Hot Topics in Total Rewards

To improve retention, understand what's driving employees away

By Stephen Miller, CEBS   |   June 3, 2020

Times are stressful for employees and employers alike. But while many industries are struggling, others—maybe your competitors—are hiring. If one of your employees is offered a job somewhere else, it may be worth extending a counteroffer. But employers should understand that, if the offer doesn't address what's driving an employee to leave, it isn't likely to keep that employee onboard for good.

A high retention rate can be financially beneficial to an employer. Each departure costs about one-third of that worker's annual earnings, according to the Work Institute, a Franklin, Tenn.-based employee retention and engagement firm.

A recent study by job-search firm LiveCareer asked 212 hiring managers about counteroffers. According to survey respondents:

• Employees reject counteroffers 35 percent of the time. 
  

• Small companies with fewer than 50 employees are more likely to make counteroffers.
  

• 39 percent of hiring managers believe that employees are more engaged after accepting a counteroffer, and 25 percent believe extending counteroffers decreases performance.
  

• 65 percent of employees who accept a counteroffer stay with the company for at least another two years.
  
  

The survey also delved into what incentives hiring managers were offering to keep valued employees onboard, as shown below.

Career Growth Drives Retention

"HR professionals should keep in mind what incentives are important and persuasive to employees," said Joe Mercurio, a member of the communications team at LiveCareer. When a raise isn't possible, effective counteroffer incentives include  promotion, role transition, and better schedule, he pointed out.

Further evidence that retention isn't driven by pay alone comes from survey findings released in April by the Work Institute. The consultancy's 2020 Retention Report analyzed data from over 233,000 employees from 2010 through 2019, including 34,312 employees who quit their job last year.

"One out of every five employees who chose to accept a new job with a different employer in 2019 was because of career development concerns," noted William Mahan, sales operations manager at the firm.

Employees leave "because they want to learn, grow and be challenged in their roles at work. If not challenged, they will find a job where they will be," he said.

A counteroffer that doesn't address those concerns isn't likely to retain employees eying a competitor's offer—or to keep them happy for long if they choose to stay.

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Source: Society for Human Resource Management (SHRM)

https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/counteroffers-should-address-more-than-pay.aspx

Separating rating and pay decisions may offer employers some legal protection.

By: Tom Starner | June 11, 2020 • 3 min read

As COVID-19’s impact on the market and workplaces lingers on, companies are facing a range of unprecedented questions. Among them: What should we do with performance management? And should performance link to pay for this year?

Lori Holsinger, senior principal with Mercer in Atlanta, explains that these are logical questions because, for more than a decade, at least 85% of companies have been linking performance and pay decisions, and 70% of companies link the two by assigning performance ratings, according to Mercer’s 2019 Global Performance Management Study.

“Some proactive companies have already taken action to separate rating and pay decisions until the pandemic is contained and the market stabilizes,” she says.

From a legal perspective, decoupling traditional pay and performance decisions during the pandemic may help employers mitigate future wrongful-termination cases due to poor performance.

Typically, she says, an employer strengthens its position by maintaining a track record over time of employee-employer feedback discussions, adequate training and coaching, and documentation to support termination due to poor performance. Holsinger says this “track record” becomes even more critical the longer the tenure of the employee.

“Companies that are automatically assigning ‘meets’ or ‘exceeds’ ratings during COVID-19 may be inadvertently increasing their future risk for wrongful-termination cases due to poor performance,” she says.

Holsinger says that, in what would be considered normal times, employers set performance goals and expectations that define how a given role will contribute to the team and company’s success, based on historical data for the company, team and role. The process helps establish the baseline for the role and set performance targets that are realistic, clarifying what meeting and exceeding expectations looks like.

“With COVID-19, all these normal planning elements have gone out the window,” she says. “While some companies are thriving financially due to the pandemic, such as home-improvement businesses, gaming and beauty products, many other companies are struggling, particularly retail and hospitality.”

In addition, forces outside the employees’ and employers’ control are at play. With the anticipated “ping-pong ball” effect of openings, closures and modifications until the pandemic is contained, even setting modified expectations for the rest of the year is tricky, Holsinger says.

For example, imagine an employee that “got lucky” due to the pandemic’s positive financial impact on their role and team. Should this employee be rewarded more for their 2020 results? What about 2021, when businesses will begin to right-size? Should that same employee get “dinged” because their year-over-year results went significantly down from 2020 to 2021?

“On the flip side, should an employee that traditionally performs well be caught in the crosshairs of the pandemic and get a poor rating for 2020 due to something outside of their control?” she says.

