57. Our plan has no lifetime maximum but it has an annual maximum of $500,000. Will we have to change or eliminate the annual maximum?

Yes. Starting in 2014, plans cannot have annual maximums on essential benefits. For plan years beginning before 1/1/14, you can have an annual maximum on essential benefits provided the limit is no less than:

• $750,000 for a plan year beginning on or after September 23, 2010, but before September 23, 2011,

• $1,125,000 for a plan year beginning on or after September 23, 2011, but before September 23, 2012, and

• $2,000,000 for plan years beginning on or after September 23, 2012, but before January 1, 2014.

58. Our plan has an annual maximum of $10,000 for chiropractic care. Do we have to remove the limit?

Until HHS has provided more guidance on the specifics of what is an essential benefit and whether chiropractic care would fall under one of the categories of essential benefits, it’s not possible to answer this question. Until these regulations are issued, the agencies enforcing PPACA have said they will take into account good faith efforts to comply with a reasonable interpretation of the term “essential health benefits”.

An alternative to having annual dollar maximums might be to replace them with day or visit limits, which are not limited or restricted for chiropractic care at this time.

59. We offer our employees a high deductible health plan combined with a Health Reimbursement Arrangement (HRA). We contribute $1,000 annually to each employee’s HRA. Does the elimination of annual limits mean we have to change our HRA?

No. When HRAs are integrated with other coverage under a group health plan (e.g. with a high deductible plan), and the other coverage is in compliance with all the applicable health insurance reform provisions, the fact that the benefits are limited under the HRA does not cause it to violate PPACA.

60. We have a lot of minimum wage employees who can’t afford our health plan so we offer them a “mini-med” plan that has a $75,000 annual maximum. Will we have to raise that maximum?

Maybe not. The agencies enforcing PPACA have indicated that they are working on a waiver program for certain mini-med plans if complying with this rule would result in a significant decrease in access to benefits or a significant increase in premiums. Stay tuned for more details on this issue.

61. PPACA prohibits “rescissions”. What does this mean and how will it affect our plan?

Rescissions are defined as a cancellation of coverage that has a retroactive effect. Rescissions are prohibited unless the termination is due to fraud, or an intentional misrepresentation of a material fact, and are permitted by the written terms of the plan. Therefore, effective for plan years starting on or after September 23, 2010, your group health plan will not be permitted to terminate coverage retroactively under any circumstances unless the employee performs an act of fraud, or the employee intentionally misrepresents a material fact and the plan has been drafted or amended to provide that such misrepresentations will result in a termination of coverage.

Retroactive cancellation of coverage due to a failure to pay premiums is not considered a rescission.

62. We have several locations and sometimes we are not immediately notified by supervisors or managers when an employee loses eligibility for plan coverage when they are reassigned to a part time position. We can still terminate coverage retroactively in those cases, right?

Yes, as long as you did not continue withholding contributions from the employee’s paycheck and paying claims. If you continued to withhold contributions and provide coverage, then the coverage can only be terminated prospectively.

Example. Joe has coverage under the plan as a full-time employee. The employer reassigns Joe to a part-time position and Joe is no longer eligible for coverage. The plan mistakenly continues to provide health coverage, collecting premiums from Joe’s paycheck and paying claims submitted by Joe. After a routine audit, the plan discovers that Joe is no longer eligible. The plan rescinds Joe’s coverage effective as of the date he changed from a full-time employee to a part-time employee.

Conclusion. The plan cannot rescind Joe’s coverage because there was no fraud or an intentional misrepresentation of material fact. The plan may only cancel coverage for Joe prospectively.

63. What are the special rules that will apply to our HMO option regarding the choice of primary care physicians (PCP)?

The new rules on PCPs are effective for plan years starting on or after September 23, 2010 but only apply to nongrandfathered plans. If your HMO option is not grandfathered, you must allow participants or beneficiaries to elect a PCP including:

• Designating any participating primary care physician who is available to accept the individual; and

• Designating any participating physician who specializes in pediatrics who is available as a child’s PCP.

64. We read that HMOs cannot require females to get authorization for OB/GYN services. How does that work?

This new rule applies only to nongrandfathered plans. If your HMO option is not grandfathered, it cannot require an authorization or a referral from the HMO or a PCP for a female seeking OB/GYN services from a participating health care professional (i.e. physician, physician assistant, midwife, etc.) who specializes in OB/GYN care.

