Friday, July 31, 2009

Five Great Reads in Human Resources Blogs This Week

I have done some reading today and I am passing on to you five blogs that I think are important reads. What a great guy I am. (Said blushing... well not really) This is not to say that there are not at least another 100 good blog posts out there to read, there are. But if you read these you will be a bit more educated on some important subjects.

  1. First up is Ann Bares at Compensation Cafe. She wrote Managers: The Next Critical Shortage. If you did not have a compelling reason to work on development programs and incentive programs you will now.

  2. Secondly is Kris Dunn at The HR Capitalist. He wrote Here's Why Companies That Have Used Card Check In The Past Are Silent These Days... This is an update on the Employee Free Choice Act (EFCA) and why companies that have used card check in the past are NOT singing its praises. Great info from someone who has been there.

  3. Eva Rykr, of iOrgPsych writes about The Case for Analytics in HR. She says analytics is more than just measurement. And in this day and age of making a contribution to the organization (so both it and you survive) this is an essential understanding to have. A KEY HR SKILL.

  4. Another KEY HR SKILL is giving presentations. Steve Tobak writes on How to Give a Killer Online Presentation. Well the advice works for in person presentations as well.

  5. Lastly, but not the least, Jon Hyman tells a personal story that should be very instructive to people about NOT USING COPYRIGHTED MATERIAL in A short rant, and a lesson in employee appreciation. Jon has his taken and he did not take to it kindly, even though the "thief" thought they were doing him a favor. He even throws in a bit of HR wisdom.

Well there you have it. Great reading, great lessons. As always, keep reading HR Observations and pass it on to your friends and colleagues. And BTW, if you know of organizations that are looking for consulting work in human resources I have a great team put together. (Hey it is the first commercial I have ever done.)

Wednesday, July 29, 2009

Follow Up on Non-Discretionary Bonuses

In my post yesterday, Getting Punished for Doing Good, about QuikTrip's fine at the hands of the USDOL for not calculating non-discretionary bonus into overtime for nonexempt employees I was asked on Twitter if that included non-cash bonuses. Well I was not sure, though I suspected it might if it was production related. So I asked around. Good blog friend Ann Bares pointed me in a couple of directions and I also asked, via Twitter. two attorneys, Eric B. Meyer and Jon Hyman. Both replied that the answer was a resounding YES! I was pointed to the following fact sheet from the US Department of Labor, Fact Sheet #23, which clearly states on page 2 "Where non-cash payments are made to employees in the form of goods or facilities, the reasonable cost to the employer or fair value of such goods or facilities must be included in the regular rate."

So clearly, if you are giving non-discretionary bonuses based upon production standards, the amount of the bonuses or the value of the award must be added to the base pay rate of the employee and then overtime must be calculated on this amount. If you fail to do so you run the risk of falling into the same trap that caught QuikTrip and many others. Go back and read the comments from yesterday, they are very informative.

As additional resources on this topic see also Ann Bares post on Compensation Force entitled
Know Ye the Regs When Awarding Bonuses or Lump Sums to Nonexempts and Michael Moore's post entitled Bonus and other Lump Sum Payments to Nonexempt Employees may Impact Overtime Calculations . Both are very informative.

Now you have no excuse for making this mistake and you can make yourself an HR HERO in your company.

Tuesday, July 28, 2009

Getting Punished for Trying to do Good: The Lesson in the Quik Trip Fine

QuikTrip, a Tulsa, Oklahoma based convenience store chain, has agreed to pay out $750,000 in overtime payments that the U.S. DOL said were due employees because of a violation of the Fair Labor Standards Act. By just looking at the headline you might think this is the "standard" case of a company working employees off the clock or not counting time they worked. Well if you thought that you would be very wrong. This case has to do with a company trying to do good things for their employees and rewarding them for their good work.

QuikTrip has a bonus system based upon a secret shopper program. Employees are rewarded for extra good work based upon their ratings in the program. What an excellent thing to do! However, QuikTrip got caught in a making a mistake that many companies probably don't even realize they could make too. In fact when I talk about this in the SHRM prep classes I teach most people are agast. The mistake that QuikTrip made was in giving nonexempt employees non-discretionary bonuses! Because if you give nonexempt employees non-discretionary bonuses you have to use that in your overtime calculation for the period of time that was covered by the bonus.

