Employers continue to feel the squeeze from swollen health care costs. Are HSAs the new treatment?

The continuing rise in the costs for employer based health insurance is bringing new attention to Health Savings Accounts or HSAs


HSAs are increasingly in popularity due to a feature, in which dollars are allocated to employees, who can roll the accounts over every year and take them with them when they leave. I have a host of clients that uses HRAs, and a host of clients that uses HSAs,” Bradley said. “Some companies prefer HRAs because they are not as cumbersome to set up, and they retain the funds, rather than returning them to employees.” But others favor the HSA for the effect it has on employees. “It encourages them to become better consumers of health care, since they’re spending their own money,” Bradley said. For instance, “if the money is coming out of their own pocket, consumers might ask doctors if they really need all three tests, or if they really need 100 pills instead of 50,” said Lou Basso, president of The Alcott Group, a Farmingdale-based professional employer organization and provider of human resources services.

For more on this topic, click the link below

http://libn.com/blog/2008/11/21/employers-hurt-by-swollen-health-care-costs/


E-mail your questions concerning your personal health care crunch to a trusted advisor and we will respond within 24 hours firstplacerightchoice@1stplacemployer.com
Please visit us on the web @ http://www.1stplacEmployer.com

2009 Salary Planning Forecast

This post is a bit off center for our blog, but we found it quite interesting and thought it may help, might provoke a bit of conversation, and provide an overall view of how to make everything fine in 2009! Please take note at the bottom of the post for a few fantastic suggestions for alternative rewards.

It’s that time of the year again – time to set 2009 salary budgets. For the past 8 years the answer has been an easy one, 3.5%. Each year the surveys predicted that salary budget adjustments would remain flat and ahead of the Consumer Price Index.

That was, of course, until the latter half of 2008. With fluctuating energy prices and their domino effect on most goods and services, we may be facing the first year in which the salary budget adjustment will fall short of the consumer price index inflation rate. In the July 2008 consumer price index report from the Bureau of Labor Statistics (http://www.bls.gov/), the consumer price index had increased by 5.6% over July 2007 levels. Currently 2008 salary budgets (http://www.worldatwork.org/) are averaging 3.7%, which is higher than 2007 levels.

There is good news as we move into 2009, however. According to the Financial Forecast Center (http://www.forecasts.org/), a financial think-tank group, inflation rates will come under control in 2009, returning to approximately 3.6% per year.

While there are numerous salary budgeting forecasts published this time of year, Astron Solutions closely follows two highly regarded sources. The first is WorldatWork (http://www.worldatwork.org/). The second is Mercer, LLC (http://www.imercer.com/). Both have been providing salary budgeting forecasts for over 30 years.

The WorldatWork 2009 Salary Budget Survey contains data from 2,375 organizations representing 21 different industry segments. In terms of 2009 salary budgeting, WorldatWork reports the following:

2009 General Increase Budgets: 2.9%
2009 Merit Increase Budgets: 3.6%
2009 Total Increase Budgets: 3.9%

From an organizational level perspective WorldatWork discovered the following:

2009 Non Exempt Hourly Adjustments: 3.8%
2009 Exempt Salaried Adjustments: 3.9%
2009 Officer and Executives Adjustments: 4.1%

The report shows very little distinction by region of the country (range of 3.8% - 4.0%), metropolitan area (range of 3.7% to 4.1%), or key industry segment (range of 3.8% to 4.2%).

WorldatWork projects overall 2009 salary range adjustments at 2.5%.

The 2009 Salary Planning Report by Mercer has data from over 1,000 organizations representing over 12 million employees. Mercer reports an overall 2009 salary budget level of 3.7%, with 2009 budgeted structure adjustments at 2.8%.

