Hot Topics in Total Rewards

  • 25 Jan 2021 9:42 AM | Bill Brewer (Administrator)

    Western Digital settles gender bias class action for $7.75m – Blocks and Files

    By  Chris Mellor | January 7, 2021

    Final approval has been granted to a Western Digital settlement of a class action lawsuit, which accused the company of underpaying female staff and discriminating against them in pay, promotions, and placement.

    Western Digital will pay $7.75m – $5m to 1863 female employees, and most of the rest to their law firm. In addition, the company will undertake “sweeping programmatic measures to help eliminate gender disparities and foster equal employment opportunity going forward”.

    The lawsuit was bought by Yunghui Chen, who  joined WD’s Audit Department in 2005 and resigned in September 2016, having been promoted to Internal Audit Manager in 2008.

    She alleged that Western Digital “paid her $30,000 less than her male counterparts performing equal and substantially similar work and refused to promote her to Senior Manager, despite promoting similarly situated, less-qualified men.” 

    Her class action lawsuit, filed in May 2019, stated: “Men dominate Defendants’ leadership and management. Upon information and belief, the overrepresentation of men in Defendants’ leadership is both the source and product of continuing systemic discrimination against female employees.”

    Also, Western Digital’s “compensation, promotions, and placement policies and practices have resulted in and perpetuated longstanding, company-wide gender discrimination and sex-based disparities with respect to pay, promotions, and job placement.”

    The company relies “on a tap-on-the shoulder promotion process that disparately impacts women and encourages the predominantly male management to engage in a pattern of disparate treatment. Rather than posting open positions, managers evaluate which, if any, of their reporting employees should be placed into them.”

    Where the money goes

    The $7.75m settlement will be disbursed to several groups of people;

    • $4,811,667 goes to California-based female employees of WD and related companies at or below the senior management level after November 1, 2012, and also to female employees of WD elsewhere in the USA with similar posts since November 1, 2013,
    • $2,583,333 at a maximum goes to class counsel in attorneys fees,
    • $97,324 goes to them for for litigation costs,
    • $180,000 at maximum to Chen for her litigation costs,
    • $18,000 service award to Chen,
    • $50,000 for Class Administrator’s fees and costs,
    • $75,000 for PAGA costs.

    Any remaining money goes to a couple of legal aid charities.

    The 1,863 individual class action members (plaintiffs) and they will get $3,615 each on average. The precise amount will depend upon their employment duration and pay rate.

    Interested parties with Pacer access can read the final settlement document or by looking up Chen v. Western Digital Corp., C.D. Cal., No. 8:19-cv-00909, final approval of class settlement 1/5/21.

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    Source: Blocks & Files

    https://blocksandfiles.com/2021/01/07/western-digital-settles-sex-discrimination-class-action/

  • 13 Jan 2021 9:59 AM | Bill Brewer (Administrator)

    Developing a Post-Pandemic Pay Strategy

    In 2021, the impact of the COVID-19 pandemic on pay will vary by industry and region—and even by job within companies.

    By Tamara Lytle | January 9, 2021


    The coronavirus pandemic took employee compensation on a roller coaster ride in 2020. The year began with a tight labor market and rising wages followed suddenly by stay-at-home orders and massive job losses that upended the labor market. Companies had to adjust on the fly. Today, business leaders struggle to set 2021 pay levels absent certainty about when the economy will recover and how soon a vaccine for COVID-19 might become widely available. They are also considering the role of compensation in retaining top performers, who are more valuable than ever in this unstable environment.

    Last spring, one-fourth of companies reduced pay (most of them temporarily) when the novel coronavirus shut down large swaths of the economy, according to research by Mercer. During those early months of 2020, as the pandemic was just beginning to be felt in the U.S. but not yet understood, companies weighed whether to stick with their compensation plans. Sixty-eight percent of them went ahead with merit pay increases and 79 percent paid out bonuses as planned, according to Mercer. Overall, the consultancy says, compensation rose about 3 percent in 2020—roughly the same as the increases seen in each of the past seven or eight years.

    A survey report from Gallagher, however, found a lower average pay increase of 2.5 percent in 2020. And the benefits brokerage and advisory company projects a 2.1 percent increase for fiscal 2021.

    But behind the averages, specific impacts varied.

    Average Salary Increases Decelerate

    Mixed Effects

    In 2021, the impact of the COVID-19 pandemic on pay will continue to vary by industry and region—and even by job within companies.

    Company leaders expect to increase compensation in 2021 by between 2.6 percent and 3 percent, according to Mercer’s research. But industries will be affected unevenly, just as they were in 2020. Online retailers enjoyed record sales as homebound consumers avoided stores and opted for delivery, for example, while other sectors were seriously hurt by the economic downturn. Between September 2019 and September 2020, the U.S. economy lost a net of 9.6 million jobs (not including agricultural jobs). A disproportionate 8.6 million of those were service jobs, with 3.6 million in leisure and hospitality, according to the Bureau of Labor Statistics (BLS).

    Some workers in hard-hit businesses realized less growth in their hourly wages than national averages, according to the BLS’s Current Employment Statistics. Between September 2019 and September 2020, average hourly wages in the leisure and hospitality industry rose just 15 cents to $14.78. By contrast, average hourly earnings for nonfarm workers in production and nonsupervisory roles rose from $23.70 to $24.79.

    15¢ amount by which average hourly wages for leisure and hospitality workers increased between September 2019 and September 2020

    Going forward, the effects of the pandemic are impacting decisions about overall compensation strategies. Incentive plans at some companies that have benefited from the unusual circumstances of 2020 paid out above target levels despite the battered overall economy, says Gregg Passin, senior partner, Executive Solutions, at Mercer. Other companies will take years to recover and must decide whether to change incentive plan awards downward to reflect the new economic reality.

    Companies everywhere are weighing the uncertainties of the economy against the need to keep pay levels up to retain top performers. There’s no right answer for all companies regarding pay, according to Mary Ann Sardone, partner, U.S. Talent Solutions leader, at Mercer. “Our advice is you have to look at your situation,” she says.

    Tom Gimbel, CEO of LaSalle Network, a national staffing and recruiting firm based in Chicago, recommends ranking employees on ability and future potential. He maintains that the top quarter need to get increases in base pay or variable compensation so that they don’t get snapped up by competitors.

    “If you want to retain your best people, you have to do it with your top quartile,” Gimbel says.

    Contributing Factors

    Despite high rates of unemployment brought on by the pandemic, some companies with front-line workers raised hourly rates to attract new hires. Target increased its minimum wage to $15 an hour in July and gave front-line workers a $200 bonus. Walmart bumped up pay for 165,000 workers.

