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SPECIAL REPORT

A supplement to BLR publications

Top 10 Best
Practices in
HR Management
For 2009

Prepared for the HR Daily Advisor

www.hrdailyadvisor.com
30612160
SPECIAL REPORT
A supplement to BLR publications

Top 10 Best
Practices in
HR Management
For 2009

30610800
Executive Publisher: Robert L. Brady, J.D.
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Top 10 Best Practices in HR Management for 2009


Table of Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
#1 Compliance Focus: ADAAA and FMLA . . . . . . . . . . . . . . . . . . . . . . . . . . .1
How the Updated ADA Affects You . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
FMLA Changes Are Here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
#2 Layoffs/Reductions in Force . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Worker Adjustment and Retraining Notification (WARN) Act . . . . . . . . . . . . . . . . . .7
Older Workers Benefits Protection Act (OWBPA) . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Preventing Discriminatory Layoffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Outplacement Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Alternatives to Layoffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Best Practice: Preserving Employee Morale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
Training . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
#3 Health Care in 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
2009 Healthcare Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Mental Health Parity Legislation Becomes Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Cutting Healthcare Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Best Practice: Improve Employee Benefits Communication . . . . . . . . . . . . . . . . . .15
President Obama’s Future Plans on Health Care . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Best Practice: Cancer Screening Saves Lives, Money . . . . . . . . . . . . . . . . . . . . . . . . .16
Wellness Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
#4 Retirement of Baby Boomers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
Survey: Few Employers Capture Boomer Know-How . . . . . . . . . . . . . . . . . . . . . . . .18
Transitioning into Retirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
Predicting the Future of Retiree Health Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
Persuading Older Workers to Stay: Is It the Money that Matters? . . . . . . . . . . . . . . . .20
Succession Planning to Fill the Baby Boomer Gap . . . . . . . . . . . . . . . . . . . . . . . . . .21
Integrating a Multigenerational Workforce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
#5 Recession Help . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
Best Practice: Mandatory Vacations at HP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
Best Practice:Teach Workers Economics 101 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
Benefits and Retention Strategies in a Recession . . . . . . . . . . . . . . . . . . . . . . . . . . .25
#6 Immigration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
No-Match Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
SSA No-Match Letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
DHS No-Match Letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30

©Business & Legal Reports, Inc. 30610800


Antidiscrimination Guidance for Employers Following the No-Match Letter
Safe Harbor Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
Federal Contractors Must Now Use E-Verify . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
#7 Privacy and Identity Theft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34
Privacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34
New Federal Privacy Law Barring Genetic Bias . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
Employer Procedures for Handling Address Discrepancies on
Consumer Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
Identity Theft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36
Most Workers Trust that Employers Protect Personal Info . . . . . . . . . . . . . . . . . . . . .37
#8 The Green Movement and Corporate Social Responsibility . . . . . . . . .39
Commuter Benefits Bring Financial and Environmental Relief . . . . . . . . . . . . . . . .39
Corporate Social Responsibility and Ethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
#9 HR Metrics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
What to Measure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
Types of Metrics Available to HR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45
Strategic Alignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47
Measuring Your Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47
#10 Communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48
Tools for Better Communicating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48
Organizational Success Through Honest, Ethical Communication . . . . . . . . . . . .50
Best Practice: Ethical Culture at All Levels of Organization . . . . . . . . . . . . . . . . . . .51
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52

Top 10 Best Practices in HR Management for 2009


Introduction

The role of Human Resources is changing as fast as technology and the global
marketplace. Historically, the HR Department was viewed as administrative over-
head. HR processed payroll, handled benefits administration, kept personnel files
and other records, managed the hiring process, and provided other administrative
support to the business. Those times have changed.
The positive result of these changes is that HR professionals have the opportunity to
play a more strategic role in the business. The challenge for HR managers is to keep
up to date with the latest HR innovations—technological, legal, and otherwise.
This special report will discuss the top 10 best practices in HR management for
2009—in other words, how HR managers can anticipate and address some of the
most challenging HR issues this year. This report will give you the information you
need to know about these current HR challenges and how to most effectively
manage them in your workplace.

#1 Compliance Focus:
ADAAA and FMLA

The recent issuance of the ADA Amendments Act of 2008 and new regulations cov-
ering the Family and Medical Leave Act (FMLA) can affect your company in 2009.

How the Updated ADA Affects You


The ADA Amendments Act of 2008 (ADAAA), passed by the House and Senate in
September, was signed by President Bush on September 25. The changes enacted
by the ADAAA affect the core of the Americans with Disabilities Act (ADA) by
expanding the definition of disability.
The stated intent of the ADAAA is to restore the ADA’s definition of disability and to
ensure that the amended ADA provides a“broad scope of protection.” Since the
ADA’s enactment in 1990, the definition of disability has been narrowed through a
series of U.S. Supreme Court decisions. The ADA defines a disability as:
◆ A physical or mental impairment that substantially limits one or more major
life activities
◆ A record of such an impairment
◆ Being regarded as having such an impairment
The Court narrowed the definition with strict interpretations of the terms that
determine whether an individual has a disability. The ADAAA expressly rejects the
U.S. Supreme Court’s interpretations of the terms“substantially limits”and“major