Of more interest is Mercer’s analysis of compensation practice trends for 2009. The following is a list of compensation practices and their prevalence in the survey sample:

• Traditional Pay Grade/Salary Range System: 77%
• Use of Non-Monetary Reward Programs: 73%
• Job Families Linked to Formal Career Paths: 68%
• Use of Spot Cash Awards: 59%
• Use of Individual Non-Management Incentive Programs: 52%
• Use of Competency Based Performance Management System: 41%
• Use of Broad-Banded Pay Ranges: 21%
• Use of Skill-Based Pay Programs: 14%
• Use of Competency-Based Pay Programs: 13%
• Use of Gainsharing Plans: 12%

Those interested in a summary of all the 2009 salary budget forecasts should connect with Lake Associates Inc. (http://www.lakebiz.com/) of Albany, NY. They have compiled an excellent summary of all the major consulting firm forecasts for 2009. Based on their review, Lake Associates recommends the following for 2009:

• Salary Structure Adjustment: 2.9%
• Merit Increase Budget: 3.8%
• Total Salary Budget Adjustment: 3.9%

“Pay increases alone won’t work as a strategic attraction and retention tool,” notes National Director Jennifer Loftus. “With a 3.8% merit increase budget, there’s often little room to recognize top performers. Couple those increases with the escalating cost of living, and the importance of using a total rewards perspective becomes all the clearer.”
Consider alternative rewards, including telecommuting, compressed workweeks, and gas cards, as key elements in your total rewards toolkit to ensure your top talent stays with your organization through these possibly challenging economic times.

To learn more about this author, visit Jennifer Loftus's Website.

Striking a Balance with Employee Monitoring

Employee monitoring is controversial, but experts say litigation trumps privacy.

HOW MUCH SHOULD EMPLOYERS MONITOR THEIR EMPLOYEES' COMPUTER USE AND E-ACTIVITY?

Employee monitoring is a workplace hot potato, steeped in controversy, no matter the industry. In most places of business, it's pretty well known that the employee will have Internet access. The larger isssue is that because of new tools, there is a blurring of work and home time, and the lines between the activities blend.

Excessive monitoring or rigid rules can drive away productive employees, especially those generation X and Y, who expect some freedom in structuring their workdays. Although most employers have come to terms with this new reality, the issue is still confusing on both sides.

From the employer's perspectivefear of litigation trumps privacy, says Nancy Flynn, executive director of the ePolicy Institute (www.epolicyinstitute.com) and author of The epolicy Handbook.

In December 2006, the Federal Rules of Civil Procedure were amended, allowing electronically stored information to be subject to discovery in federal courts.

If your company becomes embroiled in a lawsuit, you can take it to the bank that all of your company's e-mail can be subpoenaed,

says Flynn.

E-mail creates the equivalent of DNA evidence sitting on their computer system.

U.S. employers have the right to monitor employees' computer activity under the Electronic Communications Privacy Act, which has been interpreted to purport that employees should not expect any privacy on employer-owned computers.

The courts have been consistent in siding with employers

says Flynn.

Assume Big Brother is reading over your shoulder. If the company provides a cell phone, there is a good chance your texting is being monitored, too.

According to a 2007 survey conducted by the American Management Association and the ePolicy Institute, 66 percent of employers monitor Internet connections and 65 percent use monitoring software to block inappropriate software, up 27 percent since 2001. Forty-three percent of companies monitor e-mail, and 45 percent track content and keystrokes.

Likewise, more and more companies are monitoring blogs, just like this one.They are worried about,

breaching company confidentiality rules, giving away trade secrets or secret recipes, uploading videos that would embarrass the company,

says Flynn.

We've seen thousands who have been fired for blogging on their personal time, for content on their personal and social networking sites and YouTube videos.

How do you strike a balance in your monitoring policy? Flynn recommends businesses apply the three E's of risk management:

• Establish a written policygoverning usage, contect and retention of business records. Spell out when employees can communicate with family, domestic helpers, physicians and schools, and what constitutes a reasonable amount of time for personal communication. Expect the policy to evolve with the workplace.
  
• Educate your workforce on e-mail and Internet risks, policies and procedures. The 2007 Electronic Monitoring and Surveillance Survey found that 58 percent of employers fired employees last year for inappropriate e-mail or Internet use, some of which were an intentional violation of policy, and some not.

