How HR Can Support Working Parents

Being a parent is deeply rewarding, but it’s hardly without stress. Likewise, even the most satisfying and pleasurable of careers can bring their share of anxiety. Combine the two ventures and things can really seem hairy. Simply put, working parents undergo unique levels of stress, and over time that stress can impact their mental and physical health, their work-life balance, their productivity, and their job satisfaction.

The good news is, there are plenty of ways in which companies can assist working parents… and many of those ways begin in the HR department.

Supporting Working Parents

Consider just a few quick tips and strategies.

1) Develop a family-friendly environment.

Don’t make your employees feel like their kids are burdens or afterthoughts. Instead, create a company culture in which families are prioritized, and kids are regarded as part of your extended team. Some specific ways you can do that include:

  • Have some workplace parties or events throughout the year that are designed to be inclusive of the whole family.
  • Have a take-your-child-to-work day.
  • Encourage managers and leaders to ask employees about their kids.
  • Offer some flexibility to employees who want to use school vacations/holidays to spend time with their family.
  • Make sure you hold company social events at different times; working parents may not be able to make happy hour, so maybe have the occasional team breakfast or lunch.

2) Support new moms.

New moms, in particular, need plenty of support from the HR team. Specifically, consider doing the following:

  • Allow moms to bring their newborns to work as needed; or allow them to work remotely when possible.
  • Make sure you have a private and comfortable lactation room, and that new moms have enough scheduling flexibility to nurse or pump.

3) Consider family-friendly benefits.

There are a lot of creative ways in which your benefits packages can support working moms and dads. Some examples include:

  • Offer assistance with IVF or other fertility treatments.
  • Provide education about 529 college savings accounts.
  • Share college guidance resources with parents as their kids get a bit older.
  • Consider anything you can do to subsidize childcare.

4) Provide scheduling flexibility.

Surveys show that, for most working parents, the most precious resource of all is time. Here’s a simple way your HR team can support moms and dads: Be flexible in your scheduling, allowing employees to come in early or late as needed in order to work around soccer games, piano recitals, school pickup, etc.

5) Provide paid maternity and paternity leave.

Along with flexibility, the other things moms and dads want is time to adjust to newborns. This is an area where your benefits packages can make a world of difference: Offering paid leave to moms and to dads can be a powerful way to support working parents.

6) Lead by example.

Finally, remember that policies are pretty meaningless if there isn’t also a healthy workplace culture. For example, offering flexible hours doesn’t mean much if your workplace also encourages people to burn the midnight oil. Make sure HR leaders and other executives set a healthy example: Work normal, balanced hours; don’t stay too late; and don’t send after-hours emails.

These are just a few of the steps your HR team can take to support the needs of working parents. If you have any questions about how you can create a truly family-friendly work culture, reach out to WhiteWater Consulting. We’d love to chat!

How the Pandemic Can Make Your Team Stronger

It’s often remarked that adversity breeds resilience, creativity, and character. This holds true not only for individuals, but for teams and organizations, as well. Certainly, the COVID-19 pandemic has brought its fair share of adversity, including disruptions to productivity; shake-ups to team dynamics; ongoing mental health concerns, including anxiety about contracting the disease; and beyond. Yet many teams have already seen how the “new normal” may in fact make them stronger, more productive, and more innovative than ever before.

How about you? Have you found that the pandemic has caused you to jettison old habits or dated practices that were holding you back? Has your team developed some new rhythms and processes that allow you to work more efficiently, to deliver superior products, or to be more supportive of each other in the workplace?

In truth, there are many ways in which the pandemic might make your team stronger. Let’s take a closer look at just a few of them.

How COVID-19 is Strengthening Teams

1) Increased agility.

With more and more employees working remotely, and with a high level of uncertainty even in the most stable of work environments, many teams have learned to be more agile, nimbler on their feet. For example, rather than having lengthy in-person meetings, companies are adopting shorter check-ins over Zoom. Rather than plan all their projects for the next 12 months, teams are focusing more on one- or two-month “sprints,” prioritizing tasks according to urgency. This increased agility is something many teams will benefit from even if/when we return to some semblance of pre-pandemic normal.

2) Greater collaboration.

You might assume that the shift toward mostly remote work environments would cause teams to become more siloed. Actually, a lot of the businesses we’ve worked with have expressed the opposite: Their employees feel more freedom than ever before to collaborate across departments, finding it easy and comfortable to do so in quick Skype chats or Zoom breakout sessions. This propensity toward collaboration is definitely something for teams to hold onto.