65. Do we have to notify the employees enrolled in or enrolling in the HMO of these new rules?

Yes. If your nongrandfathered HMO plan requires the designation of a PCP, you must provide a notice informing each employee of the following:

• The plan requirements for electing a PCP;

• That any participating primary care physician who is available to accept the participant can be designated as a PCP;

• That any participating physician who specializes in pediatrics can be designated as a PCP for a child;

• The plan may not require authorization or referral for OB/GYN services provided by a participating professional who specializes in OB/GYN care.

This notice must be included in the plan’s SPD or any other similar description of the benefits under the plan. The DOL has issued a model notice for this purpose which can be downloaded in Word format from their website at:

http://www.dol.gov/ebsa/healthreform/

66. There are new rules for emergency room services. How will they affect our plan?

These rules apply only to non-grandfathered plans. If your plan is not grandfathered, it must provide coverage for emergency room services in the following manner:

• Without the need for any prior authorization determination, even if the emergency services are provided on an out-of-network basis;

• Without regard to whether the health care provider furnishing the emergency services is a participating network provider with respect to the services; and

• If the emergency services are provided out of network, without imposing any administrative requirement or limitation on coverage that is more restrictive than the requirements or limitations that apply to emergency services received from in-network providers.

Also, if the emergency services are provided out of network, the copays or coinsurance amounts imposed cannot exceed the amounts imposed for in network emergency room services.

Disclaimer: Staff One, with its ESAC accredited Professional Employer Organization (PEO) business offering, serves as a human resources department for small and medium-sized businesses. By entering into a co-employment relationship with a PEO, companies have access to experienced specialists who can help with many time-consuming activities in areas such as Human Resources Management, Payroll Management (including 940 and 941 filings), Employer Liability Management, Risk and Safety Management and Benefits Management. We share this information, from our partner GBS, with our clients and friends for general informational purposes only. It does not necessarily address all of your specific issues. It should not be construed as, nor is it intended to provide, legal advice. Questions regarding specific issues and application of these rules to your plans should be addressed by your legal counsel.

By TJ Carter

Being an effective manager takes work. Also, if you are new to the role with little or no training, you will discover there is a difference between being a great employee and managing great employees.

Being a manager takes courage, drive and a little insanity. Many managers know what to do; they are just overwhelmed with the volume of what they need to do.

Here are 5 tips managers most likely know but tend to forget, so lets review what you already know so you can put that knowledge into practice immediately.

1. Determine Who’s Who. Know the personalities on your team, and who you are. The 4 different ‘playground personalities’ will help you do this. Ask, “What type of kid was I on the playground?”

• The one who made sure everyone got a turn at bat? This is the Peacemaker.
• The one who made everyone line up and count off? The Organizer.
• The one who changed the rules midway through the game? The Revolutionary.
• The one who wanted to play it my way? The Steamroller.

Once you figure out your playground personality, determine whos on your playground. Don’t miss the signs. People are very clear with their body language, word usage and intentions.

Peacemakers appreciate communication and collaboration. If a staff member’s eyes bulge when others argue, that’s a clue.

Organizers are structured and decisive. If an employee comes to a meeting with charts or color-coded paper, he’s an organizer.

Revolutionaries hate routine and prefer to adapt to the moment. You’ll know a revolutionary when you ask, “Where did that come from?”

Steamrollers are smart and opinionated and can solve complex problems. They take opposing views and keep ideas floating at 30,000 feet.

2. Show Respect. Respect starts with the manager. Saying “hello” or “thank you” goes a long way. To show respect:

• Brainstorm ideas with Peacemakers
• Provide meaningful work with deadlines to Organizers
• Assign emergency tasks to Revolutionaries
• Ask Steamrollers for their opinions

3. Face Facts. Not everyone collects facts the way you do, so ask questions, be open to learning and don’t shut down discussions too early. When you think you have the facts, ask again to make sure.

4. Find the Humor. Humor should never be personal, but try to find the absurdity that invades everyone’s workspace and lighten the mood. Humor helps employees relate to you and builds camaraderie for difficult tasks.

5. Put it all Together. Managers get paid to get work done. Just when you have a plan, something goes wrong. Don’t immediately go to Plan B. Leverage personalities and the way each approaches a problem.

Understanding employees and empowering them to tackle their work in a manner that suits them will help you blossom into a confident, seasoned professional.

