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What’s New in Staffing and ACA Compliance?

by Jeanne Knutzen | November 24, 2014

0 Affordable Healthcare – ACA Smart, Legal Issues - Staffing

A Complimentary Webinar for the Clients and Friends of PACE Staffing Network! MARK YOUR CALENDAR – December 10, 2014 @ 9 AM (PST) After compliance, learn what comes next! Featuring nationally acclaimed ACA attorney, Alden Bianchi. The Affordable Care Act radically restructures how heath care is funded. In 2014, its mandates impacted individuals. In 2015, its mandates impact employers. For the staffing industry and its customers, Obamacare represents the biggest compliance challenge our industry has ever faced. It impacts all of us who do or utilize staffing services—agencies and customers.   The PACE Staffing Network, in conjunction with the Affiliated Staffing Group, has arranged for Alden Bianchi, a nationally recognized expert on the ACA and the Group Practice Leader for Mintz Levin’s Employee Benefits & Executive Compensation Practice to present a complimentary webinar for PACE customers and friends on Wednesday, December 10 from 9am-10:15am PST. Click here to register! Webinar topics will include:

  • The increased costs of the ACA mandates and what they are likely to mean for your 2015 staffing budgets.
  • Staffing company costs and price adjustment strategies. What’s going on in the staffing services marketplace?
  • Risk Management – things to do to protect yourself from unforeseen fines and penalties
  • The “Variable Hour Employee” and what that classification means to the customers of staffing agencies
  • What are the strategy “don’ts” under the ACA? When might the IRS come calling?
  • Getting ready for the ACA’s discrimination provisions, and the next round of ACA impact.
  • Staffing Strategies you can use to contain the high costs of ACA compliance while focusing on your business needs
  • The ACA and your 1099 Workforce
  • And More!
If you have any questions regarding this webinar, please email infodesk@pacestaffing.com or contact Reilly Smith at 425-637-3312. Click Here to sign up for this complimentary webinar

Co-Employment – An Over Used Scare Tactic or a Must See Reality Show?

by Jeanne Knutzen | November 24, 2014

0 Affordable Healthcare – ACA Smart, Hiring - Best Practices Affordable Care Act, Affordable Healthcare – ACA Smart, Co Employment, Employee Benefits, Employee Hiring Decision, Employee Placement, flexible workforce strategies, Workplace Harassment

With the launch of the employer mandates of the Affordable Care Act in January 2015, staffing agencies and their clients have one more reason to worry about co-employment. While the ACA clearly states that only the “common law” employer is responsible for “offering insurance,” and case law strongly supports the notion that the staffing agency is the “common law” employer, what happens if your staffing agency doesn’t offer ACA mandated benefits as required by law. Is there any way you might be liable for fines or penalties? Questions about co-employment get triggered any time two parties share rights and responsibilities inside the traditional employer relationship which is the case with all staffing arrangements involving a third party staffing company and their clients.