    As the virus raged and killed hundreds of thousands of people in the U.S., many industries realized how critical their hourly workforces were for keeping the business—and the country’s economy—going.

    While higher minimum wages and hazard pay were the answer for many companies, businesses in the health care industry were a notable exception, Sardone says. Leaders in that sector resisted hazard pay because nurses, doctors and other workers routinely faced job-related health threats before the pandemic.

    “It’s a bit of a slippery slope when you add hazard pay to an already hazardous job,” Sardone notes.

    The impact on compensation is not as widespread as in past recessions.

    But while the coronavirus is still a risk for the 50 million front-line essential workers in the U.S., most companies dropped hazard pay by early summer as a new normal took hold, according to the Brookings Institution.

    At the same time, some lower-level workers have seen their wages stagnate because massive layoffs have resulted in a larger supply of labor, Gimbel says.

    He doesn’t expect pay to collapse for managers and executives, though, as happened during the 2001 and 2009 economic downturns. That’s because the impact on compensation is not as widespread as in past recessions. Many job seekers are willing to hold out for more money instead of taking a reduction in pay because they believe that the economy will return to normal after a COVID-19 vaccine becomes widely available. “The accountant isn’t competing against the barista who got laid off,” Gimbel says.

    And, unlike in previous downturns, the federal government in 2020 decided to temporarily expand unemployment benefits and protect against evictions and home foreclosures. “You don’t see people willing to take jobs below their skills and pay grade,” Gimbel says.

    Regional differences have also impacted compensation decisions. Dan Ryan, CEO of executive search firm Ryan Partners in Nashville, Tenn., has seen virtually no downward pressure on salaries in the Southeast, where his clients include architectural, engineering and construction firms.

    “Depending on geography, in parts of the country where development is still on track, the pace of construction and design is still very busy,” Ryan says. “From a supply and demand standpoint, there is still inadequate supply [of labor].” When stay-at-home orders were imposed in the spring, many construction companies cut pay by 10 percent to 15 percent, Ryan says, but most have since restored rates to pre-pandemic levels.

    'Companies may take a much more surgical approach this year to distributing salary increases.'

    Mary Ann Sardone

    Leaders at some companies are trying to determine what areas of the business need beefing up and what type of talent they need. With the economic upheaval leaving less money to go around for salary increases, companies must choose wisely where to dole out increases. The move to remote work, for instance, put a spotlight on the importance of IT workers who can enhance a company’s digital infrastructure. And marketing talent is valuable as companies adapt to new digital platforms.

    “What COVID has shown is the need for digital transformation of … business and what parts of the business will enable that,” Sardone says. “Companies may take a much more surgical approach this year to distributing salary increases.”

    Flexible Work Arrangements

    Flexible work was a top priority for many employees prior to the pandemic. Then the public health crisis gave businesses a sudden chance to experiment with flexible work on a large scale when they were forced to send their employees home to work remotely. Even when it’s safe for everyone to be back in the office together, flexible work options and hours will become common. Before the pandemic, just 1 in 30 companies planned to let half or more of their employees work remotely, according to Mercer. Now, one-third of companies plan to allow that.

    As employees shifted to remote work, some companies provided compensation for home office furniture or equipment. Google and Twitter, for instance, kicked in $1,000 stipends for remote employees.

    Not all jobs can be done remotely. But it’s important to note that working in sweatpants from a home office isn’t the only type of flexible work arrangement available. Some jobs can provide flexible hours or allow split shifts or job sharing.

    Gimbel sees a coming rift between blue-collar and white-collar workers if only the latter get flexibility. Workers who aren’t allowed to take advantage of flexible work arrangements are going to want more compensation to make up for it. Their message, Gimbel says, will be “Pay us more … or have everyone get their butts into the office. [If] I’m in Chicago in the cold and the marketing person is in Naples, Florida, is that fair?”

    Location Matters

    As companies realize that remote work can work, some are rethinking how they recruit and compensate people. If a job can be done outside the office, should it be benchmarked to the local talent market? Should it be pegged to the regional or national market? Why pay a Silicon Valley salary to an employee sitting in his home office in Montana?

    When you say you don’t care where your workers work, it calls into question how you set pay, Sardone says.

    Some companies are cutting the salaries of workers who switch to remote work permanently if they move to a lower-cost area.

    In fact, the move to remote work could save companies money if they reclassify employees based on their remote status, Ryan says. He has already seen workers use the flexibility of remote work to move from high-tax states like Illinois and California to suburban and rural areas where they have more space, such as Texas and Florida. The ability to work remotely is high on many candidates’ priority lists when weighing jobs, even if it means less pay, because they can live in a lower-cost area. “It’s a trade-off people are willing to make,” Ryan says.

    But companies may be better off reducing pay for future hires who live in less expensive areas instead of ruffling the feathers of current staff who work remotely, Sardone warns.

    Businesses also need to be careful about how they handle executive compensation, especially if rank-and-file workers have taken a hit on pay. “Making executives whole or close to whole is a difficult story to tell” if other workers are suffering financially, Passin says.

    Leaders need to think about how employees, regulators and customers will view cushy executive incentive payouts in the middle of hardship, Passin says. He is seeing a range of strategies among his clients. Some companies planned to limit executive incentive payouts at the end of 2020. But with the uncertain economy, executives could have a tough time meeting target goals in 2021, leaving them without incentives two years in a row.

    That’s not what you want to tell an executive who you’re keen to retain, Passin says.

    There’s no right or wrong answer on executive compensation, Gimbel says. He took no salary from February through September 2020 so he could pay his employees. And he understands that it’s important to workers to be able to choose where they perform their jobs.

    “I’m seeing companies say more than before, ‘What is our culture? What do our employees mean to us?’ ”

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    Source: Society for Human Resource Management (SHRM)

    https://www.shrm.org/hr-today/news/all-things-work/Pages/the-pandemic-alters-pay.aspx 
  • 08 Jan 2021 8:57 AM | Bill Brewer (Administrator)

    How FFCRA COVID-19 Payroll Tax Credits Work by JPS CPA April 17 2020

    WRITTEN BY: Davis Wright Tremaine LLP [co-author: Crystal Miller-O'Brien] | January 4, 2021 

    The Families First Coronavirus Response Act (FFCRA), passed on March 18, 2020, temporarily mandated paid sick time and paid family leave for COVID-19-related issues, including for school and place of care closures, for certain employees and employers through December 31, 2020.