Holsinger says some employers recognize they would rather send the message of acknowledging 2020 is an unusual year, which should be extracted from their pay-for-performance approach and handled completely differently.

“Many of these same companies see this as a temporary adjustment that is more fair, authentic and transparent with their employees,” she says.

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Source: Human Resource Executive

https://hrexecutive.com/pay-and-performance-management-in-the-age-of-covid-19/

Lead the charge in the rapidly evolving landscape with employee experience, culture and work from home.

By: Nate Randall | June 16, 2020 • 4 min read

Human Resources departments have long gotten a bad rap. After talent acquisition handles an employee’s initial hiring and onboarding, it’s likely most interactions with our department are about things like employee issues, annual healthcare enrollment and dreaded performance reviews. Even worse, it’s commonly recognized that if an HR representative is present, someone’s job is probably at risk. Now more than ever, the challenges facing HR practitioners are deep and complex.

We may have gravitated toward a human resources career path because we are a “people person.” It’s likely that we and other HR professionals value interpersonal relationships and have a high EQ (emotional intelligence quotient). The world around us is rapidly changing. Interconnectedness is becoming more virtual and less in person. How is it that an industry rooted in human interaction has gained a reputation as the boogeyman, and what can we do to change it?

With the rise of self-serve performance management, healthcare enrollment and payroll processing systems, HR representatives’ roles have become more about pushing buttons and sending email reminders than engaging with colleagues. With the necessity and trend of working from home, we in HR risk becoming even more of a secret society and faceless name behind the corporate curtain. HR has continuously been asked to do more work with less staff, effectively removing the social impact of the HR function. 

As technology has created fewer reasons to engage with colleagues, it puts HR in a challenging spot. Although our department is given the responsibility for creating a great company culture, we may feel that we rarely have the time, budget or ability to influence it. 

It may seem impossible given everything we are tasked with, but there are some easy ways to integrate with our colleagues to improve HR’s reputation within the company. HR knows better than anyone that organizational change takes time. Below are both immediate and long-term ways to build your HR team to support your company’s culture through these unprecedented times.

1. Participate

The first step is to be present in the company you support. This means stepping out from behind the computer (figuratively) and actively participating in the day-to-day. 

Invite your colleagues from outside HR to a virtual lunch. Although it can sometimes feel like high school all over again, asking to “join the table” of a different department is a convenient way to socialize without adding any more time to your day. You’ll be surprised by what you learn listening to folks from various walks of life.

If you offer virtual health, wellbeing, fitness initiatives or employee resource groups, join them. If there’s a club that aligns with your interests, this is the perfect opportunity to socialize with colleagues and allow them to see you as more than a department representative. Those trendy new virtual Happy Hours? You should be there with a drink in hand. My experience as a participant has always been extremely valuable in enhancing existing programs.

2. Speak (and act) like a human

In HR, we have our own language. Abbreviations like COBRA, HIPAA, HSA and HCM abound. Although this can quickly convey information to those in our department, it will rarely mean anything to others in our company. Ensuring that we spell out words and explain what they mean in simplified language will make the conversation go more smoothly, rather than leaving them wondering “WTH is an FSA”?

Alexander Pope once penned, “To err is human, to forgive is divine.” Making mistakes is part of being human. But rarely are human resources allowed to make mistakes. When we do, our errors are amplified because they usually center around things that are intensely personal and impactful, such as employee benefits. Rightfully so, this can cause employees to have strong reactions.

Showing empathy, having the ability to apologize and being willing to find resolutions are essential skills for any good HR pro. Calming the emotional response of the other person by validating the way they feel goes a long way. After demonstrating empathy for their situation, an apology is the next logical step. Simply saying, “I’m sorry” can be sufficient, but it’s always best to repeat what we’re apologizing for, so the person feels heard. Fixing a mistake, or at the very least, making it right in some way is the critical end game. If we are unable to offer an immediate resolution, be sure to provide a follow-up date to help build trust, and then deliver. 

Another easy way to speak like a human and build trust is to ask for feedback. People love to share their opinion and all employee surveys are a key bridge-builder between HR and the organization. Questions can be as simple as, “What’s your favorite snack in your kitchen?” or something that requires a bit more thought like asking them to evaluate how they felt an HR interaction went. If we’re specific with our question, we’ll likely elicit a clear response. For example, “I’d love to know we can improve. How could we have explained our benefits in a way that made it clearer?” Additionally, we must be prepared to demonstrate change based on the feedback we receive. That will go a long way in building a culture of trust where employees feel their voices are heard. It may be obvious, but don’t ask anything you aren’t prepared to act upon. This can undermine the whole effort.

