Author Archive

Creating a Consumer Experience for Candidates and Employees

Thursday, May 26th, 2016

We are all aware of the changing dynamics in recruitment, employment and retention.  Companies should think of potential applicants and employeesRecruiting_and_Retention as consumers and create an experience that meets the candidate/employee needs as well as company needs to attract and retain the talent they need.

Technology, globalization, and the increased demand for top talent have changed the workplace landscape.  People can market themselves and access  information on companies and job opportunities to “shop” for what best aligns with their desires for organizational fit and personal growth.  That makes it more important than ever to think of candidates/employees as consumers and to make their experience a “delightful” one.

We have heard a lot recently about transparency.  Candidates searching for job opportunities want to learn as much as possible about potential employers up front.   Social media has made it easier for candidates to search for information on prospective employers (and vice versa).  What information is available to candidates online regarding your company from an employee feedback, social responsibility, and culture, etc. perspective?  How do you manage your organization’s social media profile?

After putting the best foot forward to hire and on-board top candidates that are the best fit for your organization, the consumer efforts shouldn’t stop here.  Treating employees as consumers and being interested in their aspirations and needs supports efforts to retain and engage employees.

According to Steve Lopez, Manpower Group, Companies talk about retention, but the culture does not always support that.  The rewards, measurement, and work environment often support retaining people in a job rather than retaining people within the organization. He proposes a consumer model for employee retention with the following components:

  • The User Experience – what are the goals, objectives and motivations for considering the job and staying with the company?
  • Content – Do you openly share the company culture, job content and expectations, opportunities for advancement and growth?
  • Functionality – What systems are in place to meet the user needs on a day-to-day basis in terms of exchange of information to support organizational needs as well as employee needs (two-way communication, receptive to employee feedback/suggestions, development plans)?
  • Interaction/Information/Navigation – Make resources available throughout the employee/consumer experience to provide what employees need to do their jobs.  This starts with the on-boarding process to educate new employees about the organization, to inform employees how to best obtain responses to their questions, inform them of tools they need and how to access various resources, etc.
  • Visual Experience – Does the desired visual experience for the employee reflect your company brand, web presence, culture, and the physical work space?

By approaching your employees as consumers you can create a world class experience and culture for your entire workforce, which enables positive business results. CAI can help with your company with talent acquisition, talent management, developing a better workplace and more.

(Source: Rethinking Retention, Steve Lopez, Manpower Group)

What Employers Should Know About Section 1411 Certifications

Tuesday, May 24th, 2016

The post below is a guest blog from Jay Lowe who serves as Principal, Health & Welfare Consultant for CAI’s employee benefits partner Hill, Chesson & Woody.

The Employer Mandate is perhaps one of the most nerve-wracking parts of the Affordable Care Act (ACA) for large employers: those employing morehcw than 50 full-time equivalent employees, or FTEs. (What’s an FTE? Find out here!) Many large employers understand that they can be fined with a tax penalty if they don’t provide coverage that meets the minimum requirements or is deemed unaffordable for their employees. In the event that coverage does not meet these requirements and is not affordable, employees may be eligible for a premium subsidy when purchasing individual coverage through the government’s healthcare marketplace (the Exchange). This subsidy eligibility is what triggers the penalty back to the employer.

Section 1411 of the ACA establishes the procedures for determining an individual’s eligibility for subsidies from the Exchange. A Section 1411 Certification is the notice to an employer that an employee has enrolled in a qualified health plan through the Exchange and been provided a subsidy. If you are an Applicable Large Employer (more than 50 full-time equivalent employees) that receives one or more of these notices, this could mean that you are facing a penalty from the IRS as part of the Employer Mandate provision of the ACA.

Employers should be prepared to see these certifications and have a plan of action in place once they do. For more details on the Section 1411 Certification, see here.

Dealing, Appealing, and Other Important Things to Know About 1411 Certifications

First, remember that these certifications are not penalty notifications from the IRS. They are simply informational, letting you know that an employee has received a tax credit and named you as the employer as part of their application process. You can expect a formal penalty notice from the IRS to follow; however, the notice will give you the ability to appeal if your health plan does meet all of the Employer Mandate requirements. By appealing, you can potentially stop the penalty process from the IRS.