    On December 21, 2020, Congress decided not to extend FFCRA paid time off obligations beyond 2020, and the latest COVID-19 stimulus bill (Consolidated Appropriations Act of 2021) became effective on December 27, 2020. Even though FFCRA paid leave benefits are no longer mandatory, employers can voluntarily continue providing paid leave benefits with the option of claiming the payroll tax credit, which has been extended through March 31, 2021. (See our prior advisories on U.S. Department of Labor guidance on the FFCRA here.)

    Updates to the FFCRA

    • Paid Sick Time: While employers are no longer required to provide FFCRA paid sick time to employees after December 31, 2020, employers who choose to provide FFCRA paid sick time benefits to employees continue to be eligible for a tax credit for the paid sick time through March 31, 2021. Employees who have exhausted available FFCRA paid sick time entitlements will not be entitled to additional paid sick time.

    However, if employers opt to continue to provide FFCRA paid sick time, employees can use available sick time. Employers will not receive tax credits for benefits provided in excess of statutory limits.

    • Paid Family Leave: While employers are no longer required to provide FFCRA paid family leave to employees after December 31, 2020, employers who choose to provide the FFCRA paid family leave benefits to employees continue to be eligible for a tax credit for the paid sick time through March 31, 2021. Employees who have exhausted available FFCRA paid family leave entitlements will not be entitled to additional paid family leave.

    However, if employers opt to continue to provide FFCRA paid family leave time, employees can use available family leave. Employers will not receive tax credits for benefits provided in excess of statutory limits.

    • No Retaliation: In order to remain eligible for the tax credit for providing employees with FFCRA paid sick time and family leave, employers also must not discharge, discipline, or in any way discriminate against an employee who seeks to take leave as provided for in the FFCRA. In addition, even if employers choose not extend the FFCRA benefits, retaliation against employees who used FFCRA benefit remains prohibited.

    Employer Considerations

    • Employers should consider whether to extend FFCRA paid sick time and family leave benefits to employees through March 31, 2021.
    • Employers should also keep in mind there may be other state and local laws that provide similar benefits to employees and that some of these laws may also be changing.
    • If employers continue to provide FFCRA benefits to employees, employers should obtain the requisite documentation for the FFCRA benefits to receive the tax credit. Please see our prior blog post here on FFCRA documentation.
    • If employers are providing extended FFCRA benefits, they should continue to document leave use. Employers will not receive tax credits for benefits provided in excess of statutory limits.
    • Employers should be mindful that the anti-retaliation provisions of the FFCRA are still applicable to past use of FFCRA benefits even if employers do not extend benefits until March 31, 2021. This means that employers cannot discharge, discipline or in any way discriminate against an employee who seeks to take leave or took leave as provided for in the FFCRA.
    • Employers may also want to review their COVID-19 benefits and policies to ensure they are up to date.

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    Source: JD Supra, LLC 

    https://www.jdsupra.com/legalnews/temporary-ffcra-leave-requirements-end-9761496/

  • 04 Jan 2021 10:40 AM | Bill Brewer (Administrator)

    AUTHOR: Aman Kidwai | PUBLISHED: Jan. 4, 2021


    In addition to the constantly changing guidance around the COVID-19 pandemic, California has adopted new leave and pay reporting mandates.

    California governor Gavin Newsom signed a number of bills into law that are set to take effect in the new year. These mandates represent vast change amid disruption brought on by the pandemic and continuing into the start of the year.

    Compliance will require extra attention from employers and their HR teams, according to attorneys who spoke with HR Dive. Those involved should lean on the support and resources provided by the state as much as they can, Julie Hall, counsel at Davis Wright Tremaine, LLP, advised.

    "California does a really good job with this," she said. "The agencies that enforce these laws can have very helpful links and sites on their web pages to help employers comply."

    Coronavirus precautions

    With respect to the ongoing pandemic,updates to COVID-19 precautions are changing on a regular basis in the state, nearly daily, sources said. They recommended employers task an individual with regularly checking the state's Department of Industrial Relations site for any updates.

    "Cal-OSHA recommends having a coordinator that is dealing with these issues at the company," Walter Stella, member at Cozen O'Connor, told HR Dive. "Those companies that are in a mostly remote if not exclusively remote situation, it doesn't get any easier. But for those employers who have employees coming into the physical space [...] most clients I know typically have at least one, if not more, and maybe even the department HR, that's really focused on dealing with COVID-19."

    SB-1383 - CFRA leave expansion

    A leave law, SB 1383, is the most significant new law that is not directly related to COVID-19, attorneys told HR Dive.

    The bill expanded the California Family Rights Act to include employers with at least five employees and also expanded the list of reasons for taking family or medical leave. Employees can now take leave to care for siblings, grandparents and grandchildren.

    There are some gray areas that may need to be settled, either by an update from the DIR or by a court. "One of the questions that comes up, and we still don't have notice definitively, is if the five employees have to all be California-based. And the answer is we aren't sure at this point," Hall said.

    It's also unclear whether employees that use CFRA are also eligible for time off under the federal Family Medical and Leave Act, Hall and Stella pointed out. "It's possible that you may have employees out for weeks under CFRA," Stella said, "and then for a different reason that triggers FMLA would have another 12 weeks off for FMLA."

    Hall also said pregnant employees will likely have the ability to use this leave on top of the pregnancy leave afforded to them in California. "CFRA doesn't cover pregnancy disability leave so I theoretically could take my four months of pregnancy disability leave, whether it's intermittent or continuous [...] then I get my 12 weeks to bond with my baby."

    SB-973 - Pay data reporting

    Separate legislation, SB 973, will require employers with 100 or more employees to submit a pay data report by March 31, 2021, and annually thereafter. The report must include the number of employees by race, ethnicity and gender and their job categories as well as pay band data.

    "It's a pay equity enforcement mechanism for the state of California," Hall said. "So it's important for that reason because if the employer does have pay equity issues, based on gender or race, they should know that before they file."

    Hall recommended employers get to work on this report and identify any problem areas before the March 31 deadline so they can attempt to address them. "My recommendation is [...] to have some sort of compensation analysis done [...] Because if there are problems, you want to try to fix them before you have to file your report," she said. "So there's not a lot of time and those employers should already have kind of done that" because the data reported aligns closely with the EEO-1 report required by the EEOC.

    "Employers might want to approach this by pre-identifying any problems because it's going to be public information in due time," Stella added.

