DOL issues finalized overtime regulation

The Department of Labor (DOL) released a new, finalized overtime rule recently. This new rule raises the minimum salary level to $35,568 per year for a full-year worker to earn overtime wages. Read this blog post from Employee Benefit News to learn more about this new rule.


The DOL on Tuesday released its highly anticipated finalized overtime rule, raising the minimum salary level to $35,568 per year for a full-year worker to earn overtime wages.

“Today’s rule is a thoughtful product informed by public comment, listening sessions and long-standing calculations,” Wage and Hour Division Administrator Cheryl Stanton says in a statement. “The DOL’s wage and hour division now turns to help employers comply and ensure that workers will be receiving their overtime pay.”

The final rule, effective Jan. 1, 2020, updates the earnings thresholds necessary to exempt executive, administrative or professional employees from the FLSA’s minimum wage and overtime pay requirements, and allows employers to count a portion of certain bonuses (and commissions) toward meeting the salary level.

The new thresholds account for growth in employee earnings since the currently enforced thresholds were set in 2004. In the final rule, the department is:

  • Raising the standard salary level from the currently enforced level of $455 to $684 per week (equivalent to $35,568 per year for a full-year worker);
  • Raising the total annual compensation level for highly compensated employees from the currently-enforced level of $100,000 to $107,432 per year;
  • Allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10% of the standard salary level, in recognition of evolving pay practices; and
  • Revising the special salary levels for workers in U.S. territories and in the motion picture industry.

This finalized rule is a shift from the previous administration's proposed rule, which would have doubled the salary threshold.

Under the Obama administration, the Labor Department in 2016 raised the minimum salary to roughly $47,000, extending mandatory overtime pay to nearly 4 million U.S. employees. But the following year, a federal judge in Texas ruled that the ceiling was set so high that it could sweep in some management workers who are supposed to be exempt from overtime pay protections. Business groups and 21 Republican-led states then sued, challenging the rule.

The overturning of the 2016 rule that increased the salary level from the 2004 level has created a lot of uncertainty, says Susan Harthill, a partner with Morgan Lewis. The best way to create certainty is to issue a new regulation, which is what the administration's done, Harthill adds.

While the final rule largely tracks the draft, there are two changes that should be noted: the salary level is $5 higher and the highly compensated employee salary level is dramatically reduced from the proposed level, she says.

“This is an effort to find a middle ground, and while it may be challenged by either or maybe both sides, the DOL’s salary test sets a clear dividing line between employees who must be paid overtime if they work more than 40 hours per week and employees whose eligibility for overtime varies based on their job duties,” Harthill adds.

The DOL estimates 1.3 million employees could now be eligible for overtime pay under this rule (employees who earn between $23,600 and $35,368 no longer qualify for the exemption).

A majority of business groups were critical of Obama’s overtime rule, citing the burdens it placed particularly on small businesses that would be forced to roll out new systems for tracking hours, recordkeeping and reporting.

SHRM, for example, expressed it's opposition to the rule, noting it would have fundamentally changed the rules for employee classification, dramatically increased the salary under which employees are eligible for overtime and provided for automatic increases in the salary level without employer input.

“Today’s announcement finalizing DOL’s overtime rule provides much-needed clarity for workplaces," SHRM says in a statement. "This rule marks the first increase to the salary threshold since 2004 and gives employers more flexibility to plan for the future. We appreciate DOL’s willingness to work with SHRM, other organizations and America’s workers to enact an overtime rule that benefits both employers and their employees.”

But the finalized rule still will have implications for employers.

“Education and health services, wholesale and retail trade, and professional and business services, are the most impacted industries, according to DOL, but all industries are potentially impacted,” Harthill, also former DOL deputy solicitor of labor for national operations, adds. “Also often overlooked is the impact on nonprofits and state and local governments, which are subject to the FLSA and often have lower salaries.”

All companies should be taking a close look at their employees to make sure workers are properly classified, but what they do after that will depend entirely on individual business needs, she says. “Some will hire additional employees to reduce the amount of overtime, while others will just pay overtime if their workers in this salary bracket spend more than 40 hours a week on the job.”

Employers who haven’t already reviewed their exempt workforce should do so now, before the Jan. 1 effective date, Harthill advises.

“They can opt to pay overtime, raise salary levels above $35,368, or review and tighten policies to ensure employees do not work more than 40 hours per week,” she says. “There could be job positions that need to be reclassified and that might have a knock-on effect for employees who earn above the new salary level.”

Many employers increased their salaries when DOL issued the 2016 rule, and some states have higher salary levels, so not all businesses will need to make an adjustment. “But even those employers should review their highly compensated employees — they may still be exempt even if they earn less than $107,432 but the analysis will be more complicated,” she adds.