For questions or to learn more: Alyshia Foster 214-461-1129 or alyshia.foster@staffone.com

The recent passage of the Patient Protection & Affordable Care Act (H.R. 3590) and the Health Care & Education Affordability Reconciliation Act of 2010 (H.R. 4872) will impact every business. How will it affect you? For your convenience, we have created a chronological summary for employers in general and also a bonus edition for small business owners.

Summary of the Legislation by Number of Employees:
50 employees or more | 100 employees or less | 25 or less

Effective January 1, 2014
**Applies to firms with greater than 50 employees

• Promoting Employer Responsibility. The Act requires employers with 50 or more employees who do not offer health coverage to their employees to pay $2,000 annually for a “full-time employee” (i.e., an employee working 30 or more hours per week).

• The 50-employee threshold is based on the employer’s average number of employees on business days during the preceding calendar year.
• Both full-time and part-time employees are considered in determining whether the employer has 50 or more employees; however, the number of part-time employees to be counted is determined by dividing the aggregate number of hours of service for those part-time employees for each month by 120.
• The $2,000 penalty then applies only to full-time employees who work 30 or more hours per week.
• In order to encourage employers to expand beyond 50 employees, the first 30 employees are not included in calculating the applicable penalty amount.
• The penalty can also increase to $3,000 for a full-time employee receiving a federal tax credit in the exchange where the employer offers health coverage, but that coverage would be deemed “unaffordable” because the employee has to pay more than 9.8 percent of his or her income, or the employer contributes less than 60 percent of the actuarial value of the plan.
• Therefore, while employers are not required to offer health coverage under the Act, significant penalties may be imposed on those employers that do not offer it or that only offer health coverage deemed “unaffordable.”
• In addition, employers may still impose a waiting period for coverage without being subject to a penalty, but this waiting period may not exceed 90 calendar days.

Effective January 1, 2011
**Applies to Firms with 100 employees or less

• Cafeteria Plans. The Act creates a Simple Cafeteria Plan to provide a vehicle through which small employers can provide tax-free benefits to their employees.

• Small employers are defined as employers who on average employ 100 or fewer employees over the previous two years. The Act aims to ease the administrative burden of sponsoring a cafeteria plan for such small employers.
• The Act also exempts small employers who make contributions for employees under a Simple Cafeteria Plan from pension-plan nondiscrimination requirements applicable to highly compensated and key employees.

Effective January 1, 2014

**Applies to firms with 100 employees or less

• Exchanges. The Act provides for the creation of health-insurance exchanges at the state level in 2014, where individuals and small employers would be able to buy health coverage in a manner similar to that of larger employers. Initially, the state exchanges would be open to individuals and small employers with 100 or fewer employees, unless the state opts to limit this to

organizations with 50 or fewer employees. Beginning in 2017, states would have the option to expand the exchange to larger employers.

**Applies to Firms with 100 employees or less

• Wellness Programs. The Act provides that employers can offer increased incentives to employees for participation in a wellness program or for meeting certain health-status targets. The Act permits rewards or penalties, such as premium discounts of up to 30 percent of the cost of coverage. Existing wellness regulations are limited to wellness incentives of up to 20

percent of the total premium, provided that certain conditions are met. In addition, the Act creates a $200 million, five-year program to provide grants to certain small employers (fewer than 100 employees) for comprehensive workplace-wellness programs. The grants would go to small employers that did not have a wellness program when the Act was enacted.

Effective January 1, 2010
**Applies to firms with 25 employees or less

• Small-Business Tax Credit. A small-business tax credit of up to 35 percent of the employer’s contribution to purchase health insurance for employees is now established for “qualified small employers.”

• A “qualified small employer” is an employer that has no more than 25 full-time employees for the taxable year and the average annual wages of those employees do not exceed $50,000 (indexed for inflation.
• Employers with 10 or fewer employees and average annual wages of less than $25,000 would be eligible for the full credit.

• Small-Business Tax Credits. When health-insurance exchanges are established in 2014, the available tax credit will increase to 50 percent of premiums.

For questions or to learn more: Alyshia Foster 214-461-1129 or alyshia.foster@staffone.com

The recent passage of the Patient Protection & Affordable Care Act (H.R. 3590) and the Health Care & Education Affordability Reconciliation Act of 2010 (H.R. 4872) will impact every business. How will it affect you? For your convenience, we have created a chronological summary for employers in general and also a bonus edition for small business owners.