3) More empathy and understanding.

Have you had the experience of one of your children wandering into the middle of a big Zoom meeting, or a howling dog disrupting a conference call? Here’s the thing: Most of us have been there. We’re all just trying to do the best we can, making the most of this strange new work environment. And as such, most of us are more willing than ever to extend grace and compassion to the folks we work with.

4) Trust and accountability.

Many team leaders have wrestled with these issues; if everyone is working remotely, how can standards of accountability be enforced? The good news is that most employees really seem to have figured out how to stay on-task autonomously. They know that they’re accountable for the effort they put in, and that failure to do their job can impact the whole team in an adverse way. Also note that leaders and managers are getting better and better at clearly articulating team goals and individual expectations.

5) Increased candor.

One additional way in which teams are getting stronger is in increased candor. In small group Zoom calls and one-on-one Skype meetings, employees feel empowered to offer honest feedback, including constructive criticism they may not have voiced in a more traditional work setting. This is great news for leaders and managers, who can use this candid feedback to build their businesses better than ever.

These are just a few ways in which we see teams getting stronger, tougher, more flexible, and more productive. We hope to see many of these trends continue well into the future.

Any questions? We’d love to talk with you. Reach out to WhiteWater Consulting at your next convenience.

Understanding Mental Health Problems in the Workplace

Studies indicate that a significant portion of the workforce struggles with mental health concerns; pre-COVID research showed the number eclipsed 20 percent, and it’s undoubtedly grown as the pandemic has increased rates of anxiety, stress, and depression.

Such high figures may come as a surprise to many. The reason for this is simple: There remains a lot of stigma surrounding mental health issues, particularly in the workplace. As such, many employees choose to suffer in silence rather than reveal their diagnoses.

This stigma presents a significant problem for workers, who may refuse to seek treatment because they fear that doing so could imperil their employment status. It presents a problem for mental healthcare providers, too, who are often faced with the uncomfortable scenario of counseling patients on how to address their problems in the workplace without breaking their secrecy.

The bottom line is that many mental health concerns are unrecognized, undiagnosed, and untreated. By raising awareness and increasing understanding, however, employees and employers alike can begin to remove stigma and create workplaces that are safe and welcoming.

Common Mental Health Problems

A good place to begin is with a simple review of common mental health problems, and the impact they can have in the workplace.

Depression

Research suggests that close to seven percent of U.S. adults suffer from depression. The question is, what does depression look like in the workplace? Though it is often associated with a low or “depressed,” mood, this condition can manifest differently in the work setting. Common signs of depression include restlessness, nervousness, and irritability. In addition, employees who have depression may be listless, lethargic, withdrawn, and unproductive. Depression can also result in an obsession with aches, pains, and minor physical discomforts.

On average, employees with depression report the equivalent of 27 lost workdays each year… nine sick days, and 18 days reflecting lost productivity. Similarly, research shows that employees with depression are more likely to lose their jobs, or to change jobs often.

Again, a big part of the problem is stigma, which keeps employees from seeking the care they need; fewer than half of employees with depression actually get adequate clinical intervention, according to a Harvard report.

Bipolar Disorder

Individuals who have bipolar disorder tend to cycle between a very high, energetic mood (mania) and a low, listless mood (depression.)

The impact on the workplace can be significant and wide-ranging. An employee in mania may break rules, act rashly, or exhibit reckless judgment. And an employee in the depressive stage may show some of the same symptoms we mentioned in the previous section.

About six million American adults have bipolar disorder, according to one study. According to researchers, employees with bipolar disorder may take as many as 28 workdays each year, and lose another 35 in missed productivity.

Again, stigma keeps many individuals from seeking the care they need; about two thirds of those with bipolar receive treatment, but few get the level of care they really need to keep their symptoms under control.

Anxiety Disorders

Anxiety disorders can manifest in a number of different ways, including difficulty concentrating; fatigue; restlessness; and worry. Employees with this condition may have a lot of insecurity about their role in the workplace and seek constant reassurance.

More than six percent of Americans deal with anxiety disorders, and it often takes up to 10 years for these problems to be recognized and diagnosed.