“We did not hear any objections from employers when these rules were initially proposed," adds Jason Hammersla, vice president of communications at the American Benefits Council. "That said, aside from the obvious compensation and payroll tax implications, this rulemaking is significant for employers who include overtime compensation in the formula for retirement plan contributions as it could increase any required employer contributions."

"The change could also affect plans that exclude overtime pay from the plan’s definition of compensation if the new overtime pay causes the plan to become discriminatory in favor of highly compensated employees," he adds.

SOURCE: Otto, N. (24 September 2019) "DOL issues finalized overtime regulation" (Web Blog Post). Retrieved from https://www.benefitnews.com/news/dol-issues-finalized-overtime-regulation


U.S. Jobs Increase by 130,000 in August

The Bureau of Labor Statistics (BLS) recently released a report showing that U.S. employers added 130,000 jobs this past August. The report also showed that the unemployment rate stayed unchanged at 3.7 percent for the third month in a row. Continue reading this blog post from SHRM to learn more.


U.S. employers added 130,000 jobs in August, coming in below economists' expectations, and the unemployment rate held at 3.7 percent for the third straight month, according to the latest Bureau of Labor Statistics (BLS) report.

July's employment total was revised down from 164,000 new jobs to 159,000. In the past three months, job gains averaged 156,000 a month after revisions.

"Today's jobs report shows slowing private-sector job growth and slowing wage growth, which—while expected this late in the recovery—is somewhat disappointing after the rapid gains of the past two years," said Julia Pollak, a labor economist at employment marketplace ZipRecruiter.

On Sept. 5, the ADP Research Institute and Moody's Analytics reported private-sector growth of 195,000 new jobs, better than economists' expectations of about 160,000 jobs.

"Despite the slower growth in jobs added, labor force participation did perk up, a sign that the healthy labor market is still drawing in workers from the sidelines," said Glassdoor senior economist Daniel Zhao.

The labor force participation rate—which includes people who are working and those looking for work—ticked up to 63.2 percent, one of its highest readings in years. The proportion of the population currently employed is at 60.9 percent, its highest point since December 2008. And the employment-to-population ratio for workers aged 25-54 reached 80 percent for the first time since January 2008.

Zhao said that the increases signal that the tightness of the labor market is putting upward pressure on labor force participation despite an aging population pulling it down.

Michael Stull, senior vice president at the staffing and recruiting firm Manpower North America, said other positive takeaways from the report are better than expected wage growth and strong hiring in the professional and business, financial and health care sectors.

Job gains in August were led by professional and business services (37,000 new jobs), which includes many technology jobs and the nation's booming health care industry (23,900). Other industries showing gains include finance (15,000) and construction (14,000).

"Health care and professional services have both grown strongly across 2019, carrying the labor market despite weakness in the goods-producing sectors," Zhao said. "Additionally, the increase in temporary help services [15,400 jobs] is a good sign that employers are not cutting back on the most flexible parts of their workforces in the face of recession chatter."

However, Pollak noted that the BLS reported that the private sector only added 96,000 jobs, marking a slowdown from the pace of job growth over the last two years.

Industries like mining and manufacturing are struggling. Mining employment fell by 5,600 jobs and manufacturers have seen a marked slowdown in job creation, with only 3,000 jobs added in August. "In 2018, manufacturing job growth exceeded 10,000 jobs in 11 of 12 months, but this year job growth has been below 10,000 or even negative in six of eight months," Pollak said. "Trade policy uncertainty and a global manufacturing slowdown seem to have brought the 2017-2018 manufacturing boom to a halt."

The retail sector lost 11,000 jobs in August, continuing a trend of month-over-month declines for the seventh consecutive month. "Despite strong consumer spending, increasing labor costs and the rise of e-commerce are keeping retail hiring down even as we begin to enter the holiday hiring season," Zhao said. "We'll be watching the next few reports for signs that the holiday retail hiring season has slowed or that the latest round of tariffs are having a larger effect on the retail industry."

Juiced by Census Hires

U.S. jobs data is now—and will for some time be—inflated by a temporary spike in government hiring for 2020 Census workers. The federal government added 28,000 workers (excluding U.S. Post Office hires) to its payrolls in August. The majority of those—25,000 temporary workers—will go door-to-door over the next several weeks to verify addresses ahead of the 2020 count.

The Census Bureau expects to hire about 40,000 people for this preliminary duty and about 500,000 workers next year for the actual canvassing.

Unemployment Stays Low

The BLS data showed that the national unemployment rate remained below 4 percent for the 18th consecutive month. The number of unemployed people held at 6 million.

"The unemployment rate remains near its lowest level in 50 years, again signaling the strength of the labor market for workers as the number of job openings continues to exceed the number of unemployed workers," Zhao said.

