HR can drive health care improvements by 1. designing and purchasing health care plans for their organizations 2.  educating employees and 3. ensuring a healthy and safe work environment.   Employers could provide wellness programs and encourage (incentives) employees to take proactive steps to improve their health status.   Providing a safe and healthy workplace is a must.  HR should double down on their efforts to help employees understand and utilize their health care benefits wisely.   Health care costs go up, premium increases follow, and HR must plan and budget accordingly.  It is inevitable that health care costs will rise given the aging population and the chronic medical conditions, such as diabetes, hypertenision and asthma that are key drivers to increasing costs.   The easy target to criticize is the insurance industry when premiums go up; however, those are cheap shots for political show.  Insurance is a business.  If their rate increases were for profit gouging, then criticize, but insurance profit margins are generally small.  If they are to stay in business, they have to cover their costs.  HR professionals should be constantly diligent for effective health insurance plans that meet the needs of their employees.  Until we have universal, government supplied, health care — employers will be on the front line for providing insurance as part of their compensation packages for employees.  HR — you DO make a difference! 

The State of Iowa is considering making Iowa a weakened Right to Work state.  If the legislature gives unions the right to take non-union worker paychecks it will be a step backward for the State and an unfair penalty to workers who choose to not join a union.    Most (about 75%) Iowa public sector employees do not join the union.  Unions would indeed love to have that money from those workers.  The proposed law has stipulations on how unions can use the money.  But really, how will the State of Iowa and the workers know how the money is funneled and spent once in the hands of the union.  Perhaps a new Auditor position will have to be created and funded by tax payers to monitor this additional bureaucracy. Unions claim that non-union workers are freeloaders.  They are not freeloaders.  They are independent thinking, hard working and responsible workers who are not afraid of their employer.  They don’t value the service of the union and many resent being controlled by the limiting contract.  Many workers prefer to be in charge of their own destiny and they reject the long held tenet of labor unions of everybody being treated the same, regardless of performance.    

Last week a government worker said this to me, “I just quit the union because I was tired of the union not actually doing what the employees wanted; and I’ve never needed the union; and if I ever did find myself in a situation where I needed representation, I’d find myself an attorney – not the union”.   Employees are protected in the workplace by many state and federal laws, including OSHA, Equal Pay Act, The Civil Rights Act title VII, Americans with Disabilities Act, ADEA, FLSA, FMLA, and many more.  Iowa public sector employees also have extra protection against pay discrimination via comparable worth legislation.    

This new proposed legislation would require workers to involuntarily turn over approximately $300 of their earned pay to the union.  This amount is about 85% of union dues.   Is 85% fair and reasonable?    Imagine how it would feel to cough up $300 for nothing or for something you don’t want.  (I actually experienced that feeling while living and working in Minnesota.)  Forced remuneration to a union is the same as forced membership.  Closed union shops were outlawed many years ago.  Workers should not be required to join a union.  Workers should not be required to pay money to a union.    There’s nothing fair about coercion.   If the unions do such a terrific job for their members, employees will see that and join.  Unions should earn their money.  That is the current process and it is a good one.   Politicians should not write laws that force workers to give their pay to unions.  There is nothing fair about that.

The Department of Labor seeks to enact 90 rules and regulations in 2010.  Their aim is to “ensure that workers are paid a fair wage, have a voice in the workplace, are provided a safe workplace and have a secure retirement”.   One regulation would require employers to disclose arrangements made with labor consultants.  I will be paying close attention to that one.   The Wage and Hour Division recently hired 250 new investigators to look at wage and hour issues.  The federal government is hiring!     

Many U.S. employers feared that health benefit cost growth would spike in 2009 as employees, worried about keeping their jobs and health coverage, consumed more health services than usual. In fact 2009 saw the lowest annual increase in a decade, as the average per-employee cost of health benefits rose 5.5 percent to reach $8,945 after four years of increases of just over 6 percent. However, benefit cost growth still outpaced inflation in 2009 by a widening margin, according to an analysis by Mercer, an HR consultancy.

Mercer’s research reveals that:

• U.S. employers held cost growth to 5.5 percent in 2009, the lowest increase in a decade.

• Growth in the use of wellness or health management programs accelerated as large employers looked to hold down cost without cost-shifting.

