September 2013 Newsletter

Welcome to the Four Point HR Newsletter

The Stay Interview

Most managers are familiar with the Exit Interview process — an interview that takes place after an employee turns in notice, and prepares to leave an organization.

A relatively new concept is the Stay Interview, which is a proactive approach to understanding employee concerns while employees are still working for the company.  Many of you will recognize the questions below as questions that you may have asked during a performance appraisal, or during an annual employee survey.

Think of the process as preventative healthcare for your company.  It gives you the chance to hold a face-to-face, one on one meeting, where an employee can be totally candid with you about their job, department, or the company.  It also has the impact of showing employees that you really care about their ideas, and that you want to be sure that they are happy in the work place.  Finally, it allows you to see the workplace from a different perspective, and the chance to address morale issues before you lose a valuable employee.

My personal experience with Stay Interviews has been very positive.  If you have a manager in your organization that clearly gets along with all employees, and is a positive role model for your organization, considering asking this individual to hold a series of interviews with employees to better understand any issues that you may not be aware of, or that lie beneath the surface.

If your business is small enough, encourage all employees to participate.  It is important that the very vocal employees are represented, but you must also be sure that the quiet ones have a chance to participate as well.  Often, those who are usually quiet, have the most to say in a one on one interview.  (Be sure that each employee has been with the organization at least 6 months.  Those who have shorter tenure are still learning the ropes and may not have a complete picture of the business.)

Typical Stay Interview Questions may include:

  • What do you like about your work?
  • If you could change one thing in your job, what would it be and why?
  • What is the number one reason you stay here at ABC Company?
  • What might make your workday more enjoyable?
  • Is there anything that you would change about the way the company operates?
  • Do you feel like we have positively recognize you for the work that you do?
  • What, if anything, would make you want to leave us?

Finally, be sure to hold a meeting of managers to review what is going well, and to discuss any employee concerns. Work as a group to find solutions that show the employees that you not only listened to their thoughts, but that you care enough to make changes where it makes sense for the business.

Return To Work Program

As an employer, a proactive return-to-work program can provide you with effective tools to respond to injuries or illness by providing the opportunity for injured workers to return to the workplace as soon as it is medically appropriate. A return-to-work program (RTW) also provides a mechanism for employers to encourage employees to return to work as soon as possible after injury or illness. National statistics indicate that a return to work program is a valuable loss control measure that helps control workers’ compensation costs.

Managing employees with injuries or illness often involves having an understanding of behavioral forces that motivate an employee to be a productive participant in the workforce. The longer an employee is unable to work, the more difficult it becomes to return to full duty employment. Factors such as fear, depletion of financial resources, decline of self-image or self-esteem, and lack of knowledge about the worker’s compensation system may present barriers to an employee returning to work. Employees who return to work in a modified or alternate duty capacity are likely to recover more quickly and with less impairment. In addition, these employees are less likely to become treatment dependent.

Goals and Benefits

Goals

The primary goal of a return-to-work program is to assist employees who sustain an injury or illness to safely return to work at the earliest medically practical time in a temporary (modified or alternate duty) assignment.

Benefits

1. Benefits to the Employer-Direct Savings

  • Worker’s compensation costs are reduced when temporary income benefits cease.
  • Productivity increases and human resources are used to the maximum extent.
  • Medical costs are reduced and recovery time is shortened.
  • Wage costs for substitute employees are saved.

2. Benefits to the Employer-Indirect Savings

  • Recruitment and hiring costs for new or substitute employees can be saved.
  • Work delays and business interruptions are eliminated when an experienced employee returns to work.
  • Co-workers are not required to perform extra duties to compensate for the absent employee.
  • Goodwill and positive image with the public and employees are created, as the employer is perceived as a caring employer.
  • Communication and relations between employees and management are enhanced.

3. Benefits to the Employee

  • Employees remain active and mobile when returned to the productive workforce, and recovery time is shortened.
  • Full or partial wages are earned bringing the injured worker’s income closer to pre-injury wages than workers’ compensation temporary income benefits alone.
  • Self-esteem, morale and personal security are maintained or restored through gainful employment and a productive life style.
  • Stress, boredom, and depression of the injury/illness and being out of work are reduced or eliminated.
  • Physical conditioning through a work life discipline is maintained, and the chances of returning the employee to work permanently are improved.

New Simplified Home Office Deduction

The IRS recently announced a simplified option that many owners of home-based businesses and some home-based workers may use to figure their deductions for the business use of their homes. The new optional deduction, capped at $1,500 per year based on $5 a square foot for up to 300 square feet, will reduce the paperwork and recordkeeping burden on small businesses. The new option is available beginning in 2013.

Though homeowners using the new option cannot depreciate the portion of their home used in a trade or business, they can claim allowable mortgage interest, real estate taxes, and casualty losses on the home as itemized deductions on Schedule A, if they choose to itemize their deductions. These deductions need not be allocated between personal and business use, as is required under the regular method.

Business expenses unrelated to the home, such as advertising, supplies, and wages paid to employees, can still be fully deductible. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business and the limit tied to the income derived from the particular business, still apply under the new option.