And, anxiety disorders often lead to other mental and physical health symptoms, ranging from insomnia to gastrointestinal problems. As such, employees with anxiety disorders are likely to take a lot of sick days or suffer from low productivity in general.

Investing in Employee Wellbeing

As we have mentioned in the past, the COVID-19 pandemic has only made mental health issues more pronounced; if ever there was a time for employers and HR leaders to create safe, healthy workplaces, it’s now.

A good place to begin is with basic education: Make sure you’re aware of the common mental health disorders and their effect on the workplace. And begin doing everything in your power to break down stigma and encourage employees to seek proper care.

With any questions, reach out to WhiteWater Consulting today.

Onboarding During COVID-19

In recent weeks, news headlines have painted a fairly grim scene of the U.S. employment landscape; unemployment remains a significant issue, and while the economy has added back many jobs, progress hasn’t been as robust as many had hoped. And, with the virus still surging, it’s hard to predict short-term or long-term fallout.

And yet, we know that there are still companies recruiting, hiring, and welcoming new team members into the fold. It is a most unusual time to be onboarding new employees, to say the least. Many in the HR world are struggling to effectively welcome and train employees, even in virtual work environments.

We’ve got just a few suggestions for ensuring a smooth onboarding process during the coronavirus pandemic.

Onboarding in a Pandemic: Our Tips

1) Be adaptable.

Onboarding processes can be complicated and multi-faceted. You’ll need employees to sign some paperwork, to be briefed on rules and policies, to receive task-specific training, perhaps even to be paired with a mentor.

Those things are all well and good, but the pandemic means your timeline may be a little bit looser, and some of these steps a little harder to accomplish. So, what we recommend above all else is flexibility. Spend some time thinking about the non-negotiable aspects of your onboarding process, and how you can address them as expediently as possible. Also think about the things that add very little value to the employee experience; some of these items you may wish to jettison altogether, just in the interest of a nimble and workable process.

In other words: During these unprecedented times, don’t be afraid to rethink some of your tried-and-true onboarding practices.

2) Embrace technology.

By now, most companies are well aware of the technologies available to them to enable remote work; conferencing and communication tools like Zoom and Skype, and file-sharing tools such as Dropbox.

These same technologies can be invaluable to your onboarding process. In fact, it may be smart to devote your employee’s first day to getting their technology setup in place. Be sure you have an IT person who can walk them through any needed software downloads and configurations.

Certainly, technology can help you collect the paperwork you need without asking your new hire to come into the office; have them scan and email their forms, or use DocuSign as needed. You might also get an HR representative to join them in a Zoom call, clarifying any questions they have about the new hire paperwork.

Finally, consider some of the learning management systems (LMS) available to provide virtual training for your new hires. This will require your HR team to create and upload some company-specific training content, but in the long run, this can be a great investment in a flexible and automated onboarding process.

3) Don’t forget the social component.

Finally, it’s important that new hires be given an opportunity to meet people and feel like they’re part of the team. Again, video conferencing software can make this possible, even during quarantine. Consider using video conferencing to set up mentor meetings or small group hangouts. A few low-key, low-stress socialization opportunities can go a long way toward bolstering team morale.

Questions About Effective Onboarding?

The onboarding process can pose challenges even in the best of times; in the midst of a pandemic, those challenges are compounded. If you have any questions, we welcome you to reach out to WhiteWater Consulting directly.

Prioritizing Mental Health in the Workplace, Post-COVID

As more businesses welcome employees back to the workplace, HR leaders have understandably prioritized physical health and safety. This is entirely appropriate in the wake of the pandemic: Workplaces can and should do everything in their power to promote hygiene and support employee wellbeing.

It is crucial to remember, though, that employee wellness is about more than physical safety. Mental health is also a significant concern. Keep in mind that many employees will return to work feeling anxious, afraid, or depressed; some will be carrying grief from loved ones they have lost, or trepidation that they might become sick themselves. Others may simply feel nervous due to changes and uncertainty in our work environments.

Mental Health as a Priority

Due to these concerns, it is critical that employers and HR leaders develop their back-to-work plans with employee mental health in mind.

Indeed, mental health is a major source of concern for many business leaders. Businessolver recently published the results of their fifth annual State of Workplace Empathy Study, where they found that CEOs, HR leaders, and employees agree that mental health should be a key consideration in the workplace. And yet, the same study also shows that just 69 percent of employees feel that their workplace is sensitive to mental health concerns.