3. Hire for culture

One trend that is taking off in the world of human resources is hiring a designated person responsible for employee experience and culture. This person’s sole responsibility is to create an inclusive culture where colleagues have opportunities to strengthen relationships and feel delighted about their work experience. This person is often responsible for things like company food services, as well as developing and maintaining such employee programs as fitness, wellbeing, company events and other employee-led programs. 

“All companies are communities—and as with any community, they have distinct characteristics that define their DNA,” says Alex Shubat, CEO of culture tech company Espresa. “HR teams today have massive responsibilities, to not only maintain the top tier benefits of health and wealth but also the ideas and experiences that make multi-generational and global workforces feel a sense of place, community and culture. More than ever, company culture is helping to get us through some very tough times.” 

Designating a person to help boost employee culture in this time sends a strong message to employees that culture and employee experience are important to the organization. Having a person at every virtual and in-person event who can see and feel the culture and close the employee feedback loop only makes sense.

“That’s a huge ask and a ton of responsibility in an already constrained HR organization,” Shubat says. “With new culture-based technologies, HR now has the ability to enrich their vibrant cultures without the significant labor and minutia involved. Just because you have more and more free-range employees who are working from home, or wherever on the planet, they can still get a sense of connection to their culture—and that is where loyalty lives.” 

One thing is clear, the shifting focus and trend in human resources towards employee experience and culture are only going to continue to amplify as our work world changes and we navigate to the new normal. The best organizations will be prepared to meet the expectations of their employees and recruits by supporting a rich and vibrant employee experience focused culture, no matter where they are on the planet.

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Source: Human Resource Executive

https://hrexecutive.com/3-ways-hr-can-support-company-culture-through-the-new-normal/

A federal judge ordered the commission to revisit its earlier 30% incentive limit.

AUTHOR Ryan Golden ||| PUBLISHED June 15, 2020

The U.S. Equal Employment Opportunity Commission (EEOC) voted 2-1June 11 to move forward a proposed rulemaking that would allow only a "de minimis" financial incentive to encourage employee participation in wellness programs without violating the Americans with Disabilities Act (ADA).

Commissioner Victoria Lipnic said at the commission's public meeting Thursday that the rule would be submitted to the White House Office of Management and Budget for review, adding that "there are many steps to go in this process." Lipnic and Chair Janet Dhilllon, the EEOC's two Republican members, voted in favor of advancing the proposal while Commissioner Charlotte Burrows, the agency's lone Democrat, voted against.

The rulemaking follows a failed previous attempt to implement two similar rules in 2018 that the EEOC rescinded at the direction of a federal judge. The rules amended the ADA and the Genetic Information Nondiscrimination Act (GINA) to permit employers to use a penalty or incentive of up to 30% of the cost of self-only coverage to encourage participation in wellness programs that involved the disclosure of certain ADA- and GINA-protected information.

The AARP sued the commission, alleging that the level of incentives provided for in the rules was inconsistent with the "voluntary" standards of ADA and GINA (AARP v. EEOC, No. 16-2113 (D.D.C. Aug. 22, 2017)). A federal district court determined that EEOC had failed to provide a reasoned explanation for its decision to adopt the 30% incentive levels and remanded the rule for reconsideration.

EEOC drafted its latest proposal in response to the court's order, it confirmed in a June 11 statement. The rule will propose that employers, for most wellness programs, offer no more than "a de minimis incentive" to encourage participation and meet other requirements to comply with the ADA. But the rule would also permit certain wellness programs to offer the maximum allowed incentive under the Health Insurance Portability and Accountability Act’s 2013 regulations.

The agency's public meeting saw objections to the rule from Burrows, who said the rule misreads the ADA by applying the law's "safe harbor" provision to employee wellness programs and raises concerns about how employers will collect and secure employees’ personal data.

"This rule carries unexpectedly high risks for the medical privacy of every employee in America," Burrows said. "I cannot support the rule in its current form."

Lipnic said she "respectfully disagreed" with Burrows' position on the application of the safe harbor provision, adding that the rule as drafted "does provide a solid basis to solicit comments." Dhillon said she "fully supported the rule as written."

If approved by the White House, the proposal will be published in the Federal Register and stakeholders will be able to submit comments.