The number of long-term unemployed (those jobless for 27 weeks or more) rose from 1.1 million to 1.2 million in August and accounted for 20.6 percent of the unemployed.

The U-6 unemployment rate—a broader measure capturing both the unemployed, underemployed and those too discouraged to seek work—continued its long decline and held at 7.3 percent for the second month in a row. There were 467,000 discouraged workers in August, about the same as a year ago.

"There are still more discouraged workers than we would expect, given the low unemployment rate," Pollak said. "Discouraged workers are those who are out of work but have not applied for a job in the past four weeks because they think there are none available or none for which they qualify," she explained. "If there were fewer discouraged workers, labor force participation and employment rates would be higher, and more vacancies would be filled."

Wages Inch Up

Average hourly earnings increased 11 cents to $28.11, following 9-cent gains in both June and July. Over the past 12 months, average hourly earnings have increased by 3.2 percent.

"At this point in the expansion, we'd expect wage growth to pick up, but it is continuing to stall," said Nick Bunker, a Washington, D.C.-based economist at the Indeed Hiring Lab. "Wage growth continues to be strongest for workers in lower-wage industries."

SOURCE: Maurer, R. (06 September 2019) "US Jobs increase by 130,000 in August" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/bls-hr-jobs-unemployment-august-2019.aspx


Putting Humanity into HR Compliance: Stop Tolerating Toxicity

Toxic workplace relationships impact not only the employee and their well-being but also organizational success and the well-being of employees' family members. HR departments who have a detox mission and address toxic workplace relationships can prove incredibly valuable to their organizations. Read this blog post to learn more.


In my prior career as an employment attorney and in my current one as an organizational consultant and coach, I have encountered numerous toxic workplace relationships. The cost of these relationships—to organizational success, employee well-being and the well-being of employees' family members—is astronomical.

And the greatest tragedy is this: Almost all of this loss, pain and suffering is preventable.

Why are toxic workplace relationships so common? And why are they tolerated?

The answer to the first question is that good people make bad decisions. Typically, employee relationships start out fine. Employees cooperate and collaborate in their relationships with their bosses and peers.

But then something goes awry. A trust gap opens. The employee does not address the problem promptly, directly and constructively, but the employees' avoidance instinct kicks in. Nothing constructive is done to close the trust gap. As a result, the problem festers and grows. Eventually, any remaining trust evaporates, and the relationship degenerates into aggression, passive aggression or both.

Note that I'm not talking about the incorrigible "work jerk," whose behavior should never be tolerated. Rather, I'm talking about people stuck in toxic work relationships producing jerkish and other negative behavior.

Managers and HR practitioners succumb to the avoidance instinct, too. Although aware of the toxicity, they don't intervene and are wary of wading into others' dysfunctional relationships.

What are the costs of tolerating toxicity?

  • Personal suffering. The immediate parties may think they have nothing in common, but they do: They're equally disengaged and miserable.
  • Work loss. Toxic relationships do nothing to improve the quantity or quality of work, customer service or on-the-job innovation. There is increased absenteeism and what Colleen McManus, SHRM-SCP, an HR executive with the state of Arizona, calls "presenteeism," in which people are at work but not focused on work, dwelling on negativity instead of doing their jobs properly.
  • Secondhand anxiety. Co-workers who witness the toxic behavior suffer, as does their contribution to the organization. They are the truly innocent victims.
  • Collateral damage. Employees affected by workplace toxicity typically bring their stress home. This doesn't reduce their stress; rather, it elevates their loved ones' stress. "So true! In the most serious situations," McManus said, "I have seen greater instances of alcoholism and domestic violence due to problems at work."

How HR Can Help

HR departments with a detox mission can prove incredibly valuable to their organizations and the people in them. It's not hard to identify toxic relationships. The challenge is taking action.

I can say with confidence that intervention is always better than tolerating toxicity. You'd be surprised how easily many toxic relationships can be reset when a skilled third party steps in. HR professionals are ideally positioned to help employees stuck in toxic relationships get back on track. Or, if there's too much baggage, HR professionals can facilitate a respectful relocation of the parties to different positions in the organization. This method is a good way to start.

Many times, a toxic relationship is rooted in an unwitting and unaddressed offense one employee gave the other. As a result, the offended party started behaving differently toward the offender, which produced more offensive behavior, and so on. "I'm always surprised," McManus said, "when I ask the parties to the conflict what a resolution looks like. Often, it's simply an opportunity to be heard."

She adds that a sincere apology goes a long way toward rebuilding trust. "They feel validated, which is important to them."

Sometimes there's a structural misfit in the workers' roles that needs to be clarified, or how the jobs interact needs to be modified. HR can help figure out how the jobs can function without recurrent friction. "This is our profession's bread and butter!" McManus said.

