What you may not know about your FSA
By Jody Dietel
Source: Benefitspro.com
With fall just around the corner, benefits managers are gearing up to educate employees about flexible spending accounts for the open enrollment period. While benefits professionals may have a good handle on the tax-advantaged benefits accounts that can save participants up to 40 percent on health care, dependent care and commuting expenses, there’s still plenty about FSAs that benefit pros may not know.
Now is the perfect time for HR managers to keep details of FSAs top of mind and help employees understand the fine print so they recognize why enrolling this fall is the smart financial decision.
Eligible expenses for FSA users number in the thousands. You may be surprised at the breadth of products and services that are covered by FSAs. Participants can save big on a wide range of expenses: from dental and vision care with a health care FSA; and nannies and after-school care with a dependent care FSA. While we’re at it, don’t forget to elect your monthly commuter benefits: mass transit commuting expenses and parking for work. To explore a list of items that participants can purchase using an FSA, check outwww.savesmartspendhealthy.com.
Some eligible expenses may surprise you. While the most common covered expenses include co-pays, prescription drugs and dental and vision care, there are plenty of expenses often eligible for reimbursement that may come as a surprise. They include acupuncture treatments; doctor-ordered weight loss programs; the additional costs of gluten free food items for those with diagnosed gluten sensitivity issues; mileage to/from medical appointments and smoking cessation programs.
FSA participants need to re-enroll each year. While many other benefits like health insurance do not require employees to sign up year after year, FSAs usually don’t include automatic reenrollment. Employees should look for FSA enrollment forms each year when they get their benefits package.
Contributions can occasionally be changed mid-year or opened after open enrollment. FSA contributions are not always set in stone. A life changing event, such as a birth or death in the family, can sometimes allow participants to change the amount they decided set aside during open enrollment later in the year or start an account altogether.
The entire FSA contribution is available from day one. Unlike money from an employees’ annual salary which trickles in via paychecks every two weeks, FSA participants have access to the money they elect to contribute from day one. For families who face costly surprises early in the plan year, having the money available right off the bat can be a lifesaver.
FSAs contribute to an employers’ bottom line too. Just like participants, employers don’t have to pay payroll taxes on any of the money employees contribute directly to their FSA as opposed to receiving it in a paycheck.
FSAs are a great vehicle for employees to save hard-earned dollars. As we head into open enrollment, benefits managers helping everyone brush up on FSA details is an important step.
OUTMATCHED
Fewer employers are offering a company match to their retirement benefits, a new study by the Society for Human Resource Management finds. About two-thirds of companies currently match their employees' contributions today, compared with 75 percent in 2008.
IS IT WORKING?
Having trouble figuring the return on investment (ROI) from your wellness program? A report by HRmorning suggests examining these five factors:
- Sick days
- Stress
- Presenteeism
- Health care utilization
- Employee satisfaction
A solid program will decrease the first four of the above items and bump up the last, the report noted. The report noted that a $3 to $4 return for every $1 spent on wellness is a common benchmark for wellness ROI.
LEVEL WELLNESS
A recent survey by the Society of Human Resource Management found that 61 percent of companies are offering some sort of wellness initiative this year, up only slightly from 58 percent in 2008. Although wellness adoption by employers seems to have leveled off in the past few years, the elements of the programs have changed. For instance, 45 percent of polled employers said their program includes health and lifestyle coaching, compared with 33 percent in 2008.
Happy Hour at Work?
June 4, 2012
By Denis Storey
Source: benefitspro.com
The headline that jumped off my iPad this morning was all I needed to see: “Is beer in the workplace an employee benefit?”
I jumped to my feet with my hands in the air like I was back in church.
Then I slumped back down. In this compliance-heavy era, where lawsuits are more common than doctors’ notes, how was this even possible?
But the blogger – Carol Harnett over at Human Resource Executive – went on to elaborate this stemmed from a panel discussion she’d hosted on wellness with Mark Torres, senior vice president of people and culture at The Rubicon Project. Shortly after joining the company, he polled his work force about their benefits, “which resulted in a strong staff request to retain the 24/7 beer refrigerator on the premises under the category of ‘the one thing we shouldn’t change.’”
Harnett touches on some other companies whose wellness programs venture into the progressive, to say the least.
(I’m kinda partial to Hulu’s, where their wellness plan amounts to an annual $700 check for each employee to spend any way they like to improve their own performance. But then I end up right back at the beer.)
My wife just got a new job. They apparently have these “Wellness Rooms,” where employees can go take a nap – presumably alone. Oh, and they have a “snow fairy,” an anonymous Samaritan who makes sure all the cars are cleared at the end of any our snowy Colorado workdays. And keep in mind: this isn’t some tech startup. She works for an 80-plus-year-old trade association.