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Source: HR Dive

https://www.hrdive.com/news/eeoc-to-propose-de-minimis-limit-on-wellness-program-incentives/579836/

AUTHOR Ryan Golden ||| PUBLISHED June 15, 2020

Dive Brief:

• The majority of employees surveyed by Paychex in October 2019 said that an employer's openness to negotiating benefits is important when considering a new job offer, the HR outsourcing firm said in a May 20 statement.
• Sixty-four percent of respondents said they attempted benefits negotiations with an employer. Additionally, 87% said they had done so during the hiring process, and 60% attempted negotiations after being hired. During the hiring process, more than half of respondents had requested a 401(k) match or contribution, flexible work hours or flexible time off.
• Paychex found in a survey of 299 managers and those in a similar position to negotiate benefits that about 83% were willing to negotiate. In situations where benefits requests were denied, more than half of this group said the decision was "often or always" influenced by upper management.Access Free Learning

Dive Insight:

The Paychex survey's results reflect a period in time that dramatically differs from the present, as the COVID-19 pandemic has sent the U.S. labor market into a downward trend. Though recent figures from the U.S. Bureau of Labor Statistics indicate that the situation may be slightly improving, the fact remains that talent professionals are dealing with the aftermath of shedding millions of workers from their payrolls.

One aspect of that impact is that attrition is largely unlikely among employed U.S. adults, according to a recent survey by The Harris Poll for outsourcing firm Yoh. Many workers in the survey didn't believe they would be able to find a new job during the pandemic, but most also said they might consider a job change if they felt their current company was not doing enough to protect workers.

That's not to say that employee benefits have lost their importance in the hiring and retention conversation — in fact the pandemic may be pushing employers to make benefits, particularly healthcare benefits, more accessible. Nearly half of employers surveyed in April by Wills Towers Watson said they would enhance healthcare benefits as well as well-being programs, while one-third said they would make changes to paid time off and vacation programs. Lidl, in its push to hire additional store associates during the pandemic, said new employees would be made immediately eligible for medical benefits that cover testing and treatment for COVID-19.

At the federal level, the IRS issued a May notice stating that health plans may permit employees temporary flexibility to make mid-year election changes for employer-sponsored health coverage, healthcare flexible spending accounts and dependent care assistance programs due to the pandemic.

Employers have also chosen to be more flexible in other areas of benefits coverage, like retirement. A separate Willis Towers Watson survey released in May found a majority of employer respondents had made it easier for employees to access 401(k) plan assets during the pandemic. Few respondents said they suspended matching contributions for retirement plans, but those in industries like retail or business services were more likely to have done so, according to Willis Towers Watson.

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Source: HR Dive

https://www.hrdive.com/news/candidates-want-benefits-negotiations-paychex-employer/579808/

The Small Business Administration and the Treasury Department clarified the application deadline in addition to the extent of loan forgiveness companies can expect under the new PPP.

BY DIANA RANSOM, June 8, 2020

When the Senate passed the Paycheck Protection Program Flexibility Act last Thursday, it did so with several big caveats. The Small Business Administration and the Treasury Department just shed some light on two of them.

In a Monday update, the two agencies said they will "promptly" issue rules and guidance, as well as post modified borrower and forgiveness applications to address the legislative amendments to the Paycheck Protection Program, the now $669 billion forgivable loan program aimed at supporting beleaguered small businesses. They also outlined changes in current rules that will bring them in line with the new law.

Most important, SBA and Treasury said you have only until June 30 to apply for a PPP loan. If you get one, the Flexibility Act extends the forgiveness, or "covered," period through December 31. Senator Marco Rubio (R-Fla.) and others in the Senate had requested clarification on that deadline, according to Karen Kerrigan, president of the Small Business & Entrepreneurship Council, a nonpartisan advocacy group in Vienna, Virginia.

The lack of clarity about the application deadline centers on the eligibility terms for PPP loans under the Cares Act. That is, the statute says certain eligible borrowers may receive a loan during the covered period, says David Cole, a partner with Holland & Knight's corporate and securities group. "Treasury's announcement this morning appears inapposite to the statute," says Cole. He notes that Monday's clarification may be challenged in court, just as past eligibility term changes did.

Treasury and SBA got socked with lawsuits after they changed the eligibility requirements, which previously allowed more than 200 publicly traded companies to access the program. In late April, the Treasury issued new guidance requesting that businesses with the ability to raise funds--say, via bond or stock offerings--to return the money so smaller firms wouldn't get shut out. "A public company with substantial market value and access to capital markets," Treasury advised, would likely not meet the standards required for attaining a government-backed loan. Some public firms then returned the money. 

Typically, SBA loan programs require borrowers to attest that they are unable to get credit elsewhere before applying. That's specifically not the case with the Cares Act, which says the requirement "shall not apply." In other words, the rules changed, and that then put some companies' ability to have loans forgiven in question.

Cole says that the current deadline discussion may constitute a similar overreach: "If Treasury were to promulgate a rule restricting new borrowing to the month of June, that rule could face [a] challenge in court."  