  You can't expect your employees to cooperate unless they know about it,

  Flynn says.
  
• Enforce the policy with disciplinary action and technology tools, and detail the consequences. While zero tolerance may engender resentment among employees, warnings and escalating consequences will protect the firm and its employees.

If you or a member of your team has a question regarding employee monitoring, please e-mail us at firstplacerightchoice@1stplacemployer.com and a trusted advisor will respond withing 24 hours.

Six Tips for Developing Your Employees

I am not sure how many of you are like me, when I read an article stating, "According to a recent poll"..I wander off into LaLa land. The tips below might seem basic and well...simple. How many of us on a daily basis forget to apply the simple solutions to both our lives and our business.

The trusted, professional advisors at First Place Employer Services see business owners struggle on a daily basis to attract and retain quality employees. When we read tip number one we were in no way shocked. How about you?

According to a recent poll of HR professionals, only ten percent of managers are fully prepared for the next level. Given this information, is it really a surprise that approximately fifty percent of promotions fail (source: Corporate Leadership Council) when the selection decision is based on current performance level?

One of the most important qualities of a good leader is the ability and desire to develop their employees. Taking an active role in the development of your team demonstrates confidence and concern for the future of the organization. Although talent development should be part of a company-wide initiative, most of the responsibility falls on the shoulders of the supervisors. Unfortunately, development coaching doesn’t come naturally to many leaders. By following these tips, you can prepare your employees for success at the next level.

1. Encourage professional development. High-potential employees are not satisfied with the status quo. You WANT these employees your team. They are typically ambitious, high performing, and dynamic. They will be the future leaders of your organization if they are given proper guidance in their development. If not, be prepared to lose them to the competition.

2. Create a plan. Planning is crucial to advancing your career. Help your employees establish goals that are aligned with their strengths, interest and experience and then create a plan to get there. A development plan serves as the roadmap that will take you to your goal. It can be simple or complex but it must include action steps, resources, and deadlines. Not sure where to focus your attention? Try the step-by-step promotion planning eClass. You will focus only on building necessary skills and overcoming obstacles to get you to your targeted position.

3. Pair your employee’s with a mentor. Once their goals have been established, find someone who is in a similar role to the target position to serve as a mentor. Mentoring enables an organization to use it’s existing talent to impart their knowledge and expertise to one another. Everyone – the organization, the mentor, and the mentee – benefits from the mentoring process.

4. Identify opportunities to expand their professional network. Having a solid network is imperative to the success of future leaders. A network is a great source of information, advice, support and inspiration. Recommend opportunities within the organization, as well as, networking or professional groups that will help them build strong connections.

5. Challenge your employees to move out of their comfort zone. You can’t move forward if you don’t grow and you can’t grow if you never leave your comfort zone. When possible, give your employees challenging assignments. Help them prepare by providing them a safe environment to learn from the mistakes that they are bound to make.

6. Hire a coach. For high-potential employees and employees who need to be redirected to another career path, it can be best to bring in an outside coach. An external coach provides a confidential environment where employees are free to discuss the challenges and opportunities they face in their careers through the use of assessments, powerful questions, and individual development plans.

To learn more about this author, visit Jill Frank and her website
@ (http://www.leverageyourtalent.com/)

If you or someone you know may have questions regarding employee performance, please drop us an e-mail at:

firstplacerightchoice@1stplacemployer.com

and a trusted advisor will answer your inquiry within 24 hours.

http://www.1stplacEmployer.com

Workplace Politics – Lies, Lies, Lies

In honor of Super Tuesday the trusted advisors at First Place Employer Services voted to cover an unfortunate truth in the workplace. Lies. This time of year, America talks about the lies and the mudslinging over the dinner table or at the water cooler. What we do not publicly talk about often enough is how to handle and confront lying in the workplace. Your first instinct might be to ignore a lie about you, but as it swells to a crescendo, you might want to rethink your strategy. In the workplace, this is especially important, because a lie can rapidly contaminate the environment.