• Small employers added consumer-directed health plans in 2009, helping to push up enrollment in these high-deductible plans to 9 percent of all covered employees.

Similar cost growth is expected in 2010, according to Mercer’s National Survey of Employer-Sponsored Health Plans. Employers predicted that medical plan cost would rise by about 9 percent in 2010 if they simply renewed their current plans without making any changes. However, they hope to achieve about a 6 percent increase after making changes to plan design or changing plan vendors.

 Information supplied by the Society for Human Resource Management.

Last year the Congress, Treasury and the Federal Reserve took unprecedented steps to shore up the financial industry.  With that came unprecedented government oversight.  Statutory limitations on executive compensation at companies receiving direct assistance were enacted.  Regulations have been released to expand the oversights to cover all compensation arrangements (not just executives) at nearly 7,000 banking organizations.  In the past, regulators have mandated bank governance to ensure safety and soundness only when organizations were in trouble.  Now the focus has changed to proactive and sweeping mandates. 

Creating and managing a principled compensation program that rewards desired behaviors and outcomes and offers market-driven compensation levels to attract and retain talent should be the responsibility of an organization not the federal government.  Federal mandates satisfy the needs of small thinkers to be consistent and treat all entities and all people the same.  This is the road to mediocrity, stagnation, malaise and eventual failure. 

The pendulum is swinging left. 

Tonight we hear from the President.  We’ve heard a lot about the various provisions — but what about effective dates?  According to attorneys advising the Society for Human Resource Management, we could expect perhaps the proposed mandate that individuals obtain health care insurance or pay a tax penalty might take effect in 2010.  The “pay or play” provisions for employers might not take effect until 2013.  Time would be required to set up the exchanges or gateways or the controversial federal public plan.  Time will be needed for states to enact insurance legislation.  An immediate change would be the extension of COBRA beyond 18 months to 36 months for those who are laid off or meet other qualifying circumstances.   We shall see if reform can result in affordable and accessible coverage and reduced health care spending, without endangering employer provided health insurance.

All the discussion about “we must reduce costs” is more hype than reality.  As a genetically produced “cost cutter” — it is in my blood and a former industrial engineer — I don’t think it is realistic to pretend that costs will go down.  We can always keep costs in check and be efficient, but go down – no.  I know with the increasing of the older population (us boomers) and the wonderful advancements in medical research and applications –  there will be NO bending of the cost curve.   It is a cost / expense that is worthy of being paid and we must budget and plan for it and not lie about it.  We’re not ostriches. 

And, one last thing — kudos to ALL the health care professionals who take care of us!  

The Employment Standards Administration is being eliminated from the Department of Labor.  The OFCCP will be elevated.  The newly appointed head of the OFCCP is Patricia Shiu.  Because of the reorganization, Shiu may have to go before Senate confirmation hearings.  In the meantime, employers can expect a more aggressive OFCCP under Shiu’s leadership.  Shiu, according to the SHRM News Release, has zealously advocated for women’s rights in the workplace and helped draft legislation that led to the enactment of the California Paid Family Leave Act. 

Many people believe that legislation already exists to protect gays and lesbians from discrimination in the workplace.  Not the case.  However, most employers and many states already do have formal policies and laws protecting against discrimination based on sexual orientation.   So the pending ENDA legislation will not drastically alter the workplace practices in America.  Hopefully Republicans and Conservative Democrats won’t try to grandstand and vote NO for this legislation.  The Employment Non-Discrimination Act (ENDA) has a good chance of being enacted into law and there is bipartisan support.  The pending law, as now written, exempts the military and religious organizations and does not require employers to provide benefits to domestic partners of their employees.   However, again, many employers already do offer medical insurance coverage for domestic partners and have done so for many years.  Including Walmart!  So the legislation needs to be passed to reflect the world of work realities and to protect anyone who could be discriminated against because of their sexual orientation.  

Bottom Line:  the new law will not drastically alter the existing workplace landscape — it will reflect what employers are already doing.     

Over the past year employers have frozen salaries, reduced pay, cut back on benefits and administered RIFs.  But very recent surveys show that employers are back on track and rewarding employees accordingly.  A Mercer study showed that 67% of employers expect to increase base pay and salary budgets are projected to be 3.2% higher overall.   Different regions and industries have differing practices.  An interesting insight:  ”as a result of the economic downturn and current labor market conditions, organizations are moving away from pay based on market competitiveness, instead focusing on internal affordability”.    Good idea!

