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October Hot Topics:
  1. Critical Communication: The Value of Employee Benefits
    By Human Resources Professional Group
  2. Successful Recruiting on a Shoestring Budget
    By Alden Reynoso, VP Recruitment and Client Services, Human Resources Professional Group
  3. Changes in Workers' Compensation Laws Underway In California
    By Eric Sheetz, Commercial Insurance Broker, The Michael Ehrenfeld Co.
  4. IRS Issues New Guidelines on "Tip" Income
    By Fred Patterson, lll, District Sales Manager, AmCheck
  5. Check's in the Mail: What to do if you Receive a Rebate from Your Medical Carrier
    By Michael Pondrom, Partner, Discovery Benefits Solutions
  6. Legislative Alert: AB1844: Workplace Social Media Protections Signed into Law in California


Critical Communication: The Value of Employee Benefits
By Human Resources Professional Group

It’s no secret that excellent communication with staff is essential to running a successful business. Workplace communication can always be improved upon. It is important to foster this communication as it builds trust, respect and a willingness to remain loyal to a company. Almost every employee issue can be traced back to communication - whether it is morale, performance, productivity and yes - benefits issues.

It is advantageous for those in managerial and/or supervisory positions to build trust within a company. Traditionally, employees do not trust the information on health and wellness that is shared with them by their employer. Most employees appreciate and use their benefits, but don’t necessarily see them as having a “high value”. Currently, the challenge for employers is to raise awareness and increase participation in benefits packages.

As an employer, you may not realize the importance of marketing your company’s benefits package to your employees. If communicated properly and effectively, it can provide for more participation, the perceived value can increase, and it can ultimately create a more unified company while fostering a sense of trust. Added benefits can also include an increase in productivity and a higher retention rate. However, it would appear that communication and education efforts, regarding benefits, are not meeting the needs of those in the workplace.

A recent Prudential study indicated that only 35 percent of employees rated their experience with benefits communication as “highly effective”. A benefits package is only valuable to an employee if they are aware of what is offered and if they actually use what is offered. Employees should consider the following steps in order to communicate benefits information effectively.

Be mindful of who is receiving the information. One of the first steps in effectively communicating with your employees is to be aware of your employees needs and to always keep in mind who your “audience” is. Benefits should meet the expectations of individual staff members in order to be truly valuable to them. Create a survey for employees well before the actual enrollment period begins. In this way, you can better gage what your employee is looking for in a benefits package. After all, you may have up to three different generations of employees: baby Boomers - usually with grown children or an “empty nest”; those that are raising a family, considering future retirement plans or even caring for elderly parents; and still others who are twenty-something’s, just starting their careers. When you take the time to listen to your employees, it shows you care about them as individuals and about their standards of living, thus building a greater sense of trust.

Promote your package.
Once you’ve created a benefits package, it’s time to campaign for your package. Keep in mind that you don’t have to overhaul your entire benefits package or spend a lot of money on a benefits package, but market your package so as to make it a simple and useful tool. Some effective strategies include health and wellness fairs, employee meetings, mailers, screensaver messages, internal newsletters or interactive visual messages displayed on their computer. Also offer wellness programs (for example, stop smoking, exercise for fitness, healthful diets, etc.) On-line tools can help to foster enrollment as well with the use of savings worksheets, plan comparisons and medical cost calculations. You can also keep it simple with the use of tip sheets and checklists so employees can choose appropriate information that serves their needs.

Follow-up is key. After the enrollment period ends, it is still important to keep the communication lines open. For instance, you could follow up with a brief summary of the benefits offered, those actually selected and what could be changed in the future. A few short emails throughout the year can also validate their participation in a benefits program. Make note of any changes to certain programs, perhaps a Flexible Spending Account or trends in the industry that could have a positive impact on their benefits. You can also include any useful information from the vendors that provide the benefits. And when you use total compensation statements to associate a dollar value with benefits, it can serve to remind employees how valuable their benefits package is.

Most important of all to remember, good communication conveys to your employee how much you value their service and their loyalty.

We invite you to contact HRPG if you would like to discuss ways that HRPG may assist your company in working through any of the HR challenges you see for 2012. Contact us at rdavies@hrpg.com or (619)421-0074.