There may be a personality conflict, in which case the parties need better understanding of how to interact with people whose styles differ from theirs. If that can't be achieved, though, there can be an agreement to disagree and respectfully move on—whether to a different position inside or outside the organization.

An HR team that makes a commitment to identify and resolve toxic relationships is empowered by the CEO, and is supported by the leadership team will prove to be incredibly valuable to its organization and the people in it. HR team members can directly coach others to resolve conflicts and show managers how to coach their employees who are stuck in toxic relationships.

There's also a risk management, compliance and claim-prevention component. In my employment lawyer days, most of my billable hours arose from conflict caused by toxic workplace relationships. An HR profession with a detox mission will become painfully costly to my former profession.

SOURCE: Janove, J. (Sept 06, 2019) "Putting Humanity into HR Compliance: Stop Tolerating Toxicity" (Web Blog Post) Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/employee-relations/pages/putting-humanity-into-hr-compliance-stop-tolerating-toxicity-.aspx

The answer to the first question is that good people make bad decisions. Typically, employee relationships start out fine. Employees cooperate and collaborate in their relationships with their bosses and peers.

But then something goes awry. A trust gap opens. The employee does not address the problem promptly, directly and constructively, but the employees' avoidance instinct kicks in. Nothing constructive is done to close the trust gap. As a result, the problem festers and grows. Eventually, any remaining trust evaporates, and the relationship degenerates into aggression, passive aggression or both.

Note that I'm not talking about the incorrigible "work jerk," whose behavior should never be tolerated. Rather, I'm talking about people stuck in toxic work relationships producing jerkish and other negative behavior.

Managers and HR practitioners succumb to the avoidance instinct, too. Although aware of the toxicity, they don't intervene and are wary of wading into others' dysfunctional relationships.

What are the costs of tolerating toxicity?

  • Personal suffering. The immediate parties may think they have nothing in common, but they do: They're equally disengaged and miserable.
  • Work loss. Toxic relationships do nothing to improve the quantity or quality of work, customer service or on-the-job innovation. There is increased absenteeism and what Colleen McManus, SHRM-SCP, an HR executive with the state of Arizona, calls "presenteeism," in which people are at work but not focused on work, dwelling on negativity instead of doing their jobs properly.
  • Secondhand anxiety. Co-workers who witness the toxic behavior suffer, as does their contribution to the organization. They are the truly innocent victims.
  • Collateral damage. Employees affected by workplace toxicity typically bring their stress home. This doesn't reduce their stress; rather, it elevates their loved ones' stress. "So true! In the most serious situations," McManus said, "I have seen greater instances of alcoholism and domestic violence due to problems at work."

How HR Can Help

HR departments with a detox mission can prove incredibly valuable to their organizations and the people in them. It's not hard to identify toxic relationships. The challenge is taking action.

I can say with confidence that intervention is always better than tolerating toxicity. You'd be surprised how easily many toxic relationships can be reset when a skilled third party steps in. HR professionals are ideally positioned to help employees stuck in toxic relationships get back on track. Or, if there's too much baggage, HR professionals can facilitate a respectful relocation of the parties to different positions in the organization. This method is a good way to start.

Many times, a toxic relationship is rooted in an unwitting and unaddressed offense one employee gave the other. As a result, the offended party started behaving differently toward the offender, which produced more offensive behavior, and so on. "I'm always surprised," McManus said, "when I ask the parties to the conflict what a resolution looks like. Often, it's simply an opportunity to be heard."

She adds that a sincere apology goes a long way toward rebuilding trust. "They feel validated, which is important to them."

Sometimes there's a structural misfit in the workers' roles that needs to be clarified, or how the jobs interact needs to be modified. HR can help figure out how the jobs can function without recurrent friction. "This is our profession's bread and butter!" McManus said.

There may be a personality conflict, in which case the parties need better understanding of how to interact with people whose styles differ from theirs. If that can't be achieved, though, there can be an agreement to disagree and respectfully move on—whether to a different position inside or outside the organization.

An HR team that makes a commitment to identify and resolve toxic relationships is empowered by the CEO, and is supported by the leadership team will prove to be incredibly valuable to its organization and the people in it. HR team members can directly coach others to resolve conflicts and show managers how to coach their employees who are stuck in toxic relationships.

There's also a risk management, compliance and claim-prevention component. In my employment lawyer days, most of my billable hours arose from conflict caused by toxic workplace relationships. An HR profession with a detox mission will become painfully costly to my former profession.

SOURCE: Janove, J. (Sept 06, 2019) "Putting Humanity into HR Compliance: Stop Tolerating Toxicity" (Web Blog Post) Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/employee-relations/pages/putting-humanity-into-hr-compliance-stop-tolerating-toxicity-.aspx


4 Tips for Managing Organizational Change

One thing most successful transformation efforts have in common is that change is driven through empowerment, not mandated from the top. According to a recent study, only 26 percent of transformation initiatives succeed. Read this blog post from Harvard Business Review for four tips on managing organizational change.