Organizations need to consider many, but four main, factors in determining their compensation levels and practices:  1.  Performance — of the individual, team and organization; 2.  Internal equity — people doing similar work with similar qualifications need similar pay (it’s the law!); — 3.  External competitiveness — don’t stray too far away from the market or you’ll have trouble recruiting and retaining; 4.  and, as the study discovered, the ability of the organization to pay.  

If the company is struggling, not profitable, or the market is squishy  – employers should not enter into long term contracts promising higher pay and expensive benefits. 

The successful employee pay formula:  1.   rewards performance, 2.  is fundamentally fair and immaculately legal, 3.  recognizes external market conditions and 4.  is prudent and practical based on their own ability to pay.

(The statistics from the Mercy study are from an article by Stephen Miller from SHRM.)

To get help setting up a Successful Pay Plan with the Four Square Legs — call Karla at Wright Consulting.       

Handbooks that read like a legal document can do more harm than good.  When employees are treated like “the enemy” they may feel and even become adversarial.  Handbooks do need to pass minimal legal standards but handbooks with too many “do nots”, legal words and disclaimers set a negative tone and do not build a positive and trusting relationship.

Begin the handbook with a welcoming statement to build a positive culture.  Keep legalistic words (such as:  whereas and forthwith and furthermore) out of the handbook.  Instead of listing all the do nots, describe the expectations and what ”to do”.  For any list of “do nots” there will always be another behavior, not on the list, that will inevitably surface, making the ”do not” list moot (sorry for the legal term).  Carefully choose words to avoid the “we vs them” culture. 

There should be clearly stated expectations against harassment and discrimination and also established steps to follow.  Good guidelines exist for this language.  However, the policy and procedures against harassment and discrimination should be kept in perspective.  Handbooks with many pages dedicated to this subject send the message “wow, this company has a problem”.  Be clear, be concise, be legal, be kind. 

Be careful when adding new wording for new laws.  A hastily slapped together and lengthy policy will stand out like a sore thumb and gives an impression that this is the MOST important policy.  Weave new policy generated by new laws in with other policies and practices. 

Supervisors like lists of actions subject to discipline; and they mistakenly think it will make their job easier.  It won’t.  Resist the list! 

Finally, don’t say you’re going to do something and then not do it.  If in doubt, leave it out.   Use words like “intend” or “may” to allow flexibility.  Arbitrary inconsistencies are bad, but the reality is there will always be the need for exceptions and flexibility.  Don’t mistake treating everyone exactly the same, regardless of circumstances, with fairness.  Fairness requires discernment and judgement.  Hard and fast rules with no room for recognizing the exception lead to trouble more often than not.  Managing from the heart will result in fairness; managing from the book will result in losing the good employees.  The fair manager will eventually have to say “no” to one to be fair to all.    

Contracts do have their place when two parties do not trust each other or do not know each other.  The handbook should be a communication tool that sets expectations, estalishes positive relations and builds trust.

The rule of thumb is for every fifty words of policy, there is one loophole.  So don’t try to build the perfect document with MORE words.  Build a document that sets standards and expectations, gives good guidelines and practical steps and information, sets a tone for a positive, respectful working environment for all and treats adults as adults — not felons or children.   

Bottom line, edit your handbooks for tone as well as for words.  Would an employee read the document and feel like a team member or would an employee read the document and feel like they need a lawyer?      

Employees are worried.  They are worried about losing their jobs, personal finances, retirement investments and paying their bills.  Visits to EAPs (Employee Assistance Programs) are up.  Much of the stress is caused by the fear of the unknown.  Employers can help ease those fears by providing as much information as possible about the status of the business.  Employers should take extra care in assigning work to be sure that employees are not receiving unbearable work loads and deadline pressures.  Employers must be sure that employees know the expectations for performance and production.  Communicate, communicate, communicate.  

Workplace stress causes employee health disorders and increased accidents and mistakes at work.  Stress-related dysfunctional behaviors cause anxiety among coworkers resulting in disciplinary action, lowered productivity, contagious discontent among the workforce, and even violence.  These are high costs for employees and employers.