Successful Recruiting on a Shoestring Budget
By Alden Reynoso, VP Recruitment and Client Services, Human Resources Professional Group

As online job postings continue to gain popularity, their cost is on the rise. The most popular job boards now charge in the vicinity of $400 for a 30-day posting. If you want the added benefit of being able to search for resumes, expect to shell out another $500-$1,000 for one month of access. Staffing agency fees usually start at about 25% of the annual compensation for the individual hired. For smaller and start-up companies, these costs may represent a significant portion of their annual recruiting budget. The good news is that it is still possible to generate candidates for opportunities without large outlays of cash. The key is to simply plan ahead.

Frequently, our desire to start recruiting and “fill the position quickly” manifests itself in a lack of planning - and there is nothing more fatal to a recruiting budget. Below, you will find four tips to help you keep your recruiting activity organized and on-target, making the most of your recruiting dollars.

Tip #1 - Avoid Reactive Recruiting - This means you should not wait until the need actually arises to start sourcing for candidates on mission-critical, high turnover or complicated positions. Take a lesson from TPRs (third party recruiters) and Executive Search Firms - they are always building relationships with individuals they consider “likely” candidates. This is true even when the recruiter is not working an active requisition or job order. There was a time when all recruiters had to work with was a rolodex, a telephone and a fax machine. Some highly successful recruiters still essentially work that way. If you recruit continually, you are more likely to have an appropriate candidate lead in your “rolodex” when you need it.

Tip #2 - Get the posting right the first time - Make sure you (and the hiring manager) have a good understanding of performance expectations. In general, this will always help with recruiting, but when your budget is limited - you can't afford to waste valuable recruiting dollars/time with inaccurate job postings. Most candidates apply during the first two to three weeks of the requisition cycle. Any changes made to the job description after that creates a lot of wasted resources and potentially a significant lag in the process. A good way to make sure those precious dollars are spent in the best direction: Work with the hiring manager to develop a Performance Profile. This is not simply the list of skills and qualifications that comprises the average job posting. Instead, a performance profile describes what the person must accomplish with the skills. It also incorporates factors like management style and the specific measurements of success in the position. Having that deep understanding of both the qualifications and the environment will help you target the right candidates right away.

Tip #3 - Use Internet Job Boards Wisely.
If you are hiring an administrative assistant, you will probably be very successful with a single posting to one of the large, well-known job boards. If you are looking for someone a little more specialized or with unique industry experience - you may be better served by taking some time and doing some research into niche sites. They may even have the added advantage of being less expensive. Don’t know what those niche sites are or where to look? Try doing some research on Recruiter’s Network (http://www.recruitersnetwork.com) or the IHire Job Network (http://www.ihirejobnetwork.com).

Of course, you may decide not to actually post at all. Other great, but sometimes overlooked free or low-cost sources for candidates:
Internships
Outplacement Services (DBM, Lee Hecht Harrison, Quest Outplacement)
Professional Networking/Research sites -(LinkedIn, Zoominfo, Jigsaw)
Boolean searches conducted using Google or similar search engines.
User groups/blogs/forums
Transitioning Military Personnel - every base has a Transition Assistance Program office for exiting personnel. The base web site will have information on how to contact.

Tip #4 - Check those references! Perform careful pre-employment screening including reference and background checks for any applicant who is being seriously considered for a position. As much as you have invested in identifying your candidate - you want to be sure this person has the potential to become a long-term employee. By the time organizations add up advertising costs, time spent re-recruiting, lost productivity while the position sits open, legal fees, etc - the cost of replacing an employee may actually be up to four times the cost of that employee’s annual salary! Don’t assume that a reference will always give a glowing report. You may be surprised at the information a reference might provide. Reference checks can help you avoid being accused of "negligent hiring practices”. Finally, references may become potential candidates for other positions.
Remember, applying these tips will point you in the right direction, but using the tools will take time and practice. If you still find yourself overwhelmed, outsourcing some or all of your recruiting function may be a more effective solution for your organization.

