Volume 10 : Issue 12
Compensation and Performance
Guide to Compensation Expertise Compensation Trends for 2021 and COVID-19 Impacts
Sinclair Miller SHRM Field Services Representative
Highlights of 2020 TN SHRM
Keeping up with changing laws is a full-time job, and youâ&#x20AC;&#x2122;ve already got one. EMPLOYERS AND LAWYERS, WORKING TOGETHER Ogletree Deakins is one of the largest labor and employment law firms representing management in all types of employment-related legal matters. The firm has more than 900 lawyers located in 53 offices across the United States and in Europe, Canada, and Mexico.
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projected salary increase for 2021 www.HRProfessionalsMagazine.com Editor Cynthia Y. Thompson, MBA, SHRM-SCP, SPHR Publisher
The Thompson HR Firm, LLC Art Direction
Park Avenue Design Contributing Writers Gavin Appleby J. Austin Baker Jennifer Blake William Carmichael Cassandra Faurote Tammy Henry Blair and Bruce Johanson Shonda Kines Paul McCormack Kisha Moliere Brent A. Morris Eric Schultz Colin Wheeler Barbie Winterbottom
Contact HR Professionals Magazine: To submit a letter to the editor, suggest an idea for an article, notify us of a special event, promotion, announcement, new product or service, or obtain information on becoming a contributor, visit our website at www.hrprofessionalsmagazine.com. We do not accept unsolicited manuscripts or articles. All manuscripts and photos must be submitted by email to Cynthia@hrprosmagazine.com. Editorial content does not necessarily reflect the opinions of the publisher, nor can the publisher be held responsible for errors. HR Professionals Magazine is published every month, 12 times a year by the Thompson HR Firm, LLC. Reproduction of any photographs, articles, artwork or copy prepared by the magazine or the contributors is strictly prohibited without prior written permission of the Publisher. All information is deemed to be reliable, but not guaranteed to be accurate, and subject to change without notice. HR Professionals Magazine, its contributors or advertisers within are not responsible for misinformation, misprints, omissions or typographical errors. ©2020 The Thompson HR Firm, LLC | This publication is pledged to the spirit and letter of Equal Opportunity Law. The following is general educational information only. It is not legal advice. You need to consult with legal counsel regarding all employment law matters. This information is subject to change without notice.
4 note from the editor 5 Gloria Sinclair Miller, SHRM-SCP, SHRM Field Services Representative 6 SHRM Foundation 7 SHRM Foundation Team 8 Donate to the SHRM Foundation! 9 John Daniel Recipient of James House Williamson Award 27 Data Facts Ranks in HRO Today’s Baker’s Dozen Customer Satisfaction Ratings for 2020 30 Dr. Kathy Tuberville Recipient of 2020 HR Professional Excellence Award 33 Congratulations to these Newly Certified HR Professionals! 42 Book Look - Human + Machine (AI) by Paul R. Daugherty and H. James Wilson
A Guide to Compensation Expertise
10 Formulating Your 2021 PTO Strategy 12 Compensation Trends for 2021 and COVID-19 Impacts 14 Are We Allowed to Talk About That? 16 How We Serve Clients with Base Pay and Market Benchmarking Services 18 Focus on Volatility 20 Changes Affecting Deferred Compensation
22 The Future of Benefits Administration 23 Most Brokers Say They Have All the Answers 41 Thank You Healthcare Providers!
2 Ogletree Deakins Client Pledge 32 How “Free” Speech Can Become Expensive, Distracting and Damaging 36 The Relationship Between Performance and Compensation: Does Performance Follow the Money?
24 Ongoing and Changing Security Needs in the New Normal 26 Background Screening Trends that Are Either In or Out for 2021 34 I Led an RFP for an On-Demand Pay Vendor 43 Data Facts Direct Small Business Portal
Top Educational Programs for HR Professionals
30 University of Memphis – Academic Training in HR Management 31 The Leadership Green Room – Plan Your 2021 Learning Agenda 33 Online HRCI | PHR | SPHR Certification Class Begins February 22, 2021 44 WGU Tennessee HR Program Fully Aligned with SHRM Curriculum
28 Highlights of the 2020 Tennessee SHRM Conference in Memphis November 2-4 38 Highlights from the 11th Annual WTSHRM Employment Law & Human Resources Fall Conference in Jackson October 23 40 HR Mississippi 2021 and Beyond January Issue features 2020 Profiles of Super Lawyers in Labor and Employment Law Plus Updates on Employment Law and Employee Benefits And the Latest on HR Management and the Pandemic Deadline to reserve space December 15 www.HRProfessionalsMagazine.com
a note from the editor
It is the season of giving. Please remember to make your annual donation to the SHRM Foundation this month! The SHRM Foundation offers scholarships, grants, and awards that help HR professionals gain the skills they need to take their career to the next level and make impactful changes in the workplace that lead to positive social change. In 2020 the SHRM Foundation was thrilled to award 94 Fall Certification Grants, 88 Spring Certification Grants and close to 55 undergrad and graduate academic awards. Myriad other awards were distributed throughout the year which addressed one of the SHRM Foundation’s key programming priorities, preparing emerging HR professionals to be the Next Generation of HR Leaders and developing leadership and professional potential to make HR a field of endeavor. Visit shrmfoundation. org/2020HRPgift and make your 2020 donation today! It is an honor to feature Gloria Sinclair Miller, SHRM-SCP, on our December cover. Gloria is a SHRM Field Services Representative and is described as a servant leader with a passion for developing others through service to people and community. She is a member of the SHRM Speakers Bureau and is Co-Host of the SHRM Honest HR podcast and the newly created monthly SHRM21 Annual Conference education series called Tune in Tuesdays. You can read her exciting career profile on Page 5.
I must say November was the most exciting month this year since COVID-19 began. We actually had the opportunity to cover the 11th Annual WTSHRM Fall Conference in Jackson, TN and the 2020 TN SHRM Conference in Memphis - in person! It was so wonderful seeing everyone, although we were all in our masks and social distancing. The 2020 TN SHRM Conference was a hybrid – and very successful! Check out the highlights of each of these excellent conferences in this issue! We have an excellent Guide to Compensation Expertise in this issue. I know you will love reading the latest information on compensation and performance management. Please take advantage of these experts who can help you with your compensation pitfalls as you are preparing your 2021 personnel budget. The Guide begins on Page 10. Does better performance follow the money? Littler provided a very thought-provoking article on the relationship between performance and compensation. Our focus in January 2021 will be employment law as we feature the U.S. News Best Lawyers in Labor and Employment Law. We are bringing you several free webinars in December that you don’t want to miss. On December 9 we have “How COVID-19 Changed the Company-Sponsored Benefits Landscape.” On December 16 our next webinar will be about “Getting Better Value for Your Orthopedic Healthcare Spend.” Please join us December 29 at 2 PM for our monthly complimentary webinar sponsored by Data Facts. Watch your email for your invitation to each of these exciting events! Wishing everyone a beautiful holiday season with your loved ones!
Gloria SINCLAIR on the cover
SHRM Field Services Representative Gloria holds a Master of Science (MS) in Human Resources Management from Widener University and a Bachelor of Science (BS) in Human Resources Management from Wilmington University. She holds the SHRM-Senior Certified Professional (SCP) designation. Additionally, she has earned the two SHRM Specialty Credentials in People Analytics and Inclusive Workplace Culture as well the People Manager Qualification (PMQ).
Gloria now resides in the Atlanta Metro area in Georgia and travels as much as she can with family and friends.
Gloria Sinclair Miller is an accomplished Senior HR Business Professional with more than 20 years of success in human resources in the banking, retail, pharmaceutical, and non-profit industries. Throughout her executive career, Gloria has held leadership positions with the USO of Pennsylvania and Southern New Jersey, AstraZeneca, Bristol-Myers Squibb, Borders Group Inc, TD Bank and Rosenbluth International. She is a global Human Resources leader known for delivering creative solutions for human capital management by utilizing expertise in outsourcing, merger & acquisition to assist to minimize employee impact and mitigate related organizational expenses. In her most recent role, Gloria serves as a Field Services Director with the Society for Human Resources Management (SHRM). With 300,000+ HR and business executive members in 165 countries, SHRM impacts the lives of more than 115 million workers and families globally. Gloria is part of a team responsible for overseeing the fostering and promotion of memberships, education programs, certification and services focused on advancing the profession of human resources and creating better workplaces. Additionally, the organization focuses on educating employers on hiring, engaging and retaining untapped talent groups like transitioning servicemembers, military spouses, and veterans, the formerly incarcerated and hiring those with disabilities. Gloria is also the Membership team liasion with the SHRM Foundation and an active advocate for the programs and services the Foundation offers to SHRM members and the community. As a member of the SHRM Speakers Bureau, Gloria is frequently requested to present for SHRM affiliates as well as outside organizations . She is also the Co-Host of the SHRM Honest HR podcast and the newly created monthly SHRM21 Annual Conference education series called Tune in Tuesdays. Gloria is described as a servant leader with a passion for developing others through service to people and community. She has served in various Volunteer Leader roles throughout her career including President for the Philadelphia Society for Human Resources Management (Philly SHRM) Chapter. During her terms with Philly SHRM, Gloria was instrumental in continuing to elevate the brand of the organization as a team of experts in the region. Further, at a critical time, she built alliances with community organizations and businesses to lead regional efforts to support military service members and veterans in their transition to the civilian workforce. As the daughter of a military officer, Gloria continues her families’ dedicated service, by giving back to the military and veteran community through various roles with employers and nonprofit organizations. Gloria has been a strong mentor and advocate, not only with SHRM, but also through her direct involvement with military service organizations. Gloria currently serves on the VETLANTA Board of Directors as the Co-Directors for the Employment Pillar responsible for bridging the gap between employers and veteran and military spouses emplyment needs in the Atlanta Metro area. Previously, as Board Chairman for the USO of Pennsylvania and Southern New Jersey, she served not only as a transformational volunteer leader, but also worked as a volunteer in the centers. For two years, she led the board gala committee, which is the major annual fundraising event for the organziation. Additionally, Gloria has served with the Employer Support of the Guard and Reserve (ESGR) as a committee member, a Board Member of the Philadelphia Veteran’s MultiService Center and as Advisory Team Member for the Women’s’ Veterans ROCK Campaign. She was the recipient of the Delaware Valley HR Person of the Year Award, the Veteran’s Multi-Service Center’s Advocacy Award and the Women’s’ Veterans ROCK Legends Award. www.HRProfessionalsMagazine.com
In December 2020, the SHRM Foundation is launching a free, multi faceted Getting Talent Back to Work certificate program for HR professionals to learn how to build hiring practices that provide opportunity for all. Additionally, we are launching a Self-Assessment Wizard so that HR professionals can better understand where they stand with regard to hiring practices for people with criminal records. Users of the selfassessment also receive a personalized report with suggestions for updating and changing their hiring practices. There has never been a more important time for HR. Our vision at the SHRM Foundation is a world of work that works for all. We’re committed to elevating and empowering HR as a social force by developing evidencebased solutions for workplace inclusion, by designing programs that empower the next generation of HR leaders, and by awarding scholarships and professional development grants in support of students and HR professionals. In keeping with that mission, in 2020 the SHRM Foundation mobilized the power of HR to meet the challenges the COVID-19 pandemic has created for workplaces and the workforce. We framed all of our programming priorities within this lens. They include: mental health and wellness in the workplace; skilling resources; support for students and emerging HR professionals; and workplace diversification and inclusion assistance, focusing on untapped pools of talent. Two current initiatives designed in support of two untapped talent pools during these challenging times are:
Veterans at Work Initiative Veteran unemployment rates have doubled from 3.1% to 6.4% in the past year. Veterans are a highly valuable part of an inclusive workforce, and the SHRM Foundation develops resources for HR professionals to help former service members integrate into the civilian workforce. HR professionals report that veteran recruiting is a top three priority to help to meet their workforce needs. However, veterans face difficulties when looking for a job, with 90% indicating they encountered obstacles in attaining employment. In partnership with PsychArmor Institute and the Institute for Veterans and Military Families at Syracuse University, we developed the content for the SHRM Foundation’s Veterans at Work certificate program, sponsored by Comcast NBCUniversal. An accompanying guidebook is the cornerstone of the certificate and provides the business case for hiring veterans. Through this certificate program, HR professionals, hiring managers and front-line supervisors are learning best practices for attracting, hiring and retaining these talented professionals. With the support of JPMorgan Chase & Co., the SHRM Foundation also developed a complimentary digital toolkit providing additional high-quality, no-cost resources to aid veteran employment at each stage of the employee lifecycle—employer readiness, talent acquisition, hiring and onboarding, talent development, and talent mobility. The certificate program is open to all, and, as an additional bonus, SHRM-CP and SHRM-SCP credential-holders can earn 10 professional development credits (PDCs) toward recertification. To learn more about this multifaceted program, visit shrmfoundation.org/ veterans.