©Business & Legal Reports, Inc. 30610800 1


life activity.” It also rejects the standard set by the Court that required the considera-
tion of the effect of“mitigating measures”in the analysis of a qualifying disability.
In addition, the ADAAA broadens the definition of“regarded as having an impair-
ment” and allows an episodic impairment to be considered a disability under cer-
tain circumstances. The ADAAA expressly seeks to shift the focus from whether
individuals have a disability to“whether covered entities have complied with their
obligations.” Under the amended ADA, many more employees will be deemed to
have a protected disability, and employers will need to make sure they engage in the
interactive process and provide reasonable accommodation to qualified individuals.
Definition of disability. Under the ADAAA, the definition of disability is to be
construed“in favor of broad coverage of individuals under this Act, to the maxi-
mum extent permitted by [its] terms.” This will likely result in a sharp increase in
the number of individuals found to have a covered disability.
Substantially limits a major life activity. In Toyota Motor Manufacturing v.
Williams (122 S. Ct. 681 (2002)), the Court held that an impairment must“prevent
or severely restrict”an individual in tasks that are of“central importance to most
people’s daily lives,” rather than simply restricting the individual’s ability to perform
tasks in a particular job. The ADAAA calls this interpretation“an inappropriately
high level of limitation”and mandates an interpretation of the term“substantially
limits”in a manner consistent with the findings and purposes of the ADAAA (i.e.,
to reinstate a broad scope of protection under the ADA). The ADAAA also rejects
the EEOC’s definition of“substantially limits”as“significantly restricted.” (Note: The
ADAAA also gives the EEOC authority to issue binding regulations consistent with
the purpose of the amended ADA.)
The ADAAA expands the term“major life activity”by adding activities to those
already enumerated in EEOC regulations. The new activities include eating, sleep-
ing, standing, lifting, bending, reading, concentrating, thinking, and communicat-
ing. Significantly, a major life activity also now includes the operation of a major
bodily function, including functions of the immune system, normal cell growth,
digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine,
and reproductive systems.
Episodic impairments. Under the ADAAA, an impairment that is episodic or in
remission is a disability if the impairment would substantially limit a major life
activity when active.
Mitigating measures. In Sutton v. United Air Lines (119 S. Ct. 2139 (1999)), the
Court held that mitigating measures must be considered in determining whether an
individual has a disability. Under the ADAAA, disability determination is made with-
out regard to ameliorative effects of mitigating measures including hearing aids,
medication, medical supplies, auxiliary aids and services (such as qualified inter-
preters for individuals with hearing impairments), reasonable accommodations,
and“learned behavioral or adaptive neurological modifications.” It is likely that this
last measure is intended to address the Court’s ruling in Albertsons, Inc. v. Kirking-
burg (119 S. Ct. 2162 (1999)), where the employee’s brain subconsciously learned
to compensate for his monocular vision. That compensation was found by the
Court to be a mitigating measure, and using the Sutton analysis, the Court ruled that
the employee did not have a disability under the ADA. The ADAAA excludes ordi-
nary eyeglasses and contact lenses from the list of mitigating measures. Under the
ADAAA, the employers may no longer take into account an individual’s use of

2 Top 10 Best Practices in HR Management for 2009


mitigating measures when considering whether an impairment substantially lim-
its a major life activity.
“Regarded as.” Sutton also held that“regarded as”means an individual was
regarded as being unable to perform a broad range of jobs, not just the job in ques-
tion. Under the ADAAA, an individual meets the requirement of being“regarded as”
having a disability if he or she has been subjected to an unlawful employment
action because of“an actual or perceived physical or mental impairment whether or
not the impairment limits or is perceived to limit a major life activity.” In other words,
if an employee is fired because he or she is perceived to have an impairment, the
employee meets the requirement of being regarded as having a disability under the
ADAAA. An impairment that is“transitory and minor”is not covered. A“transitory
impairment”has an actual or expected duration of 6 months or less.
The threshold issue of whether an individual has an ADA disability will no longer
be the focus of most litigation. Instead, it is likely that the focus will be on the indi-
vidual’s ability to perform the essential functions of a job and whether the employer
has met its obligations to engage in the interactive process and provide a reason-
able accommodation. In addition, there will probably be an increase in“regarded
as”litigation, with employees claiming an adverse employment action was based
on an employer-perceived impairment.

FMLA Changes Are Here


The U.S. Department of Labor’s (DOL) new regulations covering the FMLA and
addressing new military family leave entitlements for employees were designed to
clarify the requirements that the FMLA imposes on both employees and employers
and to improve the communication between employers and employees. Here are
summaries of some of the significant revisions included in the final rules.
Serious health condition. While the rule retains the six individual definitions of
“serious health condition,” it adds guidance on some regulatory matters. First, it
clarifies that if an employee is taking leave involving more than 3 consecutive cal-
endar days of incapacity plus two visits to a healthcare provider, the two visits
must occur within 30 days of the period of incapacity. The first visit must occur
within 7 days of the onset of incapacity. Second, it defines“periodic visits to a
healthcare provider”for chronic serious health conditions as at least two visits to a
healthcare provider per year.
Intermittent leave. The final rule clarifies that employees who take intermittent
FMLA leave have a statutory obligation to make a“reasonable effort”to schedule
such leave so as not to unduly disrupt the employer’s operations.
Employee notice. The final rule states that when an employee becomes aware of
a need for FMLA leave less than 30 days in advance, it should be practicable for
the employee to provide notice of the need for leave either the same day or the
next business day. When the need for leave is not foreseeable, an employee must
comply with the employer’s usual and customary notice and procedural require-
ments for requesting leave, absent unusual circumstances.
Gaps in service. The final rule adds a new paragraph that addresses the require-
ment that employees are eligible to take FMLA leave only if they have been
employed by the employer for at least 12 months and have at least 1,250 hours of
service in the 12-month period preceding the leave. The final rule states that

©Business & Legal Reports, Inc. 30610800 3


although the 12 months of employment need not be consecutive, employment
before a continuous break in service of 7 years or more need not be counted.
Light duty. Under the final rule, time spent in“light duty”work does not count
against an employee’s FMLA leave entitlement, and the employee’s right to job
restoration is held in abeyance during the light duty period. If an employee is vol-
untarily doing light duty work, he or she is not on FMLA leave.
Perfect attendance awards. The final rule changes how perfect attendance
awards are treated to allow employers to deny a“perfect attendance”award to an
employee who does not have perfect attendance because he or she took FMLA
leave—but only if the employer treats employees taking non-FMLA leave in an
identical way.
Medical certification. In the final rule, DOL adopted a change that allows
employers to contact the employee’s healthcare provider directly. An employer
may contact the employee’s healthcare provider for two purposes only: clarifica-
tion and authentication of the medical certification. The employer may request no
additional information beyond that included in the certification form.
In response to privacy concerns expressed by employees, DOL added a require-
ment to the final rule that specifies the employer’s representative contacting the
employee’s healthcare provider must be a human resources professional, a leave
administrator, or a management official, but in no case may it be the employee’s
direct supervisor.
The revision also specifies that the employee is not required to permit his or her
healthcare provider to communicate with the employer. However, if the employee
denies the employer permission and doesn’t otherwise clarify an unclear certifica-
tion, the employer may deny the designation of FMLA leave. However, before mak-
ing any contact with the healthcare provider, the employer must first provide the
employee an opportunity to resolve any deficiencies in the certification.
Fitness-for-duty certification. The final regulation also clarifies that employers
may require a fitness-for-duty certification to address an employee’s ability to per-
form essential job functions. However, if the employer does have such a require-
ment, the employer must provide the employee with a list of those essential job
functions no later than the“designation notice”and specify in the designation
notice that the fitness-for-duty certification must address the employee’s ability to
perform those essential functions.
Military caregiver leave. The regulation implements the requirement to expand
FMLA protections for family members caring for a covered service member with a
serious injury or illness incurred in the line of duty on active duty. These family
members are able to take up to 26 workweeks of leave in a 12-month period.
Leave for qualifying exigencies for families of National Guard and reserves
members. The law allows families of National Guard and Reserve personnel on
active duty to take FMLA job-protected leave to manage their affairs—“qualifying
exigencies.” The rule defines“qualifying exigencies”as: (1) short-notice deploy-
ment, (2) military events and related activities, (3) childcare and school activities,
(4) financial and legal arrangements, (5) counseling, (6) rest and recuperation,