    AB-979 - Board diversity requirements

    Finally, AB-979 mandates that boards have at least one nonwhite board member by the end of 2021. By the end of 2022, boards with five through eight members will be required to have two from underrepresented groups; a corporation with 9 or more directors must have at least 3 directors from underrepresented communities. This builds on earlier legislation which required similar measures for female representation in 2019 and 2021.

    "There are a number of legal challenges [to the gender representation law], so we'll see where that goes," Stella said. "It is difficult to argue against the policy behind it. We're just not seeing the diversity on boards that reflect the general population or workforce. That said, it will be interesting to see how the legal challenges play out. Because it means a strict quota system and it is requiring decision making based on protected classes."

    Employers have until the end of this year and 2022 to make these changes, but for many companies, changes at the board level and the search for a replacement can take time to unfold. "For the most part I see it as a corporate governance issue, because it's all about the bylaws," Stella said. "The bylaws that control how board members are removed or replaced, and so you're going through that process."

    If complying with AB-979 requires the removal of board members, Stella suggested employers exercise caution. "I'm always worried about adverse actions. Because at the end of the day, it's adverse actions that create risk for companies," Stella said, noting the potential for a wrongful termination allegation from a board member, who will have contractual protections even if not an employee.

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    Dive: HR Dive

    https://www.hrdive.com/news/4-major-california-employment-law-changes-for-2021/592772/
  • 09 Dec 2020 8:22 AM | Bill Brewer (Administrator)

    Ryan Golden | PUBLISHED Dec. 7, 2020

    Dive Brief:

    • Employers may calculate the regular rate of pay for employees paid on a piece-rate basis — i.e., those paid per unit of production rather than a period of time — by dividing the employees' earnings by the number of hours worked in a workweek, including both productive and nonproductive hours, the U.S. Department Labor's (DOL) Wage and Hour Division said in a Nov. 30 opinion letter.
    • The Fair Labor Standards Act (FLSA) stipulates that the regular rate for an employee paid on a piece-rate basis is calculated by totaling workweek earnings "from all sources," including production bonuses and waiting time, DOL said.
    • Employers may use this calculation even if they do not have a written agreement with piece-rate employees to do so, DOL said. Such an understanding or agreement "'need not be in writing, but rather, may be inferred from the parties' conduct.'" Still, the agency noted that courts "have not always been consistent regarding the content or scope" of the FLSA's mutual understanding requirement.

    Dive Insight:

    DOL's letter may aid in overtime calculations for piece-rate workers under the FLSA. Per agency guidance, employees paid on a piece-rate basis are generally entitled to an additional one-half times their regular rate of pay for each hour over 40 in a given workweek, plus their full piecework earnings.

    The department has issued a number of opinion letters in the past year addressing what may be included in an employee's regular rate of pay for FLSA overtime calculation purposes. In March, for example, DOL said that a longevity bonus must be included in the regular rate, as must certain installments of a referral bonus.

    DOL also finalized in December 2019 a rule updating the FLSA's regular rate of pay requirements. The rule clarified that bona fide meal periods, reimbursements, certain benefit plan contributions, state and local scheduling law payments and other benefits may be excluded from the regular rate when calculating overtime pay for a non-exempt employee.

    As with previous wage and hour opinion letters, DOL's interpretation may not apply to every situation, experts previously noted.

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    Source: HR Dive

    https://www.hrdive.com/news/dol-clarifies-pay-rate-calculations-for-piece-rate-workers/591674/

  • 09 Dec 2020 8:06 AM | Bill Brewer (Administrator)

    The benefit is now available to all the company’s 5,700 US employees. Pic: Danone North America

    By Jim Cornall | 03-Dec-2020 - Last updated on 03-Dec-2020 at 09:40 GMT


    Danone North America, the world’s largest Certified B Corp, has announced it is expanding its gender-neutral Parental Bonding Leave policy to its manufacturing employees, enabling them to take up to 18 weeks’ paid time off after the birth or adoption of their child.

    The benefit is now available to all the company’s 5,700 US employees, whether they work in an office or in one of Danone’s 14 manufacturing facilities across the country.

    The policy – effective company-wide immediately – is an evolution of the company’s previous practice of providing its frontline manufacturing employees up to two weeks of paid leave in addition to allowing the use of paid time off or vacation for such absences. The policy, which can be taken anytime within the first year of a child’s birth or adoption date, is applicable to either parent, which the company said recognizes parenting can be a shared responsibility between caregivers.

    “At Danone, family is important to us. We understand how special – and also how challenging – welcoming a new child into the world can be. That’s why we are proud to support all our Danone parents, of all genders, in our factories and our offices, as they bond with their newest family member,”​ said Shane Grant, CEO at Danone North America.

    “Our hope is that we will inspire others and help advance parental leave equity outside our walls, as well.”​

    Across the US, Danone North America partners with the International Union of Food (IUF), the United Food and Commercial Workers International Union (UFCW), the Bakery, Confectionery, Tobacco Workers and Grain Millers' International Union (BCTGM) and the Teamsters.

    “Danone’s family-first approach to supporting its teams sets it apart from so many of its peers in the industry. We believe an offering like this provides a huge value not only to its employees but has equally significant impacts for families and the communities where Danone operates,” ​said Mark Lauritsen, international vice president at UFCW.

    According to the National Partnership for Women and Families, only 9% of US companies offer paid paternity leave to male employees. And, while many manufacturing companies have begun to expand their paid parental leave in recent years, policies continue to differentiate between primary and secondary caregivers, which Danone said reinforces traditional family roles even while American family dynamics and needs evolve.

    Recent research from the Council on Contemporary Families also shows an 11% rise in equal responsibilities shared between mothers and fathers since the onset of the covid-19 pandemic, indicating a larger social change that Danone intends to support. In fact, encouraging gender-neutral policy that helps dads engage more and earlier in their children’s lives has broader and longer-term benefits, too; just one of which is that it impacts women’s income and consequently, their families’ financial security. Research from Sweden shows each additional month of parental leave taken by a father increases the mother’s wages by nearly 7%.

    Danone’s new policy is in line with the global commitment the company made in 2017 as part of the UN Women’s HeForShe initiative to become one of the leading parent-friendly companies in the world, through the implementation of a global gender-neutral paid parental leave policy.

    In addition, the company said its commitment to inclusive diversity includes creating an environment in which all employees feel a sense of belonging and support. Ensuring its manufacturing teams can care for their families while also maintaining employment security is a critical part of this commitment. For employees expanding their families through adoption, the company provides adoption assistance up to $6,000 and it further supports a more inclusive economy by providing a living wage to all its colleagues.

    Within its communities, Danone has long partnered with the Women, Infants, and Children (WIC) Program through product donations and policy improvements to allow for more families to access the program.