For more information or questions, contact Alden Reynoso, VP Recruitment and Client Services, Human Resources Professional Group. Alden may be reached at areynoso@hrpg.com, or (760) 730-9531.

Changes in Workers' Compensation Laws Underway In California
By Eric Sheetz, Commercial Insurance Broker, The Michael Ehrenfeld Co.

Earlier this month, chatter among lawmakers, attorneys and unions began to multiply following reports that changes in California’s workers’ compensation laws were underway. Worry began to escalate as lobbyists began to push for changes to pass, while attorneys who represented injured workers petitioned to stop the action.

Somewhere in the middle were folks like you and I who want workers’ compensation reform done the right way - unrushed, thought out, and most importantly, written in such a way that will close the often fraudulent loopholes that arise from psychological and cumulative trauma claims. All too often we see this happening in workers’ comp, do we not?

In the midst of all the chaos, press releases were sent out to business owners urging them to petition Assemblyman Jose Solorio to reform workers’ comp laws in California, especially before these so-called “secret laws” came into effect.

The petitions call upon Solorio to make important changes to Senate Bill 863 - a proposed legislation that would change the formula used to calculate benefits for injured workers. According to The Sacramento Bee, the proposed formula would raise “payments by an average of 29 percent while eliminating aspects of the process that are frequently subject to lawsuits, such as enhancements for psychiatric problems, sexual dysfunction or loss of sleep.” What does this mean?

The changes would translate to less business for workers’ comp attorneys who defend claims such as these. Lawyers are now battling it out with legislators who want to reform workers’ comp in California.

“The devil is in the details and we didn’t get this bill until Friday, and now we learn today that’s it’s been amended again last night,” said Brad Cahlk, president of the California Applicants’ Attorney’s Association.

The Sacramento Bee Reports - “An actuary from the Workers’ Compensation Insurance Rating Bureau of California testified that the plan would reduce costs by $760 million in 2013. The savings would be poured into raising benefits for permanently disabled workers. They would see their benefits increase by between 1 percent and 110 percent, depending on the severity of their injury, with an average increase of 29 percent, according to a report from the bill’s author, Sen. Kevin de León, D-Los Angeles. And employers would probably pay less for workers’ compensation insurance, according to the State Compensation Insurance Fund, which says the savings achieved in the bill could cause its rates to drop by 5 percent to 7 percent.”

What Can You Do?

Even though the promise for lower workers’ comp rates is alluring to many small businesses, it’s important that every single detail be accounted for before the workers’ comp bill passes. That’s why it’s never been so important that small to mid-size businesses voice their opinion and decide what they want to have happen. Interested business owners and executives may sign the workers’ comp petition by going to the following website:

http://www.change.org/petitions/assemblymember-jose-solorio-reduce-the-rising-costs-of-worker-s-compensation-in-california

For more information or questions regarding your companies risk exposure, please contact Eric Sheetz, Property and Casualty Insurance Broker for The Michael Ehrenfeld Co. at ESheetz@ehrenfeldinsurance.com, (760) 809-8510.

IRS Issues New Guidelines on "Tip" Income
By Fred Patterson, lll, District Sales Manager, AmCheck

Small business owners who run restaurants or other businesses where tipping is customary may have to make some changes within the next year. The Internal Revenue Service has imposed some new rules regarding the taxes imposed on tips that impact both employees and employers of service-based businesses. Some small businesses may have to adjust their automated or manual reporting systems for tips and service charges in order to comply with the new ruling.

For employers, the new ruling states that all service charges paid to employees that meet the guidelines for the new ruling are deemed as paid by the employer for FICA tax purposes.
The IRS has imposed some guidelines to help determine whether funds paid to employees are to be considered tips or wages. According to this: IRS’s Official Announcement, tips must be made free of compulsion; the customer must have the unrestricted right to determine the amount; the payment should not be the subject of negotiation or dictated by employer policy; and generally, the customer has the right to determine who receives the payment.

If there is any doubt relating to any of those qualifications, then the payment is deemed a service charge rather than a tip, and employers can be held responsible for any FICA taxes related to those wages.
There are more guidelines included in this: Official IRS Bulletin, as well as a question and answer section to help both employers and employees understand what their responsibilities will be regarding the new ruling.