It is important to educate the employees who will be handling these notices within your organization. This is a new form and something that most will not be familiar with. They need to know what to look out for and be prepared for what to do. If your health plan does meet minimum essential ACA requirements, make sure the employees in question understand that they will need to act quickly to appeal these notices; you will only have 90 days from the date of the notice to file your appeal.

In the event that your plan is not meeting all of the requirements of the Employer Mandate, look out! You’ll probably have to pay a fine. The Section 1411 Certification will alert you to your penalty liability. Only employees who receive a subsidy in the Exchange can trigger a penalty for you, and these notices will tell you exactly who those people are. As a best practice, employers should keep track of what their total exposure could be prior to receiving the notices. Their final liability could be less than what they are expecting.

With the delay of the Employer Mandate reporting requirements, it is likely that employers will not begin to see Section 1411 Certifications until late 3rd quarter or 4th quarter of 2016. That gives you plenty of time to educate your people, prepare an action plan, and learn all about 1411 Certifications!

Broaching the Subject of Retirement with Employees

Thursday, May 12th, 2016

Baby boomers retiringWith more millennials entering the workforce and baby boomers preparing to move out of workforce, the question often comes up “Can we ask Tracy when s/he plans to retire?”    Just to be clear, although social security has a retirement age to qualify for benefits, there is no mandatory retirement age for most employees.  (Some exceptions exist for airline pilots, federal law enforcement officers, firefighters, air traffic controllers, and bona fide executives or high policy makers.)

So can you ask employees about retirement and if so how?  The short answer to this question is a qualified yes, as long as you handle it appropriately.  When done wrong, particularly if you badger the employee, mention “generational words,” or when a supervisor keeps asking, pushing, and treating someone badly for giving a “wrong answer.”  The time and place also matter.  If we never ask the question and all of a sudden start asking all of our employees over 55 when they plan to retire could at the very least cause a morale problem.

Nonetheless, there is nothing inherently wrong with asking any employee about their future plans, and companies need to know that information for many reasons.  The fear of being accused of (or sued because of) age discrimination sometimes makes employers hesitant to ask about retirement.  So in what ways can you broach the subject of an employee’s retirement plans?

  • When an employee has mentioned they are thinking about retirement, you can ask them if they have a date in mind and that you would appreciate if they would give you ample notice to find someone to fill the job and perhaps have them train the person.  If they are not receptive or do not have a date in mind, be sensitive and follow-up in an appropriate way at a later time.
  • For workplace planning purposes, especially in key positions or those that have a longer learning curve/training period in job specific methods.
  • Through a policy that says if you are planning to retire, please give us as much notice as possible so that we can discuss options for training someone to fill the position as well as options for phased retirement (if that is something the Company would consider).
  • Through voluntary early retirement incentive plans that offer a severance to employees who meet a minimum age and number of years of service with a company and elect to take the package.  These should be carefully developed keeping in mind the needs of the business and compliance concerns.  They are generally used when a reduction in force is required and in lieu of an involuntary RIF.  An employment law attorney should be consulted in drawing up such agreements.
  • But what about when you have a great employee you hate to lose but you sense retirement may be in the cards?  In this case, ideally the person having this conversation with the employee has a good relationship with them and ideally that would be the manager.  The idea of retiring is stressful for many employees so we want to be delicate.  The annual review is a good time to venture into this territory particularly when discussing plans for the next year.  You can simply ask, “So Ted, what are your plans for the next year” and see where the conversation takes you.  You are asking merely for planning purposes.  Again, don’t push or badger them for an answer.  You just want to open the door.  It’s ok if they don’t want to walk through that door now.

Options for a smooth transition for the company and employees who plan to retire may include offering phased retirement, where employees gradually reduce their hours as they continue to work part-time until full retirement or while they train and transfer knowledge. Also, upon receipt of the unexpected notice that an employee plans to retire, the company may offer incentives to retain the employee through a training period for a new employee filling their position (be sensitive to the term “replacement” as no exiting employee wants to feel like they can be easily replaced).