4 Top 10 Best Practices in HR Management for 2009


(7) postdeployment activities, and (8) additional activities where the employer
and employee agree to the leave.
Intermittent leave. As previously mentioned, employees who take intermittent
leave for planned medical treatment have an obligation to make a reasonable
effort to schedule such treatment so as to not unduly disrupt the employer’s opera-
tions. This is a change from the old regulations. The old regulations said that the
employee had only to“attempt”to do so.
The rules clarify that temporary transfers are allowed for employees taking only
planned intermittent leave (the Department declined to expand temporary trans-
fers to unplanned, unscheduled, or unforeseeable intermittent leave).
The final rule also clarified that accounting for leave need not be in the smallest
increments that the employer’s timekeeping system can handle, but rather in the
smallest increments the employer accounts for in other types of leave, provided it
is not greater than one hour. This is a change from proposed regulations.
The new rules prohibit employers from charging employees for the period of time
that they are working (e.g., stop working ½ hour before end of shift, cannot be
charged for 1 hour of leave).
Substitution of paid leave. The rules clarify that an employee’s right to substitute
accrued paid leave is limited by the terms and conditions pursuant to which the
applicable leave is accrued, as long as those terms are nondiscriminatory. An
employer may limit substitution of paid sick, medical, or family leave to those situ-
ations for which the employer would normally provide such paid leave (e.g., such
policies may restrict the use of paid leave only to the employee’s own health condi-
tion or to specific family members). Employers must allow substitution of paid
vacation, personal leave, or“paid time off”for any situation covered by the FMLA.
In all cases, however, the normal procedural rules subject to which the leave was
accrued apply—unless waived by the employer—regardless of the type of paid
leave substituted. For example, if an employer’s paid sick leave policy prohibits the
use of sick leave in less than full day increments, employees would have no right to
use less than a full day of paid sick leave regardless of whether the sick leave was
being substituted for unpaid FMLA leave. Similarly, if an employer’s paid personal
leave policy requires 2 days’ notice for the use of personal leave, an employee seek-
ing to substitute paid personal leave for unpaid FMLA leave would need to provide
2 days’ notice. Employers, of course, may choose to waive such procedural rules
and allow an employee’s request to substitute paid leave in these situations, but
they are not required to do so. Additionally, employers may choose to waive proce-
dural requirements even in the absence of an employee request to do so.
Employer notice requirements. The final rule consolidates all employer notice
requirements into a“one-stop”section of the regulations to clear up some conflict-
ing provisions and time periods.
◆ The new regulations contain a new general notice prototype. If an employer
has no handbook or other written materials, it must provide the general notice
to new employees when they are hired.
◆ Absent extenuating circumstances, the time frame for an employer to respond
to an employee’s request for leave is extended from 2 business days to 5 busi-
ness days of the employee’s request for leave or of the employer acquiring
knowledge that the leave may be FMLA qualified.

©Business & Legal Reports, Inc. 30610800 5


◆ A list of essential job functions must be provided with the designation notice if
the employer will require that the fitness-for-duty certification addresses the
employee’s ability to perform the essential functions of the position.
◆ Only one designation notice is required for each FMLA-qualifying reason per
leave year, regardless of whether the leave is taken as a continuous block of
leave or on an intermittent or reduced leave schedule basis.
◆ In situations in which the amount of leave to be taken is not known at the des-
ignation stage (e.g., when unforeseeable intermittent leave will be needed),
the employer is to inform the employee of the number of hours counted
against the FMLA leave entitlement only upon employee request and no more
often than every 30 days if FMLA leave was taken during that period.
◆ The employer may notify the employee of the hours counted against the FMLA
leave entitlement orally and follow up with written notification on a pay stub
at the next payday (unless the next payday is in less than 1 week, in which
case the notice must be no later than the subsequent payday).
Employer failure to provide notice. The updated rule contains technical
changes to be consistent with the U.S. Supreme Court’s decision in Ragsdale v.
Wolverine World Wide Inc. In light of the Court’s decision in Ragsdale, the Depart-
ment stated that an employee isn’t automatically FMLA-eligible just because the
employer fails to provide the required eligibility notices to employees or provides
incorrect information. The rule clarifies that if an employee suffers individual
harm because the employer fails to follow the notification rules, the employer
may be liable.
Military family and caregiver leave. In January 2008, President Bush signed a
law that allows employees to take leave because of any qualifying exigency arising
out of the fact that the spouse, son, daughter, or parent of the employee is on
active duty (or has been notified of an impending call or order to active duty) in
the armed forces in support of a contingency operation. In the new regulations, a
qualifying exigency leave is limited to service members called up to duty in
National Guard and/or reserves, and certain retired members of service (not regu-
lar career service or state). It mimics the leave provision in 10 USC 101(13)(B)’s
definition of“active duty.” The rule defines“qualifying exigencies”as: (1) short-
notice deployment, (2) military events and related activities, (3) childcare and
school activities, (4) financial and legal arrangements, (5) counseling, (6) rest and
recuperation, (7) postdeployment activities, and (8) additional activities where the
employer and employee agree to the leave.
The new law also allows eligible employees to take up to 26 workweeks for leave
during a single 12-month period if the employee is the spouse, son, daughter, par-
ent, or next of kin caring for a military service member recovering from an injury
or illness suffered while on active duty in the armed forces. Under the new regula-
tions for military caregiver leave, the term“active duty”includes members of the
regular armed forces (not just Guard/reserves)—this differs for exigency leave.
Similarly, for caregiver leave, the term“active duty”is more expansive than for exi-
gency leave. Whether or not an injury or illness arose from active duty is a determi-
nation to be made by the treating healthcare professional as part of certification.

6 Top 10 Best Practices in HR Management for 2009


#2 Layoffs/Reductions in Force

A layoff is a termination of employment at the will of the employer. It may be tem-


porary or permanent and can occur for a number of reasons, including downsiz-
ing, changes in market conditions, or new technology.