    Recently, the company also signed the Pregnant Workers Fairness Act, to provide accommodations for pregnant women to minimize risk to their pregnancies at work.

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    Source: Dairy Reporter

    https://www.dairyreporter.com/Article/2020/12/03/Danone-expands-parental-leave-in-US

  • 02 Dec 2020 5:25 PM | Bill Brewer (Administrator)

    Willis Towers Watson on Twitter: "Take 20 minutes and stop thinking about 2020. How will you approach work and #rewards in 2021? #benefits https://t.co/M20NFz6jYR… https://t.co/Eqazn7j214"

    Highlights of key findings, North America

    November 19, 2020

    Supporting flexible work in a pandemic-altered workplace is key to delivering impactful Total Rewards and capturing business value.

    About the survey respondents

    Research findings are based on responses from 344 organizations in North America employing 4.83 million employees. The survey fielded between October 6 and 21, 2020.

    This image shows the respondent by industry: 10% energy and utilities, 14% financial services, 9% general services, 15% health care, 13% IT and telecom, 25% manufacturing, 6% public sector and education, 9% wholesale and retail.

    Respondents by industry

    Respondent profile:
    • 52% domestic
    • 17% international
    • 32% global

    Overview


    Employers pivot to flexible work arrangements and rethink approaches to Total Rewards

    In the face of the uncertainties wrought by the pandemic, employers responded by embracing workplace flexibility and prioritizing organizational resilience and agility. Our Flexible Work and Rewards Survey: 2021 Design and Budget Priorities, which fielded between October 6 and 21, 2020, takes a close-up look at the current and expected future state of flexible work arrangements as well as the implications for rewards and benefit programs.

    Respondents to the survey indicate about six in 10 workers (59%) are currently telecommuting/working from home, and they expect over half of their workers (52%) to be doing so through the first quarter of 2021. Yet despite this significant pivot to flexible work arrangements, over one-third (37%) of organizations do not have a formal policy to manage these arrangements, and a quarter (25%) have just put such a policy in place this year.

    While safety concerns will remain the primary reason for offering alternative work arrangements into the first quarter of 2021, an increasing number of employers also expect to enhance employee retention, engagement and productivity through these arrangements.

    Additionally, alternative work arrangements are prompting employers to rethink their approach to Total Rewards. Roughly half of employers (49%) indicate that the new work requirements necessitate a hybrid reward model, which for some organizations may include paying employees based on where they are located geographically.

    Most organizations do not expect flexible work policies to substantially affect pay and benefit budgets over the next three years; however, over half of employers (57%) expect reductions in real estate expenses, and over a third (36%) anticipate a decrease in commuting expenses during this period. While some of these savings will be offset by increases in subsidies around items such as computer equipment and wireless devices, organizations have an opportunity to reinvest these savings in reward and benefit programs to help meet employees where they are.

    The ability to shape a flexible workplace that meets the needs of their employees will help organizations persevere and prosper in an evolving, pandemic-altered world of work.

    “As companies continue to evaluate the cost benefits of alternative work arrangements, many indicate that the workplace changes as a result of the pandemic are here to stay. Employers that are able to create and manage a flexible workplace through automation and adaptable policies while reinforcing an enhanced employee experience will not only meet the needs of their employees but be better positioned to compete in the new world of work,” said Catherine Hartmann, North America Rewards practice leader, Willis Towers Watson.

    Employers that create a flexible workplace with automation, adaptable policies and an enhanced employee experience will be better positioned to compete in the new world of work.”

    Catherine Hartmann | North America Rewards practice leader, Willis Towers Watson

    Highlights and trends


    Alternative work arrangements

    Prevalence
    • Employers say that over half (59%) of their workers are currently telecommuting/working from home; they expect this number to remain high, at around 52% through first quarter of 2021.

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    • Employers say that 25% of their workers are also using “working from anywhere” or flextime options; they expect this percentage to remain steady in the first quarter of 2021.
    • On average, organizations currently have a similar percentage of their full-time employees working in person or onsite (45%) as working remotely/from home (44%).
    • Employers expect the proportion of their full-time employees working from home to decline by about 30% from current levels in the next three years. However that level (31%), will be almost six times what it was three years ago (5%).
    What’s driving alternative work arrangements?
    • Most organizations (91%) cite employee safety concerns as the main reason for providing alternative work arrangements.* Other important drivers include promoting employee retention (47%), maintaining or increasing employee engagement (39%), and enhancing productivity (35%).
    • An overwhelming majority of employers (89%) expect that safety considerations will continue to be a key driver of alternative work arrangements in the first quarter of 2021. At the same time, an increasing percentage of employers cite employee retention (61%), engagement (53%) and productivity (41%) as important reasons for offering these arrangements in 2021.

    Implications for pay and benefit budgets

    • Most organizations do not expect flexible/remote work policies to substantially affect pay and benefit budgets for 2021.

    25%

    are using work from anywhere or flextime options

    • Over one-third expect budget reductions in real estate (36%) and commuting expenses (40%) in 2021. Over half of employers (57%) expect reductions in real estate expenses over the next three years, while over a third (36%) anticipate reductions in commuting expenses during the same period.
    • Approximately a quarter of organizations expect to see an increase in allowances and subsidies for working from home in 2021 (26%) and over the next three years (27%).
    • In 2021, 61% of employers say they will pay fully remote workers the same as in-office employees regardless of a worker’s actual locations for all jobs; however, over a quarter of employers (26%) report that pay will be based on the location of remote workers for all jobs.

    Approaches

    Policies and principles

    36%

    expect budget reductions in real estate

    • Prior to this year, more than a third (37%) of organizations did not have a formal policy or set of principles to manage alternative work arrangements; 25% just created a formal policy this year.
    • Organizations without a formal policy to manage these work arrangements are planning to catch up quickly, with three-fifths (60%) saying they are planning or considering adopting one this year or next.
    • Most organizations (58%) with new policies expect these policies or principles to be permanent.
    Eligibility
    • Job function is the most common criteria for determining eligibility for using alternative work arrangements, now (62%) and in the future (74%). Interestingly, at some organizations, all employees will remain eligible, now (21%) and in the future (14%).
    • Most organizations (55%) do not think jobs that will be performed through telecommuting or working from anywhere are likely to be offshored over the next three years; on average, organizations expect about 4% of the jobs that will be done through telecommuting or working from anywhere are likely to be offshored over the next three years.