Summary of the Legislation by Effective Date:
2010 | 2011 | 2013 |  2014 | 2018

Effective January 1, 2010
• Medicare Part D. The Act provides a $250 rebate check for all Part D enrollees who enter the “donut hole.” Currently the “donut hole” coverage gap falls between $2,830 and $6,440 in total drug spending by Part D enrollees.

• Adoption Tax Credit. The Act increases the adoption tax credit and adoption assistance exclusion by $1,000 (now set at $13,150), makes the credit refundable and extends the credit
through 2011.

Effective 90 Days After Enactment (i.e., June 21, 2010)
• Early Retirees. The Act establishes a temporary reinsurance program to provide reimbursement to employer health plans offering health coverage for early retirees (ages 55 to 64) and their families. The reinsurance program would reimburse employer health plans for 80 percent of the cost of benefits provided per enrollee in excess of $15,000 and below $90,000. The employer health plans are required to use the funds to lower costs assumed directly by participants and beneficiaries, and the program incentivizes plans to implement programs and procedures to better manage chronic conditions.

• Pre-Existing Conditions. The Act provides that group-health plans and health-insurance issuers offering group or individual health-insurance coverage may not impose any pre-existing condition exclusions with respect to such plans or coverage. Therefore, group-health plans that include such pre-existing condition exclusions will no longer be permitted.

Effective 90 Days After Enactment (i.e., June 21, 2010)
• Pre-Existing Conditions. The Act provides that group-health plans and health-insurance issuers offering group or individual health-insurance coverage may not impose any pre-existing condition exclusions with respect to such plans or coverage. Therefore, group-health plans that include such pre-existing condition exclusions will no longer be permitted.

Effective Six Months After Enactment (i.e., September 23, 2010)
• Additional Protections for Children. The Act: (1) bars health-insurance companies from imposing pre-existing condition exclusions on coverage for children and (2) requires any group-health plan or plan in the individual market that provides dependent coverage to continue to make that coverage available until the child turns 26 years of age, if the child does not have access to other health coverage (without regard to the child’s marital status).

• Lifetime Limits. The Act prohibits insurers from imposing lifetime limits on benefits. Additionally, beginning in 2014, the Act prohibits insurers from imposing annual limits on the amount of coverage an individual may receive.

• Preventive Health Services. The Act requires that all new group-health plans and plans in the individual market provide first-dollar coverage for preventive services (i.e., not subject to a deductible). Examples of preventive services include well-childcare visits and certain immunizations.

Effective January 1, 2011
• W-2 Reporting. The Act requires employers to disclose the value of the benefit provided by the employer for each employee’s health-insurance coverage on the employee’s annual Form W-2. This is a W-2 reporting obligation and will not result in additional taxable income to employees.

• Additional Tax for Health Savings Account (HSA) Withdrawals. The Act increases the additional tax for Health Savings Account withdrawals prior to age 65 that are not used for qualified medical expenses from 10 percent to 20 percent.

• Medicare Part D. The Act provides a 50-percent discount on all brand-name drugs and biologics in the “donut hole” and begins phasing in additional discounts in brand-name and generic drugs to completely fill the “donut hole” by 2020 for all Part D enrollees.

Effective January 1, 2013
• Healthcare Flexible Savings Accounts. The Act limits the amount of contributions to healthcare reimbursement flexible-spending accounts to $2,500 per year. No limit was previously imposed upon healthcare reimbursement flexible-spending accounts. This new limit will raise healthcare costs for employees with unreimbursed healthcare expenses in excess of $2,500 annually, to the extent the employee currently has a flexible-spending account that permits contributions in excess of $2,500—and would potentially create increased taxable income for employees.

• Limiting Deductibility of Executive Compensation for Insurance Providers. With respect to services performed after 2009, the Act limits the deductibility of executive compensation under section 162(m) of the Internal Revenue Code for insurance providers if at least 25 percent of the insurance provider’s gross premium income from health business is derived from health-insurance plans that meet the minimum creditable-coverage requirements. The deduction is limited to $500,000 per taxable year (as opposed to the typical $1,000,000 limitation) and applies to all officers, employees, directors and other workers or service providers performing services for, or on behalf of, a covered health-insurance provider.