Worker Adjustment and Retraining Notification


(WARN) Act
The WARN Act imposes restrictions on the way layoffs are handled. It is designed
to give employees advance notice of the layoff in order to find another job, to seek
retraining in a new occupation, and to give state dislocated-worker units adequate
preparation to assist affected workers.
Who must comply with the WARN Act? Employers must comply with the
WARN Act if they have:
◆ 100 or more full-time employees, or
◆ 100 or more employees, including part-time employees who regularly work a
total of 4,000 hours per week, exclusive of overtime.
The Act defines part-time employees as those who work 20 or fewer hours per
week and temporary employees as those hired with the understanding that their
jobs will end when a specific project ends. Workers on temporary layoff who have
a reasonable expectation of recall are counted as employees. An employee has a
reasonable expectation of recall when he or she understands, through notification
or industry practice, that his or her employment has been temporarily interrupted
and that he or she will be recalled to the same or a similar job. In addition, an
employer may have several sites of employment under common ownership or
control, yet there is only one“employer”for purposes of the Act.
60 days’ notice. The law requires covered employers to give their affected
employees 60 days’ notice of a“mass layoff”or a“plant closing”that is expected to
last 6 months or longer. Employers must also notify local government officials and
their state dislocated-worker unit.
When all employees are not terminated on the same date, the date of the first indi-
vidual termination within the statutory 30-day or 90-day period triggers the 60-day
notice requirement. A worker’s last day of employment is considered the date of
that worker’s layoff. The first and each subsequent group of affected employees are
entitled to a full 60 days’ notice. The point in time at which the number of employ-
ees is to be measured for purposes of determining coverage under the Act is the
date on which the first notice is required to be given.
Employers must provide different types of information to employees depending
upon whether they are unionized. Employers must always notify the state. Notice
may be sent by any method designed to ensure receipt at least 60 days before sep-
aration, e.g., first-class mail, personal delivery, or insertion of a notice into pay
envelopes.

©Business & Legal Reports, Inc. 30610800 7


Union employees. If employees are unionized, only the chief elected union
representative must be given notice. The notice must contain:
◆ The name and address of the employment site where the plant closing or mass
layoff will occur, and the name and telephone number of a company official
to contact for further information;
◆ A statement as to whether the planned action is expected to be permanent or
temporary and whether the entire plant is to be closed;
◆ The expected date of the first separation and the anticipated schedule for
making separations; and
◆ The job titles of positions to be affected and the names of workers currently
holding these jobs.
Nonunion employees. Employees who may reasonably be expected to experi-
ence an employment loss and who are not represented by a union must be noti-
fied individually in writing. While part-time employees are not counted in
determining if a plant closing or mass layoff had occurred, these workers must get
a notice if they will experience an employment loss. The notice must include:
◆ A statement as to whether the planned action is expected to be permanent or
temporary and whether the entire plant is to be closed;
◆ The expected date when the plant closing or mass layoff will begin and the
expected date when the individual employee will be separated;
◆ An indication of whether bumping rights exist; and
◆ The name and telephone number of a company official to contact for further
information.
State notification. Employers must always notify the state dislocated-worker unit
and the chief elected official of the local government unit within which the clos-
ing or layoff will occur. The notice must include:
◆ The name and address of the employment site where the plant closing or mass
layoff will occur;
◆ The name and telephone number of a company official to contact for further
information;
◆ The nature of the planned action including whether it is a plant closing or a
mass layoff, and whether it is expected to be permanent or temporary;
◆ The expected date of the first separation and the anticipated schedule for mak-
ing separations;
◆ The job titles of positions to be affected and the number of employees in each
job classification;
◆ An indication of whether bumping rights exist; and
◆ The name of each union representing affected employees and the name and
address of the chief elected officer of each union.

8 Top 10 Best Practices in HR Management for 2009


Older Workers Benefits Protection Act (OWBPA)
OWBPA, a 1990 amendment to the Age Discrimination in Employment Act
(ADEA), prohibits age-based distinctions in the structure and administration of
employee benefit plans, severance packages, and separation agreements includ-
ing in cases of layoffs. The law protects individuals over the age of 40.

Preventing Discriminatory Layoffs


Employers should always avoid unlawful discrimination when considering layoffs.
Each layoff decision should be made according to objective, business-related crite-
ria and be well-documented. Layoffs following seniority are generally not discrimi-
natory under the federal Civil Rights Act.

Outplacement Services
As a matter of goodwill, some companies provide outplacement services to laid-
off employees. Outplacement counseling is designed to help terminated employ-
ees prepare themselves for a new job or a new career, to lend assistance in
providing outside resources, to receive training, and to help employees cope with
the stress of leaving the company.
Outplacement services include assistance in rewriting résumés, job placements,
career counseling, conducting employee skill surveys, and providing pre-layoff
employment service registration. Larger organizations may hire outplacement
services to assist employees, whereas smaller organizations may hire a single
counselor or use existing resources to assist employees. Employers should con-
sider providing outplacement services if employees have been working at the
same company for a long period of time and may not have the tools necessary to
successfully find another job.

Alternatives to Layoffs
There are alternatives to layoffs that employers can consider:
Work sharing. Work sharing allows employees to share the work that remains
after some jobs are lost due to adverse economic conditions. Under a work-shar-
ing arrangement, employees may work a reduced week or work every other week.
Their hourly pay remains the same, but reflects the reduced hours. In some states,
the unemployment compensation laws allow employees to collect partial unem-
ployment benefits during a work-sharing period.
Reduced pay. A reduction in pay works best if it is shared by all employees,
including management. It may be acceptable to employees if their unemployment
benefits during a period of layoff would be less than the reduced pay.
Early retirement. Some employers reduce their workforce by offering attractive
incentives to employees who are about to reach retirement age. The advantage of
retirement incentives is that they allow employers to cut costs without requiring
employees to leave their jobs involuntarily. However, the employer may lose some
employees it would prefer to keep.