Whatever the case, employers should always be prepared for employees leaving, whether through retirement or leaving for another job.  Workforce planning should be an on-going strategy, documenting processes, cross-training where applicable, and maintaining succession plans.  Absent a contract, employment is at-will (either the employee or the company can end employment at any time).  So why should notice of retirement be any different than an employee’s choice to take another job and give notice? The point is, don’t get caught off-guard.  Be prepared whatever the reason.  Let us know if we can help with your workforce management and planning.

CAI Raleigh Office Moving On June 13th

Tuesday, May 10th, 2016

After 32 years, we are moving our Raleigh office to 3150 Spring Forest Road.  This is 1.2 miles south of I-540, just off Capital Blvd., and near Triangle Town Center.  We are in our current locationMoving Postcard final through June 10th.  We will open for all business purposes . . . including training classes . . . on June 13 in the new spot.

This move is exciting for us and for you!  We will have plenty of parking for class participants, expanded modern training facilities, and a collegial open floor plan for our staff.  I-540 provides easier access for our guests from the west and east.  The interior layout was designed to meet our growing member service needs and to improve your experience.

We welcome your visit to get a sense how we will serve your class participants.  They will enjoy better break and lunch service options, including outdoor patio areas.  We plan an open house event later this summer.  Watch for details!

Call us at 919-878-9222, should you have any questions.  We look forward to showing you our new headquarters and introducing you to staff!

If you’re not yet a member of CAI, now is a great time!  Find out more about how we can help you at CAI Membership Benefits.

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What North Carolina Employers Need to Know About the Proposed Overtime Rule

Thursday, May 5th, 2016

The Department of Labor’s proposed overtime rule would expand overtime pay and raise the standard salary threshold for exempt employees toOvertime Rule $50,440 a year.  Recently, however, there have been rumors that the figure may be even less than that.  When the rule goes into effect, any exempt employee who makes below that threshold (or whatever amount is in the final rule) will no longer qualify as an exempt employee. Retail, manufacturing, warehousing, distribution, hospitality, healthcare and banking:  no industry is untouched. The budgetary impact of converting all these managers to overtime eligible, or meeting the anticipated doubled salary threshold, is enormous.

CAI and the Employers Coalition of North Carolina (ECNC) are formally supporting efforts in Congress to halt the planned federal overtime rules changes.  Most recently, we signed on to a letter sent to congress urging it to block the Department of Labor’s proposed rule expanding overtime pay.  In all, 340 organizations signed the letter in support of the Protecting Workplace Advancement and Opportunity Act. The bill would force the Department of Labor to conduct a comprehensive analysis on how its proposed changes to overtime rules would affect small businesses, nonprofit organizations and local governments.

While we are hoping our actions in delaying the rule are successful, we still believe the new rule will be in effect before summer’s end.  The course of action for a prudent company to take will be to fully understand what is being proposed and to prepare in advance.   CAI members will be continuously updated on the most current information regarding the Overtime Rule on myCAI in “Overtime Central.”  Read more about how this may impact your company.

Spousal Health Coverage Costs Continue To Rise

Thursday, April 21st, 2016

Guest blog from Joy Binkley who serves as Principal, Health & Welfare Consultant for CAI’s employee benefits partner Hill, Chesson & Woody.

Spousal Health CoverageThe cost of health insurance continues to rise, but the cost of covering one’s spouse is looking to be quite expensive for those spouses that waive their own employer-sponsored benefits. According to a recent survey of U.S. employers, the use of spousal surcharges is expected to double by 2018, from 27% to 56%. The average spousal surcharge is $1,200 per year, which is tacked on the previously determined payroll deduction.