Digging deeper into the numbers, we find the following:

  • Many employees are afraid to reveal their mental health struggles, with 64 percent saying they are concerned about confidentiality. Their fear is that, in being honest about their mental health issues, they could jeopardize their job security.
  • There is a disconnect between employees and leaders. An overwhelming 86 percent of CEOs give their companies high marks for open discussion of mental health issues… but only 58 percent of employees agree.
  • Similarly, 76 percent of CEOs note that their workplaces offer mental health benefits, but only about half of employees are aware of these benefits! Awareness-raising will be a key issue moving forward.
  • About 92 percent of employees say their companies should do more… and 100 percent of HR leaders agree!

What we see here is that mental health concerns loom large among employees and business leadership; and that there remains much work to be done in creating workspaces where mental health is addressed with honesty and sensitivity.

Take Action

As HR leaders start considering their options for improving mental health in the workplace, especially amidst a post-COVID re-opening, there are a few preliminary action steps that we can commend.

  • Start talking honestly and openly about mental health. Make your workplace an environment where people feel comfortable talking about these issues without fear. This must start at the top: Leaders and executives must be the ones who model transparency and vulnerability.
  • Create support systems in which employees can talk with each other not only about logistical aspects of their jobs, but also emotional ones. This may look like team huddles where emotional issues are expressly raised. It may also mean pairing employees to check in with each other in a more confidential, one-on-one setting (such as a “coffee buddies” program).
  • Finally, it is so crucial for employers and HR leaders to develop benefits packages that include mental health care… and, to make sure the scope of those mental health benefits is discussed openly with employees. Again, raising awareness and rejecting stigma will be important going forward.

Ready to find out more about designing (and communicating) benefits packages that put mental health as a priority? Reach out to our team at WhiteWater Consulting at any time.

Creating Safe Workplaces After COVID-19

As business owners consider the long and challenging process of re-opening in the wake of the COVID-19 pandemic, there is a central question that must be addressed: How can we begin growing the economy, and resuming some semblance of normal productivity, while still promoting the health and safety of employees?

It’s a question that may not have an easy answer, and yet one thing is clear: Prioritizing workplace safety is very much the right thing for business leaders to do. It’s the right thing ethically, it’s what’s best for employee morale, and it’s really the only way to sustain business growth in the long run.

While many employers may have outstanding questions about how they can build safe workplaces, and while there may not be any “perfect” solution, there are a few guidelines that should be taken seriously.

Creating Safe Workplaces Post-COVID-19

Some of these recommendations include:

  • Create a culture that is more fluid and permissive with regard to remote work. One of the best ways to minimize exposure to coronavirus, and to provide employees with the freedom to make their own healthy decisions, is to create a culture in which working remotely is permitted as much as possible. While some positions or projects may require employees to be physically present in the workplace, employers should make it clear that employees have some flexibility to perform their work from home whenever it makes sense to do so. (This also means implementing a technological infrastructure that facilitates remote productivity and collaboration, something most companies have invested in during the quarantine.)
  • Change your workflows. It’s also important to minimize contact between workers, and to ensure that if an employee can safely do their job alone or with just one other person, that they have the space to do so. Business owners and HR teams are encouraged to be creative in reconfiguring their existing facilities, using break rooms, closets, or unused offices to provide a little extra workspace for employees. If you have workers who are not able to maintain the recommended physical distance, ensure there is a sanitized, impervious barrier between them.
  • Limit exposure between team members and customers/clients. During the quarantine, many businesses have shown their resourcefulness by implementing “no contact” delivery, curbside pickup, and similar solutions. Maintaining these provisions can be a good way to protect not only the customer, but also your team members.
  • Continue providing hand sanitizer to workers. Advise frequent hand washing, and make sure that employees have both the time and the physical access to wash and sanitize as needed.
  • Don’t overburden your cleaning staff. Maintaining a sanitary workplace is naturally going to require a more frequent application of disinfectant, as well as rigorous standards of workplace cleanliness. This may be a significant burden placed on the cleaning staff, so support them as best you can with additional staffing or by asking your other team members to help with some of the cleaning work.
  • If you know there is a risk of infection, supply employees with PPE. In some office environments, it will be a necessity to keep masks and gloves on hand at all times, ensuring that your employees know their wellbeing is a foremost concern.
  • Be attentive to mental health. As employees return to work after the quarantine, many of them will struggle with anxiety, uncertainty, and other mental health conditions. Make sure your people are all aware of the mental health resources available to them. And, as best you can, be flexible in allowing your team members “mental health breaks” and leave.