©Business & Legal Reports, Inc. 30610800 9


Best Practice: Preserving Employee Morale
There’s no escaping that the country is officially in a recession, and unfortunately
for many businesses, that means having to lay off employees. No one enjoys the
prospect of having to tell employees that the company is going to have to let them
go, but it is important to stay well focused at a time like this and make certain that
you handle the situation the best way you can.
“This is such a tough job for managers to deal with,” says Patricia Berg, general
manager for the Career Management Services division of Personnel Decisions
International (PDI). Clear heads, however, need to prevail when laying people off,
says Berg. “You need to take time to plan the layoff carefully and to meet with and
prepare your managers for the process. It’s smart to hire a good outplacement serv-
ice or career transition firm to help you through the process, and get them
involved early on.”
Berg and PDI have suggestions for handling the process well. The first is to pro-
vide notification training for your managers because this is such a difficult talk.
You also need to allow adequate time to prepare for all the necessary contingen-
cies, such as:
◆ Giving as much warning as possible for mass layoffs,
◆ Conducting a threat assessment to ensure the safety and security of all
employees, and
◆ Having information prepared in advance to give to employees regarding their
severance, benefits, outplacement, or other information that will be important
to them.
Berg suggests that after you have put together your plan of action, the next step is
to talk with employees. “You want your meetings to be one-on-one as much as
possible, though that doesn’t always work,” she notes. The best idea is to sit down
face-to-face, in a private office, with the individual and a Human Resources profes-
sional. Acknowledge the employee’s contributions to the company, and thank the
employee for those contributions.
If possible, have your outplacement company or career transition firm on-site to
meet with employees. Explain to the employees the logistics of leaving the com-
pany, and make certain that you have clarified the separation date to make sure
the news sinks in. Explain to employees the type of services you have available for
them, including any outplacement services that are appropriate for the level of the
employee. You should also provide references for them, if applicable.
A few other general pieces of advice from Berg include:
◆ Inform employees at the beginning of the workday, rather than at the end of
the day.
◆ Treat people with respect.
◆ Use good listening skills and acknowledge employees’ reactions.
“Survivors.” “You need to be as aware of the people remaining as you are about
the people you are letting go,” says Berg. Employers“need to make sure they get
information to the survivors about how they are supporting their colleagues who
have departed. Then they need to stay very close to these employees in the weeks

10 Top 10 Best Practices in HR Management for 2009


that ensue in terms of focusing on the redistribution of work and redefining roles
and responsibilities. They also need to be there to answer questions and to absorb
some of the emotional impact the employees are feeling.”
The survivors are wondering if there will be another round of layoffs and will their
jobs be the next ones cut. Berg points out that“managers need to be prepared to
deal with those questions without making any guarantees. Being there to answer
questions, support the employees, and absorb some of the emotional impact
really helps the survivors work through the process as well.”

Training
The Workforce Investment Act of 1998 (WIA) reformed the federal job training sys-
tem by consolidating about 70 federal programs into an integrated whole. The
reformed system is intended to be customer-focused in order to help workers
access the tools they need to manage their careers and to help employers find
skilled workers. While WIA is a federal program, it will differ in how it is imple-
mented by each state.
The cornerstone of the WIA is the“One-Stop”service delivery system, which is
designed to make information about and access to a wide array of job training,
education, and employment services available for workers and employers at a sin-
gle neighborhood location. “Core services”are provided at each One-Stop location
and include:
◆ Intake and orientation to the One-Stop approach
◆ An eligibility determination
◆ Initial assessment of skills and abilities
◆ Access to job vacancy listings and job search and placement assistance
◆ Information on providers of vocational rehabilitation activities and access to
eligible training providers
◆ Information on filing for unemployment insurance and availability of
supportive services
Through the One-Stop approach, employers have a single point of contact to pro-
vide information about current and future skills their workers need to possess and
to list job openings.

#3 Health Care in 2009

The American economy is in trouble, and many people can’t afford health care.
Employers are worried about their ability to compete on the global market when
health care is costing them so much. Even before the fall, when some major banks
failed or were bought and the stock market experienced dramatic downswings, a
majority of American workers expressed concern about their financial situations
and economic futures, according to the Rockefeller Foundation/TIME survey,
Campaign for American Workers Survey.

©Business & Legal Reports, Inc. 30610800 11


Some survey results. When comparing survey results from 2008 to 2007, sev-
eral categories illustrated increased problems for workers who participated in
the survey:
◆ 25% did not go to a doctor because of cost (18% in 2007).
◆ 23% went without health insurance (20% in 2007).
◆ 23% did not fill a medical prescription because of the cost (17% in 2007).
For Generation Y (survey respondents between the ages of 19 and 29), the future
seems even more problematic. Of this group, 49 percent said that America was a
better place to live in the 1990s, and 56 percent were worried about their own per-
sonal economic security. Also, 79 percent agreed that America was a lot less
secure or somewhat less secure today than 10 years ago.
“Americans want to work hard and improve their financial situations; 80 percent
believe they are responsible for their own financial security,” according to the exec-
utive summary. Some solutions that survey respondents thought would help them
secure their economic future include:
◆ The government and employers providing basic necessities such as healthcare
or retirement programs (70%)
◆ New policies and programs that will create jobs (82%)
◆ Initiatives to provide more access to family health care (77%)
◆ Support to make it easier for people to work such as more paid family leave
(68%) and government-funded child care (66%)

2009 Healthcare Trends


In the words of Samuel H. Fleet, president and CEO of AmWINS Group Benefits, in an
article that he wrote for BLR, the country’s job-based system for health insurance is
too entrenched to disappear. The healthcare industry generates about $2 trillion—
that’s trillion, with a“T”—in economic activity annually, which means it has a strong
interest in preserving the status quo. That means employers will be forced to continue
down the path of using consumer-directed strategies and cost-sharing plans to escape
the expensive, anticompetitive burden that health benefits have become.
Expect continued pressure on healthcare providers to make their charges more trans-
parent so that consumers can make choices based on real-cost comparisons. In addi-
tion, Medicare’s recent decision to force hospitals to absorb the cost of opportunistic
infections, caused by pathogens at the hospital that compromise an unhealthy
immune system, should raise consumer awareness of quality-of-care issues.
The bottom line is that one-size-fits-all healthcare plans are a luxury of the past.
Employer-provided health benefits will continue to become more customized as
companies struggle to balance the competitive advantage of offering employees
good, affordable health care with the increasing drag on their bottom line.
Now, more than ever before, benefits professionals will have to become careful,
discriminating shoppers who can sort through sales pitches to identify partners
who can deliver value-enhanced offerings. What should you look for? Here are a
few ideas:

12 Top 10 Best Practices in HR Management for 2009


◆ Deep discounts don’t add up to much if the underlying prices are inflated.
Look beyond the promises of large insurers and examine the track record of
third-party administrators who are eager for your business. Expect—in fact,
demand—a partnership that focuses on synergies that drive down cost while
simultaneously improving patient care by reducing the inappropriate and
often wasteful use of resources.
◆ Focus on proactive measures that rein in medical costs, rather than relying
solely on controlling premium costs. Eighty percent of the average premium
goes toward paying claims, providing a large target for money-saving strategies.
Explore behavior management, such as wellness incentives and educating
employees about the impact of their choices.
◆ Demand accountability for claims management. Pharmaceutical and medical
billing audits can reveal patterns of mistakes and process flaws that can be
addressed to lower costs without affecting the quality of care.