Added Updates

Rubio, who is chairman of the Senate small-business committee, also wanted the administration to clarify whether employers would still be required to rehire or retrain workers to have their loans forgiven. The Monday update doesn't say anything new on this front: Business owners need to meet pre-crisis head count requirements unless required by regulators to reduce hours or scope of business. They'll also be granted safe harbor in the loan forgiveness calculation if they try but are unable to rehire laid-off or furloughed workers.

Rubio and Senator Susan Collins (R-Maine) had also questioned the provision that reduces, from 75 percent to 60 percent, the proportion of a loan that business owners are required to spend on payroll. They noted that the prior version for the PPP allowed for partial loan forgiveness if a company uses less than 75 percent for payroll. By contrast, the senators noted that the Flexibility Act isn't clear regarding the point about partial forgiveness if a business didn't meet the 60 percent requirement.

The update specifies that if a business owner uses less than 60 percent of the loan amount for payroll costs during the forgiveness covered period, the borrower will continue to be eligible for partial loan forgiveness.

The Paycheck Protection Program was officially authorized on March 27 and launched on April 3 with $349 billion in program funds. It was expanded on April 27 with an additional $320 billion. So far, the program has doled out more than 4.5 million loans worth more than $511 billion. 

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Source: Inc.com

https://www.inc.com/brit-morse/answers-to-your-3-top-questions-about-face-masks-in-workplace.html

By SARAH SKIDMORE SELL | May 27, 2020

Lisa Su of Advanced Micro Devices is the first woman ever to top The Associated Press’ annual survey of CEO compensation: Her 2019 pay package was valued at $58.5 million following a strong performance for the company’s stock during her five years as CEO.

The median pay for women on the list was $13.9 million, versus $12.3 million for men. Pay for women was up 2.3% from last year, looking at the median; the median change for men was 5.4%. And, women remained significantly underrepresented as CEOs, heading just 5% percent of S&P 500 companies.

“Women are making incremental progress achieving leadership positions in the C-suite,” said Lorraine Hariton, President & CEO of Catalyst, a nonprofit organization focused on women in the workplace. “However, the fact remains that women CEOs still represent a disproportionately small share of corporate leadership, and women of color aren’t represented at all.”

The 2019 pay figures are from before the coronavirus pandemic upended everything. Hundreds of CEOs have already said they’ll forgo some or all of their salary. And the turmoil in the stock market and the global economy could make it tougher for CEOs to meet performance targets this year.

The analysis of executive pay at companies in the S&P 500 was conducted for the AP by Equilar. The annual review began in 2011. It includes only CEOs who have been in their job for at least two full years, in part to avoid the distortions caused by sign-on bonuses. As a result, a couple CEOs with packages valued even more highly than Su’s were excluded.

Su’s compensation was more than four times the value of her pay in the prior year. The gain was driven primarily by rewards for performance, including $53 million in stock awards and $3 million in stock options, which vest over several years. Su was paid a base salary of $1 million and a performance-based bonus of $1.2 million.

Since Su took over as president and CEO at the chipmaking company in 2014, its stock has risen from around $3 to about $55, and AMD was the top performing stock in the S&P 500 in both 2018 and 2019. Overall, 2019 was one of AMD’s strongest years, as revenue, profitability and gross margin all improved and the company built up its portfolio of products.

Su’s compensation was $13 million higher than the highest-paid male CEO in the survey, David Zaslav of Discovery. It was more than double the next two highest-paid women CEOs, Marillyn Hewson of Lockheed Martin, whose pay was valued at $24.4 million, and Mary Barra at General Motors Co., with pay valued at $21.3 million.

While culturally, there’s been a recent spotlight on issues facing women in the workplace and increased pressure from stakeholders on companies to create inclusive work cultures, Hariton said structural challenges remain. She said women continue to face entrenched barriers and stall out in middle management.

A total of 20 women were on the list, versus 309 men. For the analysis, executive data firm Equilar looked at companies in the S&P 500 index that filed proxy statements with federal regulators between Jan. 1 and April 30, 2019.

To calculate CEO pay, Equilar adds salary, bonus, perks, stock awards, stock option awards, deferred compensation and other pay components that include benefits and perks.

Stock awards can either be time-based, or performance-based, meaning the CEO has to meet certain goals before getting them. To determine what stock and option awards are worth, Equilar uses the value of an award on the day it’s granted, as recorded in the proxy statement. For options, this includes an estimate of what the award could be worth in the future. Their actual value in the future can vary widely from what the company estimates.