This 2003 article, entitled Intersection of Bonuses and FLSA - Is More Overtime Pay Due?, written by Jason Reisman of the law firm Obermayer Rebman Maxwell & Hippel, explains that "The FLSA requires that non-discretionary bonuses - those promised to employees - be allocated over the time period to which they apply and included in calculating the overtime pay due to non-exempt employees. Such a bonus, viewed under the FLSA as additional compensation for employees' work, requires additional overtime pay beyond the employees' regular overtime pay rate, which is one and one-half times their regular hourly rate of pay. Non-discretionary bonuses that are not paid on a weekly basis require allocation to each workweek covered by the bonus before recalculating the overtime compensation due. Generally, non-discretionary bonuses include attendance bonuses, individual or group production bonuses, bonuses for quality and accuracy of work, and retention bonuses." (For further information click on the link above.)

Discretionary bonuses do not require such payment, but may have consequences beyond just the simple payment of the bonus. To avoid problems Reisman suggests either of the following in constructing a bonus program for nonexempt employees.

  1. True discretion - both the language of the bonus plan and the actual administration of the plan must demonstrate "discretion."

  2. A percentage of total earnings (both straight time and overtime) payout. As to the latter option, instead of a lump sum payment, the FLSA authorizes employers to pay a "percentage bonus" because it automatically includes an allowance for overtime pay as well as for straight time pay. The percentage bonus tool can be a silver bullet to effect compliance with the FLSA overtime provisions, while leaving intact the non-discretionary format of the bonus. However, a percentage bonus still requires advance planning, as it may have associated side effects, such as causing the employer to make different bonus payouts for similarly situated employees who earn different amounts of money, by virtue of different pay rates or working different hours.

Or you just don't pay ANY bonuses to nonexempt employees! Overtime problem solved! But wait that certainly does not get you in the direction you want to go in with having committed employees whom you want to reward for helping the company be successful. So careful design and understanding and guidance needs to go into each bonus program you design. Realize the cost of the bonus is going to be greater than the actual bonus designation. And if you don't have someone on your HR staff qualified to do this then get a good compensation consultant to help you. It will be a whole lot cheaper than paying $750,000 in back pay. QuikTrip got burned trying to do something good you need to avoid the same happening to you.

I would like for some of my compensation buddies to weigh in on this and perhaps offer some additional advice. Ann? Phil? Folks at Compensation Cafe?

Monday, July 27, 2009

Sometimes You Lead from the Back: Lessons from the Tour de France

I am a big fan of cycling, the Tour de France and Lance Armstrong. I have had the opportunity to see one race in person (2004 when Armstrong won his record breaking 6th TdF). So I definitely watched with interest as he made a comeback this year in a bid to win an eighth title. There were all kinds of questions about Armstrong, his team and his bid. They had the strongest team, that was a given, but there was potential conflict amongst the team members. There were three potential leaders, Armstrong, Levi Leipheimer and Alberto Contador. Armstrong and Contador were previous winners and the third (Levi) had finished 3rd in 2007. Experience was in Armstrong's favor, but he had been absent from cycling for over 3 years, he was recovering from a broken collar bone and of course he was approaching the "old" age of 38 years. He had more to lose than he did to win.

From the start there was dissension in the leadership. Who was going to be the leader? Johann Bruyneel, the coach and director of the team, stated that "leadership" of the team was going to be sorted out on the road. The best rider was going to be supported by the others. Early on Contador tried to establish himself in that position. He violated the team plan and make a breakaway in one of the early mountain stages. He showed that he was very good in the mountains and established himself as the team "leader." Or more correctly the "rider to support for win." In my opinion he did not establish himself as a leader. Contador made it apparent from the beginning he was there for himself by both his statements and his actions.