The surcharge is going on top of the fact that employers are just asking employees to pay more to cover spouses and dependent children. More than half (56%) of employers are increasing payroll deductions for spouses, while just under half (46%) are increasing the cost to cover children. This is a trend we are seeing here in North Carolina as well. The most recent CAI 2015-2016 North Carolina Benefit and Cost Survey shows the average medical cost increasing for family rates going up 6.2% versus the previous survey’s increase of 4.4%. Employers are consistently asking employees to pay roughly the same portion as last year, which is 47% of the total premium cost.

Employers are continuing to focus on ways to impact healthcare cost. Besides asking those to pay more that are waiving their own employer plans, some are considering dropping spouses all together. The elimination of spousal health coverage is permitted under the Affordable Care Act criteria. The rational to drop coverage entirely can depend on the underlying benefit strategy. Some employers are dropping coverage due to low (or no current) participation on their plans, therefore eliminating coverage just entitles those that may be subsidy eligible to earn those governmental credits. Other may be considering it due to a financial hardship. Regardless, of the reason the current landscape is quickly changing for spousal health coverage.

Look back on the trends in spousal health coverage in 2014 and 2015, and see how the numbers have changed over the past couple of years.

When Are You Required to Pay Interns?

Tuesday, April 19th, 2016

With summer months fast approaching, many employers are considering employing interns.  CAI’s Advice & Resolution Team often receives questions regarding pay requirements for interns.  There seems to be one school of thought out there that says the employer can decide whether or not they pay interns.  Well in fact, the USDOL (United States Department of Labor) has issued guidance on this issue (Fact Sheet #71.)  This fact sheet Internspecifies tests that must be met to exclude interns from minimum wage and overtime requirements under the FLSA (Fair Labor Standards Act).

The following criteria must be applied when making this determination:

  • The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment
  • The internship experience is for the benefit of the intern
  • The intern does not displace regular employees, but works under close supervision of existing staff
  • The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded
  • The intern is not necessarily entitled to a job at the conclusion of the internship
  • The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship

If ALL of the above factors are met, an employment relationship does not exist under the FLSA, and the minimum wage and overtime requirements do not apply.

Of course, the decision to pay an intern goes beyond the legalities of such.  There are many differing opinions as to whether or not employers should pay interns.  Local columnist, Alice Wilder at the Daily Tarheel, has written an interesting article on the virtues of paying an intern, that may be useful in making your decision.

How to Create and Sustain a More Diverse Workforce

Thursday, March 31st, 2016

diversity

In today’s post, CAI’s HR Manager Melissa Short and Marketing Intern Andy Bradshaw discuss the strategies HR professionals should take in order to foster a diverse and inclusive organizational culture.

In 2013, Harvard Business Review conducted a survey of 1800 professionals that found a striking correlation between diversity and innovation in the workplace. The study examined what it terms “two-dimensional diversity”- which encompasses both inherent diversity, or traits you are born with such as gender and ethnicity, as well as acquired diversity, involving traits you gain from experience. The study referred to companies whose leaders exhibit at least three inherent and three acquired diversity traits as having two-dimensional diversity, and found that that companies with 2-D diversity out-innovate and out-perform others.

In fact, employees at these companies are 45% likelier to report that their firm’s market share grew over the previous year and 70% likelier to report that the firm captured a new market.

Though it may sound intuitive, the evidence for the business case for workplace diversity is significant. Along with carrying the obvious social value of creating a more inclusive, tolerant workplace, diversity in the office really can improve profits and your bottom line, as evidenced above.

Of course, most HR professionals don’t need to be told that diversity is important to the workplace, as they are most likely aware of its many benefits. Where many in HR may struggle with the process, however, is how to get started on tackling diversity initiatives with limited time and money. That’s where we’re here to help. By dividing the process into these easily digestible phases, you’ll not only be able to quickly lay the groundwork for a more diverse workplace, but also put your office on a path to sustaining this diversity going forward.