Launching major transformation efforts is a common way that business leaders try to get a leg up on the competition, or just keep their heads above water. But too many of these efforts fail. Change is difficult, and many people not only resist it but seek to undermine it. Unsurprisingly, then, a McKinsey study found that merely 26% of transformation initiatives succeed. Most successful transformations have one thing in common: Change is driven through empowerment, not mandated from the top.

In my research of transformative political revolutions, social movements, and organizational change, successful efforts not only identify resistance from the start but also make plans to overcome those who oppose the transformation. And it’s done not with bribes, coercion, shaming, or cajoling, but by enabling others within their organizations to drive change themselves. Here’s how they do it.

Start with a small group. Typically, leaders launch transformation efforts with a large kickoff. It makes sense: They want to build momentum early by communicating objectives clearly. This can be effective if a ready consensus already exists around the initiative. Yet if the desired change is truly transformational, it is likely to encounter fierce opposition; inertia can be a powerful force, even more powerful than hope or fear. So by starting with a large communication campaign, essentially presenting the initiative as a fait accompli, you are very likely to harden the opposition of those who are skeptical of the change.

Most successful transformations begin with small groups that are loosely connected but united by a shared purpose. They’re made of people who are already enthusiastic about the initiative but are willing to test assumptions and, later, to recruit their peers. Leaders can give voice to that shared purpose and help those small groups connect, but the convincing has to be done on the ground. Unless people feel that they own the effort, it’s not likely to go very far. For example, when Wyeth Pharmaceuticals set out to drive a major transformation to adopt lean manufacturing practices, it began with just a few groups at a few factories. The effort soon spread to thousands of employees across more than a dozen sites and cut costs by 25%.

Identify a keystone change. Every change effort begins with some kind of grievance: Costs need to be cut, customers better served, or employees more engaged, for example. Wise managers transform that grievance into a “vision for tomorrow” that will not only address the grievance but also move the organization forward and create a better future. This vision, however, is rarely achievable all at once. Most significant problems have interconnected root causes, so trying to achieve an ambitious vision all at once is more likely to devolve into a five-year march to failure than it is to achieve results. That’s why it’s crucial to start with a keystone change, which represents a clear and tangible goal, involves multiple stakeholders, and paves the way for bigger changes down the road.

That gap between aspiration and practical reality was the challenge that Barry Libenson encountered when he arrived at Experian as CIO in 2015. In his conversations with customers, it became clear that what they most wanted from his company was access to real-time data. Yet to deliver that, he would have to move from the company’s traditional infrastructure to the cloud, an initiative that raised serious concerns about security and reliability. He began by developing methods for accessing real-time data for internal use, rather than going straight to customer-facing features. That required his team to engage many of the same stakeholders and develop many of the same processes that a full shift to the cloud would have required and allowed him to show some early results.

“Once we developed some internal APIs, people could see that there was vast potential, and we gained some momentum,” Libenson told me. Experian not only successfully moved to the cloud but also launched its Ascend platform based on the new infrastructure, which is now the fastest-growing part of its business.

Network the movement. All too often we associate any large-scale change with a single charismatic leader. The U.S. civil rights and Indian independence movements will always be associated with Martin Luther King Jr. and Mohandas Gandhi, respectively. In much the same way, turnarounds at major companies like IBM and Alcoa are credited to their CEOs at the time, Lou Gerstner and Paul O’Neill.

The truth is more complicated. King, for example, was just one of the “big six” of U.S. civil rights leaders. Gerstner gained allies by refocusing the company around customers. O’Neill won over labor unions by making a serious commitment to workplace safety. These examples show why, in his book Leaders: Myth and Reality, General Stanley McChrystal defines effective leadership as “a complex system of relationships between leaders and followers, in a particular context, that provides meaning to its members.”

Every large-scale change requires both leadership at the top and the widening and deepening of connections through wooing — not coercing — an ecosystem of stakeholders.

Consider the case of Talia Milgrom-Elcott, cofounder of 100Kin10. When she set out to start a movement to recruit and retain 100,000 STEM teachers in 10 years, she knew there was no shortage of capable groups working to improve education. In fact, she had worked with many people who were building myriad approaches to the issue. But they had never met one another. And so she created a platform for collaboration that brings together nearly 300 partner organizations through conferences, working groups, and networking. Today 100Kin10 is ahead of schedule to meet its goal.