    Workforce agility

    Opportunity for improvement

    37%

    do not have a formal policy for alternative work arrangements

    • Only roughly one in five organizations thinks its current job architecture (19%) and job leveling process (17%) supports developing a flexible and agile workforce to a very great extent. Similar percentages say their current job architecture (19%) and job leveling process (21%) do not support these objectives at all.
    Organizational effectiveness
    • Over half (54%) of organizations indicate that they are effective at recognizing the need to create a more agile and flexible workforce.**
    • 48% say they are effective at retaining critical talent (employees and contingent workers) with needed technology skills.
    Manager effectiveness
    • Over a third (38%) of employers think their managers are effective at helping workers focus equally on what customers will need tomorrow and what they require today.
    • Just 18% think their managers are effective at communicating and leading change around the new combinations of humans and automated workers.
    • Only about a third of employers (34%) agree that their managers are effective at removing obstacles to doing work with speed and efficiency.

    Digital strategy and levers to support workforce agility

    • Just 14% of organizations have an integrated digital and business strategy that enables new sources of value.
    • Slightly more than half of employers (53%) have provided their employees with digital tools, such as mobile and web apps, to help them be more productive.*
    • Less than half of organizations (42%) indicate that accountability for the success of their digital ambitions is owned by all leadership.* 
    • Only 29% of respondents say their senior leaders are effective at using new technologies and non-employee talent to change the way work is done.*

    Rethinking Total Rewards

    19%

    think current job architecture supports a flexible/agile workforce

    • About half of employers (49%) recognize that new requirements for work require a hybrid model for rewards and pay.
    • Almost a third (29%) of employers are providing additional benefits to promote workplace flexibility (e.g., backup daycare, subsidies for daycare or virtual learning).
    • Nearly a fifth (18%) are setting pay levels by first determining the market value of skills and then applying a geographic differential based on where the employee is located.
    • Most organizations agree that their retirement and financial wellbeing (62%) and health and wellbeing programs (64%) provide the security necessary to support workers to a great or very great extent.
    • However, over a fifth of organizations say that retirement and financial wellbeing programs (24%) and health and wellbeing programs (30%) need to change to provide the security necessary to support workers in a more agile and flexible workplace in the future.

    Footnotes

    * Percentages indicate “to a great or very great extent.”

    ** Percentages for organizational and manager effectiveness indicate “to a great or very great extent.”

    ***** ***** ***** ***** ***** 

    Source: 

    Willis Towers Watson

    https://www.willistowerswatson.com/en-US/Insights/2020/11/flexible-work-and-rewards-survey-2021-design-and-budget-priorities

  • 01 Dec 2020 9:48 AM | Bill Brewer (Administrator)

    Department of Labor headquarters sign

    By Allen Smith, J.D. | November 30, 2020

    Employers are preparing for changes the U.S. Department of Labor (DOL) may make under President-elect Joe Biden's administration. From joint-employer issues to Office of Federal Contract Compliance Programs (OFCCP) and Occupational Safety and Health Administration (OSHA) action, the DOL is likely to shift direction on many fronts.

    Michael Lotito, an attorney with Littler in San Francisco and co-chair of Littler's Workplace Policy Institute, discussed likely changes at the department with SHRM Online. Lotito has testified before the U.S. House of Representatives and the U.S. Senate, as well as the National Labor Relations Board and the Equal Employment Opportunity Commission. He also co-founded the Emma Coalition, a project named in honor of his granddaughter and dedicated to preparing American businesses for displacement of employees that the rapid rise in automation and artificial intelligence is expected to bring.

    SHRM Online: Might the Biden DOL reissue joint-employer guidance and, if so, how might this be significant from a practical standpoint?

    Lotito: The DOL joint-employer rule under President Donald Trump's administration was challenged by 18 state attorneys general in a federal court in New York. The district judge held the rule to be invalid. The case is on appeal. Littler has intervened on behalf of the International Franchise Association and other associations to protect the rule. The new administration might attempt to have the Department of Justice, which is litigating the case for the DOL, change its position as to whether the rule should be upheld. The case may likely go to the U.S. Supreme Court.

    In the meantime, the DOL may attempt to pause any effectiveness of the rule while it considers its options. Doing so will risk litigation against DOL, as Administrative Procedure Act rulemaking requirements will become operative. The fight then to confirm the rule will play out in court and often over complex administrative law questions. 

    However, the field personnel of DOL may well take a much more aggressive enforcement posture against companies in applying the rule to a set of facts. This, too, will invite even more litigation.

    SHRM Online: How might a Biden DOL advance unions' interests, such as if large infrastructure projects move forward?

    Lotito: Biden proudly says he is a union man and wants to be a union president. One way of demonstrating sincerity in that regard will be through federal contractors who will bid on infrastructure projects. He is likely, through executive orders, to impose requirements on contractors similar to the previously issued and nullified "blacklisting rules." Neutralitycard check, no record of unfair labor practices, strict adherence to Davis-Bacon Act rules and more will possibly impose on contractors a huge price to pay for the privilege of working for the government.

    SHRM Online: Do you expect any significant changes at the Wage and Hour Division, and, if so, what might those be?

    Lotito: I expect the Wage and Hour Division will stop issuing opinion letters, which have been helpful to many in the regulated community during the Trump administration. A potential review of the joint-employer and upcoming independent-contractor rule will be high up on the division's agenda. Perhaps the division will revisit overtime standards and issue rules dealing with pay entitlement for off-the-clock work, like checking e-mail from home. Enforcement will be aggressive, especially against certain industries like fast food, janitorial, construction and other targets. The department will also coordinate with state DOLs to cooperate with one another as investigations progress.

    SHRM Online: What shifts in priorities will the OFCCP likely make under the Biden administration?

    Lotito: The OFCCP will have to deal with the executive order from President Trump concerning diversity training guidelines. I suspect President-elect Biden will nullify it. In any event, diversity and inclusion are enormously important issues for everyone and particularly government contractors. More rigorous enforcement efforts, including in-depth audits, will once again become the norm. Controversy over pay disparity issues will intensify.

    SHRM Online: What steps might OSHA take in the Biden administration?

    Lotito: First, the new president will move quickly to appoint and have confirmed an undersecretary of OSHA, a position that has been vacant over the past four years. That person will move swiftly to promulgate an emergency temporary standard applicable to the pandemic for all impacted stakeholders. Regular new standards will evolve as the pandemic continues and ultimately subsides. Strict enforcement will be the rule of the day. OSHA will be one of the busiest government agencies so long as the pandemic persists.

    SHRM Online: What legislative changes might a Biden DOL seek to lead?