Mental Health Parity Legislation Becomes Law


Insurance companies must cover mental and physical illnesses equally under a
provision included in the so-called“bailout”legislation signed into law by Presi-
dent Bush (Emergency Economic Stabilization Act, HR 1424). The provision is the
culmination of years of effort by legislators to expand on the 1996 Mental Health
Parity Act, says Sen. Pete Domenici (R-New Mexico), who co-authored the 1996
Act and was a lead sponsor of the current parity legislation. “No longer will we
allow mental health to be treated as a stepchild in the healthcare system,”
Domenici said. “If you have insurance, then your mental-health care must be
equal to the benefits you get for any other disease.”
The new law expands parity to include:
◆ Deductibles,
◆ Copayments,
◆ Out-of-pocket expenses,
◆ Co-insurance,
◆ Covered hospital stays, and
◆ Covered out-patient visits.
Companies with fewer than 50 employees are exempt.

Cutting Healthcare Costs


Knowing that healthcare costs will not decrease in coming years, the challenge for
employers becomes learning how to keep the increases to manageable levels.
There are a variety of strategies for cutting program costs. Among these are making
changes in the areas of plan design, financing, purchasing, vendor management,
care management, pharmacy, and retiree medical management. Consider the fol-
lowing specific steps in cutting program costs:

©Business & Legal Reports, Inc. 30610800 13


HSAs. Many companies are implementing health savings accounts (HSAs), which
are a cost-effective way to co-fund health care. HSAs are designed to help individu-
als save for future qualified medical and retiree health expenses on a tax-free
basis.
Network management. Also recommended are high-performance networks
where experts analyze cost and practice patterns, weeding out from the network
specialists who cost much more than others. These are specialists who tend to
order more tests and require more doctor visits than others. By removing them, the
total cost of health care for employers decreases.
Surcharges. Another strategy for cost-cutting is introducing“dependent sur-
charges.” These are charges levied by companies to cover employees’ working
spouses who could be covered under their own plan. The surcharge creates an
incentive for the spouse to switch to his or her own plan.
Volume discounts. Joining a coalition of employers that leverages volume to pur-
chase health coverage on a group basis can also help employers reduce costs. Vol-
ume purchasing power when negotiating with community providers leads to lower
overall costs.
Consumer-driven health care. In order to curb rising healthcare costs, more
employers are implementing consumer-driven healthcare plans (CDHPs). Dozens
of concepts can hide under the trendy title of consumer-driven healthcare plans,
from smoking-cessation, weight-loss programs, and health club memberships to
three-tier pharmacy plans. But here’s a definition offered by the Washington, D.C.-
based National Business Group on Health:“Most plans include cost-sharing provi-
sions, high deductibles, a health reimbursement account or health savings
account (HSA), and tools and resources to help workers become more educated
healthcare consumers.”
BLR asked Steve Kraus, principal-in-charge of Deloitte Consulting’s Human Capi-
tal practice and leader of the study, for his reaction to that definition. He gener-
ally agreed with it, stressing that plans vary widely from employer to employer.
The core principle, Kraus says, is“enabling employees to understand the true cost
of healthcare services and the options available to them for receiving care while
requiring [them] to take on increased financial responsibility for managing their
health care.”
These are the basic features, Deloitte Consulting’s Steve Kraus reports, for each par-
ticipant in a consumer-driven healthcare plan.
◆ A fixed annual allowance to cover“wellness benefits”preventive care such as
physical exams and health screenings.
◆ Enrollment in a high-deductible medical plan, such as a $1,500 deductible
with coverage by a preferred-provider organization.
◆ In larger companies, those with at least 1,000 employees, an employer-funded
health reimbursement account (HRA), say of $1,000, for use in covering the
deductible.
◆ In smaller companies, an HSA that acts like a 401(k)-type retirement plan.
Employees save their own money, which may be fully or partially matched by
the employer.

14 Top 10 Best Practices in HR Management for 2009


◆ With either HRAs or HSAs, the employee pays $500 of his or her own money
for the rest of the deductible. In theory, participants are more likely to ask a
healthcare provider whether a test or treatment is really necessary or whether
it can be obtained less expensively.
◆ Unspent funds in both HRAs and HSAs can be rolled over from year to year.
These are other features that either the insurer or the employer may add:
◆ Third-party-provided pharmacy benefit management
◆ Disease management, usually by nurse practitioners, for such chronic condi-
tions as asthma, diabetes, heart disease, or cancer
◆ Wellness benefits, such as a gym on the premises, and weight-loss and
smoking-cessation programs
◆ Behavioral health benefits that especially target depression
Use a variety of methods. Not surprisingly, the experts maintain that no single
method will reduce costs dramatically. Rather, implementing a variety of methods
can help employers save money over the long term.

Best Practice: Improve Employee Benefits


Communication
Ninety percent of employers that offer a consumer-directed health plan (CDHP)
cited employee communication as their greatest challenge in introducing the
CDHP and during the plan’s first year, according to a study conducted by Watson
Wyatt Worldwide and the RAND Corporation. The study included 42 large employ-
ers that offer a CDHP to their workers.
The study found that employers agree that getting employees to enroll in these
plans can be difficult when they also have more traditional health plan options.
Employers were most likely to achieve high levels of CDHP enrollment when they
devoted additional time and resources to communication, forced employees to
make an active choice at open enrollment, and offered financial incentives in
ways that enhanced the appeal of the CDHP, according to the study.
Another challenge that employers face when offering a CDHP is providing workers
with information they need to help make good decisions about healthcare cost
and quality, according to the study. The study found that employers are generally
pleased with Web-based, out-of-pocket cost calculators for employees. However,
they find that specific resources needed to help workers evaluate the cost and
quality of care from specific providers are often lacking.
Just 2 percent rated cost information about healthcare providers as excellent,
and 5 percent rated it as good. Only 10 percent rated information on the quality of
care as good, and none rated it as excellent. “Provider cost and quality tools that
help employees make smart, cost-effective decisions need to be part of the con-
sumer-directed health plan package,” says Melinda Beeuwkes Buntin of the RAND
Corporation. “Better information tools would promote employee engagement and
help workers select the health plan that is best for them.”