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Source: AP News (The Associated Press)

https://apnews.com/e9e5fb359e462d50543f79cd9b2ebc48

Employers face a minefield of issues as workplaces reopen, particularly when it comes to wage and hour law, Fisher Phillips' Samantha Bononno writes.

Samantha Bononno is a partner at national labor and employment law firm Fisher Phillips where she represents employers in workplace disputes, including wage and hour, FMLA, discrimination and retaliation claims. She may be reached at sbononno@fisherphillips.com. Views are author's own.

As states lift stay-at-home orders and businesses prepare to reopen their doors to employees, employers face a minefield of issues on the employment law front. One major area is wage and hour law, as many employers had to quickly implement layoffs, furloughs and wage cuts in the wake of the pandemic. As employers bring back employees and adjust wages, the following questions are likely to arise.

1. What should employers consider when reducing or reinstating wages?

There is a myriad of reasons why employers might adjust wages right now. Some may need to further reduce costs while others may want to bring back as many employees as possible, even if at a lower pay rate. This may be especially true for businesses taking advantage of a Payroll Protection Program loan and trying to make the most of the proceeds by paying as many employees as possible.

As a general rule, employers are free to change an at-will employee's wages so long as the wages are not reduced below the federal minimum wage under the Fair Labor Standards Act (FLSA) and the change is on a go-forward basis — employers cannot reduce an employee's wages for work already performed. However, many states have further restrictions, such as advanced notice and a higher minimum wage below which the wage rate cannot be reduced. Employers should review state and local law to ensure they are compliant when making these changes.

There are additional implications for exempt employees, or those not subject to the overtime requirements of the FLSA. Exempt employees must meet the salary basis requirement of the FLSA, which is not less than $684 per week (annualizing to $35,568) in 2020. If an employer reduces an exempt employee's salary below this rate, the employee will lose exempt status and be subject to the FLSA's overtime requirement for all hours worked beyond 40 hours in a workweek. For those employees usually working more than 40 hours, such a reduction effectively could increase an employer's overhead instead of lowering it.

Additionally, changing an employee from exempt to non-exempt for short periods or repeatedly can undermine the exempt status of the position in other workweeks, opening up the employer to misclassification vulnerability. To prevent red flags in the eyes of the U.S. Department of Labor, employers should not change from exempt to non-exempt and back more than once.

2. Can an employer change or eliminate PTO policies?

Many employers are considering modifications to their paid time off (PTO) or vacation policies, either because they anticipate employees taking a significant amount of time off before the end of the year or having a significant number of hours to rollover into the next year because the employee was unable to take any time off during the chaos of the pandemic. The FLSA does not generally regulate paid time off; however, many states have restrictions. For example, some states prohibit "use it or lose it" or forfeiture upon termination provisions in paid leave policies. Other states merely require the employer to follow the terms in the policy, but that still means care must be taken when making changes.

Lawful implementation of changes can include providing sufficient notice to allow employees to use up accrued PTO before the change takes effect, paying out accrued vacation and starting over with a new policy, or eliminating accrual on a go-forward basis for a period of time. Which option is best for a business will depend on state law and the employer's current policy.

3. Is COVID-19 temperature-taking compensable time?

Now that the U.S. Equal Employment Opportunity Commission has made clear employers can take employee temperatures without violating disability laws, the question left for many employers is whether the time spent taking temperatures is compensable. While there is no court decision exactly on that point (yet), a 2014 U.S. Supreme Court case, Integrity Staffing Solutions v. Busk, held that post-shift security checks for warehouse workers were not "principle activities" and, thus, not compensable under the FLSA. Some employers may take the position that temperature screenings similarly are not compensable, but others will include the time as hours worked to minimize the risk of a challenge or to ensure state law compliance.

The Supreme Court has also said that time spent waiting to perform a principal activity is not compensable under the FLSA. This suggests that the time employees spend waiting in line to have their temperatures checked may be excluded from hours worked.

On the whole though, otherwise non-compensable activities can become hours worked depending on when they take place. Thus, a review of the principles is only the starting point to an employer's analysis. A thoughtful plan (such as staggering arrivals and ensuring that no compensable activities have occurred already) to minimize the risks, when possible, is key.

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Source: HR Dive

https://www.hrdive.com/news/answers-to-wage-and-hour-questions-youre-afraid-to-ask-as-workers-return/579090/

By Heather Lalley on Jun. 02, 2020

Covelli Enterprises, the country’s largest Panera franchisee, wrongly excluded assistant managers from overtime protections, the court found.

The country’s largest Panera Bread franchisee, Covelli Enterprises, must pay $4.6 million to settle a class-action case involving overtime pay, according to a deal that received final judicial approval late last week.