Getting Talent Back to Work Every year in the U.S. nearly 700,000 individuals are released from prison and re-enter society only to be met with barriers to rebuilding their lives, including a lack of gainful employment opportunities. The SHRM Foundation aims to end outdated, non-inclusive hiring practices to get this talented group of people back in the workplace. By using SHRM Foundation programming, businesses and HR leaders become equipped to confidently hire individuals with a criminal background. 6
Learn more about these important initiatives by visiting gettingtalentbacktowork.org. Additionally, this year we launched an initiative on mental health and wellness in the workplace, as well as an a HR apprenticeship program. In the middle of the summer and the COVID-19 outbreak, the SHRM Foundation partnered with One Mind at Work and Psych Hub to launch “Mental Health and Wellness in the Workplace,” aimed at engaging HR professionals in education and training opportunities to lead mental health change in the workplace. SHRM’s COVID-19 research found that in the summer, 41% of employees felt burned out, drained or exhausted from their work. Through this strategic alliance, we continue to promote a culture of acceptance and increased access to actionable tools to address the rising mental health issues seen this year. We’re also creating the first registered HR apprenticeship program, HR RAP, through a three-year Department of Labor grant. By fostering and expanding “earn and learn” opportunities, we’ll cultivate a new generation of HR leaders. We’re excited to partner with employers across America to establish a registered apprenticeship program to develop talent within their organization, create opportunities for a diverse workforce, even prepare to earn a SHRM-CP credential, and more. The SHRM Foundation is also committed to elevating the knowledge of students and HR professionals to unlock human potential and lead social change in the workplace and beyond. Every year, the SHRM Foundation impacts the lives of more than 300 HR professionals and students by awarding more than half a million dollars in scholarships and awards. The SHRM Foundation is committed to breaking down barriers and creating life-changing opportunities for those we serve so that they thrive and achieve their goals. Whether it is investing in HR professionals or in students, the SHRM Foundation is committed to elevating and advancing the HR profession. With donor help, we can ensure a world of work that works for all. To learn more about the great work of the SHRM Foundation, visit shrmfoundation.org. The SHRM Foundation is a 501(c)(3) nonprofit affiliate of the Society for Human Resource Management.
Our supporters who make our work possible.
SHRM Foundation Team
Impact work, workers and the workplace by creating a world of work that works for all with the SHRM Foundation. Fueled by the desire to lead positive social change and the generosity of donors, the Alexander Alonso Wendi Safstrom Amber Honesty Knowledge Officer Director Coordinator FoundationChief empowers HR to attract, Executive hire and advance untapped talent through our Alexander.Alonso@shrm.org Wendi.Safstrom@shrm.org Amber.Honesty@shrm.org free and available-to-all educational and training initiatives, such as Getting Talent Back to Work and the Veterans at Work Certificate program, while also empowering the next generation of HR professionals to make for a better tomorrow.
OUR VISION Innovative programming around New training resources for A world all. mental health and wellness in of work that works for employees assimilating back into the workplace. the workplace. Mariya Chetyrkina
Director, Programs Mariya.Chetyrkina@shrm.org
Director, Engagement & Philanthropy Ellen.Christman@shrm.org
Support for students and emerging HR professionals impacted by changing educational landscape and lack of opportunities, along with programming around employability skills.
Manger, Programs Bryan.Martin@shrm.org
Manager, Programs Vernon.Williams@shrm.org
Workplace diversification and inclusion assistance and guidance, ensuring that untapped pools of talent (i.e. veterans, people with disabilities and people with criminal records) are included in the restructured workplace. Mary Wright
Manager, Apprenticeship Program Mary.Wright@shrm.org
Be a part of the change and make a difference with your gift this year. Visit shrmfoundation.org/2020HRPgift
Impact work, workers and the workplace by creating a world of work that works for all with the SHRM Foundation. Fueled by the desire to lead positive social change and the generosity of donors, the Foundation empowers HR to attract, hire and advance untapped talent through our free and available-to-all educational and training initiatives, such as Getting Talent Back to Work and the Veterans at Work Certificate program, while also empowering the next generation of HR professionals to make for a better tomorrow.
Innovative programming around mental health and wellness in the workplace.
New training resources for employees assimilating back into the workplace.
Support for students and emerging HR professionals impacted by changing educational landscape and lack of opportunities, along with programming around employability skills.
Workplace diversification and inclusion assistance and guidance, ensuring that untapped pools of talent (i.e. veterans, people with disabilities and people with criminal records) are included in the restructured workplace.
Be a part of the change and make a difference with your gift this year. Visit shrmfoundation.org/2020HRPgift
To a leader in his field, we offer our congratulations. For his significant contributions to advancing effective human resources practices, John Daniel received the James House Williamson Award at the 2020 TN SHRM State Conference. This prestigious honor is given to someone who exemplifies what it means to be an HR leader. John will retire at the end of the year after a 14-year tenure as First Horizon Corporationâ&#x20AC;&#x2122;s Chief Human Resources Officer and 40-year career in the industry. Thank you for being an example for us all.
ÂŠ2020 First Horizon Bank. Member FDIC.
Guide to Compensation Expertise FORMULATING YOUR 2021 PTO STRATEGY By J. AUSTIN BAKER
After a year like 2020, it seems like everyone is looking forward to flipping that last page on the calendar and making a fresh start. A new year, a new opportunity for things to get back to some semblance of normal. Of course, the challenge is that no one is quite sure what "normal" will look like. Recent events have fundamentally redefined the employee/employer experience, and you need to ensure that your PTO strategy has evolved to keep pace with the changes. To help, we've put together a "top five" list that empowers you to meet the needs and exceed the expectations of your employees… no matter how the year ahead pans out. 1. GET CREATIVE In addition to the obvious COVID-related challenges employers have endured during 2020, there have also been seismic shifts in social and cultural issues shaping how workers view their relationship with their employer. Employees are more focused on how their employers view and respond to social issues over-and-above the formal DE&I programs that may already be in place. There's an increasing pool of evidence that reveals consumer sentiment is moving in this direction as well. According to a recent study by RedThread Research: "73% of people believe companies can increase profits and improve communities in the process." Developing a PTO strategy that encourages employees to volunteer with a nonprofit of their choice, for example, is a great way to show support. This approach empowers employees to back the causes about which they feel most passionate, drives more profound engagement, and ultimately helps to improve your employer brand as a result. 2. KEEP AN EYE ON COMPLIANCE Just as we saw with FMLA and the constellation of state- and region-specific absence and leave laws that emerged during the past several years, we'll likely see an increasingly prescriptive approach to helping workers regain lost ground – financial and otherwise – as we emerge from the pandemic. This means you'll need to remain vigilant on all the typical wage and hour compliance fronts, as well as stay aware of all new laws, policies, and regulations that could arise. For employers who operate in multiple locations, this can become particularly challenging. Just as there was no single, uniform Federal approach to mitigating the pandemic risks, there will likely be regulations passed at the state and local level that will provide even more generous protections. Mishandling these policies can, of course, lead to fines and penalties. More damaging, however, is the negative effect it could have on employee morale and your brand. Many employees are wrestling with significant personal challenges due to the pandemic: supporting children through remote learning, contending with the financial implications of reduced household income due to a spouse's job loss, supporting senior family members, and the list goes on. As employers, we must be extra vigilant in ensuring compliance. Consider leveraging third-party support, either via your own legal counsel or an online service, that can alert you when new policies and regulations emerge. 3. ENSURE CONSISTENCY Enforcing PTO policies consistently across your entire workforce has always been important, but it will be critical to success in 2021. Updating employee handbooks, notifying employees of new practices or procedures surrounding requesting and granting leave, and most importantly, training managers how to apply these policies, must be included in your plan. Look for ways to standardize your approach in both enforcement and communication, such as leveraging an online HR support center for templates that can be easily modified to meet your unique business needs. 10
4. GO DIGITAL The events of 2020 forced companies large and small to embrace digital platforms. Whether you're 100% comfortable with a virtual workplace or just figuring it out, leveraging an online HR support center provides access to a diverse array of tools and resources you can use to make your internal teams operate more efficiently. Document templates, "how-to" articles, and chat access to other HR professionals make these knowledge bases an easy and cost-effective way to support your existing in-house HR talent and ensure your PTO practices are keeping pace with a rapidly-evolving market. 5. STAY AGILE The best way to get ready for what could be a tumultuous year ahead is to encourage an agile mindset – within your company, its people managers, and especially within the HR team. As the world started to recover from the 2008 economic recession, the gig economy exploded. There was a tremendous amount of talent available to employers, but not in a conventional way. Companies that adjusted to this model reaped the rewards, while those who did not faced increasingly competitive talent pools. Keeping an open mind about how you define "employment" also serves as a great way to create scale within your organization, particularly if you need to cover for employees who may be taking extended or more frequent PTO. Leveraging an HRO provider's services, for example, is a great way to extend the reach of your in-house team during times of increased activity (such as during open enrollment) and cost-effectively add new skills and expertise. Despite the numerous curveballs we experienced in 2020, we have every reason to approach 2021 with a sense of optimism and enthusiasm. The lessons learned in 2020 will help us become more agile, more resilient, and ultimately, more successful than ever.
J. Austin Baker is the Founder/CEO, HRO Partners, a human resources consulting and benefit administration and enrollment firm as well as a National Enrollment Partner Member representing the largest boutique, full-service insurance and enrollment firms in the country. A veteran of more than 17 years in the human resources and insurance & benefits industry, Baker is responsible for managing a multifaceted human resources consulting company with public workforce programs and services focused on companies in the southeastern United States. Austin is a frequent speaker on a variety of leadership and benefit topics representing thought leadership and innovative practices in the HR industry. For more information, call Baker at 1-866-822-0123, visit www.hro-partners.com or connect with the company at www.facebook.com/ hropartners, www.linkedin.com/in/ jaustinbaker or twitter.com/jaustinbaker
Guide to Compensation Expertise
Compensation Trends for 2021 and COVID-19 Impacts By BLAIR and BRUCE JOHANSON
PAY EQUITY WorldatWork and Korn Ferry released results of a 2020 Workplace Equity Study earlier this year. This study includes responses from 964 organizations and based on the study results, WorldatWork and Korn Ferry confirmed that progress was being made toward pay equity and a truly diverse and inclusive U.S. workplace. Specific results include 60% of the organizations saying that they are addressing pay equity in their workplaces, 70% are taking actions to promote diversity, equity and inclusion (DEI) and 73% of the organizations are conducting compensation analyses once per year or more frequently. Pay equity analyses based on several variables are gaining traction for proactive organizations and as a defensive measure for reactive organizations. COVID-19 Impact on Gender Pay Equity SHRM published an article on August 10, 2020 titled, “Pandemic Could Worsen the Gender Pay Gap.” This article supports the notion that the pandemic could widen gender pay disparities because women are at a higher risk for pay stagnation or reductions due to being the primary family care giver and taking time off work to care for their children who are being schooled remotely from home. According to a survey by Perceptyx, a business analytics software company, working mothers are nearly twice as likely to carry 100 percent of the child care responsibilities during the workday compared to working fathers. The SHRM article encourages employers to be proactive and look for ways to mitigate the COVID-19 impact on gender pay outcomes and find ways to offer greater workplace flexibility and individualized work plans. To mark the first International Equal Pay Day, the Equal Pay International Coalition (EPIC) shared a press release about the need for organizations to prioritize pay equity during the COVID-19 recovery period. EPIC stated in their press release, “Women comprise 70 percent of the global health workforce and have been on the frontlines as essential workers, community leaders, care-givers and social workers. Women in the workforce have been disproportionately impacted in the short-term economic fallout of COVID-19.” During the first International Equal Pay Day event held at the United Nations headquarters in New York, global leaders made commitments to implement affirmative measures that will narrow the gender pay gap. The press release stated that EPIC called on governments, employers, workers and their organizations, the private sector, civil society and academia to ensure that integrated policy responses are aimed at mitigating job and income losses, and to ensure that women do not end up disproportionately shouldering job losses and reductions in incomes resulting from the pandemic.