Surviving victory. Often the most dangerous part of any transformation effort is when the initial goals have been met. That’s why successful transformation leaders focus not only on immediate goals but also on the process of change itself. If Wyeth had stopped at a 25% cost reduction, it would have soon found itself in trouble again. But because its employees embraced the lean manufacturing methods, the company was able to keep moving forward. In much the same way, if Experian had been satisfied with merely shifting to a new technology infrastructure, little would have been gained.

In some cases, the benefits of a successful transformation can last for decades. Remembering Gerstner’s IBM turnaround in the 1990s, one of his top lieutenants, Irving Wladawsky-Berger, told me, “Because the transformation was about values first and technology second, we were able to continue to embrace those values as the technology and marketplace continued to evolve.” After a near-death experience, the company remains profitable today.

 

SOURCE: Satell, G. (27 August 19)"4 Tips for Managing Organizational Change" (Web Blog Post). Retrieved from https://hbr.org/2019/08/4-tips-for-managing-organizational-change


Older Workers Are a Valuable Talent Pool

According to data from AARP, workers who are 55 and older make up less than a quarter of the nation's labor force. However, research also shows that they filled almost half of the 2.9 million jobs gained last year. Read this blog post to learn more about older workers in today's talent pool.


Over the last decade, most HR leaders have been obsessed by the role of millennials at work and figuring out how to meet the different expectations and needs of these young workers.
Certainly, this has been important work. But, leaders need to be aware of a much bigger demographic challenge ahead: the role of people over the age of 55.

The U.S. Bureau of Labor Statistics projects that in the next 10 years, the fastest-growing segments of the workforce will be for employees over 65. According to AARP, Americans 55 and older make up slightly less than a quarter of the nation’s labor force, but they filled almost half (49 percent) of the 2.9 million jobs gained in 2018—the biggest share of any age group.

This trend will continue. We are living longer and having fewer children. The fertility rates in the U.S., U.K., Germany, Japan, and almost every other developed country are below replacement. As a result, populations—and our workforces—are going to get older.

Obviously, this has an impact on public policy, immigration, and healthcare investments. But the more interesting aspect for those of us in HR is the huge impact this will have on work.

Attitudes About Age

How do most employers feel about older people? They aren’t that thrilled to have them around. While older employees may be wiser and more reliable, they usually make more money than younger workers. Many employers believe older workers can’t keep up with today’s always-on digital workplace.

A few years ago, we asked employers whether age was a competitive advantage or competitive disadvantage in their company. Almost 60 percent of respondents said that age was a disadvantage. In other words, when a young employee competes with an older employee for a job, the young person wins.

This discriminatory perception was summed up perfectly by Mark Zuckerberg in 2007 when he said in an interview, “Younger people are just smarter.”

Forced Transitions

I’ve seen this in my own personal life. Many of my friends from college (we’re all in our early 60s) are starting to think about retiring, primarily because they’ve been forced out of their companies. Most of us will live well into our 80s, 90s, or longer, and as we age, work becomes one of the most gratifying things we do. But employers just don’t see it this way.

According to a recent analysis by the Urban Institute and ProPublica, more than half of workers over 50 lose longtime jobs before they are ready to retire. Of those, 9 out of 10 never recover their previous earning power. Why? Employers simply do not want them back.

Age Discrimination

Companies are now being sued for age discrimination. Recruiters have been caught saying things like “you’re too old for this job” or “we only hire people with less than seven years of experience.” Even Facebook has been forced to remove age as a criterion for job placements in its online advertisements.

The above are examples of explicit discrimination. However, in most companies, age discrimination is much more subtle. Older people have higher salaries, so they are just passed over for many positions.

New Ideas for Older Workers

But change is ahead. Not only does age discrimination fly in the face of most diversity and inclusion programs, but the reality is that employers really need older workers because of record unemployment rates and extreme talent shortages.

“Re-careering” programs—in which employers invite retirees back to work, give them training and new skills, and let them work part-time—are cropping up in companies such as Boeing, Bank of America, and Apple. I encourage all employers to invest this way.

Business leaders also need to keep in mind that baby boomers are the biggest buying population in the world and has as much disposable income as the rest of the population combined. These consumers want to do business with organizations that respect older individuals and don’t view age as a negative.

Think about your company’s attitudes about age. Older workers are often more stable, they understand how to work in teams, and they are likely to be more loyal over time. Generational diversity in workforces is also reflective of good corporate citizenship.

Now is the time for HR leaders to work to actively eliminate age discrimination in their workforces and view generational diversity as a valuable goal.

SOURCE: Bersin, J. ( 25 July 2019) "Older Workers Are a Valuable Talent Pool" (Web Blog Post). Retrieved from https://blog.hrps.org/blogpost/Older-Workers-Are-a-Valuable-Talent-Pool


Tracking Employee Life Cycle

How are you engaging and retaining employees? The HR landscape is constantly changing. With each new generation that enters the workforce, expectations change. Read this blog post from SHRM to learn more about tracking the employee life cycle.