The lawsuit dates back to January 2018 when a group of Panera assistant managers in Ohio filed suit against the operator claiming that they were being forced to work without overtime pay after being wrongly classified as exempt from overtime protections.

Under the settlement, Covelli must pay $4.62 million into a settlement fund for members of the protected class, made up of more than 900 assistant managers

Covelli owns and operates more than 300 Panera locations in eight states.

Panera did not immediately respond to a request to comment on the legal action.

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Source: Restaurant Business

https://www.restaurantbusinessonline.com/workforce/panera-franchisee-must-pay-46m-settle-overtime-suit?utm_source=Marketo&utm_medium=email&utm_campaign=NL_RB_Daily_06-02-20&LID=5577443&mkt_tok=eyJpIjoiT0dKaU5EZzVZekEzTXpReSIsInQiOiJKUGxWZkN6cm5mZlNtT3QrckwxTTNZWmFcL0puUGNiM2VBYlUyTHNad080QU96bmxHbGU4Z3haWVBXUVNXZHFaZjk5R2xKVm9IWTNPdlcycTdRcXV1KyswWkdhT2tCZ3MrZTc0RVBNNVRVZEZ6T2J2T21RVXZQV0FxeGxnb2o3ZEMifQ%3D%3D

The long-term toll of the coronavirus is unknown, but its effects on our health care system and the economy have already been catastrophic. And while the immediate concerns of skyrocketing unemployment and a stalled economy must be addressed today, employers also need to begin considering how to rebuild for the employees returning to the workforce — or entering it for the first time.

This includes Gen Z, the youngest members of the workforce and those currently in secondary school or college. Many who were just beginning their career journey have been furloughed or fired. Those in school were suddenly confined to their homes. Collectively, they are experiencing the greatest national trauma since the Great Depression and World War II.

Ultimately, for the workforce to be equipped to move forward and thrive, employers will need to address the fallout resulting from Covid-19 on their youngest — and future — employees. 

How Events Shape Generations

As the Pew Research Center notes, looking at world events and other formative experiences through a generational lens helps provide an understanding of how people’s views of the world are shaped. Young people who grew up during the Great Depression and defended and supported the nation in World War II were coined “The Greatest Generation.” Once past the traumas of these extraordinarily difficult years, this generation shared characteristics that included a patriotism manifested by reverence for American ideals, a belief in the wisdom of government, and a frugality born of severe want.

For Millennials, the horror of 9/11 and the global economic crisis that began in 2007 were calamitous events that were life-altering for their generation. As many were sitting in classrooms, word of airplanes crashing into buildings spread through their school; frightened teachers, family members, and friends were unable to offer their usual reassurance that everything would be okay. The chaos that followed became the touchstone for a future where potential terrorist attacks were an ever-present theme in the way Millennials interacted with the world around them.

As they later began to make their way into the workplace, the economy collapsed. Job offers were rescinded, full-time opportunities became part-time without benefits, and many new hires were the first fired. A generation with an undeserved reputation for disloyalty had to change jobs frequently simply to keep up with basic bills and crushing student debt. Together, these experiences contributed to a profile of a generation more likely to seek order in their world and meaning in their work.

Today, even as the coronavirus has been merciless in its impact on people of all ages, the long-term effects on the Gen Z cohort of adolescents are likely to be particularly severe.

For the rest of their lives, the time the world stopped will be seared in Gen Z’s collective memory, a generation-defining moment that instilled deep fears about their uncertain future. Overnight, they lost their daily interactions with the teachers who trained them, coaches who mentored them, clubs that fulfilled them, and friends who sustained them through the painful ordeals of youth. Milestones such as proms, plays, athletics, and the ritual of graduation can be crucial to social and emotional development, each experience serving as a rite of passage to the next stage of life. These lifecycle markers of adolescence that were nervously anticipated and excitedly shared swiftly vanished.

How Companies Can Support Gen Z Employees

It will be years before sufficient data exist to quantify the full impacts of this experience on Gen Z. Existing research, however, can help employers learn what they should expect and how they can best manage their Gen Z employees, today and in the future.

Research in three areas offers a good start for this analysis: skill development, stress management, and building emotional intelligence.

Skill development. Gen Z’s learning has been disrupted in a way that schools were unequipped to manage. Some converted course work to online formats, often implemented by teachers and professors untrained for such a platform. Others minimized direct instruction, urging students or (depending on the grade level) parents to turn to independent projects and digital resources.

In most instances, learning has been attempted in the presence of entire families similarly house-bound and juggling multiple responsibilities — environments that are not conducive to instruction without any preparation. Grades have been converted to pass/fail, tests have been abandoned, and deadlines extended.

