visa prepaid card. In July, PayActiv became part of the ADP marketplace, so companies that use ADP can use its service.
PayActiv's largest employer is Walmart, which started offering it via the Even app in December 2017. In October, Walmart began allowing employees to pick up cash through the app in Walmart stores, so users who were unbanked could avoid ATM fees.
Shah said the service helps employers reduce employee turnover, improve retention and recruit employees who prefer real-time pay. He also has a guilt pitch.
“I was first in the market to this, in 2013,” Shah said. “People looked at me and said, ‘What? I’m not going to pay my employees in advance. Let them go to a payday lender.’ Then I’d show them pictures of their offices surrounded by payday loan shops. I’d say, ‘They’re here because of you.’ ”
Does early access to wages lead to financial health?
When Todd Baker was a Harvard University fellow last year, he studied the financial impact of PayActiv’s earned wage access program. He compared PayActiv’s $5 fee to payday loans and bank overdraft fees.
Baker found that a $200 salary advance from PayActiv is 16.7% of the cost of a payday loan. Payday lenders typically charge $15 per $100 borrowed, so $30 for a two-week, $200 loan. If the borrower can’t pay back the amount borrowed in two weeks, the loan gets rolled over at the original amount plus the 15% interest, so the loan amount gets compounded over time.
With PayActiv, "there is always a full repayment and then a delay before there is enough income in the employee’s payroll account for another advance," Baker said. "It never rolls over.”
Baker also calculated that the PayActiv fee was only 14.3%, or one-seventh, of the typical $35 overdraft fee banks charge.
So for people who are struggling to manage the costs of short-term timing problems and unexpected expenses, Fintech tools like PayActiv’s are a lot cheaper than alternatives, Baker said.
“Does it create extra income? No. What it does is help you with timing issues,” he said.
Aaron Klein, a fellow at the Brookings Institution, said workers should have access to money they’ve already earned, whether that’s through real-time payments or through apps that provide pay advances.
“I also am on board with the idea that by saving your $35 overdraft and saving your payday loan rate, you’ll be better off,” Klein said.
But he’s not willing to say these tools solve the problems of low-income people.
“If the core problem is I used to make $35,000 a year, now I make $30,000, and because of that shock I’m going to end up accruing $600 of payday loan and overdraft fees, eliminating that $600 makes you a lot better off,” Klein said. “But it doesn’t negate the overall income shock.”
Thompson at CFSI says it’s too soon to tell whether earned wage access brings about financial well-being.
“We’re just beginning to explore the potential for these tools,” he said. “Right now they feel very promising. They could give people the ability to act quickly in an emergency and have access to and use funds in lieu of a payday loan or some other high-cost credit or consequence they would rather avoid, like an overdraft fee.”
What could go wrong
Thompson also sees a potential downside to giving employees payday advances.
“The every-other-week paycheck is one of the few normal structures we have for people around planning, budgeting and managing their money,” he said.
Without that structure, which is a form of savings, “we’re going to have to work hard to make sure we don’t just turn people loose on their own with even less structure or guidance or advice on their financial life.”
Another common concern about payday advance tools is that if you give people access to their money ahead of time, they’ll just spend it, and then when their paycheck arrives, they will come up short.
But Klein, for one, doesn’t see this as an issue.
“I trust people more to manage their money,” he said. “The people who work paycheck to paycheck spend more time budgeting and planning than the wealthy, because it’s a necessity.”
A related fear is that people could become addicted to payday advance tools, and dig themselves into a deeper hole.
Jon Schlossberg, CEO of Even.com, somewhat surprisingly acknowledges this could happen.
“Getting access to your pay on demand is a tool you can use the right way or the wrong way,” he said. “If you offer only on-demand pay, that could cause the problem to get worse, because getting access to that money all the time triggers dopamine; it makes you want to do it more and more. If you are struggling with a very low margin and you’re constantly up against it, getting more money all the time accelerates that problem."
Quantitative and qualitative analyses have borne this out, he said.
Even has granted users $700 million worth of Instapays; they typically use Instapay 1.4 times a month. Schlossberg doesn't see high use of the feature as success.
“You shouldn’t need to be using Instapay,” he said. “You should be becoming financially stable so you don’t have to.”
Baker said addiction to payday advances isn't a danger because they don't roll over the way payday loans do. With a salary advance, “It’s conceivable you could get $200 behind permanently, but it’s not a growing obligation and it’s not damaging,” he said.
Shah at PayActiv said users tend to withdraw less than they're allowed to — about 75%.
“When it comes to usage of their own salary, instead of asking for more, people behaviorally ask for less,” he said.
They see PayActiv more as a headache reliever like Tylenol, rather than an addictive candy or drug, Shah said.
Pay advances are just one of many tools that can help the working poor. They also need help understanding their finances and saving for goals like an emergency fund and retirement.
“This conversation about on-demand pay is a double-edged sword because people are paying attention to it now, which is good, but they’re viewing it as this magic tool to solve all problems,” Schlossberg said. “It isn’t that. It is a piece of the puzzle that solves a liquidity problem. But it is by no means going to help people turn their financial lives around.”
SOURCE: Crosman, P. (14 March 2019) "Do paycheck advance apps improve financial health?" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/do-paycheck-advance-apps-improve-financial-health?brief=00000152-146e-d1cc-a5fa-7cff8fee0000
Editor at Large Penny Crosman welcomes feedback at penny.crosman@sourcemedia.com.