Despite the fact that only one person rides a bicycle in this sport it is very much a team sport. No one rider can make it without the support of the team. And this is where Armstrong showed his leadership. Rather than making a big show and trying to be competitive with Contador he put aside his personal ambitions and supported his team and his team "leader." He conducted the race from the peloton (see here for the Wikipedia explanation) and made sure Contador stayed in position to win the race. He was careful in the interviews not to make an issue of the tension on the team or the fact that Contador did not follow the rules. And Armstrong was interviewed alot. He realized that it was best for the team. And this was very tough for the VERY competitive Texan. But his maturity and leadership paid off. Contador was the champion, the team was the best team and, by the way, Lance was able to still make the podium in 3rd place. Not bad for a personal comeback and very lucrative for the team. Contador's win, Lance's 3rd place and the team's placement garnered over $900,000 in prize money alone.

The lessons on leadership for us in this sporting example are:

  1. Leader's have to realize the race is not about them.

  2. Support is necessary at all times, even if there is some dissension.

  3. You don't air your differences in public.

  4. You keep focused on the goal.

  5. You deal with issues after the goal is achieved.

Lance Armstrong's comeback showed that you can lead from the back.

Photo Credit: This is my photo taken in Paris in July of 2004 on the Rue de Rivoli.

Thursday, July 23, 2009

Meaningful Work: It Helps Employers and Employees

I wrote an article for the Atlanta Journal Constitution, the online version, on Meaningful Work. I think it helps both employers and employees. Click on the link above and let me know in the comments section either here or there and let me know what you think of meaningful work.

Wednesday, July 22, 2009

HR Blogs of Greatness On the Midway: Carnival of HR July 22, 2009 Edition

The folks at Inform are hosting the Carnival of HR this time. The have a great list of topics keeping in the carnival theme. You have carnival games “Roll-up, roll-up…everyone’s a winner!”. You have carnival food “Hungry? It’s Corndog and Deep-Fried Oreo time”. Games of skill, lost friends, uncertainity of what to do next and then time to go home. Sounds like a real carnival to me!

So head over to the midway and read some of the best in human resources blogs. And make sure you invite friends! The more the merrier! Just make sure you don't get dizzy from the twisting and twirling posts. Employee engagement, HR education, challenges with recruiting, the future of HR, managerial questions and psychometric testing are just some of the jobs to make your head spin.

Monday, July 20, 2009

Trust: Keystone of Relationships

I am reading up on the use of social media in marketing and PR. One of the books I am reading is Social Media Marketing: An Hour a Day by Dave Evans. In the book Evans starts the entire discussion on the topic of TRUST. He is talking about whether consumers will trust your message. That got me to thinking about trust and what a foundation it is for most everything we do in relationships. Whether it is through social media, regular media, books, TV or whatever form you choose. Walter Chronkite just passed away and in the many accolades showered on him was the phrase "The most trusted man in America." We (those of us that ever saw him on TV) trusted that what he was reporting was the truth. People who violate the trust we put in them suffer for it. Witness Dan Rather.

We all know the importance of trust in our personal relations. Violations of that trust cause alot of emotional hurt and fuel an entire industry of divorse lawyers. Violations of trust estrange friends, and children, and parents and spouses. Trust can be regained but it takes alot more work to do so than would have been necessary to keep it in the first place.

Trust is also equally important in the workplace. It is the keystone to working relationships as much as it is in personal relationships. You have to trust that your supplier will deliver, that your customer will buy, that your employees will work faithfully and that your boss will support you the way that was promised. Becky Regan, writing for the Compensation Cafe wrote a post entitled Build Employee Trust By Treating Employees Fairly, Not Equally. It is an excellent post on how important trust is in a working relationship and how that trust is built through fairness rather than equality. She points out the errors many managers make by using the misguided principle that equality equals fairness. It doesn't. We all work at different paces, with different efforts and different results. We don't necessarily deserve, because we have not earned, the same outcomes. This is explained by Adam's Equity Theory (click for an explanation).

So how can you become a better manager using fairness to build trust? I would suggest you read Regan's blog post by clicking the link above. It is very instructive and it is well written so I figured you should enjoy it personally rather than hear it from me.