• Medicare Part D. The Act eliminates the federal income-tax deduction for the 28-percent subsidy for employers who maintain prescription drug plans for their Part D eligible retirees.

• Itemized Deduction for Medical Expenses . The Act increases the income threshold for claiming the itemized deduction for medical expenses from 7.5 percent to 10 percent. Individuals over age 65 would be able to claim the itemized deduction for medical expenses at 7.5 percent of adjusted gross income through 2016.

Effective January 1, 2014
**Applies to Firms with 50 or more employees
• Promoting Employer Responsibility. The Act requires employers with 50 or more employees who do not offer health coverage to their employees to pay $2,000 annually for a “full-time employee” (an employee working 30 or more hours per week).

• The 50-employee threshold is based on the employer’s average number of employees on business days the preceding calendar year. Both full-time and part-time employees are considered in determining whether the employer has 50 or more employees; however, the number of part-time employees to be counted is determined by dividing the aggregate number of hours of service for those part-time employees for each month by 120. The $2,000 penalty then applies only to full-time employees.
• In order to encourage employers to expand beyond 50 employees, the first 30 employees are not included in calculating the applicable penalty amount.
• The penalty can also increase to $3,000 for a full-time employee receiving a federal tax credit in the exchange where the employer offers health coverage, but that coverage would be deemed “unaffordable” because the employee has to pay more than 9.8 percent of his or her income, or the employer contributes less than 60 percent of the actuarial value of the plan. Therefore, while employers are not required to offer health coverage under the Act, significant penalties may be imposed on those employers that do not offer it or that only offer health coverage deemed “unaffordable.”
• In addition, employers may still impose a waiting period for coverage without being subject to a penalty, but this waiting period may not exceed 90 calendar days.

**Note: firms with more than 200 employees must provide coverage, of which an employee can opt out.

Effective January 1, 2014 Continued
• Wellness Programs. The Act provides that employers can offer increased incentives to employees for participation in a wellness program or for meeting certain health-status targets. The Act permits rewards or penalties, such as premium discounts of up to 30 percent of the cost of coverage. Existing wellness regulations are limited to wellness incentives of up to 20 percent of the total premium, provided that certain conditions are met.

• Waiting Period. In addition, employers may still impose a waiting period for coverage without being subject to a penalty, but this waiting period may not exceed 90 calendar days.

• Exchanges. The Act provides for the creation of health-insurance exchanges at the state level in 2014, where individuals and small employers would be able to buy health coverage in a manner similar to that of larger employers. Initially, the state exchanges would be open to individuals and small employers with 100 or fewer employees, unless the state opts to limit this to organizations with 50 or fewer employees. Beginning in 2017, states would have the option to expand the exchange to larger employers.

Effective January 1, 2018
• High-Cost Plan Excise Tax. The Act imposes a nondeductible excise tax of 40 percent on insurance companies and plan administrators (including self-insured plans) for any health-insurance plan where the combined annual employer/employee premiums exceed the threshold of $10,200 for self-only coverage and $27,500 for family coverage. The tax would apply to the amount of the premium in excess of the threshold. An additional threshold amount of $1,650 for singles and $3,450 for families would be available for retired individuals over the age of 55 and for plans that cover employees engaged in high-risk professions (e.g., law-enforcement professionals, EMTs, construction and mining).

For questions or to learn more: Alyshia Foster 214-461-1129 or alyshia.foster@staffone.com

The HIRE Act mmediately enhances employers’ cash flow by allowing employers to retain the employer portion of Social Security Tax. Read on as to be sure that you don’ t miss this opportunity as an employer to receive increased tax credits and payroll tax exemption.

With the recent passage of the Patient Protection & Affordable Care Act (H.R. 3590) and the Health Care & Education Affordability Reconciliation Act of 2010 (H.R. 4872), some employers may already be planning to limit growth as to not be affected by certain mandates of the new legislation. To comfort the fretting business owner, some alleviation has been signed into legislation in the form of tax credits.

On March 19, President Obama signed into legislation the Hiring Incentives to Restore Employment (HIRE) Act that creates a tax credit for the hiring of new employees. The law includes a payroll tax exemption and increased tax credits for employers that meet certain eligibility requirements. Under this new law, an employer that hires an employee after February 3, 2010 and before January 1, 2011, can receive a tax credit equal to the employer’s portion of the Social Security Tax. All employers, excluding government employers, are eligible to receive the credit. Public Institutions of higher education are the only government institutions that qualify for the tax credit.