  • Most staffing companies recruit and screen candidates, conduct background and reference checks, pay wages, calculate and pay wage related taxes and benefits, complete required reports, and retain at least some right to hire and fire an employee.
  • Most of their employer clients take on the responsibility of supervising, directing, and controlling the employee’s daily activities.
What creates confusion is when the client starts to specify pay rates, directs the hire or fire of employees, or involves themselves in administrative processes that should only be performed by the staffing agency. Since I’ve been in the staffing business, I’ve heard it countless times, “Don’t do ______________, or you will create an issue with co-employment.” And the “what we can’t do” has ranged from “allow our temporary employees to attend a client’s company meeting” to “allow an employee to work on an assignment for no longer than a (year, six months, or other time period “du jour”). Some of these “rules” have blurred the fact that co-employment covers many different types of overlapping liabilities—some that need to be avoided; some requiring co-management and partnership. Here are some of the co-employment scenarios we see on a regular basis and our somewhat common sense approach to how we look at each: Employee Placement/Hiring Decisions “I’m Perfect” (IP) Staffing Agency recruits and screens candidates for “I’m Even More Perfect” (IEMP) client for a 3-month technical help desk role. IEMP refuses to interview Julie, an African American female who appears to meet most, if not all, screening requirements. IEMP chooses instead to interview and hire Andrew, a Caucasian man. Julie believes she has been discriminated against because her application was not considered. Without IP’s awareness, Julie files a complaint with the EEOC. What will the investigator want to know about the roles of IP and IEMP?
  • What reasons were given to IP about why IEMP didn’t interview Julie? Were those reasons valid? Staffing companies who do not ask their client to disclose reasons for considering or not considering each candidate submitted for a job and employers who do not provide those reasons, often leave themselves open to charges of (unfounded) discrimination.
  • What screening requirements did IEMP give to IP? Were all of IEMP’s screening requirements job relevant? Screening requirements that aren’t clear or are so broad that everyone is lead to believe they are qualified, are asking for trouble. Establishing job relevant screening criteria is a joint responsibility of the staffing agency and their client.   
If IEMP’s hiring manager requested only male Caucasians and IM complied with that request, both parties are liable for that violation. If IM rejected IEMP’s illegal screening request and refused to work their request, only IEMP is liable. If IM rejected IEMP’s illegal screening request, but continued to work the request even when the client was discriminating, IM would be considered complicit. In today’s world, claims of discrimination rarely stem from overt acts of discrimination. Usually, they stem from perceptions of impropriety created by poorly designed or improperly executed screening processes. Both the staffing agency and their clients should be reviewing all recruiting and selection processes regularly to ensure that what they are doing is free of unintended consequences. Claims of Workplace Harassment… …often happen because employees don’t know who to talk with about things bothering them at work. George is 60-year-old Caucasian male working for IM, but being supervised on a daily basis by Andrea, a “20-something” supervisor who works for IEMP. Andrea is constantly harassing George about how he doesn’t fit in, and accuses him of “being slow” even though he is meeting all production requirements. George is frustrated but doesn’t know who to talk with about his concerns. He can’t go to Andrea; he goes to the Washington State Human Rights Commission. Who’s at fault? Clearly any staffing agency who doesn’t set up a formal process to receive and manage employee “concerns” is asking for a problem that can impact both themselves and their client. Most investigators consider the question “did they know” less important than “should they have known” and if IM doesn’t have clear communication policies for their employees, they are subject to liabilities stemming from workplace harassment. If, on the other hand, IM went to IEMP with George’s issue and IEMP chose not to do anything about it, it is only IM who would have a valid defense, not IEMP. Access to the Client’s Benefits As we learned from the early 90’s Microsoft settlement (90 million+ paid to its temporary and contract workers), if employers don’t adequately spell out the employees who will and will not be covered under their benefit plans, they can face serious and unexpected benefit liabilities. But avoiding unwarranted claims of benefit entitlement is not about shortening assignment lengths or requiring “breaks in service”—it’s about making sure benefit plans clearly spell out who is and is not eligible for benefits, specifically excluding employees from all third party employers. Unfortunately the core reasons behind the Microsoft settlement were never fully understood by the business community and ended up putting a whole lot of Microsoft staffing policies into mainstream HR policy without a clear understanding of what might have been an easier, less costly, solution.    