My first thought – after asking about job openings – was how do you tell the difference between a perk and a benefit these days? Or is there one anymore? And where do wellness programs fit in to all of this?
Then it occurred to me we’re watching the slow, sometimes clumsy evolution of employee wellness. Many companies are getting it: that it goes far beyond gyms or smoking cessation programs. It’s about more than reducing claims or cutting costs. Simply put, it’s about getting (and keeping) happy, healthy employees. So how do you get there – booze, dark rooms or by just cutting a check?
And I think that the employers who take more of a holistic – if sometimes out-of-the-box – approach to wellness (and benefits in general) are the ones who are not only going to hang on to the best talent as we fight out way out of this economic malaise, but they’ll be far better positioned to attract the next generation of employees who live their entire lives out of the box.
Now if you’ll excuse me, I’m sleepy and I need a drink.
We are too fat! Now what??
BY JENNY IVY
May 14, 2012 •
Source: Benefitspro
The nation's obesity epidemic is literally too big to ignore. And now the most respected names in medicine are hoping to galvanize citizens and employers to confront the problem.
Tonight, HBO will premiere "The Weight of the Nation," a four-part documentary series that examines the risks and consequences of obesity—everything from childhood prevention to community involvement.
The impact is certainly not out of reach for employers and HR professionals. They know obesity impacts business. Companies lose $4.3 billion annually due to obesity-related absenteeism, according to the Institute of Medicine. And for firms with offices around the country, it's obvious the costliest health plan claims are coming out of places in which obesity - and poverty - is rampant. [See 10 fattest states in America]
As a nation, we know it's a problem. We've already been told we're too fat. But why, after decades of increasing waistlines, would we expect a national campaign to suddenly change things?
It probably won't. But, in speaking with a Kaiser Permanente spokesperson just today, it seems the medical organizations and experts behind the documentary understand that. "This is only the beginning," she said. Campaign collaborators, including Kaiser, are hoping to start a movement, not just increase awareness.
With that said, as an employer or benefits manager, it wouldn't be a bad idea to check out the free resources available through this campaign. After all, this isn't just another wellness program promo. These are established research institutions that are serving up more innovative tools to get Americans to at least think about how to become healthier.
"We're going to have to think our way out of this in creative ways," Executive Producer John Hoffman told NPR on Friday. "We have got to really renovate tremendous aspects of our culture, and it's going to take a tremendous amount of invention and tremendous amount of intervention to really re-engineer our lives."
If you don't have HBO, don't worry. The movies aren't restricted to the cable network. Filmmakers are allowing the series to be broadcast on the campaign's website at https://theweightofthenation.hbo.com/.
Taking the Long View of New Hires
By Mark McGraw
May 22, 2012
Source: Human Resource Executive Online
Don't be too quick to measure the impact of new hires, experts say. Even though many companies are "concerned" about the way they appraise new professional and managerial-level hires, it's important to allow them to develop and grow before determining their worth to the organization. It's also important to establish meaningful metrics.
Professional football franchises are big businesses that depend on frequent injections of new talent to remain successful.
Look at the recent NFL draft, where each of the league's 32 clubs carefully selected a handful of college athletes they hope will lead their organizations to success for the next decade or so. These pro prospects are poked, prodded and closely scrutinized for months leading up to draft day, and teams have become increasingly thorough in testing the physical and mental capabilities of these young men before making sizable investments in them.
Still, predicting a just-drafted player's career trajectory is an inexact science. Highly touted players with big-name college pedigrees don't always pan out at the pro level, while unheralded, under-the-radar picks from smaller schools sometimes blossom into superstars.
And NFL teams and their highly paid talent evaluators are left to contemplate their methods for measuring the potential impact of these skilled, but unproven, new employees.
Sound familiar? There's an almost 50/50 chance it does, if findings from theFuturestep Global Talent Impact Study 2012 are any indication.
The survey of more than 1,500 HR professionals in five continents finds that 40 percent of respondents report they "are concerned" about the metrics and measurements they have in place to assess the impact of new professionals and managerial-level recruits on their organizations.
There is no one-size-fits-all approach to measuring a new hire's potential impact, says Byrne Mulrooney, CEO of Futurestep, a global recruitment company with U.S. headquarters in Los Angeles.
More than half (52 percent) of survey respondents say they rely on two to five metrics to assess a new hire's potential value within the organization, he says.
Measurement tools will vary based on the industry and type of position, but there are broader measurements that an organization can use to assess the possible worth of a new hire, according to Dave Ulrich, professor of business at the Ross School of Business at the University of Michigan and a partner at the RBL Group, a Provo, Utah-based consulting firm.
