Optimum HR Systems

Optimal Knowledge: The Resilience Issue

The new issue of Optimal Knowledge is about resilience. Here is an excerpt from the leading article of Anita Ryan: “At The Crossroads: The Keys to Organizational Resiliency”: “American businesses, large and small truly are at a crossroads. Those organizations resilient enough to have survived the longest economic downturn since the Great Depression are now faced with dual dilemmas that could challenge their continuing success. On the one hand the uncertain global financial situation requires businesses of all types to maintain vigilance related to cash reserves, workforce expansions and internal project investment. On the other hand in certain sectors there has been an easing of recession pressures. An increase in sales has been accompanied by a simultaneous rise in external customer demands and an internal strain on human resources that are already at a breaking point.

The layoffs and hiring freezes that were required at the height of the recession placed an ongoing burden on remaining employees. Increased hours and productivity demands could be sustained for a certain period of time. However, now that 3 years have passed, top employees (and they are the top employees because lower performing workers were cut at the beginning of the downturn process) who have not been sufficiently supported are beginning to respond to the call of recruiters from competing businesses. Suddenly these hard working top-notch people are saying “enough” and considering other options.

Although businesses want to maintain the fast reacting strategies that have enhanced their survival capabilities, now is the time to pull some mid and long terms strategy tools out of their organizational toolboxes.The loss of underappreciated highly skilled key employees is as big a danger to continued corporate resiliency as are poorly constructed or executed sales and marketing plans. So what are these tools?...” Keep reading... 

COMPENSATION AND BENEFITS STATE OF THE MARKET REPORT

Keystone Compensation Group LLC, an Optimum HR System partner, just released a new report titled “COMPENSATION AND BENEFITS STATE OF THE MARKET REPORT”. This is an executive report for compensation and benefits professionals and includes 2011 projections for base pay and bonus programs as well as benefits trends. 

The Report is based on thorough research from numerous sources and provides an overview of the current economic environment, salary structure projections, and the 2011 salary budget increase. The report also shows a snapshot of the current health care costs and their projected increase for 2011. It highlights a significant trend for how employers are shifting a larger portion of their healthcare costs increase to employees. The reports also provides high level estimates of the overall cost of providing health care coverage to employees and the breakdown between employees and employers.

Key observations gleaned from this report are:

• The current economic expansion, as measured by Gross Domestic Products (GDP) growth, will gradually contribute to creating new jobs and declining unemployment. 
• As a result of this economic growth, talent retention is likely to climb on the list of priorities for most employers as they start to add staff.
• To retain their top talent, organizations need to become better at differentiating pay based on employee contribution. 
• While salary increase budgets are inching up, they are not likely to increase fast enough to reverse the effect of the cost saving measures that employers implemented during the recent recession. 
• Variable pay continues to play an important role in providing employers with a vehicle to share the results of their successes with their employees while keeping their fixed costs under check. 
• The average salary increase budget for 2011 is projected at 3.0% up from 2.4% in 2010. In contrast, employers are budgeting around 11.6% of payroll for variable compensation for professional exempt level positions. 

You can Download the full report here or contact Linda Herman for further information or assistance with your compensation and benefits programs.

 

Happy Friday!

A federal minimum wage increase is effective today, Friday, 24 July, 2009. The Department of Labor Wage and Hour Division reminds us that with this change, employees who are covered by the federal Fair Labor Standards Act will be entitled to be paid no less than $7.25 per hour. This increase is the last of three provided by the enactment of the Fair Minimum Wage Act of 2007. All employers who are affected by this change should display the poster in a visible place on their premises, where each employee could see it easily.  The link to the poster is here.

Your state may have its own minimum wage regulations and employers are required to comply with both so you should be sure to check your applicable state regulations.

Comprehensive “DO-IT-YOURSELF” compensation toolkit

by  Linda Herman (an Optimum HR Systems associate)

Sometimes it is not practical to spend thousands of dollars to have an outsider design a sophisticated compensation program in a time of economic crisis. This was the reason behind the “Do-It-Yourself” compensation toolkit created by the Optimum HR Associate, Linda Herman. As a compensation specialist in Gallagher Benefit Services, formerly Stanton Group, Linda has the expertise and the common sense to reduce to a minimum the paperwork and the hassle in creating such complicated programs.

Gallagher Benefit Services has seen companies struggling with their compensation programs, but with no budget to do a complete market study during the current economic environment. This well thought out compensation system for small and medium enterprises was built on benchmark data for the St.Paul/Minneapolis area, but can be modified using area differentials to fit most locations in the U.S. 

Many organizations can benefit from this compensation toolkit-- and at a very low cost--, provided they fit the design profile of a company with less than 150 employees. If you would like to have a professionally developed compensation structure along with tools to administer your pay program, please contact Linda Herman or Optimum HR Systems.

About Linda Herman

Linda Herman is a principal consultant in Stanton Group’s compensation consulting & surveys department. She develops compensation programs ranging from non-exempt salary structures to executive compensation programs. Linda’s experience and skills also extend to developing programs in executive on-boarding, performance management, and organizational development.

With over 25 years of experience as a leader in compensation roles, Linda understands the challenges of leading compensation in organizations of all sizes. A former director of Stanton Group’s compensation consulting & surveys practice, Linda rejoined Stanton Group in 2007. Her corporate leadership background includes senior level roles at Fortune 500 companies, including Thrivent, Ameriprise, and Best Buy. Her consulting experience includes working in a wide variety of industries, including health care, engineering, manufacturing, casinos, financial services, grocery chains and many employee-owned organizations. Linda is able to leverage her depth and breadth of experience to develop customized, common sense solutions for each client.

Linda holds a bachelor’s degree in education from the University of Wisconsin-Oshkosh and a master’s degree in business administration from the University of St. Thomas.  She is a member of WorldatWork, the Society for Human Resources Management (SHRM), and the Twin Cities Compensation Network.

How Does the Ledbetter Fair Pay Act Impact Your Compensation Practices?

by Nancy  Diekmann and Linda Herman (an Optimum HR Systems associate)

When the Ledbetter Fair Pay Act was signed into law by President Obama on January 29, 2009, it essentially waived the statute of limitations for pay discrimination claims. Now, each time an employee receives a paycheck based on a discriminatory pay decision of their employer, it restarts the 180-day period for filing a pay discrimination claim. If an employee receives a paycheck within this eligible filing period, they may seek lost compensation no matter when the pay discrimination first began.

This legislation stems from Lilly Ledbetter’s lawsuit against Goodyear Tire and Rubber Company for sex discrimination under Title VII of the Civil Rights Act of 1964. She was a supervisor with Goodyear and alleged that she was given poor performance evaluations based on her gender.  Ledbetter filed her initial wage discrimination complaint in 1998 stating the low ratings resulted in her pay not increasing as much as her male counterparts. Those pay decisions affected the amount of pay throughout her employment so that by retirement, she was earning significantly less than her male colleagues. Keep reading...