When practical, employers should consider offering additional self-care training and work life balancing seminars.  Perhaps some much needed downtime and fun get-togethers could help.  Offering alternative and flexible work schedules and offering an “extra” paid holiday to just ease the load and tension and show appreciation could be tried.  Communication is always key though to ensure employees know what the company is planning and the realities.  A company blog with employee feedback allows information to flow both ways.   

EAPs have been shown to be a worthwhile investment for employers.  In today’s uncertain climate, employees can seek assistance through EAPs for not only behavioral health issues but also for seeking financial, family counseling, stress mitigation support, improved work life balancing and planning and learning to deal with uncertainty. 

Many of the above ideas came from SHRM News.   

This is a book worth reading.  Our busy schedules and obsession with the economic downturn squeezes out reflective time we should take.  Randy Pausch was diagnosed with incurable cancer and set out to leave a legacy for his children.  He used the idea of “The Last Lecture” to portray his vision of happiness and fulfillment while alive.  I often use Maslow’s Hierachy of Needs to explain and understand human behavior and motives in the workplace, and this book demonstrates how those needs surface throughout and at the end of life.  Over a half million people die every year of cancer and many diagnosed with the disease right now are figuring out how they want to spend their finite days.  Our finite days become richer and fuller when we know they are fewer.   We put the real priorities ahead of the trivial troubles.  Moral of this story for me is to live each day as though it is my last.  If we don’t think we’ll be around to ask for forgiveness — then let’s not do the thing that requires forgiveness in the first place.   Thanks for reminding me, Randy.    

Yesterday is history

Tomorrow is a mystery

Today is a gift

That’s why it’s called the present.

A large majority of Iowans, 66%, are opposed to the so-called “fair share” legislation that requires employees to pay union dues and fees even if they do not join the union.  A recent poll conducted for the Des Moines Register by Selzer and Company, Inc. found that 66% of Iowans are opposed to the concept of “allowing unions to charge nonunion employees for union services”. 

The majority of Iowa workers also believe they are treated reasonably by their employers.  When asked if employers have too much power over workers and take unfair advantage of workers, 62% of the respondents said no. 

Lack of trust between employers and employees creates the need for workers to join labor unions.   It appears that in Iowa the employer - employee relationship is positive and trusting. 

Employers who DO take unfair advantage of employees will find themselves without a qualified workforce — the workers will go elsewhere where they are treated with respect.  There is NO competitive advantage to mistreat employees.  Maybe in the short term a few bucks are saved or something, but in the long term the economic advantage goes to the employers who do the right thing. 

Treating employees with respect is good business.  Looks like Iowa businesses are doing the right thing.

Wright Consulting helps employers do the right thing through their Workplace Harmony initiatives. 

Survey data taken from Des Moines Register, April 5, 2009 

The six pillars within the Character Counts program have never been so important to employees and employers as today in these uncharted and choppy business waters.  A recent SHRM-sponsored study discovered the most egregious misconduct witnessed by HR professionals was abusive and intimidating behavior by other employees.  According to Federal Sentencing Guidelines for Organizations (FSGO) seven elements are important to a complete ethics and compliance program.   Employers:  check it out!  Did you know that the Character Counts program used within your kids’ schools also has a program for use within your business.  In Iowa, contact The Drake Center for Character Counts .    The six pillars of character are:

Trustworthiness — encompasses honesty, integrity, reliability and loyalty.  Being trustworthy means keeping promises and doing one’s best not to deceive, even with white lies or statements that one migh defend as “technically true.”

Respect — The golden rule of treating others as you wish to be treated applies.  Be courteous, listen to others, and accept (don’t have to agree) differences.

Responsibility — Accountability, self-control and the pursuit of excellence.  We MUST get back to these qualities.  Also, being responsible means we must carefully consider the consequences of our choices BEFORE we make them.  Harsh words spoken can’t be taken back.  You can’t unrin a bell. 

Fairness — Playing by the rules and not taking advantage of others is fairness.  A fair person makes informed judgments without prejudice and does not blame others.

 Caring — Kindness, compassion, altruism — these are the heart of ethics.  Of course some ethical decisions inevitably cause pain, but the caring person acts to minimize hardship and to help others whenever possible.