Selection and Hiring

To create a truly diverse workplace, you have to start at the beginning. Hiring people with different backgrounds may be an obvious way to improve diversity, but it takes a conscious effort to broaden recruiting efforts to reach those candidates. Here are a few ideas as to where to start this process:

  • Think about where you look for candidates. Are you looking in markets or roles that seek out membership associations, clubs, and publications with minority or underrepresented community audiences? Right here in the Triangle, you could be looking at reaching out to minority publications such as Que Pasa and The Triangle Tribune in order to place job postings.
  • But go beyond just posting a job to engaging and networking with the owners and employees in order to build longer term-genuine relationships.
  • Train and educate hiring managers on the importance of organizational diversity, particularly the business benefits. By ensuring the hiring team is aware of both the social and financial need for diversity in the office, HR can lead the charge to finding more qualified and diverse minority candidates.

Enhancing Organizational Inclusion

Once you’ve moved past the selection and hiring of a diverse pool of candidates, how will you ensure they want to stay at your organization? It takes a company-wide commitment to cultivate a culture of organizational inclusion. Employees want to work in an environment where they feel supported and valued for their differences and Human Resources plays a large role in driving this culture. Here’s how HR can permeate inclusion throughout their organization’s culture:

  • Go beyond handbook policies that cover anti-discrimination laws and consider including an organizational statement that addresses the company’s commitment to an environment of support and inclusion.
  • Revisit your dress guidelines to ensure that you aren’t inadvertently excluding items that are cultural or religious in nature.
  • Demonstrate a company commitment to utilizing minority-owned or managed businesses for key vendor relationships.
  • Regularly review your pay system to identify and correct any pay inequities.

Sustaining diversity going forward

Now that you’ve planted the seeds of diversity within your organization, HR must do its part to ensure it continues to grow and prosper moving forward. Creating a diverse workplace is one thing, but what about keeping it that way? Here are a few tips to ensure your diverse workplace is here to stay:

  • Ensure your minority employees have equal access to opportunities through the use of a minority mentorship program. This will not only give minority employees a space for engagement and advancement but also breaks down barriers between generations and other boundaries at work
  • Train managers and all employees on cultural awareness and inclusion – this can be as simple as an online training course or even sharing an article or case study around this subject.
  • Educate your front line managers around the business and social benefits of diversity and teach them to recognize any signs that point otherwise.
  • Be transparent around your intent to create and sustain a diverse and inclusive work environment and the company practices that support it. By openly showcasing your organization’s commitment to diversity and inclusion, you will continue to create a culture that fosters these ideals and attract employees who are dedicated to fulfilling them.

Though the process may seem overwhelming, it is imperative that HR leads the charge for a more diverse and inclusive workplace. By following these phases, you can foster a sense of inclusion that will transform your business for the better, both culturally and financially. For any other helpful tips about how to create a more diverse workplace, please let us know in the comments!

Helping Managers Overcome Performance Review Anxiety

Thursday, March 24th, 2016

performancereview

In today’s post, Advice and Resolution team member Renee’ Watkins shares helpful tips for managers looking to escape that dreaded performance review anxiety. 

Conducting performance reviews and discussions on a regular basis is a key part of a manager’s responsibility.  Conducting a performance review also carries a certain amount of anxiety, as any manager tasked with providing one can attest. There is always the potential of a dispute over the facts, a difference in perspective, or even an unplanned, unexpected, or premature discussion regarding compensation.

In order to effectively have performance discussions that identify employee accomplishments, address areas for improvement, and generate individual development plans, managers must get past any anxious feelings and move through the process confidently and deliberately. Below are some tips which will help managers overcome some of their apprehension:

Expect Some Negotiating 

Approximately one out of every five employees will work to negotiate some part of the performance review process.  It may be around the rating itself, the wording of the review pertaining to “areas for improvement” or even the compensation aspect of the review – even though this typically occurs in a subsequent discussion.   Expect it and be prepared for it.  Anticipating issues, understanding what latitude you have within your organization’s guidelines, and knowing your response(s) will go a long way towards you  being  successful in this part of the meeting.

Keep it Conversational 

Performance reviews should be conversational. Remember, this is also your employees’ opportunity to provide their input and feedback on the performance period under review.  By keeping it conversational, you will remain at ease as will your employee.