An article published on Courant.com takes a truthful look deeper into this issue. The article titled, "Don't Ignore Lies In The Workplace; Confront Them" suggests what to do with lies that sprout up like fast growing weeds in the workplace. Psychologist David Gruder offers containment tools below:

Escalating Steps to Confront Lying in the Workplace

• "Talk to that person privately, or with a neutral third party, where he doesn't have to put on a face for the public."


• "Identify key people in the system to tell that a lie is circulating. Ask these key influencers for advice about how to respond."


• "Organize an intervention if the previous methods prove ineffective."


• "Gather people who understand what the truth really is to collaborate on a procedure for publicly confronting the liar" — but only if you're desperate, because of the humiliation it causes. This could mean a note in a personnel file.

Read more of the article here: href="http://www.courant.com/business/hc-mildred0204.artfeb04,0,1785619.story">

The HR pros at First Place Employer Services tackle workplace challenges head on utilizing a team approach with our client as Captain. If you are an employer, we encourage you to take a look around and take note of behaviors which allow some people to be rewarded for behavior unrelated to doing a good job.

If you or someone you know may have questions regarding workplace behaviors affecting your place of business, please drop us an e-mail at:

firstplacerightchoice@1stplacemployer.com

and a trusted advisor will answer your inquiry within 24 hours.
to learn more vist us at:

http://www.1stplacEmployer.com

Is Sexy an Ingredient in Successful?

Did you ever wonder if your paycheck or your job stability depended on how attractive you were? Well published research suggests that in addition to our highly qualified skills and college degrees, looks are a highly compensated feature desired by employers across the land.

As a CFO or the owner of a successful business, does that also in turn mean that by hiring attractive, pretty people your business will be more successful than those competitors who hire their staff based on brains alone? You might wonder, but the research does not point out a profit equals prettiness factor.

Unattractive people earn less than average-looking people, who in turn make less than the good-looking, according to a study by economists Daniel Hamermesh and Jeff Biddle. The “plainness penalty” is about 9%, while the “beauty premium” is 5%, according to the report, which was published in the Journal of Labor Economics. So what exactly does this mean? Translation: An attractive worker makes 5% more per hour than an average-looking person, who in turn earns 9% more than their unattractive counterparts. In real dollars, this means that if an average-looking person makes $30,000; their beautiful colleagues would make $31,500, while the homeliest workers earn just $27,523. And interestingly, the impact was similar for both men and women.

Read more of the story here:
(http://www.theimproper.com/Template_Article.aspx?IssueId=3&ArticleId=1207)

Luckily, beauty is in the eye of the employer. What one recruiter considers plain, another HR executive finds beautiful. Will Corporate America be better off if they see that talent is a beautiful thing?

Good luck, stay legal, and look for the beauty within!

E-mail your questions concerning survival in the workplace to a trusted advisor and we will respond within 24 hours firstplacerightchoice@1stplacemployer.com
Please visit us on the web @ http://www.1stplacEmployer.com

Do I have to pay them when.......

It is the start of the New Year and we wanted to get a jump on answering questions our clients face throughout the year. Employers are often encounter, "How do we..." or "Do we have to ...." when it comes to paying employees outside of the normal pay cycle.

The trusted advisors at First Place Employer Services (www.1stplacEmployer.com) fielded a few questions from last year, consulted the experts and decided to put them out for you to use.

Q. What is the financial exposure from payroll in the event an employer closes its operation for a day? And when an employer asks its exempt employees to put in extra hours, is additional compensation required?

Federal law sets certain parameters with regard to the compensation of exempt employees, but in this area employers also retain a fair amount of discretion.

Q: If the company closes for two days for the Christmas and New Year holidays but only one day (the actual holiday) is a paid holiday, must the company pay the exempt-salaried employees for the other day? Can the company require them to take vacation time for the days that are not paid holidays?

Employees who are exempt from the Fair Labor Standards Act's overtime-pay provisions must, among other things, be paid on a "salary basis." This means that the employees must be paid full compensation in a predetermined amount for any week in which they perform any work, regardless of the number of days or hours worked. 29 C.F.R. § 541.602(a) (2008). The exempt employees generally do not have to be paid for any week in which they perform no work for the employer.