These options may be right for the moment, but likely will have costs. Research shows that Gen Zers already experience a difficult cultural transition between college and the professional world that can leave them feeling disoriented and confused. Now that their structured learning has been upended, employers and employees may need to develop greater patience with Gen Z’s adjustment to the professional world and a greater focus on intergenerational mentoring and support.

Employers should consider thoughtfully designed programs to ease Gen Z’s transition by, for example, rethinking orientation programs, early assignments, and mentoring focusing on the development of expertise. For example, orientation programs generally consist of a short-term introduction to manuals, computer systems, and other basics of the workplace. A more comprehensive approach could extend orientation throughout the first-year work experience, offer rotations throughout the organization, and include programs to help new hires integrate into the culture of the workplace. Programming can also address substantive job requirements, offer strategic career support, and provide training on the organization’s goals and objectives, allowing employees to appreciate where they fit and why they matter.

Mentoring, too, can be a powerful way to leverage generational diversity. Research demonstrates that, properly coached, new professionals will develop faster because their learning has been enhanced and guided. To maximize the opportunity for a successful mentorship program, employers should ensure managers understand the benefits of strengthened intergenerational relationships, dispel negative perceptions that could weaken engagement, and provide the needed time and resources. One way to accomplish such buy-in is by including reverse mentoring programs where young employees help senior workers improve their skills in technology and social media. For members of Gen Z, such mutually-supportive relationships can enhance their expertise and ease their transition into the workplace, offering employers the added bonus of a stronger multigenerational culture.

Of course, the most significant and potentially enduring adjustment that workplaces had to make during this pandemic has been the implementation of remote working arrangements. The sudden shift was forced on employers by a crisis, but workplace experts have long advocated for greater flexibility based on changing gender and age demographics, globalized businesses, and technology improvements. As businesses begin to rethink how they open their doors, they should also consider building new transition and learning opportunities into the culture of flexibility that younger workers are seeking.

Stress management. For more than a decade, researchers have noted an alarming trend: Gen Z reports higher levels of anxiety and depression than other generations. Studies also tell us that childhood exposure to significant stress can impact brain development and affect mental and social development. If Gen Z’s baseline already shows high levels of stress, what will the impacts of this pandemic be when it comes to their work and careers?

Most companies are aware that unaddressed employee stress and anxiety can also result in absenteeism, turnover, and lowered productivity. Recent data estimate that the annual cost of job stress to U.S. businesses exceeds $300 billion. But too few firms have developed effective programs to help their employees with mental health struggles. In fact, studies shown that an effective stress management policy operates at the employee, workplace, andorganizational levels. In particular, organizational approaches lead to more sustainable results than interventions solely directed to individuals.

Further, because Gen Zers are starting their careers with higher levels of anxiety exacerbated by the coronavirus pandemic, employers can adapt existing research and best practices to create customized programs for young workers. This could include early-career affinity groups that encourage open conversation in a supportive environment. In addition, coaching interventionscan boost an individual’s confidence in their ability to succeed and reduce anxiety, helping to keep minor performance challenges from becoming career-damaging incidents.

Emotional intelligence. Research demonstrates that emotional intelligence, consisting of self-awareness, self-regulation, motivation, empathy, and social skills, is a critical element of effective leadership — and can be taught and learned. Employees who develop emotional intelligence can provide a foundation for a respectful work environment and a talent pool of future managers. This area of research offers both challenges and opportunities for Gen Z employers.

In having to cope with a shut-down of life as they knew it at such a young age, many Gen Zers have experienced a massive interruption in their ability to discover what motivates and fulfills them. Because of this, they’ll need more time in their young adult years to undertake this self-exploration. Employers can help fill this gap by offering programming that helps build emotional intelligence from the outset of their careers — not several years down the road. One note: I would recommend eliminating the phrase “soft skills,” a term that actually denigrates the importance of training and development in these important areas.

Employers are likely to benefit from the likelihood that Gen Z enters the workplace with a greater level of empathy and adaptability, qualities that are critical components of emotional intelligence. Having experienced both the significant disruption to their own lives and the pain and sorrow felt by friends and loved ones who suffered during the pandemic, Gen Zers are likely to be vigilant to the emotions of others at work.

Companies have the opportunity to help members of Gen Z become the Next Great Generation of leaders. Having been tested at a very young age, they will bring a special blend of resiliency and humanity to the workplace. Employers can take advantage of these unique formative experiences by providing structured support to their younger employees that will smooth their transition and ensure their place as valued members of the workforce.

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Source:  Harvard Business Review 

https://hbr.org/2020/06/what-your-youngest-employees-need-most-right-now