Thursday, July 16, 2009

The Importance of Continuing Education for a Successful Career in Human Resources

As many of you know, in addition to being an HR consultant, I am also an instructor in Continuing Education for two Georgia Universities (Kennesaw State University and the University of Georgia) where I teach HR related subjects. In a meeting of instructors and staff we had a discussion about the importance of continual learning and keeping your HR career on track. We discussed how rapidly things are changing in the field of human resources and business in general. Without ongoing learning you will NEVER be able to keep up. In today's business environment the person that continually enhances their learning and keeps improving their skill sets is the one who will survive cutbacks. And even if you don't then having that enhanced set of skills and knowledge will make you that much more employable by the next company.

This new skill set has to include a strategic perspective, business acumen, a knowledge of metrics, conflict resolution ability, decision making skills, speaking ability, a knowledge of changes in technology (to include the use of social media) and a ongoing legal and compliance awarness. Being a Futurist is also an important skill. Helping your organization see the future and prepare for the future will make you very valuable. The days of "carrying the watermelon to the company picnic" are over. Continuing education programs, both live and online, help you improve or acquire skills.

Consistent reading, a skill losing traction everyday, will also put you in the top of your class. Self-improvement guru, Brian Tracy, says in his book Time Power, "Read at least one hour per day in your chosen field. One hour a day will translate into approximately one book per week. One book per week will translate into approximately fifty books ove the next twelve months. If you read an hour per day, one book per week, you will be an expert in your field within three years. you will be a national authority in five years, and you will be an international authority in seven years. All leaders are readers." What a powerful statement!

If you are not yet convinced to the importance or need to keep up then watch this YouTube.

Tuesday, July 14, 2009

Government to Check I-9s in a Nationwide Audit

According to an article on SHRM's website (sorry you have to be a member to read this one) U.S. Immigration and Customs Enforcement (ICE) issued notices to 652 businesses that they will be audited. In all of 2008 they only issued 503. So obviously they are stepping up activity. The agency is trying to build criminal cases against employers before they conduct raids. According to the SHRM article:

"As part of its shift in strategy, ICE is going after employers instead of undocumented workers, according to Mira Mdivani, an immigration attorney with The Mdivani Law Firm in Overland Park, Kan., in a July 7 interview."

Apparently the targets of the investigations, which are widespread, were gathered from No-Match letter data, use of E-Verify, union instigation and other "investigative measures." The agency is being secretive. According to the article "...ICE officials “refused to tell us how to define substantive violations of I-9s versus technical violations. We thought we knew, but they won’t tell us.” And ICE wouldn’t disclose the guidelines that are being used to fine employers, ...."

Mary Pivec, an attorney with Keller and Heckman in Washington, D.C. provided SHRM with the following list of items that ICE might be looking for on an audit.

  • Original I-9s. Forms I-9 must be retained for three years after the date of hire or one year after the date of termination, whichever period is longer.
  • A spreadsheet listing alphabetically all current and terminated employees with hire and termination dates in electronic form Word or Excel, non-PDF, including the names, Social Security numbers and dates of birth of each employee.
  • Copies of quarterly wage and hour reports and/or payroll data for all employees—current and terminated—covering the period of inspection, as well as quarterly tax statements.
  • Business information, including the employer identification number, taxpayer identification number, owner’s Social Security number, owner’s contact information (e.g., address, information, phone numbers and e-mail addresses), articles of incorporation (if applicable) and copies of business licenses.
  • Copies of Social Security no-match letters.
  • A copy of any I-9 policy.
  • The name and responsibility of those who complete I-9 forms.
  • The date the business was established, form of the business, where it is incorporated and its revenue.
  • The department or job titles of employees.
  • Quarterly unemployment insurance reports with the state or quarterly returns for Federal Income Contributions Act taxes.

According to the article and the attorneys HR needs to own this process. My experience has been that too often forms are incomplete because HR does not own the process. And since this is a law that can result in jail sentences great care needs to be taken in completing the information on this form.

The advice in the article is "Designate a lead person to spearhead immigration compliance at the company and adopt an immigration compliance policy that incorporates recommended ICE best practices that make sense for your company, she recommended, and become thoroughly familiar with ICE’s I-9 handbook. Conduct annual immigration audits in cooperation with legal and provide annual training, keeping the big picture clearly in focus as enforcement strategies and laws change. That way, instead of scrambling after receiving an I-9 audit notice, Mdivani said, a company will be prepared."