To qualify for the 6.2% Employer Social Security Tax exemption under this legislation, an employer must hire an employee who has not been working for 40 hours per week for the past 60 days and whose 2010 earned wages after March 18, 2010 and before January 1, 2011 do not exceed $106,800. The exemption has no limit as to the total amount of benefits that can be claimed by an employer. An employer can save up to $6,622 per qualifying working no matter how many employees are hired.

In consideration of tax credits, employers will receive the lesser of $1000 or 6.2% of wages paid to the qualifying work. In order to qualify, an employee must have been hired after the initial start date (February 3) and remained on payroll for 52 consecutive weeks. Wages for the last 26 weeks of the period may not drop below 80% of the wages paid the first 26 weeks. Each eligible employee is expected to verify status per signed affidavit, under penalties of perjury, he or she has “not been employed for more than 40 hours during the 60-day period ending on the date such individual begins such employment.”

The legislation also encourages employers to hire sooner rather than later as the tax benefit will be greater. Neither the 6.2% Employer Social Security Tax exemption nor the retention tax credit is permitted if a person is hired to replace another employee, “unless such other employee is separated from employment voluntarily of for cause.” Additional benefits in the new legislation include: an allowance for small businesses to expense up to $250,000 of their taxable income through the end of 2010, an expansion for the eligibility of “Build America Bonds,” and it extends surface transportation policy through December, providing $19.5 billion for road construction and other infrastructure projects under the Highway Trust Fund.

Alexandria, Va. (March 12, 2010) — Wisconsin’s small business owners and other small employers who have come to depend on the outsourced employment solutions of professional employer organizations (PEOs) for payroll, benefits, risk management and human resources are guaranteed tax credits and other economic incentives remain with them under passage of Senate Bill 504 this session.

The bill was unanimously passed by both the Senate and Assembly and updates the provisions of Wisconsin Act 189, which established the original regulatory framework for PEOs. The PEO market has grown substantially since passage of the statute in Wisconsin in 2007. The average PEO serves approximately 200 business clients and 4,000 workers.

“PEOs assume a wide variety of significant employer responsibilities for these small employers, including the delivery of risk management services, said Michael Gotzler of Madison headquartered QTI Human Resources Inc. “They also pay the wages of worksite employees, manage payroll tax payments and compliance, improve compliance with federal and state labor regulations, share human resource management best practices and sponsor many employee benefit programs including health care and retirement savings plans. Ironically it is this shared or co-employment arrangement that lead to the need to clarify that tax credits and economic benefits offered by local government belong to the client and not the PEO.”

Melinda Heinritz, executive director of the Wisconsin Historical Foundation and long-time PEO client of QTI Human Resources, explained, “We rely heavily on the services and expertise of QTI to help us effectively navigate all aspects of human resources management. Doing so allows the Foundation to focus time and energy on fulfilling our mission and executing our core competencies in marketing, membership and fundraising on behalf of the Wisconsin Historical Society.”

Gotzler worked with the PEO industry’s trade association, the National Association of Professional Employer Organizations (NAPEO) and the Department of Regulation and Licensing to ensure the original intent of the act provided a layer of safeguards and oversight for small business owners and their employers in PEO outsourcing arrangement. Under the original law, PEOs were wrongly classified as temporary help agencies leading to some of the administrative confusion.

As in 34 other states, PEOs in Wisconsin are required to maintain minimum financial standards, file annual audited financial statements, and register with the Department of Regulation and Licensing.

NAPEO says the concept of regulating PEOs is not a new one. The provisions contained in this bill are based on model legislation. “Over the past 25 years, these standards and requirements have been tested and refined to strike the balance of the need for responsible regulation,” said Milan Yager, president and CEO of NAPEO. NAPEO represents the $68 billion industry, which has experienced double digit growth for the past five years.

The bill was sponsored by Senator Bob Wirch and led through the Assembly by Representative Steve Hilgenberg, who introduced companion legislation Assembly Bill 716.

About NAPEO

As the recognized Voice of the PEO Industry,® NAPEO represents nearly 400 professional employer organizations (PEOs). The PEO industry has matured to $68 billion with double digit growth annually since 2004. As NAPEO enters its 25th year, the potential market remains promising with high client retention rates, a projected increase in revenues for 2010, and the current untapped market now serving 300,000 business owners and 2 to 3 million workers. PEOs allow clients to “reduce costs and free up time to devote to revenue generating activities, improvements that can be instrumental to gaining competitive advantage,” according to research by the Society of Human Resource Management Foundation. To learn more about how PEOs contribute to small businesses’ success, visit the NAPEO Web site at www.napeo.org.