In the coming months, business owners will be figuring out how to adapt to a new normal, and much of it will be through trial and error. Throughout the process, ensure that employee wellbeing is your North Star.

With questions, don’t hesitate to contact us at WhiteWater Consulting.

Final Changes to Coronavirus Relief Act, Paid Leave

Yesterday, the House of Representatives scaled back the paid-leave portion of the Families First Coronavirus Response Act that it attempted to enact days earlier following pressure from businesses worried about financial burdens of extended FMLA. The revised bill was sent to the Senate on Wednesday, where it passed by a vote of 90-8. President Trump then signed the emergency bill into law. The bill goes into effect on April 2, 2020, and it sunsets on December 31, 2020.

The new measure still provides two weeks of sick leave to employees affected by COVID 19, including those who are in quarantine or caring for family members who have it, and those who have children whose schools or daycare centers have closed in response to the outbreak.

Here’s what’s changed:

For the next 10 weeks (following the 2 mentioned above), paid leave would be limited only to employees caring for a child whose school or daycare had been closed. Employees who had been in quarantine or caring for a family member affected by the virus wouldn’t be eligible for the additional 10 weeks of leave. Health-care providers and emergency responders aren’t guaranteed the additional 10 weeks of paid leave either. The decision to extend their time off will be made by the Labor secretary at a later date, the reason given that the government might face a shortage of such workers.

The legislation also makes coronavirus testing free and increases access to food assistance to those who need it.

The new mandate still applies only to companies with fewer than 500 employees and sets up a mechanism for the government to reimburse through a tax credit employers who pay employee wages while they are absent from work due to coronavirus. Two notes about this provision:

  1. The bill amends the FMLA to allow employees to take up to 12 weeks of job-protected leave if the employee is unable to work or work remotely because they need to care for a child under the age of 18 because the child’s school or daycare has closed due to COVID-19. The first 10 days of such leave is “emergency FMLA” and may consist of unpaid leave, but the employee must be paid for every day thereafter. That payment would be calculated based on the number of hours the employee would normally be scheduled to work, not less than two-thirds the employee’s regular rate of pay. The bill provides that this amount will not exceed $200 per day and $10,000 “in the aggregate.”

    Employers with fewer than 25 employees may be exempted from this job-protected aspect of the “emergency FMLA” leave provided certain conditions are met, including if a leave-taking employee’s position is eliminated due to “economic conditions” or other changes that affect the employer’s operations resulting from the public health emergency.

    The bill allows the Secretary of Labor to exempt employers with fewer than 50 employees from the “emergency FMLA” leave requirement “when the imposition of such requirements would jeopardize the viability of the business as a going concern.”
  2. The bill mandates that employers with fewer than 500 employees provide paid sick time to employees when those employees are sick with or have been quarantined due to COVID-19, are experiencing symptoms of the disease and seeking medical attention, or are caring for a child/children because of school or daycare closures due to COVID-19, among other situations. Full-time employees are entitled to 80 hours of such leave; part-time employees are entitled to time equal to the number of hours they work on average over a two-week period. The leave doesn’t carry over from one year to the next.

    Note that an employer, as a condition of providing paid sick time, cannot require that an employee search for or find a replacement to cover for the hours during which the employee is using the paid sick time. The payment is calculated based on the employee’s “required compensation” (i.e. the employee’s regular rate of pay or minimum wage, whichever is greater) and the number of hours the employee would otherwise be scheduled to work. Pay standards differ in certain situations, such as if an employee is using the time to care for a family member.The Secretary of Labor can also exempt small businesses with fewer than 50 employees from the paid sick leave requirement.In the original version, all employees who received paid sick time would have been eligible for the additional 10 weeks of paid leave at two-thirds pay. That version of the bill passed Saturday morning, 3/14/20. 

Original Source BGW CPA, PLLC

Paycheck Protection Program Offers Employers Ability To Prevent Layoffs

The CARES Act passed both houses of Congress and met the president’s signature this evening. Its primary item for small business aid is a $349 billion loan program called the Paycheck Protection Program (PPP) which can be used to support small businesses to maintain their payroll and some overhead expenses through the coronavirus emergency. The stated goal is to keep workers paid and employed during the period of the emergency.