So, depending on what your company does, what your history has been like and how you have things set up you may have a lot of work that needs to be done. But I hope this makes you sit up and pay attention.

Monday, July 13, 2009

Marketing Tips for the HR Department

As an HR consultant I am always working on bringing in new clients. There are many traditional methods of marketing and selling, which unfortunately are not working as well in today's economy as they have in the past. So it is time to look at new methods and since I am a blogger, and on Twitter and LinkedIn I thought I would look at using social media as a potential method. To this end I picked up and read David Meerman Scott's book The New Rules of Marketing and PR: How to Use News Releases, Blogs, Podcasting, Viral Marketing, and Online Media to Reach Buyers Directly. It is a good book. I plan on using several of his ideas and I am looking forward to increasing business.

One of the concepts he talks about is understanding your buyer's persona. And it is likely you will have multiple buyers, thus you need to understand multiple personas. Certainly good information and an interesting concept for marketing. But it got me thinking that ALL Human Resources Managers should read this book because much of what he talks about in terms of social media use and understanding buyer personas applies equally well to the HR department and employees.

David Meerman Scott (you will have to find out from him why he uses his middle name) writes about having content rich materials as opposed to the one-size fits all products and features. Great marketing stuff that HR needs to pay attention to. Too many HR departments have one-size-fits-all handbooks, health insurance, compensation programs. We create the materials in terms of what we, the HR department, want people to know instead of creating multiple buyer personas and giving them the information they want to have. Does anyone really want to read a wordy stiff sounding handbook? Perhaps they would rather have an online FAQ site that is searchable. I know there are companies out there doing this sort of thing, but there are others that are not. How do you view the use of social media in your company? I know many that shut it off. Is this shutting off your best communication tool?

When was the last time you viewed all the potential "buyers" of HR? Managers, employees, the C-Suite, applicants, ex-employees, the press and vendors are just some to of the buyers for which you would need to develop a "persona". Have you? Or does everyone get the same story and material?

If you have not looked at your human resources department from a marketing perspective I suggest you do so and DMS's book is a good start. Check it out.

Thursday, July 09, 2009

Ageism in the Workplace

As I was watching the reflection of my hair being cut the other day I thought out loud "Holy crap, look at all that gray hair." The woman cutting my hair consoled me with "At least that is better than loose." Not the greatest of consolation, but it got me to thinking. As many of you know, I had my birthday on July 7th, my 58th such day. Not a hallmark age by any means. But I guess it is better than not getting there.

Age is important to us, especially it seems in the US. And AGEISM exists everywhere. According to the WiseGeek, ageism is a term coined in 1969 by Robert Butler. Most of us think of it in terms of discrimination against older people, especially in the workplace. As The WiseGeek says "Many people use this term specifically to refer to discrimination against older people, but ageism can strike people of all ages." Teens can feel shut out of the workplace with "adultism", a preference for older workers, and older workers feel shut out by "jeunism", where workplaces prefer younger workers.

The legal protection in this country against discrimination based upon age is provided by the Equal Employment Opportunity Commission's (EEOC) enforcement of Age Discrimination in Employment Act (ADEA)of 1967. The law states that it is illegal to discriminate against anyone over the age of 40 in all aspects of employment, unless age is a Bona Fide Occupational Qualification (BFOQ). There is no protection for workers under the age of 40. However, the fact that this law exists does not stop the discrimination from occuring, as you might have guessed. The EEOC reports that in 2008 it "...received 24,582 charges of age discrimination. EEOC resolved 21,415 age discrimination charges in FY 2008 and recovered $82.8 million in monetary benefits for charging parties and other aggrieved individuals (not including monetary benefits obtained through litigation)." This is almost 25% of the total number of discrimination claims of all types.