About Staff One

Founded in 1988, Staff One is a leader in the Human Resources
Outsourcing industry with an ESAC accredited and bonded PEO service
offering. The Company is a preferred provider of outsourced human resources
management services that include, benefits and payroll administration,
health and workers compensation insurance programs, personnel records
management, employer liability management, employee performance management
and employee training and development services to small and medium-sized
businesses. Staff One is headquartered in Durant, Okla., with offices
in Dallas, Little Rock, Ark., Nashville, Tenn., and Tulsa, Okla. For
more information, visit www.staffone.com.

The NCAA tournament is just around the corner and offices are abuzz with friendly banter and cries of team loyalty. Along with plenty of excitement and newfound bragging rights among fellow colleagues, March Madness brings forth a torrid fear of lost productivity in the workplace. Though accurate numbers are incredibly difficult to pinpoint in such instances, outplacement firm Challenger, Gray & Christmas, estimated in a 2008 press release that lost productivity during the tournament could cost businesses an estimated 1.7 billion every year. While these numbers are seen only as an estimate and in some opinions as a heavily aggrandized estimate, it would be foolish to think that there is not a significant impact on time and productivity for the duration of the tournament.

While an employer’s first reaction may be to try and limit March Madness related activities in the workplace, there are definitely a few things to consider before taking any action against tournament involvement. First, denial of participation could be seen by employees as overbearing and in opposition to a fun work environment. Employee morale is crucial for productivity, and would therefore seem counterintuitive for employers hoping to retain a high level of productivity to discourage participation in an activity considered somewhat of a sports holiday. Instead of discouraging involvement and risking a discontented office, consider using March Madness to your advantage. There are many different ways an employer or manager could use the NCAA tournament as a way to improve employee morale and create a stronger sense of camaraderie throughout the workplace:

1. Create an online, office-wide bracket.
Creating a bracket on a website such as ESPN.com or Yahoo! Sports would eliminate the need to create, hand out and fill in paper brackets. Encourage people to participate only if they would like, and if the employees would like to have a buy-in for competitive purposes, we suggest the money go towards a charity or non-profit organization of the winner’s choice.

2. Offer small, fun and/or personalized prizes for top placers.
An already stated prize would not only encourage friendly competition and participation, it would also help to discourage against illegal gambling in the workplace. Some example of appropriate prizes may include gift certificates, a favorite team souvenir, or perhaps a meal on a supervisor’s tab.

3. Offer flexible hours and dress code allowances when appropriate.
A possible solution to the distraction of an early evening game could be a flexible work week. Also, since Fridays are often considered a more causal day in the workplace, employees could be encouraged to wear a tie, jersey or even socks to show where their hopes and loyalties lay within the tournament.

4. Encourage watching the tournament as a group
Many workplaces allot for short breaks throughout the day. Encourage employees to gather to the TV in the break room (or at single designated computer as to not take up too much bandwidth) during those times. One could even promote a potluck lunch, catering or group gatherings after work to watch the game together.

5. Designate times to stay involved and keep the competition alive.
A bi-weekly e-mail or short announcement at the end of an informal meeting discussing up-to-date results would help to discourage employees from constantly tracking brackets while at work and would also help the manager or supervisor to stay involved.

While this list is not at all exhaustive, these are a few simple ways to take what is consistently seen as a drag on productivity and turn it into a way to promote a healthier and more enjoyable work environment. For more information or any questions, contact Staff One at 1-800-771-7823 or visit www.staffone.com.
Founded in 1988, Staff One is a leading Human Resources Outsourcing firm with an ESAC accredited and bonded PEO service offering. Staff One operates as a full-service human resources department and delivers a comprehensive range of solutions that provides our clients with a level of support and value previously only available at much larger companies. By aggregating the buying power of hundreds of firms, we provide premium benefits, risk management, compliance management, payroll outsourcing, tax administration and strategic HR services to our customers, so they can focus on growing their core business.