©Business & Legal Reports, Inc. 30610800 15


President Obama’s Future Plans on Health Care
President Obama proposes a healthcare plan that would require employers to
offer healthcare insurance to employees or pay a percentage of payroll to support
a public healthcare plan. Small employers would be exempt. President Obama
would also give a tax credit to small businesses to encourage them to offer health-
care insurance.
All children would be required to have healthcare insurance, and the new presi-
dent’s plan calls for subsidies for people who are unable to afford insurance. Presi-
dent Obama also has a plan that he says will reduce healthcare costs, including a
change to allow Americans to purchase less expensive prescription drugs from
other countries.

Best Practice: Cancer Screening Saves Lives,


Money
C-Change, a national cancer coalition of key leaders from the government, busi-
ness, and nonprofit sectors, recently launched an initiative designed to encourage
employers to add cancer prevention and screenings to their health insurance poli-
cies and programs. Its white paper, “Making the Business Case for Cancer Preven-
tion and Early Detection,” is available in its entirety at www.c-changeprojects.org/
MakingTheBusinessCase.
With more than half of Americans covered by health insurance provided through
employer plans, the costs associated with cancer have a direct impact on business’
bottom lines. Cancer is the second leading cause of death in the United States,
after heart disease. Proper screenings can prevent cancer and improve outcomes
where cancer is found. As such, screenings lead to lower costs and, of course, bet-
ter outcomes for individuals, families, and businesses.
C-Change says there are four prevention areas that can have the most impact:
tobacco-cessation programs, breast cancer screening, colorectal cancer screen-
ing, and cervical cancer screening. A study by America’s Health Insurance Plans
and the Kaiser Permanente Center for Health Research found that investing in
tobacco-cessation programs reaps immediate results.
“By investing 18 cents to 79 cents per member, per month, an employer can gener-
ate a cumulative savings of $1.70 to $2.20 per member per month after 5 years,”
says C-Change. Death rates are reduced by about 16 percent in women over the
age of 40 who have mammograms every 1 to 2 years. And the U.S. Department of
Health and Human Services says that the death rate from colorectal cancer can be
reduced by at least 30 percent with regular screening for the disease.
Educating employees about when and why they should quit smoking or be
screened for cancer is important, and there are simple, low-cost ways to do that.
Invite a mobile screening unit, such as a mammography van, to come to the work-
place. Send reminder cards around employees’ birthdays to encourage them to get
screened. Include notices in newsletters, on the company intranet, and in break
rooms about when and why employees should be screened. Offering time off to
take advantage of cancer screenings can also encourage early detection.

16 Top 10 Best Practices in HR Management for 2009


Wellness Programs
There is little question that employers can have a positive impact on employee
behavior. Done well, employer-sponsored wellness programs have been successful
in helping employees make better choices. Some such activities are full-blown pro-
grams. Others are small, finite activities that are part of overall HR and safety. Well-
ness programs include:
◆ Exercise and fitness
◆ Smoking cessation
◆ Blood pressure management
◆ Weight management
◆ Stress management
◆ Cholesterol management
◆ Nutrition
Studies of the wellness plans of 200 companies completed by the American
Journal of Health Promotion conclude that the return on investment (ROI) for
employee wellness programs can be as high as 348 percent in 3 to 6 years. This
figure certainly suggests taking a closer look at instituting a wellness program if
you don’t already have one in place at your company.
When wellness programs are not successful, it’s often because there’s a lack of sen-
ior management support and/or the original planning wasn’t as comprehensive as
it should have been. Senior leadership must communicate the importance of the
wellness initiative to employees up front. They should also participate in the pro-
gram once it is up and running to set an example for other staff.

#4 Retirement of Baby Boomers

Are you prepared for the retirement of lots of your older workers? Never mind
whether you can find warm bodies to replace them (and even that may be tough),
but how will you fill the knowledge gaps left by their departures? There’s been
much talk about phased or delayed retirement programs, but two topic experts
provide a fresh perspective on surviving the brain drain.
Misconceptions on both sides. Alan Bernstein and John Trauth, co-authors of
Your Retirement Your Way (McGraw-Hill, 2006), since publishing their book, have
shifted their focus to include both older employees and their employers. On the
lecture circuit, they explain their recommendations, based on a good deal of
research, for hanging onto the much-needed knowledge and talent of older work-
ers. Employers, they say, have these wrong impressions about older workers:
◆ Older workers can’t handle the physical demands of their jobs. In
today’s service and knowledge economy, most employees can do most of the
jobs they’ve always done.

©Business & Legal Reports, Inc. 30610800 17


◆ Older workers are just coasting to retirement. In fact, they can be just
as—or more—productive than younger workers. Their work tends to be more
accurate and their decisions more thoughtful.
◆ Older workers get hurt more often and heal more slowly. Instead,
they’re less reckless than younger workers and subject only to repetitive strain,
which can be eased.
◆ Older workers can’t or won’t learn new skills. Instead, they do learn
differently but continue to enjoy chances to learn something new.
◆ Older workers are short-timers, so not worth the investment. The truth
is that they are more loyal, have lower turnover, and have positive work values.
Bernstein and Trauth think they have an effective answer to the looming talent
crunch in which employers won’t be able to find enough workers with the right
kinds of skills to fill needed positions. Here are elements of their program, MORe
(Mutually Optimized Renewal), “a new retirement paradigm”for retaining older
workers.
The first step is to prepare a 5-year plan of business objectives for change and
growth, including the employee skills that will be needed to get from here to there.
Next, assume that all workers aged 59 or over now will retire before the end of the
5 years. Do any have skill sets and/or institutional knowledge that will be essential
to keep? The answer is likely yes, and Human Resources should approach those
people to discuss their retirement needs and wishes.
Bernstein and Trauth see real problems with the phased retirement programs some
large employers have used:There’s low enrollment, too-brief tenure, and failed
mentoring processes. The authors believe the reasons are that older employees are
burned out from doing their current jobs, they’ve not thought enough about what
they want out of work and life in the future, and they haven’t been properly
trained for mentorship. What should happen, Bernstein and Trauth advocate, is
that chosen older workers take a 1- to 6-month sabbatical to assess their needs and
wishes. That renewal break should be accompanied by completing a reliable per-
sonality profile that reveals the kinds of work they like best and what job aspects
lead to stress. Based on those activities, the worker and the employer together
structure a new, part-time job tailored to the worker’s personality and interests.
The other part of the bargain is the one or more mentoring relationships that will
aid the organization in transferring the older worker’s skills and knowledge to
future leaders in the firm. Not only should the potential mentor be thoroughly
trained in how to carry out the responsibility but the personalities and interests of
potential mentees should be carefully assessed to find the right match or matches
for the mentor.