If you’re looking to take part, here’s what you need to know:

  • Who can apply?
    Businesses and nonprofits, veterans organizations, or tribal businesses with 500 or fewer employees, or under the Small Business Administration standard (if greater than 500 employees), or under 500 employees per physical location for all food-service companies, are generally eligible for the loans. But the loans aren’t restricted to companies: Individuals operating as sole proprietors or independent contractors or self-employed individuals (including gig workers) also qualify. Qualified borrowers must have been in business before February 15, and must have paid employee salaries and payroll taxes or contractors.

    For sole proprietors and independent contractors, “payroll costs” are similarly defined, and include any annual compensation, commissions or other similar payments up to $100,000, as prorated for the period from February 15 to June 30, 2020.

    Borrowers need to make good-faith certifications that (a) current economic uncertainty makes the loan necessary, and (b) the proceeds would be used for retaining workers, maintaining payroll, or covering existing overhead costs. They do not need to show that credit was unavailable elsewhere.
  • What can I use the loan for?Loan proceeds can be used for payroll support (including group health costs and insurance premiums), employee salaries, mortgage interest or rent payments, utility payments, and interest on existing debt obligations, rather than just the capital costs allowable under existing Section 7(a) programs.

    The PPP sets out a comprehensive definition of “payroll costs” (e.g. salary, cash tips, leave benefits, insurance and retirement benefits)—a definition that excludes (a) any compensation for individual employees in excess of a salary of $100,000, as prorated for the period from February 15 to June 30, 2020, and (b) compensation paid to employees residing outside the United States.
  • How much?
    Businesses can receive these small business interruption loans up to 2.5 times their average monthly payroll up to a maximum of $10 million at up to 4% interest rates, depending on how much they paid their employees between January 1 and February 29.
  • What’s the deadline to apply?
  • Loans under the PPP are available to eligible recipients through June 30, 2020, with streamlined eligibility criteria.
  • When do I have to start repaying?Lenders are required to defer payments on PPP loans for between six months and one year, with the Small Business Administration to issue deferment guidance to lenders within 30 days of enactment.
  • Who’s providing the money?
    Loans will be provided through banks, credit unions, and other lenders and will be guaranteed by the Small Business Administration. Loan applications should be submitted through lenders who are partnered with the Small Business Administration, not the SBA itself.
  • How long will the process take?
    The loan process could become a same-day process as early as next week, meaning loans would be signed and disbursed within 24 hours.
  • Can the loans be forgiven?
    The program is meant to ensure that businesses have the funds to pay their employees and to prevent layoffs. Loans offered through the program are forgivable if they are used for their intended purpose. That is, as long as a business receiving a loan maintains the average size of its workforce, it will only need to pay back the interest accrued, and the principal will effectively become a grant. The forgiven amount will be nontaxable. Loan forgiveness is limited to costs incurred between Feb 15 and June 30, 2020.

    In order to incentivize the retention of employees at existing salaries, the amount of loan forgiveness is reduced by any reduction in the average number of monthly full-time equivalent (FTE) employees employed by the loan recipient during the eight weeks following disbursement of the loan (the covered period) as compared to the average number of monthly FTE employees employed by the recipient during, at the recipient’s election, either the period between February 15 and June 30, 2019, or the period between January 1 and February 29, 2020. For example, if the recipient had an average of 95 FTE employees during the covered period and an average of 100 FTE employees during the reference period, then the recipient would only be entitled to 95% of the loan forgiveness that would otherwise be available; and the amount of any reduction in total salary or wages of any employee during the covered period that is in excess of 25% of the total salary or wages of the employee during the most recent full quarter during which the employee was employed (taking into account only employees who did not receive, during any single pay period in 2019, wages or salary at an annualized rate of pay in an amount more than $100,000).In order to incentivize the rehiring of employees and the reversal of any recent salary reductions, loan forgiveness will be determined without regard to the reduction in the number of FTEs of a loan recipient and any reduction in salary or wages of employees of a loan recipient, in each case in between February 15, 2020, and 30 days after enactment of the CARES Act, that is eliminated prior to June 30, 2020.A detailed application and documentation are required for borrowers seeking forgiveness, with lenders required to decide any such application within 60 days, with forgiveness capped at the amount of the loan principal.
  • I run a seasonal business. Am I out of luck?
    No, there are special provisions for seasonal businesses and businesses that were not in operation between February 15 and June 30, 2019. Source: BGW CPA, PLLC

Is a PEO Your Differentiator?