Co-Employment and the Affordable Care Act… …should be as simple as making sure all contracts with staffing providers clearly state (affirm) the agencies role as the common law employer and their responsibility to administrate all ACA related requirements. This means that while it may be of interest to an employer whether or not their staffing agency is “playing or paying,” and who they would be offering benefits to (or not) they would not want to involve themselves in those decisions.    I-9. Immigration. Privacy Issues. Your staffing agency is responsible to administer the I-9 process. If they purposefully or thru negligence place an illegal employee into your workforce, they are liable for that violation. If an employer becomes aware of this practice, and fails to take action, they would be complicit in the violation and fined accordingly. If an employer stipulates that only US citizens work for them, they would be subjecting themselves to claims of discrimination based on national origin. Additionally, if they require copies of I-9 documents or any materials that include social security numbers, they incur risks of violating certain “privacy” requirements which could result in significant and costly damages (ex. identity theft, etc.). In general, employers should stay at arms length from any administrative process used by their staffing agency including how they administrate qualifications to work, pay and benefits. FMLA. ADA. Accommodation Issues. The co-managed version of co-employment is definitely alive and well when it comes to most FMLA and ADA requirements. If an issue or need comes up, particularly on a long term assignment, both staffing agency and their client are responsible for providing employees with time off to address a medical issue (FMLA) or to provide an accommodation (ADA).  Safety. All employers, both the staffing agency and their client, are responsible to provide a safe and hazard-free work environment for their employees. While the lion’s share of that accountability lies with the client, a staffing agency cannot knowingly assign its employees to work in environments where there are known violations of OSHA standards. As a matter of routine, staffing agencies should be inspecting their client’s worksites, ensuring that OSHA standards are being followed; that the work is being properly described and that employees are being issued the appropriate clothing, equipment, and instruction to ensure their safety. An employer’s safety record is a matter of public record and should be reviewed by the staffing agency before assigning an employee to begin work. Staffing agencies and their clients will typically work together to address any and all safety issues as they are revealed. Staffing agencies, who are concerned about an employer’s safety practices and repeated failures to act to remedy known issues are duty bound to remove employees from those assignments. Property Damages Frank is working in an IEMP warehouse, placed by IM. Frank drives a forklift and accidentally drives it into a wall, destroying $25,000 in product and doing another $10K in damages to the wall and the forklift. Who pays for the damages—IM or IEMP? Here are the factors that will likely make a difference to the final outcome:
  • What does the contract between IM and IEMP say should happen? Typically these contracts indemnify the other from acts of negligence—so who’s at fault? Which party was negligent?
  • Did IEMP require that IM screen Frank be a qualified forklift driver? Did they disclose that he would even be driving a forklift?
  • What training or instruction did IEMP provide Frank before asking him to drive a forklift?
  • How closely did IEMP supervise Frank’s work on the forklift?
If Frank was in an administrative or professional role, his damages might be different (ex. a violation of confidential information), but the considerations are the same:
  • Did IM screen Frank for a job that required him to handle confidential information?
  • Did IEMP properly protect the information they needed to be kept confidential?
  • Did IEMP properly instruct and supervise Frank on how to handle confidential information?
For more information on co-employment or how to implement flexible workforce strategies that minimize the impact of unforeseen co-employment liabilities, contact PSN at infodesk@pacestaffing.com or by calling 425-637-3312 to arrange a complimentary consultation with a member of our Partnership Development Team. jeanneThis article is intended for general informational purposes only and in no way is intended to provide legal advice or to circumvent the need each employer has to seek competent legal counsel. This article was written by Jeanne Knutzen, founder and CEO of the PACE Staffing Network.          