• 70% of Employers are non-compliant with wage and hour laws, according to the Department of Labor (DOL).
• 2 out of 3 workplace-related lawsuits that go to trial are won by the employee.
• $10.3 Million: Civil penalties assessed against employers by the Wage &  Hour Division of the DOL in 2007.
• $220.6 Million:  Damages paid by employers for wage and hour non compliance in 2007.
• 11.2 Million:  The jury award against Mary Kay Cosmetics for classifying beauty “consultants” as independent contractors.
• $650,000:  The average jury award to plaintiffs for damages in workplace-related lawsuits.
• 88,846:  Number of violations recorded by OSHA inspectors in 2007, of which 67,176 were serious.
• $1 million: Potential per-occurrence fine for failure to safeguard personal/non-public information against identity theft under the Gramm/Leach/Bliley safeguard Bill.

At home, most of us would be outraged if we thought someone was listening to our conversations or looking at our computers. But what happens when we go to work?

Generally speaking, an employer obtains the right to monitor internet usage, e-mails, and phone calls in the workplace without the consent of the employee. In 1986 Congress passed the Electronic Communications Privacy Act (ECPA). The act states that one is liable if they “intentionally intercept, use or disclose any wire, oral or electronic communications.” However, there are many exceptions to the ECPA such as the consent exception, business use, and provider exception that leave the issue of employee privacy open to broad interpretation. There are certain circumstances where employees may have rights.

For example, if an employer is monitoring phone calls and realizes the call is personal, they must stop monitoring the call immediately. However, if the employer has told employees not to make personal calls on business phones, then the employee takes the risk that those phones may be monitored. Also, union contracts may limit an employer’s ability to monitor e-mails or phone calls. There also may be additional rights in the state of California.

The fact is, three out of four companies monitor employee activities in one form or another. 63% of those companies track internet use, 47% review e-mails, 15% use video surveillance, 12% monitor phone calls, and 8% review voicemail messages. Employees need to be aware that they can be monitored if they are using company property such as computers and phones. Over the last couple of years, social networks have become increasingly popular and a growing concern for employers. The concern that employers are losing productivity has caused an increase in electronic monitoring.

Because workplace privacy laws are few and weak, employers can monitor employees, and there is virtually little to no protection. So with that, a good general rule is to assume someone is watching and don’t take any chances! Take personal calls on a cell phone and use your personal computer for personal use.

References:

http://www.workplacefairness.org/sc/privacy.php

http://www.privacyrights.org/fs/fs7-work.htm

http://jobsearchtech.about.com/od/laborlaws/a/work_privacy.htm

http://www.llrx.com/congress/090400.htm

With the unemployment rate at more than 9%, talk of layoffs, and the closing of numerous businesses, it’s easy to see why many organizations are tightening their reins.  However, it is important to maintain, or create, an atmosphere of security, flexibility, and contentment for employees especially during an economic crisis.  The temptation may be to put more emphasis on the bottom line than on those that create the bottom line.  This could create more cost than you think.  For example, turnover rates for 2008 (both voluntary and involuntary) averaged 18.7%.  According to Watson Wyatt, total turnover costs including hard dollars and lost productivity are approximately 48% – 61% of salary.  If a company has 60 employees with an average salary of $40,000, that could mean a cost of $215,424 to $273,768!

So how does an employer stay competitive without spending a lot of money?  There are several things employers can do that cost little, but can go a long way in eye of an employee.

1.       Communicate.

Communication creates a sense of security for an employee.  Not only communication about operations and product offerings, but culturally and structurally as well.  If people feel that they have a good understanding of where the company is going and how it is going to get there, they are generally more connected and invested in it.  Communication creates a purpose and meaning to come and work every day.

2.       Be flexible.

Increasing flex-time or being more flexible with work schedules is a great way to add value in the eye of the employee.  Being aware of the scheduling needs of employees and then trying to meet those needs creates a loyalty and appreciation to your company.

3.       Recognition and Rewards.

Recognizing a job well done or rewarding employees that have just finished a project shows that they are appreciated for their efforts and it is noticed.  Rewards could be anything from an extra vacation day or a gift card to a restaurant.  They don’t have to cost a lot to have a significant impact.

These are just a few ways employers can keep their employees productive, content, and loyal through wage freezes or layoffs.  Eventually the economy will turn and the last thing an employer needs to worry about when this happens is finding good employees.  Remember, investing in the your human capital doesn’t have to cost much, but will pay huge dividends in the future.