Citizenship — Good citizens work to make their homes, businesses, jobs, associations and environment a better place.  We American citizens use the democratic process.  Good citizens know how their government works, know the laws that impact them and seek information to understand issues. 

The six pillars are so fundamental and yet so often abandoned when times are tough, people are nervous, change is everywhere and others are not treating you the way you want to be treated. 

Employees and employers will be better if the six pillars of character are sustained.    

Above information taken from:  SHRM Business Ethics Survey, Aliah Wright, SHRM Online’s Ethics and Sustainability Focus Area  

Discrimination claims filed with the EEOC jumped 15 percent in 2008 to 95,402 — the highest level since the agency opened in 1965, said spokesman David Grinberg.  Age discrimination charges were up 29 percent.  Preliminary figures to be released by the EEOC this week show that claims of age discrimination saw the biggest jump last year to 24,582.  Retaliation claims (where employees believe they were fired or demoted based on their complaints or bias or other issues) saw the second-largest increase.  Grinberg said “It’s possible we have yet to see the full impact of the recession on discrimination charge filings as the economy continues to spiral downward since fiscal year 2008″.  He predicts that job bias cases may swell to more than 100,000. 

The category with the largest number of complaints was race, followed by retaliation, sex, age, disability, national origin, religion and equal pay act.

The Lilly Ledbetter Fair Pay Act removed the “statute of limitations” or time limit for claiming pay discrimiantion.  As that possibility becomes fully understood, the number of complaints could rise even more. 

What can employers do?  They should continue to follow both the spirit and the letter of the fair employment laws — as always.  When layoff, demotion, pay decrease, job changes, training opportunities and termination decisions are made — make sure illegal criteria are not used to make these decisions that impact employees.   Audit practices and outcomes to be sure unintentional discrimination does not exist. 

(above data from SHRM.org website– contributors: Tahminicioglu and Grinberg) 

This legislation is sneaky and misleading.  The name says “free choice” but it is not.  It takes away the long held process of using both card checks and the private voting ballot for workers to decide if they want a third party — a labor union — to represent them to their employer.   This legislation called the “free choice” act is anything but a “free choice”.   It would take away the fundamental right of privacy.  Individuals should feel comfortable deciding the important question of whether or not to have a third party represent them — and they should be free from intentional or unintentional intimidation.    Most workers are opting out of a union work environment, believing unions limit their full potential and constrain their pay and upward mobility. 

Unions have served a good purpose in our work world in the past, and some still do provide useful standards and functions.  We have no reason to pass this unneeded legislation.

We are dangerously close to having this legislation.  Employer and employee apathy will result in passage of this legislation.    The National Labor Relations Act established the foundations for union organizing and it has served us well.  We should not change the process.   Currently private ballot elections are administered by the National Labor Relations Board after a union has acquired at least 30% of the covered workers’ authorization cards to hold an election.   The Board certifies the union as the official bargaining representative of the workers in the majority of votes during the secret ballot election are in favor of the union. 

This process works.  The Employee Free Choice Act, sponsored by Senator Edward Kennedy would amend the NLRA to allow unions to be certified after only the use of the “card check” process with NO voting ballot.    The non secret nature could lead to employees feeling pressured by co-workers or union organizers.  We need to keep the private voting ballot process. 

I hope this legislation is not railroaded through but I fear the tide is strong and it will be the law of our workplace land soon. 