Twenty years ago, PEO’s had 3-4% penetration in the small to midsize marketplace within the US. Today, that number has grown to 175,000 clients which represents approximately 15 percent of all employers with 10 to 99 employees. Currently, there are approximately 907 PEO’s in the US and most of us can only recall the name of the larger PEO’s in the industry; however, does that mean they are the best fit for your company? Not necessarily. The reality is there are many smaller PEO’s that provide great value and service to their clients. I want to focus on four important questions that need to be addressed when considering a PEO for your company:

Can a PEO enhance a company’s Talent Acquisition strategy and Employee Engagement?

With small to midsize companies seeking solutions to help fill the gap with their talent acquisition and retention strategies and seeking strategies to enhance employee engagement, a PEO can be a viable option. Studies show that PEOs help their clients achieve better revenue growth and profitability. Clear results also illustrate that they help to improve their clients’ HR policies and practices, employees’ work environment and satisfaction/engagement, and businesses’ ability to focus on factors that drive business success.

If the PEO model can help me address my greatest challenges of being an employer, how do I select the PEO that is best for my company and our employees?

After you and your leadership team determine that outsourcing HR is right for your company, the question becomes, how do I know which PEO is the right for my company? This determination is based on the priorities and objectives of your company and the breadth of services offered by the PEO. There are two mindsets and options available at this point:

Is the DNA of your company one of growth and investment into your company and your employees or are you focused on stabilization and cutting costs?

Are you seeking strategic HR (where you focus on being proactive, planning and preparing for both short and long term objectives), or do you prefer a more tactical approach to HR (where you are focused on the core components like payroll processing, employee benefits, work comp and compliance)?

There are Tier 1 and Tier 2 PEO’s that can fit the needs of both mindsets. There are fewer PEO’s that can fit the requirements to be a ‘strategic business partner” that is focused on providing the infrastructure to help businesses grow and there are many that can provide the more tactical HR services at a lower cost which helps those companies that identify with #2 above.

Over the years, I have found that a majority of companies interested in HR Outsourcing via PEO are focused primarily on cutting costs and only a small percentage of companies are seeking to make their companies better. How do the results of these mindsets differ? Companies that were focused on lowering costs, changing providers regularly because of price and focused on tactical operations grew at a much lower rate than the companies that selected a PEO that provided more flexibility and offered the ability to scale within its model. Several clients grew from 5 – 15 employees and ultimately outgrew the model when they were 150 – 300 employees. Does this mean that the PEO model is outgrown when companies get to this size? No; however, it depends once again on the needs and the objectives of the organization. Some elect to bring HR back in house meanwhile, others prefer to keep utilizing HR Outsourcing due to the efficiency it offers.

How does a PEO establish their Service Fee?

Most PEO’s will require you to provide similar information in order to provide a proposal and pricing. You should be prepared to provide:

  • Employee Census that includes employee and dependent name, age, home zip, pay amount, pay frequency, work comp code, and benefits election.
  • Company profile
  • Copy of current Work Comp rates, codes and 3 years loss runs
  • Copy of current Benefit invoice, plan designs and potentially a copy of the upcoming renewal pricing if you are within 60 – 90 days of renewal.
  • Copy of current State Unemployment rate

Once this information has been provided, the PEO will calculate how much will need to be allocated for:

  • Payroll taxes. This includes the employer’s portion for FICA and Medicare, Federal Unemployment, and State Unemployment tax. These allocations should be consistent between PEO’s; however, the exception to this is the State Unemployment allocation. As with every company, each PEO has their own State Unemployment rate (aka SUI) and it is important to fully understand what the state Wage Cap is and what percentage the PEO is collecting. It is also important to verify that once the Wage Cap has been achieved for an employee that these fees do not continue being collected for that employee and you should see a reduction in fees on future invoices. It’s important to do occasional audits to confirm that you are being billed correctly.
  • Employee Benefits. Most PEO’s will try and map your current plan(s) designs to comparable plans they offer. By using the information on the census and invoices provided, the PEO can calculate the estimated Benefits allocation. They will then divide the monthly allocation into two parts; first is the employee portion which is collected when each payroll is processed and then the remaining is the employer’s portion and these dollars are built into the Service Fee. This is an area where pricing transparency is above average for most PEO’s.
  • Work Comp. This is calculated by determining the estimated payroll for each code and multiplying by the corresponding code rate. The rates are determined based on the amount of risk a job has. An example would be Work Comp code 8810 is for office and administrative positions and it carries a low risk so the corresponding rate is .15 for each $100 in payroll whereas a Work Comp code of 8742 is for the Outside Sales position and since the position has a higher risk of a claim happening the corresponding rate may be .40 cents for each $100 in payroll. As your payroll fluctuates, the work comp allocation will fluctuate.