LIVING WAGE AND PAY COMPRESSION From our experience working with clients and based on recent SHRM and WorldatWork articles, we believe that the “Living Wage” and related pay compression issues will be active compensation 12
decisions during 2021 and subsequent years. We worked with an organization this year that has about 1,300 employees and the President committed to pay a minimum “Living Wage” of $30,000 or $14.42 per hour for all employees below this level of pay. This commitment by the organization’s President impacted approximately 41% of the total employee workforce and it produced a 17% base pay budget increase. A plan to address resulting pay compression due to the Living Wage decision encompassed about 44% of the organization’s employees. The pay compression adjustment expanded the base pay annual budget by an additional 2.6%. The combined living wage and pay compression adjustment represents an 8.3% increase in the organization’s base pay budget and had an impact on 85% of the total workforce. This is a significant investment for this organization, but the ability to attract and retain competent employees will improve with this important and timely compensation decision. On September 18, 2020, Dacona Smith, Chief Operating Officer of Walmart U.S. made public a company decision to raise pay for 165,000 associates. The press release mentioned that hourly pay for numerous jobs would increase from $11 to $15. An internet search on October 21, 2020 for a Walmart OrderPicker shows a national hourly pay average of $20.20. Several of the larger online retailers and retail big box stores inclusive of Amazon, Costco, Sam’s, Target and Whole Foods are paying between $12 and $20 per hour for store and warehouse positions. COVID-19 Impact on Living Wage and Pay Compression There is no doubt that COVID-19 safety precautions have changed our daily lives and they will continue to influence the way consumers shop, receive and pick up groceries and other goods from local, regional and national retailers. Consumers are warming up to or accepting self-service check-out stations, online ordering and pick-up parking lot spaces, home delivery, fast food order and drive-through lanes, call-in and take-out options with national fast food chains and local restaurants and numerous indoor and outdoor retail ordering and receiving options based on COVID-19 pandemic safety considerations. New and more responsible employee positions are increasing as a result of the pandemic. We believe that the rebounding economy along with natural demand and supply economic factors will drive current low-end hourly wages toward a living wage or as Ben and Jerry’s calls it, a “Liveable” wage which, by the way, averages $18.13 for their national company.
COMPENSATION FOR REMOTE WORKERS During the past few months we have responded to client inquiries about pay differentiation for remote home workers now that the COVID-19 pandemic is showing signs of not letting-up in the United States. Several articles by SHRM, WorldatWork and national and international human capital consulting firms have affirmed the great migration from company/organization office-based work to home office or remote site work via an internet connection. Some organizations have 100% of their employees working remotely with national averages above 50% based on recent surveys and related published articles. The consideration for pay differentiation associated with remote worker seems to be focused mainly in high cost of living or high wage metropolitan areas like San Francisco, New York, Los Angeles, and Chicago. It makes sense that
remote work wage discussions would surface in these very expensive work and cost of living metro areas where the cost of housing can decrease considerably by living 15 to 35 miles outside of the city center district. COVID-19 Impact on Compensation for Remote Workers The COVID-19 pandemic-forced remote work decision has proven to be productive for most organizations but it has not been accepted as a long-term strategy or acceptable practice by employers and employees. The employers are worried about employee engagement and lost productivity associated with remote work distractions and employees are missing in-person team relations and onsite meetings. Questions about remote worker compensation have fostered responses that include discussions on 1) each employee’s value to the company whether working onsite or from a remote location, 2) the cost of living and/or labor expense between the metro area located office or the employee’s remote location, 3) the employer’s savings or additional expense for an onsite or remote workforce and 4) other tangible and intangible factors associated with in-office or remote workforce. Bruce and I agree with the general consensus of the professionals who have stated that reducing compensation for remote workers increases the risk for employee turnover and disengagement. Most of the professional consultants have said that the reduction in remote work pay is not worth the increased risk of turnover. Increasing bonus pay for greater productivity by thriving remote workers should generate a better return on investment as opposed to a decrease in pay for remote workers.
NEW POSITIONS RELATED TO VIRTUAL INTERNET MEETINGS AND EVENTS The COVID-19 pandemic has definitely had an unfathomably negative social and economic impact on in-person meetings, events, conferences, concerts, plays, and other indoor and outdoor group activities. Implementation of federal and state severe public health emergency measures in order to reduce the spreading of this deadly virus through social distancing, donning of facial masks in public, self-imposed or government influenced remote work and schooling and other forms of anti-virus spreading efforts have placed an unimaginable demand on national and international internet usage and band width. This represents a significant economic shift from associated travel, lodging and meeting venue expenses for onsite meetings versus the transition to virtual intranet and internet meetings, conferences and events. A new category of positions related to virtual intranet and internet meetings and events are increasing at a rapid pace based on workplace and non-workplace needs. New internet-related positions inclusive of Internet Meeting Master Facilitator, Virtual Event Producer, Virtual Meeting/Event Moderator/Emcee and Intranet Moderator and Enablement Specialist are some of the position openings advertised on Indeed, Monster, and ZipRecruiter websites. We believe that these positions will be around for the foreseeable future, but the jury is still out on how soon and to what level we will return to our past habits associated with local, regional, national and international in-person meetings, conferences and events and the related travel, lodging and food complimentary services. The COVID-19 Pandemic is a reminder of how quickly our world and lives can be changed by a deadly virus outbreak. The world and its global marketplace have been disrupted during most of 2020. As we close 2020 and look forward to 2021, we will remember 2020 as the pivotal year that changed us individually and corporately forever.
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Guide to Compensation Expertise
Are We Allowed to Talk About That? By JENNIFER BLAKE
hen I was an HR newbie, I was standing in line at the credit union waiting to deposit my paycheck. (Yep, it was a long time ago!) I became incensed when I overheard two fellow employees discussing their recent raises. They shouldn’t be sharing that information with each other, and certainly not in a public place!
In those days, the two words “pay” and “transparency” had not yet been linked together, at least not in the private sector. Today the concept of pay transparency is well known and a subject of debate. Why has pay transparency become common in business parlance? Do a bit of reading on the topic, and you quickly discover certain words popping up often enough to become themes. Words like trust, pay gap, and diversity seem to point to underlying issues, which have pushed the concept of pay transparency to the surface.
Pay Gap PayScale’s Gender Pay Gap Report for 2020 shows women in 2020 earn 81 cents for every dollar earned by men when measuring median salary for all men and all women. When measuring the “controlled” gender pay gap, which measures median salary for men and women with the same job and qualifications, women are paid 98 cents for every male dollar. Close, but not quite there. Then there is the racial pay gap. On average, black men in the U.S. earn 87 cents for every dollar earned by white men according to a separate report by PayScale, Racial Wage Gap for Men, May 2019. Black women who work full time year-round earn 63 cents for every dollar paid to white non-Hispanic men, according to the nonprofit National Women’s Law Center. The gender gap has created enough of a ruckus that some states have passed legislation giving candidates and employees the right to access pay information for the jobs they are applying for or being promoted into. Other states have passed “ban the box” legislation making it illegal to ask candidates about their earnings history so as not to perpetuate patterns of pay inequality.
Trust If you have any experience administering or managing pay, you’ve likely discovered employee skepticism about most things pay related. In my experience, this skepticism is often the result of employees not understanding how they are paid. In the place of facts, conjecture and assumptions take root, fostering a lack of trust. Although employee mistrust is not a new phenomenon, it must be recognized when discussing pay transparency. 14
Diversity & Inclusion Society’s awareness of the need for diverse and inclusive workplaces, where everyone is welcome and encouraged to contribute, has risen to a new level in 2020. Given what we know about wage inequities affecting people in marginalized groups, the push for real change makes it essential that companies take a serious look at their compensation practices.
The Data is Out There! During the time I’ve worked in compensation management, one of the most profound changes impacting pay discussions between employees and employers, is the amount of real time pay data available online. Often this data is not as reliable as traditional employer-provided survey data but try convincing an employee of this fact. If it’s on the Internet, it must be true, right? Despite the inaccuracy of some of the information, employees really are more informed about competitive pay practices than ever before. Some are more knowledgeable than the senior leaders in their organizations responsible for recruitment and retention. A lot of anecdotal data exists linking pay equity to pay transparency, although not enough research has been done to definitively link the two. The literature available on the subject does a good job presenting the pros and cons of a more transparent pay culture. Often, when presented with a new way of looking at things, we seem to take an all-or-nothing approach. But what about thinking about pay transparency on a continuum? Mercer, on their website, shares a model of “The Pay Transparency Journey”. What this model demonstrates so well is the level of transparency must be considered in light of the company’s existing culture and its aspirational culture, that is, where the organization wants to be. I would encourage anyone to go to their site and review the whole model. (https://www.mercer. us/our-thinking/career/the-new-reality-of-pay-transparency.html)
The Mercer model includes six potential points along the transparency journey, beginning with “We don’t have pay ranges for all of our jobs, but we’re working on it.” I like that: We’re working on it! Something as basic as designing a few salary ranges shows the company has a plan and is doing something to be more intentional in its pay practices. Pay transparency doesn’t have to mean posting your employees’ salaries on the company website. Some companies do that, and it seems to have worked well for them. That doesn’t mean it will work for everyone. Find the level of transparency that fits your organization and start there. Belle Beth Cooper, in a Culture Amp blog, summed up her experience with full pay transparency at her former employer, Buffer.
“I found that knowing how and why my salary was determined, was even more powerful than knowing what my colleagues made. There was never any question about whether my pay was fair.” From my perspective as a compensation professional, when employees understand how and why their salaries are determined, that’s a win for transparency!
Jennifer Blake, CCP
email@example.com PerformancePoint, LLC. www.performancepointllc.com
Engaged Employees. Resilient Relationships. Collaborative Cultures. • Customer and Employee Experience • Compensation Strategies • Strategic HR (Analytics) • Leadership & Talent • Diversity & Inclusion • Change & Transformation
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Guide to Compensation Expertise
How We Serve Clients with Base Pay and Market Benchmarking Services By CASSANDRA FAUROTE
Total Reward Solutions, we find ways to help clients rise to employee compensation challenges in good times and bad. That’s one reason so many clients consider us their trusted partner for compensation solutions, year after year. Another reason is that we offer a broad range of services, including employee Base Pay projects, Market Benchmarking, Executive Benchmarking, and Incentive Compensation program design. How do we tailor these services for our clients? Read on to learn more about our Base Pay and Market Benchmarking services, and how we deliver tailored solutions to help clients overcome their employee compensation challenges:
Base Pay Projects A base pay program provides structure and organizes your jobs so you can attract and retain talent. It can also help provide career pathing, help ensure internal and external equity, and help eliminate discrimination in compensation. Well-crafted base pay programs have many benefits. They can:
• Ensure costs are maintained and managed appropriately • Help reduce turnover through improved employee morale and engagement when pay is not a dissatisfier Naturally, because your market and your organization are one-of-akind, we offer many options and variables. Ultimately, we tailor our Base Pay Project services to match your unique needs. Recent TRS Base Pay projects, for example, have included the following: • Helping an organization that has combined several separate entities into one to develop a single overall pay structure • Helping an 8-year client in the pharma industry completely update their benchmarking and base pay structure • Helping a client in the medical industry update three job families and their associated pay structures for over 150 jobs
• Provide a basis for determining the external value of jobs to market
Regardless of your type of pay program, market benchmarking is crucial. Just what is market benchmarking? It’s the process of identifying competitive pay levels for jobs in the external market (external equity). It helps companies establish their job worth hierarchy. Also, market benchmarking typically supplements the job evaluation process, although some organizations use pay systems based solely on market benchmarking.
• Provide baselines for reviewing employee performance and rewarding desired behaviors
To be done well, market benchmarking requires good survey data. Therefore, it’s important to verify the reputation and integrity of the
• Provide appropriate pay ranges for recruitment • Promote accurate job descriptions
data source as well as the data screening methodology. The best kind of market data is third-party published data that is employer-reported and “scrubbed”. Recent TRS Market Benchmarking projects have included the following: • Helping an entity that is small in terms of the number of staff members (but larger in the sense that it serves four separate company entities) by determining the compensation value of their complex roles. • Helping a technology company by benchmarking new values for all positions during a major restructuring and developing a new pay structure to support the new organizational structure. • Helping a non-profit update their current market values. We also looked at what the market values would be if we blended in all industry data vs. just non-profit data to determine their competitiveness to the overall market.
The Bottom Line: Whether your organization is in “operations as usual” mode, undergoing a major restructuring, combining entities, or you just want to be certain your company is market competitive with employee compensation, we can help. Over the past 15+ years, we have worked with clients in over 30 different industries whose staff levels ranged from
6 to 4,000 employees. Simply put, our track record is as strong as our commitment to client service. We have the depth of experience as both internal and external consultants you want in your trusted compensation partner. Let us help you strengthen your position as an employer of choice who can attract, retain, and motivate staff with market competitive compensation programs.