For example, he says, "there are some generic metrics such as perceived performance (perceptions of those that work with the person), behavior (the extent to which the new hire's time is spent on the appropriate business issues) and 'time to productivity,' which is the time before the new manager or hire is fully productive in the new job."
Ideally, these essential processes should be in place before hiring a candidate for a managerial-level position, adds Ulrich, "then those expectations can be the standards to determine if someone is doing the right job."
A new hire's impact will evolve over time, and companies and their HR leaders should rely on a combination of metrics to assess value in the short-, medium- and long-term, says Mulrooney.
"There are three distinct dimensions to a new hire's impact," he says. "First is the immediate impact, when a candidate with the right skills arrives to get the job done. The consequential impact is when an individual's contributions transition from the actions within their own role to influencing others. The third dimension is when additional value is brought to the organization over time, and an employee shows potential to be promoted and grow within the company."
A key reason many companies wind up questioning their assessment tools is that they place too much weight on short-term results as a predictor of future, rather than more long-term success, says Mulrooney.
He notes that about two-thirds (67 percent) of respondents identify the immediate performance of a new professional and managerial-level employee as a critical indicator of a successful recruitment process.
"Our study unearthed an alarmingly short-term approach, with one-in-three respondents (35 percent) measuring impact within a new hire's first six months. Although it's encouraging that measurement is taking place, it's essential that a meaningful process is engaged to maximize impact in the long-term and retain staff," he says.
Indeed, HR leaders should take the long view when evaluating new managerial-level employees, says Keith Strodtman, research fellow of HR strategies at HfS Research, a research-analyst organization with U.S. headquarters in Boston.
"Most would acknowledge that it's more important to hire a quality employee than it is to hire a poor employee quickly," says Strodtman. "Yet, when it comes to hiring metrics, speed-of-hire or cost-of-hire are much more commonly measured than quality-of-hire. Speed and cost are important, but don't forget the big picture."
In the grander scheme, HR must be instrumental in defining the processes and measurements of the recruiting process that are meaningful to their organization and industry, and can often find reliable predictors of new hires' performance within their own organizations, says Strodtman.
"Profiling existing successful employees will provide the key indicators required to assess the potential value of a new hire," he says.
"HR leaders must also work with line-of-business hiring managers to define the metrics and processes that provide insight into the success of a new hire. The metric will vary depending on the goals of the business and the type of role being filled," he says.
"Companies may want to consider a global metric to measure overall quality-of-hires and specific metrics for key roles in the organization. A key is to focus on business outcomes and how successful employees deliver against the desired outcomes," he says.
Ultimately, HR professionals are "like architects who design the processes that capture the desired meaning within the company," says Ulrich. "And, like architects, HR professionals need to listen carefully to the desires of their clients -- in this case, line managers -- so that they can design the right systems."
Job Gains by Demographic
May 21, 2012
By Michael J. O'Brien
Despite the weakening jobs data of late, signs of an economic recovery abound. But is the rising tide lifting all demographic boats equally?
Economists continue to argue about the overall significance of jobs-report figures released by the U.S. Department of Labor, but debates notwithstanding, data from earlier this year shows that older workers -- those ages 55 and older -- may be making a better argument for their employment than their slightly younger competitors.
According the Labor Department's March 2012 figures, those older workers gained 2.8 million jobs since March 2010, compared to a net job loss of 258,000 for workers between the ages of 45 and 54 during that same time period.
Such figures should not come as a surprise, says John Challenger, CEO of Chicago-based Challenger, Gray & Christmas.
"The 55-plus population is expanding rapidly and, whether by choice or by necessity, many of these older workers plan on working beyond the traditional retirement age of 65," he says.
Some of these older workers are continuing in the occupations and industries where they spent most of their careers, he says, but many others are starting entirely new career paths.
"Because they may be more willing to work fewer hours or accept lower pay in exchange for better health benefits," Challenger says, "employers are welcoming these older job seekers.
"The older worker's experience makes it more likely that he or she can hit the ground running with little or no training and, in many cases, can do the job of two younger workers, simply by knowing the 'tricks of the trade,' " he says.
But, despite the advantages that many older workers offer to employers, Challenger says, recent college graduates should be stepping into a labor market that is more positive than in the recent past.
"Each year, we continue to see improvement in the college-graduate job market," he says. "Last year was slightly better than 2010, and this year should be slightly better than 2011."