It appears employed Americans are no more or less likely to be looking for a new job in 2009 than they were in 2008, according to a recent survet conducted by Ipsos Public Affairs and published by SHRM.  The assumption is that workers would not want to leave the security of a paycheck for the unknown of a new job.  However 26 percent of employed Americans indicated their intention to put out their resumes in 2009.  Reasons for leaving jobs in the past have been more job quality reasons.  Now most are motivated by the meat and potato issues of money and security.   “Nearly four in 10 workers (37 percent) said the number one reason to look for a different job is money. Meanwhile, 19 percent of these workers think that they are in danger of being laid off, and another 11 percent are hoping the grass is greener with another employer because they are unhappy at their current job.  29 percent of hourly workers said they will be on the job hunt, which is down 2 percentage points from 2008. More money is the top reason 44 percent of hourly workers will be looking for new employment.  22 percent of salaried workers plan to find a new job, up 3 percentage points.  Three in 10 of these salaried workers are most motivated to find a new job because they fear being laid off.  An additional 26 percent need a new job in order to make more money.  Older workers are more likely to be on the job hunt than they were a year earlier.  Of those respondents who are at least 55 years old, 13 percent said they will be looking for a new job, which is up 5 percentage points. The need to make more money is the top factor for 42 percent of this group; an additional 18 percent said they will need a new job because they plan on relocating to a different area.  Fourteen percent of this group felt they are in danger of being laid off.”  Some did express concerns about the economy and labor market as motivators to stay where they are.  “Nearly one in five workers (17 percent) said they consider themselves fortunate to have the job they do; 7 percent said that times are tough and it’s not a good time to be looking for work.”

Employers should not shrink from their workplace harmony strategies.  This is not a time for employers to think less about their work life balance issues and quality of workplace factors.  Employees can still leave employers and will.  The recession has definitely changed employer and employee perspectives about job security but the same motivators for job change exist although the percentages are shifting.  Employers should not neglect their recruitment and retention strategies because the unemployment rate is higher.

  statistics from article by Theresa Minton-Eversole at SHRM.org

The Lilly Ledbetter Fair Pay Act of 2009 amends the Civil Rights Act of 1964, Americans with Disabilites Act of 1990 and Age Discrimination Act of 1967 to declare that an unlawful employment practice occurs when: (1) a discriminatory compensation decision or other practice is adopted; (2) an individual becomes subject to the decision or practice; or (3) an individual is affected by application of the decision or practice, including each time wages, benefits, or other compensation is paid. This law allows recovery of back pay, for up to two years preceding the filing of the charge.  This back pay provision is what many HR practitioners and lawmakers objected to.  The analysis, discovery and finding of factors that determine pay decisions from the past will be a serious challenge for employers. 

 The Senate and House have approved this legislation and is expected to be signed soon by President Obama. 

This legislation will not change the way responsible employers compensate employees but it will mean HR will need to audit the compensation decision documentation and make sure it is clear and accessible.  Perhaps a review of compensation forms should be on HR’s long list of things to do in 2009.   

 Other looming pay related legislation:  The Paycheck Fairness Act and The Fair Pay Act which addresses equal pay for comparable skill, effort, responsibility and working conditions.  Comparable worth was a big topic in the 80’s and requires employers to establish a structured job evaluation system to measure job worth to determine comparability.  This is different than equal pay for equal work which is already the law of the land since 1963.   Currently The Fair Pay Act is “dead” but I’m watching for its resurrection.    

“Say on Pay” is a movement and pending legislation that allows shareholders to have a “non-binding” vote on the pay levels of company officials / executives.  The executive compensation for corporation executives has gotten out of line.  Some CEOs make 262 times more than a typical worker in their organization.  Here’s the question though — who should decide how much is too much?  The board of directors who are voted in by the shareholders or the government?  CEO pay is out of whack but eventually corporations will get it adjusted.  The pendulum will swing back if the market is allowed to adjust normally.  Proposed legislation on the issue of executive pay is a slippery slope.  What would the government want to regulate next?   

The recent raid in Postville, Iowa, resulted in hundreds of undocumented (illegal) workers and their families to be rounded up, handcuffed and herded into detainee centers.  A very sad situation.  Employers and our elected officials MUST develop a method to verify employment eligibility.  Congress is considering using the “E-Verify” system which is a make-shift and unreliable system.  A better approach is NEVA “New Employee Verification Act”, H.R. 5515.  The lynchpin for true immigration reform is Employment Verification.  Under the H.R. 5515 bill, employers would use the state “new hire” reporting process which is currently utilized for child support enforcement to confirm the work eligibility of new hires.  The Social Security Administration database would be used for U.S. citizens and the Department of Homeland Security (DHS) database would be used for non-U.S. citizens.  The bill would also create a voluntary biometrics option that employers could choose to use.  Susan R. Meisinger, CEO of SHRM, is working with U.S. legislators for a more secure, accurate, and reliable system.  Hopefully, someday soon, the sad images of workers in handcuffs will be only in the history books and no longer on the front page of newspapers.