    Lotito: Legislative changes will depend largely on the results of the Georgia Senate contests. But even if the Senate is 50/50 with Vice President-elect Kamala Harris breaking all ties in likely favor of progressives, legislative initiative may be minimal. A 50/50 Senate will not eliminate the filibuster as Sen. Joe Manchin, D-W.Va., has said recently he is not in favor of the filibuster's removal. As long as one needs 60 votes to approve legislation in the Senate, controversial matters on labor and employment like the Protecting the Right to Organize Act, paid sick leave, a new minimum wage and the like may not be front and center as Biden deals with COVID-19, taxes and infrastructure. 

    SHRM Online: How should employers prepare to respond to these possible changes?

    Lotito: First and foremost, be comfortable with uncertainty. Increase compliance focus. Stay engaged and informed. Elections have consequences. How this plays out will depend on many factors. But if the Biden Administration really wants to be remembered for workplace initiatives, it should embrace a new GI bill for upskilling the workforce of the 21st century. We are in the midst of the most transformative workplace disruption in history given the pandemic, robotics and artificial intelligence.

    ***** ***** ***** ***** ***** 

    Source: Society for Human Resource Management (SHRM) 

    https://www.shrm.org/resourcesandtools/legal-and-compliance/employment-law/pages/dol-priorities-will-change.aspx

  • 24 Nov 2020 10:24 AM | Bill Brewer (Administrator)

    buying health insurance online

    By Stephen Miller, CEBS | November 24, 2020

    As ICHRAs approach their first birthday, vendors see continuing growth

    Individual coverage health reimbursement arrangements (ICHRAs) became available as a new employee benefit in January 2020 under IRS regulations issued by the Trump administration in June 2019. As ICHRAs approach the end of their initial year, consultants and firms that administer the accounts weighed in on the benefit's future.

    With ICHRAs, pronounced "IK'-rahs," employers subject to Affordable Care Act (ACA) coverage requirements could opt to pay for employees to purchase their own health insurance coverage on the ACA marketplace or through an insurance broker, rather than providing an employer-sponsored group health plan. Among a few ICHRA facts to keep in mind:

    • As with other health reimbursement arrangements (HRAs), employees don't pay taxes on health care spending reimbursed through an employer-funded ICHRA.
    • An ICHRA, like most other HRAs, is not portable when employment ends, although businesses subject to COBRA requirements must give eligible employees a chance to elect COBRA coverage.
    • When employers with 50 or more full-time or equivalent employees provide coverage through an ICHRA rather than a traditional group health plan, employer funding must be sufficient for employees to purchase a plan that meets the ACA's coverage and affordability requirements. For instance, in 2021, an employer's ICHRA allowance must be high enough that employees can buy the lowest-cost silver plan on an ACA marketplace exchange by combining their ICHRA funds with no more than 9.83 percent of their adjusted gross income.

    Employers Take Notice

    There is a growing interest in ICHRAs as a way for employers to keep their health care spending at a fixed dollar amount. This is according to 397 large U.S. employers that participated in HR consultancy Willis Towers Watson's 2020 Health Care Delivery Survey, conducted in August and September. The survey revealed these statistics:

    • About 15 percent of employers polled were planning to offer or were considering offering ICHRAs to at least some of their employees in 2022 or later.
    • Almost a quarter (22 percent) of wholesale and retail employers were planning to offer or were considering offering ICHRAs in 2022 or later.

    In a further sign of support for ICHRAs, one-third of chief financial officers (CFOs) are considering ICHRAs for some of their active employees, according to 54 CFOs who participated in the Willis Towers Watson 2020 Health Care CFO Survey, conducted in September and October.

    "Not surprisingly, relatively few employers adopted ICHRAs this year, as the pandemic diverted much of their attention to other critical benefit matters," said John Barkett, senior director of policy affairs, benefits delivery and administration at Willis Towers Watson. "However, we expect to see interest grow as companies learn more about ICHRAs and the market for individual health plans continues to grow more robust each year."

    As more employers adopt ICHRAs to fund health care, he added, "employees could find relief from the burden of having to change plans whenever they change jobs."

    ICHRAs, QSEHRAs and Group Plans

    Dallas-based HRA administrator Take Command Health recently posted its first ICHRA annual report. "Many business owners and brokers are evaluating their options for group benefits, searching for flexible and budget-friendly options," said Jack Hooper, the firm's CEO.

    Among the firm's clients, ranging in size from one to 151 eligible employees, 46 existing clients that previously offered a qualified small-employer HRA (QSEHRA) switched to an ICHRA to offer more generous benefits to their employees.

    QSEHRAs—pronounced "kyoo-SEHR'-ahs"—allow employers with fewer than 50 full-time employees to use pretax dollars to reimburse employees who buy nongroup health coverage. The rules for ICHRAs and QSEHRAS differ. For instance, QSEHRAs have a reimbursement cap while ICHRAs do not. QSEHRAs first became available in 2017.

    Take Command Health's client data showed increasing interest in ICHRAs:

    • California, Texas, Florida, Pennsylvania and New York lead the country in ICHRA sign-ups, thanks to their strong individual markets.
    • Professional services, nonprofits, tech companies, and health care providers and services lead in sign-ups.
    • The average reimbursement rates for 2020 ICHRAs were $749.93 for singles, $847.20 for couples and $931.95 for families.
    • Survey respondents rated budget control and flexibility at the top of their list of ICHRA benefits.

    "Despite the uncertainty that we've all faced these past few months, we've seen sign-ups for individual coverage HRAs climb steadily and double since January," Hooper said. "Carriers are returning to the individual market, and individual premium prices are stabilizing—critical factors in the success of this new HRA."

    Differences by Industry

    Marek Ciolko, CEO of Gravie, a Minneapolis-based health insurance brokerage, currently has 52 ICHRA clients, some of whom dropped group health coverage and adopted ICHRAs.

    "With the unsustainable increases in many current group plans, an ICHRA is a good option," Ciolko said. "Many want to get out of the business of administering health benefits and also prefer the simplicity and predictability of defined contributions enabled by ICHRA."

    Specifically, he noted, the firm has seen an increase in interest from companies in the home health care, restaurant, and manufacturing and delivery sectors. "Another area where we have seen interest in ICHRAs is midsized companies that find it challenging to locate or maintain health coverage at reasonable rates due to employee health status," he said.

    Reimbursements Differ

    Salt Lake City-based PeopleKeep, which provides consumer-directed health accounts, recently posted its own "first nine months" report on ICHRAs.