Ready to learn more and discuss your organization’s specific needs, contact us today at 317.589.8529.
Cassandra Faurote, CCP, SPHR, SHRM-SCP Founder & CEO Total Reward Solutions firstname.lastname@example.org www.totalrsolutions.com
About Total Reward Solutions: Total Reward Solutions is your trusted partner for compensation services. Led by Cassandra Faurote, professionally certified Compensation and Human Resources expert and author of the book Compensation Sense 101, Total Reward Solutions offers a broad range of compensation and total rewards consulting services to help your organization attract top talent, motivate employees and retain top performers. We can partner with you on a project basis, on retainer, or as your total outsourced solutions provider for compensation services.
Guide to Compensation Expertise
Focus on Volatility By COLIN WHEELER
When it comes to money, many Americans have some sort of stake in the markets. Whether it is directly through investments, or indirectly through a retirement account like a 401(k) or IRA, Wall Street can have a big impact on an individual’s financial future. If you’ve paid attention to the stock markets, you know that recently, investors have experienced anything but smooth sailing. The weeks leading up to a nail-biting election made the markets extremely unpredictable, but what factors should truly concern investors? The answer may be simpler than you think.
POLITICS Every four years, the highest seat in the land comes up for grabs. Often, our personal political beliefs may be formulated by our economic worldview. For that reason, presidential elections are frequently seen as potential turning points for the economy. During election years, many Americans wonder if a new administration will make huge policy changes, or if a returning administration will keep the status quo. Both are valid concerns, but according to history, a transition of political power may not have a big impact in the long run. According to historical data from Bloomberg, since 1948, the S&P 500 has grown regardless of political party. In fact, if you made a $1000 investment under President Truman, your S&P stock would have grown to almost $2.7 million as of January of this year, but that’s only if you left it untouched. The reality is many investors are quick to react with their emotions, and if this election year has proven anything it’s that politics can bring out the best or worst in us. Say you were extremely dedicated to your party, and only put money in the market when your party held the presidency. If you kept that investment mindset, you would have missed out on nearly half of the years between 1948 and 2020, regardless if you held a Democratic or Republican view! But how does this all apply to 2020? The day after the election, the S&P 500 rose 2.2%, and the Nasdaq rose 3.9%. According to the preliminary election results, it appeared that America would have a divided government with a Democratic President and House, and a Republican Senate. It may seem that having a singular party control the White House and both houses of Congress is the best situation for investors, but in practice, that may not be the case. Since 1937, the S&P index has shown a 14.6% return after elections resulting in a divided government, compared to a 13% return in election years where one party took the presidency, House, and Senate. In other words, the markets seem to approve a diverse control of political power. 18
INDUSTRIES AND NEWS Ask any financial advisor what they think is a key factor in portfolio development and you may get a trending answer: diversification. Just as the markets have historically approved of diverse political views, many financial advisors view diverse investments as a smart strategy. The old phrase, “don’t put all your eggs in one basket” translates seamlessly to many investment management theories. Asset diversification refers to the spreading assets across various investment categories to potentially reduce exposure in one certain area. A recent example of this is the impact COVID had on different industries in the market. On Monday November 9, Pfizer announced their COVID vaccine is more than 90% effective in preventing infections. That same day, Wall Street responded by betting that our “normal lives” may return sooner rather than later as stocks of travel companies, sit-down restaurants, and various entertainment industries shot up. On the flipside, this news sent quarantine thriving companies like Peloton, Zoom, and Netflix into a sharp sell off. In either of these cases, if you had all of your investments dedicated to one company, you would have felt it in your wallet. While it may have been nice to be one of those travel companies on November 9, those same companies experienced huge hits earlier in the year. Even more so, if you were invested solely in travel, you may have sold off your investments when the pandemic stuck and were unable to reap the surge that occurred in early November.
PUTTING THIS INTO PRACTICE There are several key takeaways that you may want to consider for your own portfolio. 1. Make decisions with data, not emotions. Humans are innately emotional beings, so this advice is easier said than done. One common theory amongst seasoned investors is that many are driven by one of two emotions: fear or greed. In good times, investors tend to make bolder moves–which exposes those investments to more risk. And in bad times, investors tend to pull back and then miss out on great buying opportunities. Most often, if your instincts are telling you to act in times of panic or euphoria, your best bet may be to take a step back and look at the facts. That breather could save you from a decision you might regret. 2. Understand how long-term and short-term investing can impact you. Long-term and short-term investment strategies are all based on defining your personal goals and timelines. While the day trader sells or buys in reaction to immediate economic or market news, the buy-and-hold investor has a long-term perspective and understands that the market can have periods of volatility. Either way one thing is for certain, the stock market is an ever changing entity. What impacts the markets today may be irrelevant tomorrow, a year or 5 years down the road. Knowing what your investing goals are ahead of time can help you better determine your personal investment strategy. 3. Partner with a professional. It goes without saying that everyone’s financial situation is different. Getting the opinion of an unbiased fiduciary financial advisor can reveal some insights into how your investments
could impact your overall financial outlook. A fiduciary such as a Certified Financial Planner Professional™ must always put their client’s best interests ahead of their own. Your financial advisor should equip you with the facts you need to make the best investment decisions available to you. They will also help you create a plan to stay on track towards your personal financial goals. While you consider your investment strategy, it’s important to remember that past performance does not guarantee future results. These times of market volatility can be unnerving, but rest assured it is a normal occurrence. Additionally, being prepared with an investment strategy can help calm heightened emotions and ensure you are on track with your personal financial plan.
Colin Wheeler, CFP®
Financial Advisor ColinWheeler@argi.net www.agri.net
Guide to Compensation Expertise
Section 162(m) Affecting Deferred Compensation Arrangements
By S USIE BILBRO, NOAH BLACK, DOUG DAHL, CURTIS FISHER, BRETT GOOD, BRYAN METCALF, FRITZ RICHTER, CATHERINE SIMPSON & DAVID THORNTON
Public companies maintaining deferred compensation arrangements for their executive officers should consider how recent changes to the regulations under Section 162(m) of the Internal Revenue Code (the Code) may impact the timing of payments to be made to participants and their beneficiaries under such plans – if action is required, the affected plans must be amended before December 31, 2020 to avoid complications or penalties. Section 162(m) of the Code disallows a tax deduction for any compensation paid to a “covered employee” of a public company over one million dollars (Million Dollar Limit). On December 16, 2019, the IRS issued proposed regulations (Proposed Regulations) implementing certain changes that were made to Section 162(m) of the Code by the Tax Cuts and Jobs Act of 2017 (2017 Tax Act). The 2017 Tax Act made several significant revisions to Section 162(m), including changing the definition of “covered employee” such that a covered employee in any year remains a covered employee for all subsequent taxable years (and thus subject to the Million Dollar Limit), including after termination of employment. In other words, once an individual is determined to be a Section 162(m) “covered employee,” that individual is always a “covered employee.” Under Section 409A of the Code, a non-qualified deferred compensation plan may delay a payment past the designated payment date to the extent that the service recipient reasonably anticipates that the payment would not be deductible because of the Million Dollar Limit. Many deferred compensation plans (including employment agreements This article was originally published by Bass, Berry & Sims on October 22, 2020 at www.bassberryhrlawtalk.com
that contain rights to deferred compensation) take advantage of this 409A provision by providing that compensation subject to the Million Dollar Limit will be deferred and paid out only as and when the deduction would not be limited by the Million Dollar Limit. In most cases before the 2017 Tax Act, this provision resulted in only a short deferral until the
service provider was no longer an employee of the service recipient, at which point the Million Dollar Limit would no longer apply, and fully deductible, regularly scheduled payments could be made. However, as a result of the new “once a covered employee, always a covered employee” rule under Section 162(m), if an employer’s deferred compensation arrangements provide for delay of payments until the Million Dollar Limit no longer applies, deferred compensation balances may require a significant passage of time before they become paid in full (generally limited to $1 million per year). So, for example, a covered employee with a deferred compensation plan balance of $25 million might not receive full payment for 25 years.
Practical Takeaways for Employers Recognizing this disconnect, the IRS is allowing companies to amend deferred compensation arrangements to remove any provision that requires a delay in payment due to the Million Dollar Limit, as long as the amendment is made by December 31, 2020. Of course, if these deferral provisions are removed, the company’s deduction for any payments that are not ”grandfathered” (e.g., payments made according to a written binding contract that was effective on November 2, 2017, and not materially modified on or after that date, all as described further in the Proposed Regulations) will be disallowed under Section 162(m) to the extent such amounts, when combined with other compensation paid to the covered employee in the same year, exceed $1 million. These amendments may be drafted to apply only to deferred compensation not otherwise exempt from the 2017 Tax Act changes to Section 162(m) under various grandfathering provisions. We strongly encourage public companies to review applicable non-qualified deferred compensation arrangements to determine if amendments are necessary before December 31, as well as to consider the impact that the disallowance of a portion of the compensation deduction attributable to deferred compensation payments may have. If you have questions regarding the information in this alert, please contact the attorneys in our Employee Benefits and Tax practice groups.
GO CONFIDENTLY. Bass, Berry & Sims listens and responds with creative yet practical counsel. We stay on pace with the complex and rapidly evolving employment landscape, connecting your dynamic human resources needs to proactive strategies. Relationships, reliability, and respect – at the center of our Labor & Employment and Employee Benefits practices.
Stay up-to-date on the latest in HR Law. Visit our blog at bassberryhrlawtalk.com.
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The Future of Benefits Administration Technology for HR Professionals
By KISHA MOLIERE
For almost two decades, Application Programming Interface (API) has been simplifying the lives of consumers. The convenience we take for granted in the online and mobile experiences of Amazon, Expedia and Uber, for example, exists only because of the two-way, real-time communication between disparate systems made possible by API. Even the banking industry recognized the value of API and created the near instant transfer of funds between parties through services such as Zelle. And while they have been resistant in the past, benefits administration (ben admin) technology vendors, payroll providers - and most recently, insurance carriers - are now also finally embracing API. This will have a significant impact on the ben admin technology experience of HR professionals in the near future. Below are just a few practical areas where the impacts will be felt. Implementation of Ben Admin Platforms Anyone who has ever “endured” the implementation process of a typical, standalone ben admin technology platform knows the pain of pre-populating the new platform with employee and dependent census information, as well as their existing benefit elections. It usually requires gathering this information via reports from their payroll/HRIS systems, in addition to their carrier benefit reports - and then manipulating these reports into a specific format the new benefit platform can import. This process not only requires sufficient levels of technical sophistication on the part of the HR person submitting the data, but is also time consuming and ripe with risk for data errors and discrepancies which need to be researched and resolved. Establishing API connectivity between these previously segregated systems will transform the implementation experience by: • Eliminating the need for HR to manually manipulate employee census data from a prior ben admin, payroll, or HRIS system for import into the new one, since the systems will communicate electronically in real time. • Reducing the number of discrepancies, since the data will be delivered timely and directly between the systems themselves. • Introducing automated data validation via two-way communication of the disparate systems and API middleware. • Condensing the overall implementation timeline as a result of the above. Data Synchronization of Segregated Systems The current standard of one-way, weekly EDI (Electronic Data Interchange) file feeds flowing from payroll, ben admin technology and insurance carrier systems typically creates at least a seven-day lag of data updates between them. That means, in reality, these systems are never truly synchronized on any given day. However, when an API integration is built between a payroll and ben admin platform: • New hires, demographic changes, status changes and payroll deductions in both systems will be synched daily. 22
• Duplicative data entry by HR into the two systems will eliminated. Similarly, when an eligibility API is established between ben admin and carrier systems: • The “access to care” issues that arise due to the EDI file delay will be in large part eradicated. • Qualifying life events (QLEs) will be processed much quicker. Billing Reconciliation The above mentioned data synchronization lag between payroll, ben admin technology and carrier systems is also responsible for the burden of billing reconciliation and calculating/collecting retro premiums. Introducing API will mean, for example, when employee terminations are entered in payroll, they will simultaneously appear in the ben admin and carrier systems. Similarly, when benefit elections are added or changed in the ben admin platform, updates to eligibility in carrier systems and deductions in the payroll system will also process same day. This will lead to a precipitous decline in the need for reconciliation and retro deductions. EOI Management Benefits such as group life and disability are attractive to employees, especially since employer-provided options often come with lower premiums and simpler underwriting. However, when employees choose amounts in excess of the Guaranteed Issue (GI) amount, they may still need to complete Evidence of Insurability (EOI) documentation. The management of the EOI process by HR professionals is a time drain that includes chasing down employees to complete paper forms that have to be forwarded to the carrier, awaiting underwriting decisions, manually updating the ben admin and payroll systems, etc. An EOI API between a carrier and ben admin system means the EOI submission is handled in real time by the employee during their online enrollment experience, and underwriting decisions and coverage changes from the carrier are electronically fed back into the ben admin and payroll systems - removing HR from this task almost completely. There are many more implications of this technology for HR and benefits, such as real-time flexible spending account balances in the ben admin portal, automated claims initiation, and employee access badge termination triggered simply by a status change in a ben admin system. API’s ability to allow segregated systems to communicate with each other in real time will allow HR professionals to integrate their best-inclass HRIS, payroll, ben admin and insurance provider systems into an automated ecosystem that is more efficient than ever before.