The Administrative fee is another area where you may see significant differences. Although there can be a wide range in these fees, I want to focus on the two ways these fees are calculated:

  • Fixed dollar per employee per month. Regardless of pay amount, pay frequency, title or position with the company, the PEO will charge a fixed dollar per month for each employee. An example is a company that has 10 employees and the PEO is charging $120 per month per employee, the administrative fee would be $1200.
  • Percentage of Pay. The PEO will calculate the administrative fee based on the amount of pay for that pay period. There are occasions where this can be advantageous, however, it is important to note that as employee pay increases or if bonuses are paid, the administrative fee increases too. My concern with this model is that the more successful a business is, the more a PEO will charge when it doesn’t cost any more to deliver their services.

Do I need a Consultant to help guide me through the PEO evaluation process? It is not required to include a Consultant in this process; however, they can bring experience, expertise, objectivity, and clarity to a somewhat confusing process as every PEO proposal is unique. A consultant can help you define and design an HR infrastructure solution that fully supports the company, their people and solve your greatest business challenges. Based on twenty years of experience, clients have shared that they had clarity and peace of mind as they worked through the decision-making process with a consultant.

Driving Value To Your Employee Benefits

Communicating what’s new in benefits and how those changes impact employees is challenging to do in a short amount of time. Which is why benefits communication and personalization should be considered a year-round strategy for higher benefits literacy and an overall better enrollment experience for employees. 

Since benefits spending is one of the highest price tags for employers, using data and communicating these benefits in a personalized way is key to higher ROI. 

There is too much at stake for the process to not run efficiently. The urgency and importance of getting this right is heightened by the fact that benefits spending is often the second or third largest budget item in a company’s budget.

Having the right benefits administration technology and meaningful data can transform annual enrollment from a once-a-year event into a year-round personalized journey that engages employees. Ultimately, this helps employees become better consumers of benefits, thereby lowering benefits spend.

But how can organizations move from a solution that administers benefits to one that focuses on benefits strategies to create better member outcomes? Most organizations face headwinds that include tracking benefits data effectively, helping members select the appropriate plans and automating tasks such as dependent verification.

For example, knowing who is not eligible for benefits coverage is important. Many organizations unknowingly provide benefits to those who are not eligible or who are no longer with the company, oftentimes it can be 5-7% of those enrolled. With an average annual health benefits cost of $15,000 per employee, that amounts to a significant financial burden to the business. Without full and transparent access to data, businesses can’t make informed decisions that drive better outcomes.

It’s common for businesses to see close to double-digit increases in their annual benefits spend from health care costs. “Tackling these costs requires organizations to have an understanding of employees’ claims and utilization data to determine their biggest expenses. Using that data, organizations can tailor plans to fit employees’ needs.

Some clients took this approach, but we realized that creating an optimal plan for employees is only part of the solution. How that plan is communicated is also critical. When they implemented a high-deductible health pan (HDHP) a few years ago, less than 2% of employees enrolled. An HDHP essentially has lower premiums and higher deductibles than a traditional health plan and is meant to encourage consumer-driven healthcare. What they found was people didn’t understand how an HDHP works. It is important to offer a decision guidance tool to help employees choose the plan that best fit their needs. The following year, the clients saw an increase of 5x in HDHP participation at their next Open Enrollment.

By leveraging technology to learn about your population, you can significantly impact your organization’s bottom line. To create a sustainable benefits program and reduce the average annual increase in total spend for your organization, you must have access to the right data and transparency.

The real value to a business is using the right technology and data analysis to better understand employee needs and craft a benefits strategy that addresses those needs.

How does a comprehensive employee benefits strategy impact a company’s culture? We will be presenting our finds in February’s Insight.