I witnessed an act of "ageism" personally the other day. I was not the target, but I was involved. I was at a local Starbucks (I name the company, but not the location, because hopefully someone in their HR department will read this and realize they have some further education to do. I am sure it is more widespread than this one spot) and I was ordering coffee and trying to pay with my coffee card. However, it needed more money put on it so I also gave the gentleman a credit card. I asked him to load money on my coffee card and to then pay for the drinks with my coffee card. Perhaps I was not clear, but he did not understand me. We went back and forth a couple of times and finally he had to ask for some help. Now the guy was probably about my age or within 5 years. But we were clearly not communicating. So a younger worker, who did pick up on what I wanted, helped him complete the transaction.

End of story? No, the next day I was sitting in the same store, with my under 30 adult daughter, and one of the baristas came over and apologized for "the confusion yesterday." In that apology she said "What can you expect, he is old." Now, being in HR and of similar age, I immediately bristled at this and gave her a mild rebuke. (I would have given her a lecture, but my daughter gave me a look that said "don't go there.")

All this leads to my musings on age. Age is important to us. It colors our perspective on everything. In the US we celebrate "youth" more than older age. Witness the statement "50 is the new 30", or whatever variation you use. I was reading an article as I was waiting to get my haircut about how women over 40 can avoid behaving old. (Text with your thumbs not your index fingers and never wear a watch, among other advice.) Magazines are knocking actresses who are not wearing "age appropriate" clothing. We curse at old people who are driving the car in front of us and we avoid going to Kroger on Wednesday. None of us are immune. I swear at AARP everytime I get their offers to join. At least there are signs that some aging is being accepted. December/May romances between older women and younger men is more acceptable and "Cougars" are being celebrated.

The important thing, however, from an HR perspective is that discrimination in the workplace on the base of age (albeit older age) is illegal and it will cost the company money. Workers need to be trained to be more aware of what they say, how they say and what they do. You need to focus on JOB PERFORMANCE. In my Starbucks example, if the "older" worker was let go due to his actual poor performance, the "innocent" statements of "what can you expect he is old" may cost the company alot of money. So be aware and train your employees.

Carnival of HR for July 8th

Well darn! The day after I get a top 25 ranking I find out I missed yesterday's Carnival of HR. But you don't have to... here it is at Effortless HR. My good friend Cathy Martin has a great post about employee engagement and my blogger friends Sharlyn Lauby, Dan McCarthy, Wally Bock, and Mike VanDervort also have great posts. So check it out!

Wednesday, July 08, 2009

Top 25 Talent Management Blogs: We Made It A Second Time

The list of the Top 25 Talent Managment Blogs has been posted at Fistful Of Talent. If you are looking for some of the best blogs in HR this is were you will find them.

AND, I am very proud to say that HR Observations was on the list tied at 15th! Thanks!

I hope you keep reading, commenting and connecting us to other readers.

Wednesday, July 01, 2009

Update on EFCA: SEIU Rejects "Card" Signing: SAY WHAT???

According to an article in the LA Times (SEIU borrows business' anti-union tactics to fend off a rival) the SEIU, the Service Employees International Union, is rejecting exactly what they are supporting in the Employee Free Choice Act. The article states "...the union is urging federal officials to throw out petitions signed by tens of thousands of its own members who have asked to be represented by a rival upstart group." The article goes on to say " In lodging legal challenges to the roughly 80 petitions filed by its fledgling competitor, the SEIU has moved to block organizing elections at hospitals, clinics and nursing homes up and down the state. And it has used some of the same tactics that employers often use to thwart union drives."

Amazingly the SEIU, as the article states "One of the giant union's allegations echoes a key argument that corporate interests make against the proposed law, the Employee Free Choice Act: that labor activists can intimidate or mislead workers during organizing campaigns." Talk about being two-faced! The SEIU has turned to the NLRB and has charged the rival union with unfair labor practices (ULPs) and wants the petitions set aside. Yet Andy Stern, president of the SEIU, says this does not change his stance on EFCA. Sure, not as long as it will work for his benefit. But let it work against him and he is for using current labor law. Sounds like a good argument for not needing EFCA in the first place.

Read the article (link above) to get the full story, especially if you think EFCA is a good thing. This may help you decide otherwise.
A side note: Al Franken will be made the newest Senator next week. This will give the Democrats a philibuster proof majority. This is going to make it much more likely that the EFCA will be passed along with all the other pending legislation mentioned in yesterday's post. Read them and weep.