Benefits Administration Technology Practice Leader McGriff Kisha.Moliere@McGriff.com McGriffInsurance.com
Most brokers say they have all the answers.
We start with a lot of questions. Every organization has unique needs. We want to know yours before we talk about solutions. McGriff specializes in delivering innovative employee benefit strategies to help manage costs, increase employee engagement and allow HR more time for strategic initiatives. Let us design a benefits program tailored to your organization.
To learn more, visit McGriffInsurance.com and select Employee Benefits.
ÂŠ 2020, McGriff Insurance Services, Inc. and McGriff, Seibels & Williams, Inc. All rights reserved. McGriff Insurance Services, Inc. and McGriff, Seibels & Williams, Inc. are subsidiaries of Truist Insurance Holdings, Inc.
Ongoing and Changing Security Needs in the New Normal By PAUL MCCORMACK With millions of employees working remotely, organizations cannot overlook the importance of security. During the COVID-19 pandemic, businesses have been forced to rethink many aspects of their operations. With millions of employees forced to vacate their offices and work from home â&#x20AC;&#x201D; many for the foreseeable future â&#x20AC;&#x201D; organizations of all sizes must understand how technology is changing the workplace. Here we will discuss how security risks are evolving for organizations and their employees, and how small and mediumsized businesses (SMBs) in particular are weathering the storm.
Security in Uncertain Times For Kim Albarella, Vice-President of Risk and Security Advocacy at ADP, the threat landscape began to shift in January, when she started receiving security-related questions regarding the virus from clients in Asia. "As time went on, it then shifted to Italy, and that's when we really started seeing our global clients start coming to us with lots of questions," says Albarella. In those early days, ADP's clients wanted to know whether ADP could work from home, and whether the organization had previously identified the security risks of employees working from home and how to mitigate them. Today, as certain ADP employees return to the office, there's a new set of questions coming from clients. "Our clients are really interested in how we are safely going to come back to the office," says Albarella. "They are asking whether now that most of our employees have moved to working from home, will they feel safe coming back? They want to know what we are doing to keep them safe from COVID-related scams and social engineering schemes that keep popping up" To address those concerns and to help ensure the appropriate level of data protection, ADP maintains a robust client security program that informs clients about the security measures in place to protect their data. 24
Risk Mitigation for Small and Medium-Sized Businesses As ADP continues to help ensure that suitable security measures are in place to protect its global client base, those same clients are responding to the stresses placed on them by COVID-19. While most headlines in the business press detail the troubles that household names are facing, small and medium-sized businesses are toiling in relative obscurity to survive the economic turmoil created by the pandemic. At the same time, these smaller organization cannot overlook the threat posed by cybercriminals. "Bad guys don't take a day off. They don't quarantine and go into hiding," notes Albarella. And with vast amounts of data now residing outside the traditional IT perimeter, businesses must protect their data wherever it travels and resides. To that end, organizations of all sizes should continue to focus their efforts on security, including the following basic measures: 1. Be aware of the latest security trends. Albarella says scammers' focus has been fluid over the last several months. Whereas the focus during the early stages of the pandemic was on targets seeking virus-related information or looking to donate money, a prominent recent trend has centered on unemployment fraud. "They're always looking for this unproven way; everyone's nervous, people are in different environments, and scammers are really taking advantage of it," says Albarella. 2. Commit to patching software vulnerabilities. In response to evolving threats from sophisticated cybercriminals around the globe, software companies continue to roll out security-related patches. Most installations require minimal time and effort to adopt, and they
grant access to the latest security methods needed to thwart an attack. Make sure someone from your organization is working to deploy patches as soon as they become available. 3. Educate employees on cybersecurity. There is often a lack of employee knowledge regarding the types of schemes the organization faces. Provide employees with brief yet consistent reminders about security best practices, including how to use robust passwords and how to handle unsolicited emails that appear suspicious. 4. Secure sensitive data. Most businesses are awash in data, but not all of it requires the same degree of protection. Make sure your organization identifies and protects its sensitive data, such as customer and employee-related data. This should include granting employees access to sensitive data only when they need it for their job responsibilities. In addition to the steps noted above, consider reaching out to your business partners to learn more about best practices concerning data protection. Because they offer support to many businesses operating across numerous industries, they'll be able to share insights they have obtained while helping to protect their clients' data. With face-to-face contact slowly returning, but many employees still working from home, technology is continuing to play a more dominant role in today's business environment than ever. As businesses come to terms with how technology is changing the workplace during COVID-19, security must remain a top priority. After all, the virus may eventually subside, but criminals are here to stay.
Background Screening Trends that Are Either
for 2021 By TAMMY HENRY
Just like fashion, background screening changes every year. Some things that were in one year are out the other. While certain staples make up a background check, the way we use the information evolves. As this year closes out, HR professionals must prepare for the background screening trends that will shape next year’s processes. Here are some important background screening trends we predict will be either IN or OUT in 2021. IN: Screening Gig Economy Workers As the number of people who work as gig economy workers rises, so does the risk they pose to the organizations that use them. Whether a person works for your company 40 hours a week or 5, they should be screened. A few years ago, many employers wouldn’t have bothered with the time and cost it takes to screen such an employee, but that is changing. In 2021, we’ll see HR focus on gig economy screening as closely as they do regular employees. OUT: Focusing on Salary History Asking how much money a job candidate makes is going the way of oversized sunglasses. A variety of cities and states have banned the use of salary history questions for employment screening purposes. Once a common question in the interviewing and hiring process, the salary history question has recently come under fire because of pay disparity. The salary history question typically sets the starting point higher for men than it does for women. If, for example, a woman and man are vying for the same position, but the woman is making $50,000 a year and the man is making $58,000 a year, the woman’s offer may be lower than the man’s offer. The philosophy here is that the salary history question keeps the gender income gap (in 2019 it was estimated that a woman makes 79 cents to a man’s dollar) from narrowing. Without the question, both parties will be offered the same salary which, over time, helps close the gender pay gap. We predict seeing the salary history question become even more of a faux-pas than it is now.
The time to find out about a candidate’s criminal history is further into the hiring process so it can be weighed along with other aspects of the applicant to make an informed decision without prejudice. IN: Screening Current Employees While most employers screen job applicants before hiring them, many of them are getting onboard with screening them AFTER they become employees, too. While a good pre-employment screening process helps decrease the possibility of hiring unqualified, dishonest, or dangerous applicants, implementing a screening process for current employees further guards against risk to the company and the workplace. Ongoing criminal search screening and drug testing are two items companies may want to periodically review. Finally, let’s talk about the “little black dress” of background screening: Compliance.
IN: Using Technology to Boost Productivity
Adhering to strict and consistent compliance processes never goes out of style. This means following FCRA guidance, maintaining proper documentation, setting consistent processes, and conducting hiring and onboarding in a relevant and fair manner. Companies also need to send pre-adverse and adverse action letters to applicants who they choose not to hire in whole or part because of information returned on their background check. Making compliance a top priority protects the company from damage caused by lax, vague, or inconsistent practices.
Applicant Tracking Software (ATS), mobile-friendliness, automated “knockout” keyword processes, and other technological solutions are becoming key in moving the hiring process forward efficiently and successfully. Such tools can save time, create a better candidate experience, foster more accurate data, and help make hiring decisions more insightful. Paper is as out as bell bottoms and probably won’t be coming back in style anytime soon.
Just like we know fashion trends change, HR pros know to expect changes in how recruiting, screening, and hiring are conducted. By proactively understanding the trends, you can meet the challenges 2021 brings head-on and well-prepared.
OUT: Criminal Records Being an Automatic Deal Breaker Asking candidates to check a box on the application regarding previous felonies is not only out, in many states it’s illegal. The “ban the box” movement began to give those with criminal histories a fair chance to be viewed by their education and experience, rather than being passed over because they were a convicted felon. The argument behind this trend is that when convicted criminals cannot find jobs they are more likely to re-offend. 26
Vice President of Client Success Data Facts, Inc. email@example.com www.datafacts.com
Data Facts Ranks in HRO Today’s Baker’s Dozen Customer Satisfaction Ratings for 2020 Memphis, TN: Data Facts, a national and international provider of background screening solutions, proudly announces they, for the third year in a row, have been ranked in HRO Today’s Baker’s Dozen Customer Satisfaction Ratings: Pre-Employment Screening for 2020. HRO Today’s Baker’s Dozen rankings are based on feedback from current clients of the background screening providers. The data is analyzed and measured by service breadth, deal sizes, and quality of service. Scores are then calculated in all three subcategories and an overall score. Data Facts was recognized as an Overall Midsize Program Pre-Employment Screening Leader, a Breadth of Service Leader, a Size of Deal Leader, and a Quality of Service Leader. Julie Henderson, Data Facts’ Vice-President of Sales, is happy with the recognition, and even more pleased with what it represents. “I’m delighted to see Data Facts receive an award that’s driven completely from customer feedback. We are thankful and honored to serve the great organizations that choose to partner with us. Every member of our team gives their best every day. Knowing our clients feel we exceed their expectations is priceless.” Tammy Henry, the Vice-President of Client Success, was also thrilled with the news. “Ranking on this list, which is one of the most noteworthy honors for our industry, is rewarding to our team that builds these relationships every day. Thank you to our incredible, loyal clients for the acknowledgment of our unwavering commitment to excellence.” ABO U T H R O TODAY HRO Today’s Baker’s Dozen Customer Satisfaction Rating: Pre-Employment Screening is based on quantitative rankings and feedback from approximately 1,200 verified customers from over 550 client companies through an online survey on categories including service breadth, deal sizes, and service quality. The customer survey data used to achieve this recognition is based primarily on customer satisfaction. To achieve inclusion on the Baker’s Dozen list, companies are rated anonymously by their clients. Once collected, response data for all providers with a statistically significant sample size are loaded into the HRO Today database for analysis using a statistical analysis and predetermined algorithm. The Baker’s Dozen list is one of the most prestigious surveys in the pre-employment screening industry. ABOU T DATA FAC T S For over three decades, Data Facts’ background screening solutions have provided clients with innovative, transformational technology and a personalized customer experience. This 360-degree support system is the foundation of our client relationships. Experience the fastest turnaround times, the strongest customer service, and the most accurate information available in background screening with Data Facts. Because you deserve a better experience.