There are certain limited circumstances in which an employer may pay an exempt employee less than the employee's full weekly salary. For example, deductions can be made for time that the exempt employee is absent from work for one or more full days for personal reasons or as a result of sickness or disability if the employee has exhausted applicable paid-leave banks. 29 C.F.R. § 541.602(b)(1)-(2).

If, however, the exempt employee is "ready, willing, and able" to work, but the employer either closes its facility (e.g. for a holiday) or has no work for the employee to perform, then the employer cannot deduct that time not worked from the exempt employee's pay.

An employer that makes such an improper deduction risks jeopardizing the employee's exempt status. 29 C.F.R. § 541.603(a)-(b). Thus, the employer that closes its offices for two days but considers only one a paid holiday would, nevertheless, be required to pay its exempt employees their standard weekly salaries for that week.

The FLSA does not address paid time off, such as vacation time. Rather, whether the company in this example could require exempt employees to take vacation time for the days that are not paid holidays would be governed by state law.

In most states, an employer could lawfully require its exempt employees to use their vacation time in the event of an office closing, provided this was consistent with the terms of the employer's vacation and related policies and any applicable employment contracts.

However, because the permissibility of such a mandate is fact-specific, it is advisable to consult local counsel before proceeding with such an approach.

Q: We have exempt employees who are sometimes mandated to work overtime. Can we pay them a straight hourly rate for these hours without losing the exempt status? Can we distinguish between overtime that is mandated or pre-authorized versus overtime that is a normal part of the job?

Under the FLSA, an employee who is properly classified as exempt is not entitled to be paid overtime for hours worked beyond the standard 40-hour workweek.

An employer may, however, pay an exempt employee money in addition to the standard salary for hours worked beyond the typical workweek without jeopardizing the employee's exempt status.

The FLSA regulations provide that such additional compensation may, but need not, be paid as a straight-time hourly amount. Other alternatives for supplemental compensation include a flat sum, a bonus payment, time and one-half, paid time off, or any other basis. 29 C.F.R. § 541.604.

Moreover, the employer retains the ability to set the rate for such additional compensation irrespective of whether the overtime is "mandated," "pre-authorized" or a "normal part of the job."

If you or a member of your team has a question regarding employee pay, please e-mail us at firstplacerightchoice@1stplacemployer.com and a trusted advisor will respond withing 24 hours.

Are Salespeople Entitled to Overtime?

This a great article on the exempt on non-exempt discussion. Entreprenuers who have evolved into the employer role commonly get caught in this kind of trap.

Even if this claim is frivolous, I wonder how many hours the company owner spent dealing with this case? I wonder how much they have paid out in leagl defense fees? I wonder what price the owner would put on their emotional toll a case like this brings on; sleepless nights, stress, tension, fear, concern?

I wonder if this company had the benfit of a professional on his or her business team with insourcing the HR expertise of a professional employer organization brings to the table?

Find the article here:

What circumstances qualify an employee as an outside salesperson who is exempt from overtime?
A federal court sitting in New York State recently reviewed some of the factors.

What happened? A woman worked for the Paul T. Freund Company, a manufacturer of boxes in Palmyra, New York, where she was promoted to the job of salesperson in 2002. In that job, she regularly worked 50 to 60 hours per week, spending 75 percent to 80 percent of her workday working inside the office, and 15 percent to 20 percent of her work day performing tasks and keeping appointments outside of the office, such as making sales calls and periodically meeting with customers at their places of business.

Freund didn't pay her overtime because the company classified her as an outside salesperson. After she left Freund (for undisclosed reasons), she sued for failure to pay her overtime in violation of state and federal law. Freund asked the court to throw the case out at an early stage, without full development of the facts.

See what the court had to say here:
http://hr.blr.com/news.aspx?id=77866

If you or someone you know may have questions regarding exempt and non-exempt status, please drop us an e-mail at:

firstplacerightchoice@1stplacemployer.com

and a trusted advisor will answer your inquiry within 24 hours.