Will Unlimited Vacation be the Death of Vacation?

by Jeanne Knutzen | November 21, 2014

0 Resources for Employers, Hiring Managers, HR Professionals Employment Vacation Policies, Inc., Michael Haberman, Omega HR Solutions, Paid Vacation Days

By Mike Haberman As many of you have probably heard by now, Richard Branson has created a "non-policy" vacation policy. He said he modeled it after the Netflix policy. According to writer and entrepreneur Daniel Green, "Branson described the 'non-policy' as giving employees the flexibility to take as much vacation time as needed when they feel 100% comfortable that they are up to date on every project and that their absence will not in any way damage the business or indeed their own career.'" Green then raised the question, "Is this a good or bad thing?' I raise the question of whether this could be the death of vacation time in the United States. AMERICANS ARE NOTORIOUS American companies are notorious for their vacation policies that give just about the least amount of time off in the entire world. Denmark is a much happier place because of time-off, and more productive, too. Despite having the least amount of vacation in the world, many U.S. workers still don't take all their allotted time. According to Venessa Wong at Bloomberg Businessweek, as quoted by Anna North, "Already, some 40 percent of American workers don't use all their paid vacation days." The criticism of Branson's move is that the non-policy states that:

The policy-that-isn't permits all salaried staff to take off whenever they want for as long as they want. There is no need to ask for prior approval and neither the employees themselves nor their managers are asked or expected to keep track of their days away from the office. It is left to the employee alone to decide if and when he or she feels like taking a few hours, a day, a week or a month off, the assumption being that they are only going to do it when they feel a hundred percent comfortable that they and their team are up to date on every project and that their absence will not in any way damage the business–or, for that matter, their careers!"
The emphasis in the criticism is the statement that the employee must feel "100% comfortable that they and their team are up to date on every project and that their absence will not in any way damage the business–or, for that matter, their careers!" The naysayers feel that few Americans will ever have that confidence in their work and thus by that being the provision to live by, this policy could actually spell the doom of vacation. Not only will employees not take unlimited vacation, they will resort to taking no vacation because the work is never caught up and most people are unsure of their standing in the company to feel absolutely sure their careers will not be harmed. THERE ARE COMPANIES WHERE IT DOES WORK. Branson, by his announcement, got a lot of press; but in reality there are many companies that offer unlimited vacation. The Motley Fool is one such company. If you want to read some testimonials on this policy read the comments attached to Anna North's article in the online version of the New York Times. US VERSUS THEM One problem I see in these policies is the potential "us versus them" situation that is being set up. These unlimited vacation policies only apply to salaried exempt employees. The Fair Labor Standards Act does not allow them to be applied to non-exempt employees because you have to track their time. That is the basis on which they are paid. Just saying "work whenever you want" becomes very difficult with an hourly, non-exempt employee. Additionally, many of those positions are not ones where the employee can just take off anytime they want. Customers have to be served, food has to be delivered, and products have to assembled. That is a much different situation than that of a manager, consultant, advisor, marketing specialist, IT professional, etc. With this divide, what are the employee relations issues that companies will be faced with? I like the idea of unlimited vacation, but I have to tell you that even I, as an independent consultant, feel guilty if I take too much time off. I don't think I am alone in that mental dilemma. Michael Haberman is cofounder and senior HR consultant of Omega HR Solutions, Inc. His company offers HR solutions that include compliance reviews, wage and hour guidance, supervisory and managerial training, strategic guidance, executive advisement, and more. He can be reached at mhaberman@omegahrsolutions.com.

9 Low-Cost and No-Cost Ideas for Motivating Employees

by Jeanne Knutzen | November 21, 2014

0 Human Resources Staffing Coaching Employees, Employee Motivation, Job Shadow Program, Mentoring Programs Work Place, Val Grubb, Valerie Grubb

By Valerie Grubb Managing employees can be one of the most challenging–and also most rewarding–responsibilities as you move up within a company. When your management works and you see your employees surpass even their own expectations, it's wildly exciting and incredibly fulfilling! If you're new to managing employees – the great news is that you don't need a big budget to inspire your employees. The strategies listed below can help you motivate and engage your employees, even under the tightest financial constraints. 1) Provide Interesting Work Management theorist Frederick Herzberg once said, "If you want someone to do a good job, give them a good job to do." So give your employees good jobs by making sure that at least part of their responsibilities includes something of great interest to them. Even for those jobs that are inherently boring, having at least one or two stimulating projects can motivate employees to perform well in the mundane tasks, too. Recommend your employee to a new task force your CEO is forming, for example, or let him or her take the lead at your next staff meeting. Find out your employee's career aspirations, then identify assignments that will expand his or her skill set in the desired direction. The increased productivity you gain by providing interesting projects beyond the day-to-day tasks will more than compensate for the time your employees are away from their regular jobs. 2) Require Managers to Coach and Develop This strategy may sound like a no-brainer. But it bears repeating, because we all know managers who are slackers when it comes to coaching and developing their employees–and in these uncertain times, employees need feedback more than ever. Remember, employees join companies, but they leave managers. So hold your managers accountable for coaching employees to achieve outstanding results and developing their staff through mentoring and training opportunities (see the next two bullet points). If they aren't fulfilling those responsibilities, replace them with people who will. 3) Establish a Mentoring Program Seventy-one percent of Fortune 500 companies offer mentoring programs to their employees. Why? Because those companies recognize that such programs bring a multitude of benefits to both protégé and mentor. Mentoring employees (especially new hires) can lead to better retention while mentoring aspiring talent can form the cornerstone of succession planning. Mentoring programs traditionally pair a junior employee with a more experienced colleague, but there's no need to stick only to this format. Reverse mentoring, for example, can help senior executives keep up with cutting-edge technology and with company issues that are usually only on the radar of junior staff. Group or situational mentoring is also on the rise for issues such as diversity or high-potential training. And if your company doesn't have a formal program, create your own! Establish mentoring relationships for your employees by tapping fellow executives (and agree to mentor their employees in return). 4) Train Your Employees Training doesn't have to cost money. No-cost and low-cost internal training options include:

  • Establish a job-shadowing program – even if you're the executive your employee is shadowing! Allow your high potentials to gain exposure to senior executives through the projects on your plate.
  • Arrange for monthly luncheons with your top executives whereby they can interact and ask questions.
  • Allow your employees to represent the company at a public function (charity fundraiser, sporting event, etc.), teaching them the responsibilities when in front of clients.
  • Expose employees to organizations with relationships to yours (e.g., visit a vendor, take a trip to customer's site).
  • Rotate employees into areas in which they need to improve their skills or gain exposure for continued growth.
  • Invite employees to spearhead projects in areas where they need improvement.
  • Read case studies and books on issues that are relevant to your organization, and discuss with fellow executives. (Be sure to find out what books your CEO recommends!)
  • Encourage employees to volunteer for industry organizations where they can develop leadership and management opportunities. Local non-profit groups, school organizations, or community-based programs may also be an option.
5) Roll Out Financial Training All employees need to understand how your company makes money, how individual department budgets connect to the organization's products and services, and how all that information describes the company's financial health. Unfortunately, most employees (including some senior leaders) are woefully ignorant in this area. So have your HR and finance departments team up to teach classes on budgeting and its connection to your company's financial well-being. By teaching fiscal responsibility, you'll soon have employees identifying cost-cutting measures, because they'll be as eager as your CFO to save the money and improve the company's finances. 6) Invite Involvement and Ownership in Decisions Most companies don't prioritize involving employees in decisions that affect them. Perhaps it's time to reconsider that practice, though. Keeping employees in the loop is not only respectful, but it's also practical: people who are closest to a situation typically have the best insight on how to improve it. Employees on the ground floor of an issue often know what works (and what doesn't) and can provide valuable insight into how to resolve the issue quickly and effectively. In addition, employees who have a hand in crafting a solution are more invested in working toward its success. 7) Increase Visibility and Opportunity Motivate employees by recognizing when their performance goes above and beyond. You can do this through publicly crediting them for their work, for example, or by giving them new assignments or additional responsibilities. Keep in mind, however, the first strategy in this list: make sure those additional responsibilities are of interest or value to the employee. (After all, having to deal with even more mundane tasks isn't the reward most people are looking for.) Remember, you get what you reward. 8) Provide autonomy Employees value the freedom to do their jobs as they see fit. So if your employees are able to get their jobs done (and done well) on their own, leave them alone! When you give high-performing employees more autonomy, you increase the likelihood that those employees will continue to perform as desired. Even with new recruits who haven't yet proven themselves in your company, you can provide autonomy in work assignments by telling those employees what needs to be done without dictating exactly how to do it. 9) Train your Managers to Provide Greater Recognition A 2012 Bersin & Associates study indicates that, compared to companies without recognition programs, those organizations that do have such initiatives enjoy 14% higher employee engagement, productivity, and customer service and 31% fewer voluntary turnovers. So tout the accomplishments of employees–and require your managers to do the same. And if your company doesn't already have a formal recognition program, perhaps now is the time to push for one. Next Steps Even if you do have a big budget, simply throwing money around rarely creates a more engaged and motivated workforce. Don't get me wrong–if your employees are underpaid, money is the first step toward making them happier and more valuable members of your organization. But if you really want to engage them, you need to think beyond the paycheck. Many employees work longer than an eight-hour day because that's what it takes to get the job done, but all of us probably know people who put in the extra time and effort because they are totally committed to their company (or have a passion for a particular volunteer organization or cause). They have this drive in large part because they're getting more than a paycheck. There's something that motivates them to go above and beyond–and with the strategies outlined here, you can cultivate a similar commitment and drive in your own employees! Valerie Grubb of Val Grubb & Associates Ltd. (www.valgrubbandassociates.com) is an innovative and visionary operations leader with an exceptional ability to zero in on the systems, processes, and personnel issues that can hamper a company's growth. Grubb regularly consults for mid-range companies wishing to expand and larger companies seeking efficiencies in back-office operations. Her expertise and vibrant style are also in constant demand for corporate training classes and seminars. She can be reached at vgrubb@valgrubbandassociates.com.