Know the Details 

Some performance reviews are conducted only once a year.  This makes it not only difficult, but imperative that details are provided during the review.  Recalling the specifics of something that happened ten months ago can be a challenge for both you and your employee.  Having accurate details can make things easier to discuss and avoid disputes. Moving forward consider meeting once a month to discuss progress towards goals and objectives. These discussions will benefit both you and the employee for the annual review meeting – which would now be more of a “year in review” format.

Take Time to Consider 

There may be questions or considerations which arise during a review that need some additional thought.  This may include an employee request about a different job assignment or perhaps a promotion.   If the answer is not obvious or if you are not prepared to have that conversation at the moment, advise the employee that you need additional time to consider his/her request.  This is reasonable, but make sure you get back the employee within the stated time allotted.

Time to Re-evaluate Process/Approach? 

If you have reviewed tips above and your managers still feel somewhat anxious about conducting a performance review, perhaps it is time to re-evaluate your approach or the process in general.  Maybe the reason they are so uncomfortable is because something about the process leaves them with a lack of conviction in some area of either evaluating the employee’s performance, measuring improvement, ability to have a “critical conversation”, or some other aspect of the review details.

Maybe it’s time for a critical review of your process.  CAI can help – give our Advice & Resolution team a ring at 919-878-9222 or 336-668-7746!

Please be sure to share below any tips you have about overcoming the pressure and anxiety of performance reviews.

Can We Control Healthcare Cost By Utilizing Medicare?

Tuesday, March 22nd, 2016

hcwhealthcarepicThe post below is a guest blog from Dax Hill who serves as Principal, Health & Welfare Consultant for CAI’s employee benefits partner Hill, Chesson & Woody.

Did you know Medicare reimbursement rates for healthcare are typically lower than reimbursement rates paid by insurance companies?  Some employers are taking notice and indexing their employer reimbursement rates to the Medicare rates in hopes of trying to control their medical claims spent.

This arrangement is typically called “Reference Based Contracting” or a “Cost Plus” program.

There are many flavors of these types of programs, but here’s how these funding arrangements generally work….

  • An employer self-funds their medical insurance plan utilizing a Third Party Administrator (TPA)
  • The TPA partners with a network of doctors to provide discounts on medical services for “professional” charges. The medical reimbursement rates are based on the negotiated charges agreed upon by the network and doctors….this is similar to most of the current arrangements.
  • For “facility” charges, though, things get interesting. Instead of using the typical insurance carrier’s negotiated rates, reimbursements are based on Medicare reimbursement rates. For example, the TPA agrees to reimburse the medical facility at 120% of the Medicare allowed amount.  Medicare reimbursement rates are generally much lower than the typical insurance carrier negotiated rates.  These lower reimbursements (indexed to Medicare) can lead to claims savings to both the employer and employee.

All of this sounds good so far – who doesn’t want to pay a lower price?  There must be some catch, right?  The main concern for these programs is this: what happens if the hospital or medical facility push back and do not accept the employer/TPA reimbursement rates?  The amounts over the employer’s allowed price gets transferred to the employee.

For example, let’s say an employee receives a $5,000 medical procedure and the employer’s allowed amount is $1,000.  In this scenario, the hospital may decide to “balance bill” the employee for the $4,000 difference.  It is important for the employee to appeal this balance bill.  Most TPAs that focus in this market partner with legal counsel that represent the employee at no additional cost to the employee.  The attorney handles the appeal for the employee.  The attorney will send the medical facility a letter stating the reimbursement is adhering to the employers ERISA plan document and the employee should not be balanced bill.  The attorney explains that the employer and employee are paying above what’s normally acceptable (since most of the facility’s patients are covered by Medicare).

At some point, hospitals and facilities will become more aggressive in trying to 1) collect the balance bill from the employee 2) refuse to provide healthcare to individuals that are enrolled on these types of insurance plans or 3) negotiate on the allowed amount.  In the meantime, these plans are getting attention of employers as they try to best manage their healthcare cost.

Take a look at the pros and cons of Reference Based Pricing and the key considerations employers should look at prior to implementing these plans in this white paper.