Challenger points to two surveys to support his theory: one from the National Association of Colleges and Employers that finds employers plan to increase hiring of spring graduates by 10 percent over last year; and a survey from Michigan State University's Collegiate Employment Research Institute, which finds that employers are planning to hire bachelor-level graduates at a 7-percent higher clip than last year.
Indeed, according to DOL data from March, workers ages 20 to 24 gained 939,000 jobs during that same March 2010 to March 2012 period -- second only to the 55-plus segment.
Challenger says that, while the slowly improving economy is creating more opportunities for all job seekers, many companies have started looking beyond recovery toward expansion, and those organizations have to make sure they have started to develop the talent they will need to fuel the next period of growth.
"That means beginning to build the entry-level ranks now," he says, "so that, over the next five or six years, it is possible to identify and cultivate the high potentials who will drive the company forward."
There is also new data confirming that the economic recovery is impacting passive candidates.
According to the Corporate Executive Board, for the first time in five years, the ranks of passive candidates -- or employees who aren't actively looking for a new job -- shrank in the first quarter of 2012.
While still below pre-recession levels, active job seekers now make up 27 percent of the employed workforce, which the Board calls "another sign that the job market is recalibrating."
"Overall, this is a positive trend," says Christopher Ellehuus, managing director of the Washington-based Corporate Executive Board. "It means candidates in the labor market are feeling more bullish about job opportunities in the labor market and are more willing to take risks and move to another job with better career opportunities or better pay."
Ellehuus says the Board's new data also finds that employees who left their old companies in the second half of 2011 received 10-percent higher pay with their new employer, up from 8.5 percent in the first half of the year.
"While the global downturn provided organizations with selective opportunities to 'trade up' on talent for bargain prices," he says, "that opportunity appears to be fading quickly as the market begins to re-equilibrate in favor of candidates."
But one demographic that is not enjoying any effects of a revived economy is disabled workers, according to a new study based on DOL data analyzed by Allsup, a Belleville, Ill.-based provider of Social Security disability representation.
The Allsup Disability Study: Income at Risk finds that the unemployment rate for people with disabilities was nearly three-quarters (74 percent) higher than for non-disabled workers during the first quarter of 2012: 15 percent for disabled workers versus 8 percent for non-disabled workers.
And compared to the first quarter of 2011, the figures show no positive movement for either group: 13 percent for disabled workers versus 8 percent for non-disabled workers.
Allsup has been tracking such figures since the first quarter of 2009.
"People with disabilities often face a much greater challenge in securing employment," says Paul Gada, personal financial planning director for the Allsup Disability Life Planning Center. "Their health condition may make it difficult to continue to work for extended periods, or it worsens so they are forced out of the labor market entirely."
With all this data, it's no surprise many HR executives are unsure of their next step, says Challenger.
"This is complex time for HR executives," he says. "HR has to manage staffing demands for the next six months without losing sight of what will be needed over the next six years.
"Unfortunately," he says, "those expecting a rapid turnaround and sudden burst in hiring will be disappointed."
The Good News..and the Bad News
By Susan R. Meisinger
May 14, 2012
A combination of factors may lead to a resurgence of manufacturing in the United States. While that's certainly a positive development, the downside is that HR leaders will be challenged to find job candidates proficient in STEM skills.
Many years ago, my father vehemently opposed my decision to use my savings and buy a used 1970 Volkswagen Bug. It was my first car, and he argued I had no understanding of the true cost of owning a car -- the insurance, gas, maintenance, etc.
A few months later, OPEC imposed a fuel embargo on the United States in response to a U.S. decision to re-supply the Israeli military during the Yom Kippur War. Gas was rationed, and there were long lines at the pumps. I remember this particularly clearly, because that was when my father announced that "we" had made a smart decision to buy such a fuel-efficient car.
The embargo raised concerns -- and brought into sharp focus -- U.S. dependence on overseas oil for its energy needs; a concern that has continued for the past 40 years.
The good news is that some recent reports are suggesting that U.S. energy independence may finally be within reach. This security is because of a huge boom in oil and natural-gas production in the nation and an increased focus on fuel-efficient cars and renewable resources. Some believe this will lead to energy sufficiency for Americans within 20 years.
Why should U.S.-based HR executives care about energy sufficiency (beyond never having to worry about sitting in a gas line)? Because as the nation relies more on domestically produced natural gas, the economics of offshoring manufacturing changes.
The "perfect storm" of lower energy costs, greater employee productivity, rising wages in places such as China and India, and higher international shipping costs, may combine to make the nation much more attractive for manufacturing.
Research from the Boston Consulting Group and a poll from the Society for Human Resource Management suggest the tide is already beginning to change in this regard.