Stuck In the Middle

by Jeanne Knutzen | November 21, 2014

0 Human Resources Staffing Employee Development Opportunities, Employee Recognition, Employee Training Opportunities

By Chad Savoy Who gets the bulk of your attention? The people who do really, really well at everything, consistently exceed targets, go over and above and serve as a shining beacon of light, hope and inspiration to the rest of the organisation? The people who never seem to get anything right, to the point where you're left wondering why exactly they're working for you in the first place? (For a given value of 'work'). Or the other people. The quiet inoffensive ones who come in and do their work with zero fuss and then go home? It's always never the quiet ones Nearly 80% of employees are 'consistent performers' (* Bersin & Associates High Impact Performance Management research 2011), while managers spend about 80% of their time focusing on the other guys. What usually happens is that these solid workers live under the radar, going largely unnoticed while attention and energy gets spent on the flashier people; your stars or problem children. The people in the middle may have the potential to be stars themselves, but without development that potential may just go to waste. Stars get retreats, fancy rewards, training and development; low performers get more supervision, additional coaching and mentorship...and the middle child usually gets by with a performance review. How many of them interpret this lack of attention as a sign of their work's unimportance and slip quietly away? Look past the stars It costs you less to keep your average workers around than it does to hire in new people. ESPECIALLY stars, who – frankly – you just can't afford outright. Hiring new people also usually results in losses from a drop in productivity due to onboarding and upskilling and orientation and all that just starting out stuff – and even then the new hires might not fit. Your consistent performers are already attuned to your culture, and hold a wealth of company-specific knowledge and experience. They've already proved themselves reliable, stable, sane workers so they're pretty good ambassadors for all things you and shouldn't go maverick if elevated to management positions. They're a known quantity, and that quantity is a decent one. And face it: every company needs employees who'll just...produce. Solidly – without requiring a parade when they deliver, and without needing constant supervision. Your reliable performers have a history of supporting your stars and picking up the problem kids' slack, so why wouldn't you want to keep them around? Be the phone booth How then do you make sure you hang on to these solid if unremarkable performers; maybe even encourage your Clark Kents and Peter Parkers to live up to their superhero potential (costumes optional)? Figure out who they are and what they do. Collect detailed information on their skills, competencies, what they've worked on and how they've worked with others. Profile them and record their progress over time. Then explore these things: Recognition. By making thanks and recognition part of your culture, you start actively looking for things to celebrate – big things, small things, the kind of things the quiet people work quietly on. Training opportunities. Open access to a range of professional and skill development courses would be a good start for your average joe. Just don't waste resources pushing them into something generic and irrelevant that's not going to pay off! Career paths and obvious development opportunities. Give them somewhere to go and something to aspire to; make the path to stardom an obvious one and support them on their way. Goal contribution. So they AND YOU can see how their good work is actually making an impact on the organisation's overall achievement. Bottom line: you hired them for a reason It's easier to keep these people than to hire new people. So show them a little love and one of two things will happen: 1. They'll stick around and keep on keeping on. This is good. 2. They'll thrive under the attention and join the ranks of your stars. This is better. Then you just have to work on keeping them! Chad Savoy is Cornerstone's VP of worldwide sales for the SMB market. A seasoned sales professional, Chad is passionate about recruiting, hiring, training, and mentoring high potential professionals to become high performing stars.