TS H G LI H IG H
Visit tnshrm.org for more information/registration The 2020 TN SHRM Conference & Expo will be hosted VIRTUALLY. What’s in it for you? 40 Credits with extended learning opportunities for the full conference experience! Take advantage of these robust VIRTUAL conference features: Live 1Key Speakers Innovative Live Learning Sessions Virtual Exhibit Hall Pre-Conference Diversity and Inclusion Event Young Professional and Student HR Summit Bonus Post-Conference Legal Sessions
Recordings of the live sessions will be available for up to 30 days after the conference for your learning review and for earning SHRM/HRCI credits. 3
General Counsel SVP & Secretary International Paper
Featuring Conversations with the “She-Suite” 4
Lauren Robinson President and CEO Huey’s
Terri Freeman President/National Civil Rights Museum
Susan Springfield SR EVP/Chief Credit Officer First Horizon Bank 9
1 2020 SHRM-Memphis Board of Directors – Dr. Kathy Tuberville, co-VPSponsors: Programs, Beverly Washington, co-VP Hospitality, Verlinda Henning, Past Presenting President, Brigette Wilson, President, Tyler Stegall, co-VP Communications, Dale Harris, co-VP Programs, David Estel, Treasurer, David Dufour, President Elect Not pictured: Sonja Walton,VP-Communications; Chris Van Hekken, Co-VP Hospitality; Foluke Houston, VP Membership; Brad Federman, VP Workforce Development; Randy Irving, VP Diversity & Inclusion 2 2020 TN SHRM Conference & Expo Team 3 John Daniel, honorary chair of 2020 TN SHRM Conference & Expo and CHRO EVP of Human Resources for First Horizon National Corporation, presented “Career Preparation on Steroids,” “Fireside Chat with John Daniel,” “ Where Do We Go From Here: Leading Through Capacity Building;” and led a CEO Panel on “Leadership Drives Culture-Transforming Cultures and Revitalizing Organizations.” 4 Brigette Wilson, President of SHRM-Memphis, the host chapter. 5 Amy West, Director of TN SHRM, and co-presenter of the TN SHRM Awards ceremony. 6 Dr. Kim Estep, Chancellor of WGU Tennessee. WGU was a presenting sponsor of the conference. TENNESSEE SHRM AWARDS – 7 John Daniel, honorary chair of the conference and presenter, was the recipient of the James House Williamson award, the most prestigious HR award in Tennessee. 8 Dr. Kathy Tuberville, recipient of the HR Professional Excellence Award. Dr. Tuberville served as the lead for programs for the 2020 TN SHRM Conference & Expo. 9 Mary Merschat, recipient of student the James House Williamson Scholarship Award. Not pictured: Olivia Ray, recipient Joseph P. Goddard Scholarship; Timothy Dyer, recipient of the HR Professional Excellence Award; Kent E. Samuels, recipient of the HR Professional Excellence Award; Foluke Houston, recipient of the HR Professional Excellence Award. STUDENT CHAPTER SHRM NATIONAL AWARDS – Outstanding Chapter Award – University of Tennessee – Knoxville; Merit Chapter Awards – Middle Tennessee State University and University of Memphis STUDENTS & YOUNG PROFESSIONALS CAREER SUMMIT, OCTOBER 31 – 10 Dr. Trish Holliday, partner with Holliday Kenning, spoke on “Transformation in HR, Innovative and On-Point.” She also presented “Global Trends You Can’t Ignore As You Transform Your Organization.” Dr. Holliday was also the co-presenter of the TN SHRM Awards and SHRM Update. 28
11 David Dufour, President-Elect of SHRM-Memphis, discussed “Young Professionals Using Data to Develop an HR Business Case,” and “Becoming the HR Leader You Want to Be! Developing the Competencies You Need for Success.” 12 Dr. Deneen Lester, co-chair of the Students & Young Professionals Day and member of the 2020 TN SHRM Conference Team, presented “Becoming the HR Leader You Want to Be! Developing the Competencies You Need for Success,” and moderated the “Fireside Chat with John Daniel.” DIVERSITY & INCLUSION CONFERENCE , NOVEMBER 1 – 13 Dr. Enrica Ruggs, Assistant Professor of Management and Director of the Center for Workplace Diversity and Inclusion in the Fogelman College of Business at the University of Memphis, spoke on “The Diversity Bonus: Data Driven Inclusion Strategies.” Dr. Ruggs is 20 also the director for the Center for Workplace Diversity and Inclusion at the University. 14 Brad Federman, CEO of PerformancePoint, LLC, presented “Inclusion Leadership During Change – Thinking Differently in a New Norm.” He also co-presented “Hot Topics for Future HR Professionals,” and presented “The Talent Crunch, Rethinking the Future of Talent Acquisition.” 15 Randy Irving, SHRM-Memphis VP of Diversity and Inclusion, closed the Diversity and Inclusion Conference with a “Call to Action.” He also co-presented “Hot Topics for Future HR Professionals.” in the Student and Young Professionals Career Summit. TENNESSEE SHRM CONFERENCE & EXPO, NOVEMBER 2 – 16 Bill Courtney, keynote speaker, spoke on “Leadership When it Matters – How We Develop Talent in Times of Adversity.” He is an author, motivational 21 speaker, CEO of Classic American Hardwoods, and Academy-award winning actor from Undefeated. 17 Dr. Mario Brown, Chief Learning and Development Officer, First Horizon, presented “Emotional Intelligence for the Savvy HR Professional.” 18 “Culture and COVID – What’s Ahead for Legal Compliance,” was presented by Paul Prather, attorney with Littler Memphis. 19 Chief Alex Smith, CHRO of the City of Memphis discussed “Changing Culture, Changing Outcomes, A Case Study of HR Momentum in Progress.” 20 “Changing Trends and Complexities with Employee Wellness Programs,” was presented by Jeff Weintraub, with Fisher Phillips LLC. 21 (L-R) September Lyles and Amanda Durbin with Barnhardt Crane, a presenting sponsor of the Conference. 22 Conversations with the “She-Suite” – What Lessons Have Been Learned? What Changes Need to Happen?” (L-R) Sharon Ryan, General Counsel, SVP & Secretary with International Paper; Panel Moderator, Lauren Robinson, President and CEO with Huey’s Restaurants; Terri Freeman, President, of the National Civil Rights Museum; and Susan Springfield, SR EVP/ Chief Credit Officer with First Horizon National Corporation 23 Andy Masters, CEO, Masters Performance Improvement, Inc., author and motivational speaker presented “HR Leadership from Hollywood – An Interactive, Multi-Media Presentation.” 24 “Big Data in HR – How Does Data Really Drive HR Leadership and Operations?” was Austin Baker’s topic. He is CEO and President of HRO-Partners. 25 Dr. Kurt Kraiger, Professor and Department Chair of Management at the University of 25 Memphis, presented “Career Development for HR – What’s the BottomLine Advantage?” www.HRProfessionalsMagazine.com
Congratulations, Kathy! Your colleagues in the Department of Management applaud your recent SHRM award.
Congratulations to Dr. Kathy Tuberville, who received the 2020 HR Professional Excellence Award from the State of Tennessee Society of Human Resource Management. The award is fitting given Kathy's tireless work in service to the HR profession, the State of Tennessee, the City of Memphis, and to the students of the University of Memphis.
FOGELMAN COLLEGE DEPARTMENT OF MANAGEMENT
Undergraduate, MBA, and doctoral courses offered. Topics include HR management, staffing organizations, employee training & development, compensation & performance appraisal, and employee relations. Undergraduate HR concentration started in Fall 2015.
Kurt Kraiger, Ph.D. Professor of Human Resource Management and Chair of the Fogelman College Department of Management
Kristen P. Jones, Ph.D., Assistant Professor
Alex P. Lindsey, Ph.D., Assistant Professor
Caitlin Porter, Ph.D., Assistant Professor
Enrica Ruggs, Ph.D., Assistant Professor
Jessica Kirk, Ph.D., Assistant Professor
Chuck Pierce, Ph.D., Professor
Carol Danehower, DBA, Associate Professor
Laura Alderson, Ed.D., Instructor of Management
Kelly Mollica, Ph.D., Instructor of Management
Kathy Tuberville, Ed.D., Instructor of Management
Dr. Wendy Bedwell-Torres Instructor, Dept. of Marketing & Supply Chain Management and Dept. of Management
Dr. Kurt Kraiger, Management Department Chair, at firstname.lastname@example.org.
PLAN YOUR 2021 LEARNING AGENDA
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AUTHENTIC LEADERSHIP FOR WOMEN (Day 1) FIND YOUR VOICE & KICK SOME GLASS (Day 2) January 14 & 15, 2021 COACHING OTHERS FOR HIGH PERFORMANCE February 26, 2021 LEAD LIKE A BOSS: LEARN HABITS TO BE YOUR MOST SUCCESSFUL March 24, 2021 INFLUENCING FROM THE MIDDLE: LEAD YOUR BOSS, LEAD YOUR PEERS April 14, 2021 DEVELOPING THE LEADER WITHIN YOU (Based on the best-selling book by John Maxwell)
Participants vary across industry and experience level, from mid-sized and small organizations to Fortune 500 companies.
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How “Free” Speech Can Become Expensive, Distracting And Damaging By BRENT A. MORRIS
we recover from a week-long “Election Night” in 2020, let’s return to the unexpected and tense evening of November 8, 2016. In
the early morning hours after the results came it, when it became clear that Donald Trump had shocked the world with an electoral victory, Danyelle Bennett, a 911 dispatcher for the Metro Government Emergency Communications Center of Nashville, Tennessee (“Metro”), went to Facebook to comment on the win, as millions of others did. Ms. Bennett, however, certainly crossed any line of decency as she celebrated the President’s victory. She posted on her public profile - “Thank god we have more America loving rednecks. Red spread across all America. Even n***** and latinos voted for trump too!” [she did not include asterisks.] Immediately, co-employees of Metro responded to her in shock as to her racist comment. One co-worker stated – “Was the n***** statement a joke? I don’t offend easily, I’m just really shocked to see that from you.” Another colleague (an African-American woman) called her and explained why the post was offensive. Ms. Bennett took her post down that night, but the damage was done. The next day at work, her Facebook post had circulated among the workplace. Ms. Bennett’s supervisors received reports about complaints and conversations over the post. Two employees complained that it was offensive. One member of the public complained, linking Ms. Bennett’s personal account to her position at Metro because her position was in her bio. The public post even got the attention of the Mayor’s office. At the end of an investigation, in which Ms. Bennett stated that her co-workers were just “playing the victim,” she was terminated for conduct “unbecoming of an employee of the Metropolitan Government.” Ms. Bennett filed a lawsuit in federal court, claiming that her Facebook post was political speech protected by the First Amendment. She argued, therefore, that she was wrongfully discharged. In another interesting twist, the case was heard by Eli Richardson, a recent Donald Trump appointee. The judge sent the case to a trial jury, and the jury concluded that Bennett’s 32
speech “was not reasonably likely to impair discipline by superiors at [Metro], to interfere with the orderly operation of [Metro], or to impede performance of Bennett’s duties at [Metro].” The jury did however conclude that the post was “reasonably likely to have a detrimental impact on close working relationships at [Metro] and undermine the agency’s mission.” Based on these findings, the district court ruled from the bench, in a surprising opinion, that because the Facebook post represented the “mere use of a single word” and generally concerned the election, it amounted to core political speech protected by the First Amendment, and therefore Metro was unjustified in terminating the plaintiff. The jury, told to calculate her damages, did not seem to have their heart in any large verdict, awarding only $25,250. Earlier this year, the 6th Circuit released their opinion on the case, unanimously overturning the opinion of the District Judge. They stated that the word was patently offensive and that employees’ concerns over the language, including the “detrimental impact on close working relationships for which personal loyalty and confidence are necessary,” overrode any First Amendment concerns. In a strongly worded moment, the Court stated that “[t]he district court’s reference to Bennett’s use of “n*****” as ‘the mere use of a single word’ demonstrates its failure to acknowledge the centuries of history that make the use of the term more than just ‘a single word.’ The use of the term ‘evok[es] a history of racial violence, brutality, and subordination.’” So what lessons can we take from this case? If you are a governmental employer (or a semi-governmental employer, a sometimesdifficult analysis), you can see that the First Amendment provides powerful protections for your employees’ speech. In a case involving explicitly racist speech, openly published on Facebook and viewed by other employees, the trial court still determined that such speech was protected. The 6th Circuit’s overturning of that result does, at the very least, suggest that using the “n-word” even in a political context is grounds for dismissal if other employees are upset by its usage.
So what if you are a private employer? Obviously, you are free to terminate any employee that engages in the sort of language used by Ms. Bennett. And you very likely should terminate an employee using any such language, as any lesser disciplinary measure could be used against you in a lawsuit should the same employee become the target of that suit. In other words, in a racial discrimination lawsuit, opposing counsel can use your failure to terminate an employee using the “n-word” or similarly extreme racial language as evidence of a culture of racial insensitivity or bias. The trickier analysis, however, involves less extreme racial language. When, for instance, an employee posts on Facebook or any other platform language that is problematic but perhaps not patently offensive, your best defense is having a solid Social Media Policy. Such policies clearly lay out the expectations of the employer as it relates to an employee’s conduct outside of work on media platforms. The language of the policy should explicitly reserve the right to discipline employees for language used on social media or the internet at large. These policies are actually helpful to employees, as it has been our experience that many employees believe that the First Amendment protects their “free speech” outside of the workplace. The short answer – it does not. Employees have no First Amendment protections as it relates to discipline by a private employer. Finally, Social Media Policies insulate the employer from claims that the offending employee(s) were wrongfully terminated. For instance, imagine a suit brought by an employee who was terminated for allegedly inappropriate Facebook posts, but said employee argues that they were in reality fired for some illegal reason (for example, retaliation for filing a workers’ compensation claim). In that case, the Social Media Policy will provide the precise mechanism of termination which helps the lawyers argue for the defense of the employer.