If energy independence and a rebounding manufacturing sector is good news, what's the bad news? After all, it means more job opportunities -- and that's the problem. They are jobs that require science, technology, engineering and math (STEM) skills.
This potential new demand will only exacerbate the existing challenge many HR executives in the manufacturing sector are already facing as they try to fill current positions.
And the statistics on the future availability of workers with, for example, math skills, are pretty grim. According to the Organization for Economic Co-operation and Development, the United States places 18th among its member countries in overall mathematical skills.
There have been many initiatives launched to grapple with the STEM shortage. Educational reforms have attempted to focus greater attention on math skills. Government studies have suggested that communities take up action to meet the challenge. Websites such as Stemconnector.org have been created to try to expedite dissemination of information on strategies that might prove useful.
And summits have been held or planned for concerned parties to discuss how best to meet the challenge. On June 24, in fact, SHRM and the U.S. Department of Labor will hold a summit on the shortage of skilled workers in manufacturing.
So what can just one already overworked HR executive really do?
Begin by resisting the temptation to be overwhelmed. Become fully versed in the scope of what this means for your business -- wherever it's located -- and make sure other executives appreciate the challenge.
Accept that educational efforts and achievements aren't uniform at all state and local levels, and begin to tackle the problem at a local level. Investigate how well the localities are preparing students for a career in manufacturing. Take steps to help educators understand the current -- and future -- needs of your business.
Of course, to do that, you need to know your business well enough to be able to educate the educators, or, to use a hockey analogy, help them skate to where the puck is going to be, not to where it is now.
In addition, learn about and take advantage of new technologies that are now available for workforce training. Training that may have seemed insurmountably expensive in the past becomes more affordable with technology -- especially as the need for skilled talent becomes more critical.
Finally, remember that the good news -- potential energy independence and the resulting rebound to manufacturing -- outweighs the bad news. After all, wouldn't you rather have the challenge of finding skilled workers instead of having to let them go?
Are rules and regulations around alcohol going to make a difference?
By Penny Ferguson
As an HR director or business leader, are you drawing any parallels between the Government’s approach to dealing with the problems of binge drinking and the way our organizations attempt to create behavioral change?
This may sound like a strange question, but for me there are so many things that resonate, and my question is this: are rules and regulations the most effective way to change the way people behave?
The Government obviously believes so. Binge drinking is, without question, a serious and growing problem, but Government is only dealing with the symptoms, not the cause. Why do individuals feel the need to go out and binge drink?
Probably because they think it's fun. How sad that we have become a nation where many people find fun in a bottle rather than more healthy pastimes. Those who passionately pursue activities and hobbies are much less likely to be among this number, perhaps because they're focused on a sense of purpose and belonging.
Just putting in numerous rules to remove from someone something they want, without their having something worthwhile to replace it with, I have never known to have any significant impact on behaviors. Usually, it just makes them devious, trying to find ways round it. You could therefore argue that you may be creating even more problems for the broader community.
Where will they get the booze from if they don't have the money to get it? If it's 'the only way to have fun', they'll surely find a way – steal either the drink or the money to buy it, maybe?
The same thing is true in our businesses. When we continually create rules and structures to stop people doing certain things or behaving in certain ways, they often invest huge amounts of time in finding ways to get around them.
However, if we focus more on helping people to see how they can really contribute and how they uniquely make a difference to their team and the organization, we may create sustainable change. We may begin to inspire people to embrace their role so they get much more from every working day, which in turn may positively impact on their performance.
Let me put this into a context. How many companies have you worked at where a communication problem was dealt with by appointing consultants? How much real change resulted? Most of the time, when people are asked that question, they respond, 'not a lot' or 'nothing at all'.
So, your problem is that individuals are not communicating and you put in a system to sort it? That won't work. If each and every individual took 100% responsibility for communicating, you wouldn't need a new system anyway.
At home, and I will admit sadly to this being very true of me for many years, you love your children very much so you keep telling them 'what to do' and what 'not to do'. Effectively, you are educating them into not thinking for themselves. You are actually teaching individuals how not to be responsible.
To change the culture of drinking, or to change any culture for that matter, necessitates something very different from putting in new systems. I believe if this is the route the Government goes, then the impact will be negligible and, within a couple of years, they'll be looking to 'upgrade' or put in a new system and the problem will have escalated.
How often have you seen systems merely create a 'fix' rather than bring about lasting change within your organization?
David Cameron talks about responsibility but, if he just keeps putting in systems to tell people how to behave differently, then to my mind he clearly doesn't understand the true meaning.
I wish, for once, the powers that be would start addressing the cause rather than the symptom. Then, and only then, will we begin to address so many of our challenges.
How are you applying this principle in your organizations?