In tax year 2010, the most recent year for which figures are available, the IRS indicates nearly 3.4 million taxpayers claimed deductions for business use of a home. Please contact us if you would like more information on the home office deduction or any other tax compliance or planning issue.

Source: Forrestall CPAs, Buford GA

Employer Healthcare Delay For Exchanges

The success of the Affordable Health Care Act is based largely in part to how many are willing to buy subsidized health plans through government health care exchanges.  The delay in the employer mandate to provide health insurance will cause many to be eligible for enrollment in the exchanges when they open October 1st.

The law’s creation of state-by-state marketplaces had pinpointed at least 26 million of the more than 50 million uninsured Americans for coverage.  A few million more may now be made eligible by the delay. The administration needs people to enroll in health insurance, and they want them to do so through the exchanges.  However, there is still much concern with the ACA being implemented into Law.

The July 2 announcement by the White House allows employers with 50 or more workers to wait until 2015 to comply with a mandate to provide full-time workers with health insurance.  The increased enrollment in the exchanges will be “an unintended effect” of the employer coverage delay, according to Former Democratic Party Chairman, Howard Dean.  “What this means is that if you don’t have insurance, the exchanges is your default position, not the employer.”  Dean, who is a medical doctor and served as Vermont’s governor from 1991-2003, said in a phone interview.  “This will drive more people into the exchanges, and that’s good.”

If the exchanges are to benefit, it will be as a result of many separate decisions by large employers affecting small numbers of workers.  For Foot Locker the delay may affect “a few hundred” people out of its 38,000 person workforce, said the company’s chairman.

In 2012, 95% of companies with at least 50 workers offered health benefits to at least some of their workers, according to Menlo Park; a California based Kaiser, which has been tracking implementation of the health law.

That leaves a thin margin for exchange enrollment beyond what was already projected.  The effect of the employer-mandate delay is probably “more symbolic than substantive,” and it’s up to the exchanges to get the word out that the programs are available, he said.

The affected Foot Locker employees work 30-40 hours a week.  Instead of immediately reducing their hours to fewer than 30, the threshold that triggers the health law’s requirement for employers to offer health care, companies will see the delay as something that “allows time to get them situated properly.”  This is according to Hicks, the companies Chief Executive Officer.

“We now have time to get them to the 30 hours or make a determination whether we want to make them full time”, he said.

At least 14 states are building their own exchanges, and the federal government is setting up the rest for the remainder of the 50 U.S. states.

About 7 million people are expected to get coverage through their state exchanges in 2014, according to the Congressional Budget Office, and the Obama administration has said at least 2.6 million of them would need to be young and healthy to hold down costs for insurers and in turn hold down costs for insurers and in turn keep premiums affordable.

Any young people enrolling will help their exchanges by making their pool of customers less risky to cover.  That could lead to lower premiums starting in 2015. Therefore, the insurance industry will most likely begin marketing more aggressively and creatively to get young healthy people into the exchanges.

About 25 million people are expected to gain coverage through the exchanges by 2016, which includes the state exchanges, and expansion of Medicaid and reduced employer coverage.  The CBO had projected when the law was signed in 2010 that 32 million uninsured people would be on a health plan within a decade, and a year later raised its estimate to 34 million.

The Importance Of Meeting Deadlines And Providing Accurate Documentation

Meeting deadlines saves your company money and time.  As an employer it is important to calculate the consequences of not reaching your deadlines by how it affects your profitability and our accuracy in payroll processing.  Accuracy is the biggest benefit.  The amount of errors decreases significantly when paperwork arrives to payroll on time.

It is important to submit timely and accurate information to your payroll department to ensure that you and your employees are paid accurately and on time.  Typically, we request payroll documents, changes and updates within 48-72 hours. This allows the payroll team to make the proper adjustments to deductions, pay rate, taxes, etc.

In addition, employers have specific payroll responsibilities that are required by federal, state, and local government agencies. These responsibilities include, but are not limited to, withholding amounts from your employees’ compensation to cover income tax, social security, Medicare, and other payments. All documents you provide to your payroll department must be valid — documents that have not expired and that follow government valid document ordinance. The consequence of having inaccurate or incomplete documents can vary from incorrect number of dependents on the W-4 (which can result in IRS penalties), incorrect deductions, inaccurate or incomplete employee data packets, missing I-9 information, and payroll changes (which can result in costly audits).

Implement good documenting practices and supplement those practices with regular internal audits and refresher or retraining classes on changes in government regulations.

Upcoming September Events – Free Webinars

Identifying and Controlling Hazards In The Workplace

Wednesday, September 11, 2013, 10AM EST

Phil Herron – President, Four Point HR

This general market webinar will review the most common hazards in the workplace and detail strategies to identify and control them.

Register here: https://student.gototraining.com/r/5214259423366398976

Terminations, Resignations and Layoffs

Wednesday, September 18, 2013, 10AM EST

Kathryn Schene – Director of HR, Four Point HR

This general market webinar will review the points that go into successful separations.  It will include Resignations, Terminations and Layoffs and will review best practices for each.

Register here: https://student.gototraining.com/r/7528707210579080960