Employees have no First Amendment protections as it relates to discipline by a private employer. This case worried employers for months as we waited on the 6th Circuit decision. To have ruled that Ms. Bennett’s posts were “protected political speech” would have potentially created untenable situations with co-employees and would have left governmental employers with little options to prevent hostility. Thankfully, the 6th Circuit ruled that there is no place for extreme language in the workplace, and all employers can use the case as an opportunity to review their Social Media Policies.
Brent A. Morris, Attorney
Wimberly Lawson Wright Daves & Jones, PLLC Nashville, Tennessee office email@example.com
Congratulations to these newly certified HR professionals who recently passed their HRCI exam!
Barbara Anderson, SPHR Director of Total Rewards Kindeva Drug Delivery Minneapolis, MN
Cathy Wotalewicz, SPHR
Toni Quist, SPHR
Human Capital Consultant People and Performance Strategies Minneapolis, MN
HR Manger Building Plastics, Inc. Memphis, TN
Kimberly Klein Graham, SPHR HR Manager Tower International Shepardsville, KY
Our next Online HRCI | PHR | SPHR Certification Exam Prep Class begins February 22, 2021. Deadline to register is February 15, 2021. www.hrprofessionalsmagazine.com
I Led an RFP for an On-Demand Pay Vendor. Here’s What I Learned. By BARBIE WINTERBOTTOM
he popularity of on-demand pay has risen so sharply that sometimes it feels like it exploded overnight. Giving employees access to their earned but unpaid pay has really gone from being a “nice to have” to a true necessity these past few months. And as many businesses across the country begin to reopen their doors, they are looking to cut costs, enhance employee safety and attract job hires. Whew! Tumultuous times, indeed. There are a number of benefits to on-demand pay programs, with some of the main ones being: 1. On-demand pay boosts hiring and serves as a competitive differentiator for your company 2. On-demand pay reduces cash handling 3. On-demand pay helps businesses improve retention and boost worker productivity, all for zero cost to the employer But to really maximize these benefits, it’s important to select the right on-demand pay vendor for your company. Given the nascency of the market, there are a plethora of models out there, and it seems like there is a new vendor popping up every other week. It can feel overwhelming trying to make the right choice. To make things easier, I wanted to share my experience leading an RFP process. I walked away with ten key questions that other HR or payroll professionals should keep in mind when choosing a provider: 34
1. What if employees have questions on how it works? Do they contact you? In the absence of call center support (or failing to effectively market the existence of the call center), the burden of support will fall upon your payroll team. Be sure to choose a vendor with live, multi-level call center support with 100% U.S.-based dedicated agents. 2. Does the vendor’s technology account for the approval of employee requests for funds or will your team be approving hours or funding requests? If a solution relies upon your existing payroll infrastructure to approve hours or employee requests for funds: (a) The administrative hassle of approval will fall to your team or (b) You may introduce risk of employee bias or discrimination by assuming responsibility for the order and timely response of fulfilling the request. 3. Is the technology compatible with any payroll/TMS setup? Can we change our tech stack at any time without your employees losing access to on-demand pay? Implementing and rolling out an on-demand pay program is no easy feat. If you work with a payroll provider who’s ODP program is only compatible with their software, you run the risk of losing your on-demand pay program should you wish to change payroll systems in the future. 4. Who handles paycheck reconciliation? If the vendor doesn’t handle paycheck reconciliation, your payroll team will be required to process a wage deduction to reconcile the paycheck. This introduces unnecessary hassle and risk for your team. 5. How long does it take employees who enroll in the program to get access to their funds? Immediate accessibility upon enrollment helps drive program adoption, which ultimately maximizes your ROI. If employees have to wait until the following pay period to access funds or wait for the delivery of a program pay card, adoption rates could be negatively impacted. 6. Where can employees send their pay? Are there different fees for sending funds to varying destination accounts? It’s 2020. Employees expect choice and flexibility. Limiting them to one destination account (e.g., program debit card, paycard) or charging exorbitant fees to send funds to their personal bank account create confusion at best and frustration at worst.
7. Are there limits on how much pay an employee can transfer prior to payday? The fundamental goal of on-demand pay is to help employees achieve financial stability. If employees have an emergency, they deserve the ability to access up to 100% of their already earned pay. It’s their money- they worked for it. They should be able to use it in the event of emergency to avoid predatory payday loans or overdraft charges. 8. Does the program offer savings tools? Are they free? While many vendors offer savings and budgeting tools, it’s important to ensure they are free. There are a plethora of free D2C savings and budgeting tools available for employees to use. If you want them to leverage tools offered by your vendor, they should be free or else you risk lower program adoption rates.
While every organization is different, there are a few themes that are more universal: payroll and HR teams are busy, introducing compliance risk is a no-go, and your employees want a simple and transparent way to access their own pay. On-demand pay has so many benefits, but in order to make the most of them, be sure to choose a vendor that provides a full-service experience to you and your employees.
9. Who funds the pay advances? If the employer is funding, when are withholding taxes due? To minimize regulatory risk and increased workloads, choose a vendor that funds 100% of the advances. If the employer funds the program, there are tax withholding obligations that you should consider. If the vendor acts as a commercial lender, the on-demand pay program may require amendments to existing loan agreements. 10. Do you provide marketing collateral at no cost, such as posters, flyers, cards, etc.? An on-demand pay program is only successful if your employees know about it. If you don’t want to do the heavy lifting when it comes to program awareness, choose a vendor who can offer you a free, agency-grade rollout plan with the customized marketing materials to promote it.
CEO The Business of HR firstname.lastname@example.org https://www.businessofhr.com/
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The Relationship between Performance and Compensation:
Does Better Performance Follow the Money? By GAVIN APPLEBY and ERIC SCHULTZ
or many years, Human Resources Officers have discussed, evaluated and largely agreed that improved performance is affected by compensation. Whether the compensation relates to raises or bonus incentives is a secondary issue. Either way, there is a relationship between performance and compensation. However, better performance doesn’t always follow the money. In fact, bad or unethical behavior may instead follow the money. And, to make things even more complicated, the law may affect a good faith effort to connect performance and compensation. Don’t give up though – done well, a compensation system does improve performance in many (but definitely not all) situations. Like most things in life, there are pros and cons related to developing a way to seek better performance through compensatory incentives. No system is guaranteed to work perfectly. Beyond the legal issues there are numerous other practical concerns. Some workers prefer a bonus plan while others will work harder to get a raise. More frustratingly, some workers won’t work harder or better despite the incentives. Others will argue that the system is unfair and some will try to find a way to make more money without having to work more hours. But let’s start with the legal side of the situation.
Legal Issues to Ponder Be wary of legal risk created by tying compensation to performance. Otherwise well-intentioned companies may unwittingly implicate anti-discrimination or wage-and-hour issues if they are not careful with their administration of such plans. ANTI-DISCRIMINATION CONSIDERATIONS
First, companies may run into trouble trying to make sure that male and female employees receive even total compensation—a seemingly righteous goal—by fiddling with incentive benchmarks. For example, a health spa operator that divided its locations by gender found itself in hot water because it paid male managers (who ran the men’s operation) a commission based on a higher percentage of sales than female managers (who ran the women’s). Sounds like obvious discrimination, right? The company argued, however, that the market for women’s 36
memberships was simply larger than the market for men’s, leading to stronger sales in the women’s operation and thus larger incentive pay for female managers. To bridge the gap and avoid uneven total remuneration, management raised the percentage-of-sales commission given to male managers while keeping the commission to female managers the same. The 6th Circuit Court of Appeals found the company’s argument unavailing. The Court reasoned that segregating male and female managers who were selling the exact same product—membership to a spa—while also applying a lower commission to one sex “effectively locked female employees, and only female employees, into an inferior position regardless of their effort or productivity.” This violated the basic tenets of the Equal Pay Act of 1963, which demands equal pay for equal work. Meanwhile, the Court emphasized that “there is no discrimination if two employees [of a different sex] receive the same pay rate, but one receives more total compensation because he or she produces more.” OVERTIME CONCERNS
Companies also encounter problems when incentive pay impacts overtime obligations. Conscientious HR Officers must be sensitive to proper overtime computation, and aware that a seemingly minor misstep can result in major exposure (particularly since aggrieved employees usually are entitled to liquidated damages and reasonable attorney’s fees, in addition to back pay). Calculating the correct application of overtime to be included with incentive pay, though, can be a challenge. A large, Arizona-based contractor learned this lesson the hard way. A Department of Labor investigation revealed that the employer “failed to include all production bonuses and commissions in employees’ regular rates when computing overtime rates.” In other words, employees received less than they actually earned, resulting in six-figure exposure for the company. Incentive pay can implicate overtime requirements even where an employer thought it had none. Many exemptions from overtime require that the employee earn a minimum salary of $684/week. Employers may satisfy up to 10% of this threshold through incentives. But what happens if an employee does not meet the performance
benchmarks to earn the incentives, dropping her under the minimum salary level? Suddenly, the employee is not exempt and instead entitled to overtime for weeks in which she worked more than forty hours. This is a contingency the employer may not have planned for—and if the employer did not track the employee’s time, it could be faced with the near impossible task of figuring how much it owes. BEWARE OF VARYING STATE LAWS AND LABOR AGREEMENTS
State laws vary as to incentive pay systems, especially in regard to sales. Some states dictate rules regarding commission plans, bonus plans and clarity as to how incentive pay will operate. Other states may require that certain types of “accrued commissions” or “accrued benefits” be paid irrespective of substantial performance or poor performance. Federal law, other than the wage and hour issues noted above, does not usually apply to incentive plans. As a result, for employers that operate in multiple states, plan rules may vary, creating occasional or yearly headaches and modifications of the plan. Union labor agreements also often include some type of incentive pay. Done well, that can be a very helpful thing for employers. However, not done so well, employees may well try to beat the system. Long story short – plan carefully in establishing your incentive-based system. INCENTIVES MAY DIFFER BY POSITION LEVEL
Compensation and performance plans may vary by the level of the job. Often a company may have a bonus plan for hourly workers, an incentive plan for mid-level managers and other exempt positions, and stock or other substantial compensation for executives. Each approach has its ups and downs. For hourly workers, a good incentive plan usually is built on key performance indicators (KPIs) or other similar applications. The amount of incentive pay may depend on the number of widgets produced, the number of cars or clothes sold, and how many injuries have occurred or safety violations have taken place. To be a true incentive, the KPIs should be makeable – employees may consider difficult-to-reach incentives that rarely offer much incentive money as not worth the hard work. At the same time, KPIs that are too easy often create a different problem. Once the KPIs are reached and, hypothetically, two weeks are left in the applicable month or quarter, the employees are likely to slow down production for those two weeks since their incentive level already has been reached. Some of the better plans have minimal KPIs, extended KPIs and stretch KPIs in order to keep the incentives coming. Importantly, don’t underestimate the benefit of incentive pay for hourly workers. Performance does follow the money if the incentive pay is meaningful. Hourly workers in such a program are very knowledgeable as to what they need to do to make their incentives. Not surprisingly, a not-so-good or fair program may disincentivize workers. Compensation and performance in lower management or exempt positions also can be helpful. Again, the best answer is typically an incentive plan. In some situations, the KPIs that are in play with the hourly workers carry over to the higher level. For lower-level managers, how effectively they manage can make a great difference as to whether the incentives are reached (particularly stretch incentives). At the same time, there are unintended consequences to be mindful of if the program is not carefully designed. Managers sometimes ignore important duties and instead focus their time on reaching metrics that are more likely to enable them to earn performance incentives. In fact, studies show that incentives can lead to unethical behavior. (Article regarding 2018 study out of Virginia Tech).