    "There is a vast difference in the allowance amounts offered by employers who allow reimbursement [through ICHRAs] of both insurance premiums and out-of-pocket expenses compared to those who only reimburse employees for premiums," wrote Nick Green, product marketing manager at PeopleKeep.

    Among the ICHRAs PeopleKeep administers, 37 percent were limited by employers to reimbursing plan premiums, while 63 percent could be used to reimburse both premiums and out-of-pocket costs.

     

    Employers' Average Annual ICHRA Funding Amounts

      Reimburse Plan Premiums Only Reimburse Premiums and Out-of-Pocket Costs
    Employee-only coverage $538 $1,017
    Employee plus spouse coverage $640 $1,233
    Employee, spouse and dependents coverage $723 $1,324

    Source: PeopleKeep.


    "It stands to reason that employers who are able and interested in broadening the type of expenses they reimburse would also want to make more money available to their employees for those expenses," Green wrote. "What was unexpected was the degree to which that is true."

    A Bipartisan Solution?

    ICHRAs have "proven to be a great fit for employers who want more control over their health benefits costs than a group health insurance plan can provide but want to offer more in allowances than the QSEHRA will allow," Green stated.

    Ciolko noted, "Employers don't have to worry about selecting plan options that will work for all of their employees, but rather can empower their employees to choose a plan and carrier that meets their needs."

    According to Hooper, "We think the ICHRA model could be the key to bipartisan success. It delivers more lives to the individual market, which is important to Democrats, while providing consumer choice and flexibility that Republicans insist on."

    He added, "We believe it could be one of hopefully a few bridges that help to fix the health care system from both sides."

    ***** ***** ***** ***** *****

    Source: Society for Human Resource Management (SHRM) 

    https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/employers-interest-in-individual-coverage-hras-is-rising.aspx

  • 19 Nov 2020 12:22 PM | Bill Brewer (Administrator)

    Fewer Workers Will Get Pay Raises in 2021; Bonuses Gain Ground

    By Stephen Miller, CEBS | November 17, 2020

    More organizations shift from across-the-board increases to variable pay models


    The economic effects of COVID-19 have forced nearly half of organizations (45 percent) to re-evaluate salary increase plans for 2021, new survey findings show.

    Researchers collected data from 1,283 U.S. organizations during July and August for benefits advisory and brokerage firm Gallagher's 2020/2021 Salary Planning Survey report.

    At the start of 2020, two-thirds (66 percent) of surveyed employers had awarded pay raises, as organizations felt primed for growth with a robust economy and record-high employment. By the end of the first quarter, however, the reality of COVID-19 had set in, forcing many employers to put the brakes on wage hikes.

    This trend will continue into 2021, according to surveyed employers.

    Among the segment of employers that indicated COVID-19 has forced them to re-evaluate 2021 salary increase plans, half (51 percent) expect to reduce salary increases, and 45 percent plan to suspend salary increases altogether.

    According to the report:

    • For 2020, salary increase budgets will end up rising 2.5 percent, down from earlier projections of a 2.8 percent average increase.
    • For 2021, Gallagher projects average salary budget increases of 2.1 percent, with variations by employee group (see chart below) as well as by location and industry.

    Average Fiscal Year Salary Increase Budgets by Employee Group 

      2020 2021
    Executives 2.3% 2.0%
    Managers 2.6% 2.1%
    Other exempt workers 2.6% 2.1%
    Nonexempt workers 2.6% 2.2%

    Source: Gallagher's 2020/2021 Salary Planning Survey report.

    Shift Toward Variable Pay

    As an alternative to salary increases, variable pay, such as annual bonuses, "can save money and serve as an investment in future success," according to Gallagher's report.

    "Revenue streams and budgets will be unpredictable in 2021, and for these reasons, many employers are pausing across-the-board salary increases," said William F. Ziebell, CEO of Gallagher's benefits and HR consulting division. "However, the data shows more employers are leaning into variable pay models because this allows them to provide employees with a pay increase based on performance."

    The researchers found that 40 percent of respondents use variable pay for at least one employee group. In addition:

    • 57 percent don't anticipate changing their variable pay budgets for 2020 despite the pandemic.
    • 73 percent don't anticipate changing their variable pay budgets for 2021.

    The benefits of variable pay, according to the report, include increasing employee productivity by linking compensation to organizational success while avoiding long-term costs by not adjusting base-pay levels upward.

    Incentive Pay Pointers

    "Organizations can be prudent in protecting themselves from overpaying under an incentive plan during challenging economic times," said Bob Lindeman and Linda VanDeventer, managing director and co-founder and director of compensation consulting, respectively, of The Overture Group, a boutique executive compensation and search firm that specializes in privately held, small-market organizations.

    Lindeman and VanDeventer advise organizations to take the following steps:

    • Review who is participating in the plan.
      Reducing plan participants is a simple way to reduce potential cost, they noted. "Most legal plan documents and employee communications state—and if not, should state—that management reviews and selects the participants in the plan annually. Stating this fact tempers the expectations of employees, albeit it is a drastic change to implement," they noted.
    • Examine the plan's threshold, target and maximum payouts.
      Reducing a payout maximum as a percent of salary, such as from 250 percent to 150 percent, can curb excessive payouts. "Participants will likely notice such a change, but if communicated effectively, plan participants should respect that an organization does not have a bottomless checkbook, especially in the era of COVID," Lindeman and VanDeventer said.

    Similarly, raising the payout threshold percentage, for example from meeting 60 percent of a targeted goal to 80 percent, "is another effective method to modify the plan while still keeping it motivational," they suggested. Increasing the target performance required for a payout in the financial formulas can ensure "the organization will have enough profit dollars to afford the payout."

    Financial Sector Rewards

    In at least one area of the U.S. economy, the financial sector, employees may find both salary increases and annual bonuses under pressure.

    Year-end incentive payments in the U.S. financial sector are expected to be lower compared with last year, according to an analysis by Johnson Associates, a compensation consulting firm. "The pandemic is wreaking havoc on many parts of the U.S. economy this year, and the financial services industry is no exception," said Alan Johnson, managing director of the firm.

    "Unfortunately, as we look to 2021, even with an optimistic vaccine path, the pandemic will continue to negatively influence businesses, but perhaps to a lesser degree than in 2020," Johnson said. "Headcount reductions will continue in the first half as companies transform and adapt. For 2021, we expect some stabilization with early projections for modest salary increases and flat to slightly increased incentives."

    ***** ***** ***** ***** ***** 

    Source: Society for Human Resource Management (SHRM) 


    https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/fewer-workers-will-get-pay-raises-in-2021-as-bonuses-gain-ground.aspx

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