We who study Employee Engagement are consistently looking for trends in hiring and the direct effect on retention. The Human Resource landscape is slippery, no other profession is tasked with such a diverse cycle of management skills. The ability to find great talent, train, engage and promote are an unenviable set of tasks. Recruiters mirror salespeople, Total Rewards professionals have to have an acumen for numbers and the disparate technologies that represent the progression from hiring through promotion can make one's head spin.

So, we stare down the inevitable:

How do we create a synchronized strategy from recruitment to retirement.... ????

Let's start with the job market....

As a new generation of talent enter the workforce are expectations changing?

Are those escalated in age better equipped with irreplaceable experience?

Is a recession coming?

Do elite talents have any interest in job-hopping?

Those who are great at what they do are probably not interested in switching jobs and there are others who simply do not have the proper qualifications. So, staffing professionals are tasked with finding people who are qualified, able to engage and humble in their entry-level financial expectations.

Prospective employees have a few simple expectations:

  • A product/service they believe in
  • Leadership that is visionary yet receptive to change
  • A culture of transparency
  • A manager they enjoy serving

Sounds simple enough but the ability to pull together these traits under a common mission is difficult. Companies are often great at producing quality products but lacking in employee development. Again, our staffers are called upon to sell the good qualities of the company while side-stepping what isn't working.

Sustaining Engagement....

Getting them in the door is one thing. Delivering on promises is another.

Once employees are trained, they need to develop the confidence to acclimate to the culture. Our extended HR team has to sustain the attraction of the hiring process with technology that is accessible and intuitive. HR is then called upon to make sure there is a vessel for strong manager/employee communication while keeping leadership abreast of the action in the trenches.

Take inventory:

  • Does training scale to specific functional traits while enhancing soft skills?
  • Is your Human Capital Management technology integrated and engaging?
  • If employees and managers aren't on the same page, how will you know?
  • Does your CEO recognize general employee goals?

Train, Reward, Challenge and Eliminate Silos!

Seeing departures before they happen.....

If exit interviews are part of your engagement strategy, you are a step behind. The popular counter is to have HR integrate "stay interviews". If you need to administer a survey for employees to validate your existence, your workplace relationships might be fractured.

Managers should have an accountability plan for their employees that is more parts celebration of achievement than calling out deficiencies.

Recognize in public, discipline is private.

If in every day you leave people with a firm understanding of what is working and where they need development, there is no guesswork. People know when they haven't performed to their fullest potential, calling them out twice a year doesn't work.

Ask yourself: do our hiring enticements continue through our day-to-day engagement proposition?    

We all just want to represent something we believe in among people we respect and an ever-evolving challenge cycle complete with rewards at every step of progression.

Originally published on Dave's Weekly Thought blog.

SOURCE: Kovacovich, D. (6 August 2019) "Tracking Employee Life Cycle" (Web Blog Post). Retrieved from https://blog.shrm.org/blog/tracking-employee-lifecycle


Creating an ‘urgent care first’ mindset for employee benefits

Urgent cares are popping up everywhere, making getting quick healthcare easier and more convenient for patients. Read this blog post to learn why it's important to guide employees to adopt an "urgent care first" mentality.


Urgent care centers are popping up everywhere, which means getting quick healthcare is easier and more convenient for patients. But these centers could also help employers minimize expensive emergency room claims. That’s why it’s important to guide employees to adopt an “urgent care first” mentality.

The concept of urgent care has been around since the 1970s, but rising healthcare costs, especially for ER care, have spurred an increase in centers across the U.S. over the last decade. In fact, from 2014 through June 2017, the number of urgent care centers rose by nearly 20%.

Urgent care centers provide care for health problems that aren’t life-threatening, but can’t wait for an appointment with a primary care provider. No one wants to suffer with a sore throat all weekend. Many urgent care centers are staffed with doctors and nurses, and provide more advanced capabilities than what’s typically available at a primary care doctor’s office. For example, some urgent care centers give stitches, provide X-rays and even MRIs.

Patients can also get treatment at urgent care for conditions they’d typically see a primary care doctor for, such as the flu or a fever, mild to moderate asthma, skin rashes, sprains and strains, and a severe sore throat or cough — illnesses that produce unnecessary high claims if treated in an ER.

Still, when a severe sore throat and high fever strike on a weekend and the doctor’s office is closed, employees may gravitate to the ER because they’re sick and need help right now. That’s where the urgent care first mindset becomes good medicine. It typically costs the employer (and often the employee) far less if that sore throat is treated in an urgent care facility.