EXECUTIVE PLANS ARE MORE COMPLICATED BUT NOT ALWAYS MORE EFFECTIVE
It’s a different world at the executive level, including in regard to compensation. Stock options or other profitability tracking methods can be extremely lucrative. Be aware, however, that flat stock values are a great invitation for executives to leave the organization. There is considerable frustration in owning stocks that have no value. Shortterm incentive plans and long-term incentive plans may be more helpful in that they are tied to KPIs rather than stock market perceptions. That may mean less money if the stock value is really flowing, but meeting the KPIs will provide incentive pay or bonuses even if the stock market is down. Importantly, having stock options or executivelevel incentive plans are helpful in convincing a solid candidate to join your company. FINALLY, SOME NEW PLAYERS IN THE FIELD
In the last few years, some new monetary incentives have been created to deal with new types of performance – increased diversity and legal compliance. Many companies are now creating diversity and inclusion programs, including becoming more diverse in regard to employees at some or all levels. Some companies are paying incentives for recruiters who find more diverse candidates and for managers that hire “diverse persons.” Done poorly, those incentives may result in a manager violating anti-discrimination laws, even if they help minorities or women obtain jobs that they historically have not been able to obtain. The risk is less if recruiters are incentivized to find more diverse candidates. Even then, however, HR and Legal should seek advice on how to create a diversity program without violating the law. As for compliance incentives, the law is not such a concern. Done correctly, compliance-based incentives should be helpful. Safety, financial, proper manufacturing or developing of products and legal trade or use of certain products can affect an organization negatively, including meaningful financial penalties. Incentivizing managers to maintain legal compliance is not a bad idea. CONCLUSION
With the exception of poorly developed programs, incentives that are off target, and programs that provide bonuses but miss the need to apply incentives in important areas, performance does indeed follow the money. That may be true in single-person situations where that individual works hard enough to get a raise or a promotion. It also applies to incentive and bonus programs. But if you really want to see performance improve through incentives, make sure your plan is well thought out, legally compliant and effective.
Gavin Appleby, Shareholder Littler Atlanta email@example.com www.littler.com
Eric Schultz, Associate Littler Atlanta firstname.lastname@example.org www.littler.com
H I G H L I G HTS You’re invited to attend the
October 23, 2020 Friday 8:30 a.m. to 4:00 p.m.
Registration opens at 8:00 a.m. at
Union University Carl Grant Event Center 1050 Union University Dr. Jackson, TN 38305
Presented by: THE WEST TENNESSEE SOCIETY FOR HUMAN RESOURCE MAN In coordination with: THE LAW FIRM OF RAINEY, KIZER, REVIERE & BELL, P.L.C.
Join us for an informative day where we will dive deep in critical issues facin human resources, including:
♦ Workers’ Comp Pumpkin Patch – Review a checklist of Wo Compensation guidelines to make sure you are complying with a current legal regulations. 1 2 ♦ Bobbing for Apples and the ADA Interactive Process –L how to engage in an interactive process with a disabled employee seeking workplace accommodations. ♦ Tricks or Treats - Social Media and HR – Exploring the imp legal concerns of social media in the workplace and using it as a t HR. ♦ Skeleton in the Closet: Employment Case Studies – An interactive discussion of recent employment law cases and the application of relevant concepts and HR strategies. ♦ HR Spooktacular – An interactive session that will test your k of key legal standards and principles on a wide spectrum of HR is 3
Lunch is provided. Explore our impressive showcase of HR-related exhibitors. Great door Registration Fee:
$100 for WTSHRM Members $125 for non-WTSHRM Members Join WTSHRM for only $25 at: wtshrm.org/join
The registration deadline is Friday, October 16, 2020. Register early as seating is limited. You may pay by check or credit card. 5
1 Amy West, 2020 Director TN SHRM, welcomed attendees 2 Dr. John President of WTSHRM 3 WTSHRM Board 4HRCI Back Row (L-R) Thisof program has been approved for Carbonell, 5.5 recertification credit hours through and SHRM. Matthew Courtner, John Burleson, and Rob Binkley; Front Row (L-R) James V. Thompson and Dale Thomas 5 Attendees 6-8 Exhibitors
Legal Challenges are Coming at HR Professionals from Every Direction 9
That’s Why Rainey Kizer Makes Your Business Our Concern
As the issues facing HR executives become more frequent, challenging, and complex each year, you need a law firm that provides advice invidualized for you specific needs. This is why you should know the employment law attorneys at Rainey, Kizer, Reviere & Bell, PLC. For over 40 years, our AV-rated firm has advised businesses, non-profit organizations and government agencies on all aspects of employment law. To learn more, please call.
13 9 (L-R) Taylor Flake-Lawson (Associate) and Geoffrey Lindley. Taylor presented “HR Spooktacular: An Interactive Trivia Game,” with James V. Thompson and Rob Binkley. 10 (L-R) R. Dale Thomas and James V. Thompson presented “Workers’ Compensation Pumpkin Patch.” 11 “Bobbing for Apples and the ADA Interactive Process” was the topic discussed by (L-R) John Burleson and Matthew Courtner. 12 (L-R) Dale Conder, Jr. and Bob Binkley presented “Tricks or Treats – Social Media and HR.” 13 “Skeleton in the Closet: Employment Case Studies” was discussed by (L-R) Geoffrey Lindley and Rob Binkley
Tennessee does not certify specialists in the area of employment law.
HR Mississippi 2021 and Beyond By SHONDA KINES
Shonda Kines, SHRM-CP, PHR, CCP, CBP, FLMI Director, Human Resources, Southern Farm Bureau Life Insurance Company and Director-Elect, Mississippi State Council of SHRM
I am honored and humbled to be the incoming Director of the Mississippi State Council and looking forward to working with the great HR professionals in Mississippi. This year our profession has been stretched like never before to show our resiliency and to expand our thinking as we continue to deal with a global pandemic and the increased focus on racial and social injustice. These challenges provided all of us the opportunity to grow and demonstrate the value we bring to our employees, organizations and the HR community. These circumstances also provide the opportunity for all of us to come together and continue to connect, convene and collaborate as one HR Mississippi. As an affiliate of the Society for Human Resources Association (SHRM), the mission of the Mississippi State Council is to serve as the central hub for information about HR in Mississippi as well as provide networking opportunities, information and professional development for all HR Professionals. Our organizational structure includes the state council, 8 SHRM affiliated local chapters and 3 student chapters. Each organization’s leadership is made up of volunteers committed to the advancement of the HR profession. The council has a long history of great leaders working together in various roles to provide resources, a state-wide conference and exhibition and recognition programs. We owe a debt of gratitude and thanks to our past, current and future volunteer leaders for the gift of their time and talents to help our organization and profession prosper and advance.
“Volunteering is a way to make a difference in your individual community and/or professional network. Through the act of volunteering, we gain knowledge for personal and professional growth, as well as develop talents and passions that otherwise we may have not discovered. The connections to new people, new experiences and new characteristics allow us to achieve a sense of physical, mental, and spiritual “self ” health that will carry us through many facets of complicated busy lives, and provide fun and joy that can change lives in the process.”
Jan Farve, PHR, SHRM-SCP, CMSA, ERS, CME Human Resources Director, Merchants Foodservice Past Director, Mississippi State Council of SHRM
The Future of HR Mississippi Our state council leadership team has a vision of advancing and sustaining the HR professional in Mississippi by better connecting and engaging our local and student chapter members at every level. We want to draw from the knowledge and experiences of our long-term members, provide value to our mid-career members and mentor our members new to the profession. It is essential that we work together to improve our communication strategy, bridge our nationalstate-local membership and evolve our delivery of educational and certification credit opportunities using diverse platforms. For many years, several of our long-time members have helped to mentor new and upcoming professionals and we are striving to solidify these key relationships in the coming years. I know having great mentors like Billy Sims, Joyce Plunkett, Lindsay Carter and Teresa Boutwell at the start of my career was invaluable to my growth as a leader and professional. We will work to connect our college chapters and local chapters to the state council and together build the strategies to increase membership, promote certification and develop the leaders of tomorrow. This effort will provide the growth we need to move forward so that HR Mississippi can “Thrive” and not just “Survive.” To accomplish this, we all must work together towards this common vision for our profession and organizations. We must think differently and keep our minds open as we evolve our membership connectiveness and the growth of our membership across the state.
“After having the opportunity to attend the SHRM Leadership meeting last year, it was said many times “Better Together”. Though I understood what was being said, in 2020 it was proven and put into action. With the support and resources available through SHRM and the state our chapter not only persevered but grew during this time. More importantly it was a great reminder that we all have the same purpose - to elevate the HR profession. Through sharing ideas and resources we can and will achieve greater success throughout the state of MS for all HR professionals. I am excited to be part of this forward move.”
The year of 2020 has been a disruptor for sure but it has provided us a wealth of opportunities for the future. All of our organizations are having to embrace the “new normal.” The state council and our local chapters are no different. While our mission remains the same, we have the opportunity to chart the course of that “new normal.” We hope you will join us in our goal to make HR Mississippi the voice of our profession in the state as we improve the quality of our offerings and quantity of members who can work together for a more inclusive and sustainable future.
Cynthia Black, SHRM-CP Human Resource Officer, The Peoples Bank Chapter President, Gulf Coast Human Resource Association
The HR Mississippi Challenge
We challenge all of our Mississippi HR professionals to get involved, join your local chapter and become active by volunteering to serve in a chapter role. These efforts will help build a bench strength of future leaders and provide the continuity for our chapters. The state council and local chapters have to rethink and promote the value we bring to our members. We can no longer keep doing the same things year over year.
For information on local chapters in your area, please visit our website at https://msshrm.shrm.org/.
Why this is a Must Read Three reasons: 1. This book is an excellent primer on where things stand now in the development of AI. 2. This book will help us think about the human place and role in work in the world of rising AI capabilities.
Human + Machine:
Reimagining Work in the Age of AI BY WILLIAM CARMICHAEL
Last month, I reviewed the first of three current bestsellers on the topic of Artificial Intelligence (AI) and did so from a perspective of AI as a human resource’s change agent within an organization. I touched on how AI has become a transformational inevitability for both business and industry and how the organizational dynamics of AI directly impact that organization’s global success. That inherently, changes needed must be built-in and ultimately become ontologies which are frameworks for representing shareable and reusable knowledge across a domain. In this second review, I will look specifically at AI as the next paradigm shift for organizational growth. For this, Human + Machine: Reimagining Work in the Age of AI by Paul R. Daugherty and H. James Wilson show that the essence of the AI paradigm shift is the transformation of all business processes within an organization. It also establishes a much-needed benchmark for those of us still new to AI. And once again, HR is right there.
What is AI and Our Role in it? For HR and legal practitioners, understanding AI and how it applies to our individual roles may seem daunting at first, yet it is surprisingly logical. In Human + Machine, Daugherty and Wilson define AI as “systems that extend human capability by sensing, comprehending, acting, and learning.” Simple enough but where exactly do we as employees, fit into these systems? Or, if machines replace much of the work done by humans, what will be the (new) work for humans to do? According to the authors, “The key to understanding AI’s current and future impact is its transformation of business processes.” They go on to say, “A widespread misconception is that AI systems, including advanced robotics and digital ‘bots’ will gradually replace humans in one industry after another. . . That may be true for certain jobs, but what we’ve found in our research is that although AI can be deployed to automate certain functions, the technology’s greater power is in complementing and augmenting human capabilities. And there is one new job that will likely be needed, and filled; HR Directors for machines, providing training; correcting; firing; re-purposing; performance reviews for our machines.” “Today, 61% of activities in the missing middle require employees to do different things and to do things differently,” the authors report. Therefore, companies must reimagine their work processes and “reskill their employees.” Employees’ new jobs include training data models and “explaining and responsibly sustaining an AI system’s performance.” Doing things differently means employees’ “using amplification, interaction, and embodiment to get a job done with superhuman performance.” When humans and machines do what they do best, “the result is a virtuous cycle of enhanced work that leads to productivity boosts, increased worker satisfaction, and greater innovation.” According to the authors’ research, “companies that use AI to augment their human talent while reimagining their business processes achieve step gains in performance, propelling themselves to the forefront of their industries. 42
3. This book will inspire us to think about what is possible in ways that we have not yet considered. Based on the authors' experience and research with 1,500 organizations, the book reveals how companies are using the new rules of AI to leap ahead on innovation and profitability, as well as what we can do to achieve similar results. It describes six entirely new types of hybrid human + machine roles that every company must develop, and it includes a "leader’s guide" with the five crucial principles required to become an AI-fueled business.
Structure and Layout Written in two parts, at 215 pages, Human + Machine: Reimagining Work in the Age of AI, has the look and feel of a user-friendly technical guide and one I recommend as a linear read. Figures, charts, and author observations also help support points throughout the book, as does an excellent technical index. Well researched, readers will appreciate the insight and clarity our authors bring to AI in our lives.
Who Will Benefit Most from This Book? Human Resource Professionals, Corporate Trainers, Information Officers, Senior Management
About the authors: Paul R. Daugherty is the Chief Technology and Innovation Officer of Accenture. He leads Accenture’s AI Initiatives, as well as its R&D facilities around the world. H. James Wilson is Managing Director of Information Technology and Business Research at Accenture Research.
William Carmichael, Ed.D
Professor | Strayer University William.email@example.com www.strayer.edu
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