In some cases, the IRS may only apply the new ruling to charges made on or after January 1, 2013 in order to give businesses the necessary time to amend their business practices.

For more information or questions regarding your payroll processes, please contact Fred Patterson III, District Sales Manager for AmCheck, a payroll solutions firm with offices throughout the United States. Fred may be reached at fred.patterson@amcheck.com or (619) 595-7900.


Check's in the Mail: What to do if you Receive a Rebate from Your Medical Carrier
By Michael Pondrom, Partner, Discovery Benefits Solutions

Under the PPACA Health Care Reform Law, fully insured carriers are giving rebates back to employers IF they did not meet the Medical Loss Ratio Requirements. Anthem Blue Cross for example has been sending rebates out recently to their customers, while other carriers have not, since they met the MLR Requirement.

Here is some information on this portion of the law, and what you can do if you receive a rebate (how you can use the funds/distribute them). Ultimately, we recommend you contact us and your CPA, since this could involve Tax advice.

MEDICAL LOSS RATIO REQUIREMENT:
No more than 20 percent of small group premiums may be spent on administrative costs such as salaries, sales, and advertising. This is referred to as the “Medical Loss Ratio” standard or the 80/20 rule. (For large groups over 50, and in 2014, over 100 employees, the mark is 85%).
If it is NOT met, the carrier must issue Rebates to the Employer. Rebates are taxable if benefits were paid for via pre-tax.
Employers or group policyholders must follow certain rules for distributing the rebate to you if one is issued. (Rules for distribution will be explained by your carrier)
Self Funded Employers do NOT have to abide to MLR rule, and also do not qualify for rebate (but SF employers save more when MLR is lower anyway)

Rebates will be issued, depending on the type of plan, and will include one of the following methods:

Rebates will be applied to pay premiums (over the next 90 days)
Rebates will be refunded to participants within 90 days
Rebates will be applied toward future premiums or benefit enhancements upon the direction of your employer

Rebates provided as cash payouts will either be distributed proportionately to those employees currently participating in the plan, or in some cases, those who participated in 2011.

What does it mean to use plan assets to pay for plan benefits?


Distributes refunds only to current participants
Uses rebates for permitted plan purposes other than refunds, such as applying the rebate toward participants’ future premium payments or benefit enhancements
Limits rebate benefit to only relevant plan participants who are entitled to a rebate for the applicable year

How are rebates refunded to employees enrolled in the plan?

For current enrollees, insurers may issue rebates in the form of either a premium credit (i.e., reduction in a premium owed), premium holiday (a period of time where no premium is due) or a lump-sum payment. Rebates in the form of a premium credit may be applied in the next policy year.

Michael Pondrom, Partner at Discovery Benefits Solutions, may be reached at MikeP@DiscoveryBenefitSolutions.com or call him at 619-298-7625 for more information.


Legislative Alert: AB1844: Workplace Social Media Protections Signed into Law in California

California Governor Jerry Brown has signed into law Assembly Bill 1844 (AB 1844) and Senate Bill 1349 (SB 1349). AB 1844 protects employees from having to give their passwords to their employers should they ask for them. SB 1349 makes it illegal for universities to demand that current and prospective students grant them that access. Both laws will become effective in California on Jan. 1, 2013.
AB 1844 protects employee use of social media by prohibiting an employer from requiring or requesting an employee or applicant for employment to disclose a username or password for the purpose of accessing the employee’s personal social media. Additionally, an employer may not require an employee or applicant to divulge any personal social media with the following exceptions:
An employer may:
require an employee to divulge personal social media reasonably believed to be relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations; or

require or request an employee to disclose a username, password, or other method for the purpose of accessing an employer-issued electronic device.
Although employees may sue employers in court for a violation of the new law, the California Labor Commissioner is specifically exempted from investigating or determining any violation of the Act.
Passage of these laws makes California the third state to pass legislation that makes it unlawful for companies to ask its workers to forfeit their social media account passwords. Maryland and Illinois passed similar legislation to AB 1844 in April and August, respectively.





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