The high cost of ER care is enough to make anyone run a high temp. From 2009 to 2016 (the most recent data available), the average amount that hospitals billed insurance carriers for an emergency room visit more than doubled, from $600 to $1,322. By contrast, urgent care typically costs about $150 per visit. Members often pay a lower copay for urgent care visits, too.

The urgent care first mindset is starting to take hold. New data analysis from Aetna shows that as urgent care centers began to proliferate, ER visits for minor health issues dropped 36%, while the use of urgent care and other non-emergency health settings increased 140%.

However, the same study shows that plans only saw a decrease in ER visits if there were several urgent care centers in the geographic region where their employees lived. Awareness is key.

Fostering an urgent care first mentality

Employers can’t just include urgent care in a benefits plan and expect employees to use it. They need to design the plan to encourage use and follow up with plenty of education.

Education about the benefits of primary care versus urgent care versus the ER should take place during open enrollment and throughout the plan year so members understand the medical necessity and financial implications of each option. Including the closest urgent care centers to employees, as well as a list of services they provide, can help encourage them to adopt an urgent care first mentality.

A word of caution: not every nearby urgent care center is actually in-network. It literally pays for employees to keep a list of nearby in-network centers handy when that inevitable weekend sore throat strikes.

Reminders about urgent care before spring allergies, summer vacations, fall school physicals and flu season can also help encourage their use.

The too-low ER copay

Plan design is another important piece of the puzzle to help steer employees to the right level of care for their needs. It’s not that unusual to see a $100 copay for an emergency department visit. While no one wants to discourage ER visits for true emergencies, it makes sense to adjust the plan design to encourage primary and urgent care visits instead. That may mean a $20 copay for primary care, a $40 copay for urgent care and a $200 to $250 copay for ER visits — which is waived if the plan participant is admitted to the hospital.

For high-deductible health plans paired with a health savings account, the savings can be even more drastic; patients may pay $200 for an urgent care visit versus $1,200 for an ER visit.

The combination of education and plan design can help curb unnecessary ER visits, which could help employers control healthcare increases from plan year to plan year. For health issues that crop up during off hours, the urgent care first mindset is good for both employers and employees, who will ultimately save time and money.

SOURCE: O'Conner, P. (5 July 2019) "Creating an ‘urgent care first’ mindset for employee benefits" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/creating-an-urgent-care-first-mindset-for-employees


How to Sweeten Your Healthcare Offerings to Attract + Retain Employees

Employees are the heart of any great business, and key employees and leaders are essential to long-term success. Once acquiring what you feel like is a complete team, some employees may be exploring other options and walking away. You may also find yourself struggling to attract younger generational employees.

But why is this?

For any employee, benefits are no longer a perk in business; they’re an expected part of compensation.  For any employer looking for ideas on how to ensure their business meets the wants and needs of their employees, Tonya Bahr, one of our expert Benefits Advisors, has outlined three benefits sure to help.

Benefit #1: Gym Memberships

As the old saying goes, “healthy employees are happy employees.” More companies are encouraging healthy habits in and out of the office. The typical employee would like to have the ability to join a gym and work out. This helps negate a general sense of feeling too consumed by work and life, while putting action to their desires. Joining a gym of their liking through the use of a company stipend or expense is a huge plus for many employees and will aid in long-term employee retention.

Benefit #2: Focus on Family

Nobody is without a life away from work. The considerate employer is no stranger to the normal work-life balance and is flexible to offer employees time off when their attention is needed elsewhere – typically family matters. Parents who need to attend a child’s event, a mother who requires maternal leave or those tending to the needs of their elderly loved ones desire a company that doesn’t have a fixed focus on strictly work itself.

Benefit #3: Community Involvement

Numerous studies have found employees increasingly value brands that emphasize doing good around them. From encouraging employees to volunteer on their days off and promising rewards or hosting in-house events, the ways in which your organization can spread a good name into the community is nearly limitless, not to mention, a fun and active way to market your business to prospective employees.

Better Benefits Strategies with Hierl Insurance…

When it comes to Employee Benefits, the experts at Hierl bring an element of strategic innovation to the conversation that others simply are not.  We take pride in the experience we provide our customers focusing in on a clear, defined, proven process and diligent communication to deliver real results that are meaningful to your unique vision and goals as an organization.

The industry has gotten complicated. With an ever shifting landscape, keeping up can be exhausting and trying to plan ahead can seem daunting.When you partner with Hierl, you gain a team of innovative, kind-hearted, strategically focused, big picture experts that work diligently to ensure your outcomes are meaningful where it matters most to you.

For more information, contact Tonya Bahr at 920.921.5921 or tbahr@hierl.com. You can also visit our website for more information on our collective services.

Employee Benefits


At Hierl, we know you are more than just numbers on a spreadsheet. You are a unique, diverse population of real people with real needs and real objectives.

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