Survey: Few Employers Capture Boomer


Know-How
Only one quarter of large organizations are making an effort to transfer knowledge
from retiring Baby Boomers to other employees, according to a survey of 2,046
Human Resources executives by Novations Group, a global consulting and train-
ing firm based in Boston.

18 Top 10 Best Practices in HR Management for 2009


The survey found that just 4 percent of respondents said they have created a for-
mal process to pass on know-how, while 23 percent report doing so informally.
Twenty-nine percent of respondents said that while they currently have no process
for transferring knowledge from retiring Baby Boomers to other employees, they
plan on developing one. Forty-four percent of employers said they have no process
and have no plans to develop one.

Transitioning into Retirement


According to a recent survey by AXA Equitable Life Insurance Company, there is a
disconnect between how you view the next step in the retirement process and
how employees view it. In fact, they’re waiting for you to help them with the transi-
tion into retirement.According to Bill McDermott, executive vice president at AXA
(www.axa-equitable.com), “71 percent of the employees we surveyed said they
believe it is their employer’s responsibility to prepare them for retirement.
“People have three critical decisions to get ready for retirement,” says McDermott.
“The first is to save; the second is to invest, and the third is the distribution—how
you’re going to live off of your savings.” Most companies are doing well at helping
employees with the first two by providing a plan, encouraging saving, educating
about investments, and even matching contributions. But when it comes time to
think about the third decision, many companies are lacking.
How to help employees near retirement prepare. There are several things
near-retirees need to think about during the last few years of their working life. You
can access tools through organizations such as AARP, the company that provides
your retirement plan administration, or via the Internet. Many are low- or no-cost.
AARP recommends that people start by thinking about how they want their retire-
ment to look. The organization’s self-assessment tool, Retirement Roadmap, is
available online (www.aarp.org) and leads people through a variety of questions
in a dozen categories designed to guide the process. The answers help the
employee think through possibilities and learn how much money those possibili-
ties might take. AARP also suggests starting early to determine how much money
to expect from Social Security and from the corporate plans. You can make that
easier by providing benefit statements regularly.
How to invest retirement funds. One of the critical decisions employees must
make when retiring is how to invest their retirement nest egg so it will last their life-
time. HR can take steps in the right direction without having everything figured out
at once.
◆ Assess how you are doing in preparing employees to live off their retirement
savings;
◆ Contact your retirement administrator and ask if it can provide a speaker for a
brown-bag lunch for employees over age 50;
◆ Make sure employee benefit statements are provided regularly; and
◆ Ask employees what they need from you.

©Business & Legal Reports, Inc. 30610800 19


Predicting the Future of Retiree Health Care
Educating employees may be the most important thing you can do to help them
plan for retirement health costs, says Robert Schmidt of Milliman. He expects that
an unmarried employee retiring at age 60, with an initial insurance premium cost
of $227 per month (subsidized by a generous employer) and assuming an opti-
mistic health cost trend of 8 percent per year, can expect to need $205,000 for the
purchase of health insurance if he or she lives to age 85. That’s a present value of
$95,000 using a 5 percent discount rate.
Of course, for married people, or those retiring from an employer that doesn’t sub-
sidize part of the cost of coverage, the amount would be substantially more. That
means retirement savings are more important than ever before. “Plan to just chop
off $100,000 of your retirement savings to pay for health care,” Schmidt advises.
Not only do employees and retirees need education about the cost of health insur-
ance, they also need to be on board with wellness and disease management initia-
tives, says Schmidt.
In a recent survey, Kaiser and Hewitt asked companies sponsoring retiree health
benefits about their future plans. In the Kaiser/Hewitt Survey on Retiree Health
Benefits, the highest percentage of respondents pointed to changes in their plan
designs that will mean increased costs to retirees. For example, 80 percent said
they will likely increase retiree premium contributions; 40 percent will increase
cost-sharing requirements; 36 percent are likely to increase drug co-pays or coin-
surance; and 30 percent will increase out-of-pocket limits. Fortunately for retirees,
just 2 percent said they are likely to terminate all subsidized health benefits for
current retirees.
Robert Schmidt believes early retirees are more likely to maintain some form of
employer-sponsored benefits. “I’m seeing a trend,” he says. “If companies are going
to provide retiree health care, they’re providing it to early retirees, and letting post-
65 retirees go on their own. There are so many more options for them now.”

Persuading Older Workers to Stay:


Is It the Money that Matters?
The Employee Benefit Research Institute (EBRI) asked workers who had retired in
2003 or later about company policies, practices, and incentives that would have
encouraged them to delay retirement. The 4,981 respondents worked in the aero-
space and defense industries and at the time of the survey, were between the ages
of 55 and 65. Most (79 percent) were men, and 83 percent were married when
they retired.
Just ask. Nearly two-thirds said they would have seriously considered an offer
from their employer asking them to stay on.
You need me? Almost half (48 percent) of the retirees said that if they had felt
truly needed for an assignment, that would have been extremely or very effective
in encouraging them to delay retirement.
Money please. However, money does enter the equation. Half of the respondents
who had a defined benefit pension plan said that if they had been able to receive
a full pension and still work part time, it would have been effective in getting them

20 Top 10 Best Practices in HR Management for 2009


to delay retirement. A partial pension had the same effect for 44 percent of respon-
dents. EBRI points out, however, that this would require a change in federal law.
Other compensation-related incentives may be almost as compelling, without
requiring legal changes. One-third of the retirees said that a pay increase would
have been an effective way to get them to stay, with 56 percent ranking it among
the top two incentives. And nearly half (46 percent) said that they would be
encouraged to continue working part time if the company continued to subsidize
their health insurance benefits at the same level as full-time workers.
Communicate early. If you’d like to encourage workers to stay with you a little
longer, start your efforts early. According to the EBRI survey, the timing of the offer
is important. Almost two-thirds (63 percent) of the survey respondents said that
the offer would have been much more effective if they had known about it in the
2 years before they communicated their intention to retire.

Succession Planning to Fill the Baby Boomer Gap


Employers rightly fear the aging of the workforce and the significant“brain drain”
many companies will experience as Baby Boomers begin to retire. Companies
must plan not only for staffing needs at the top of the company, but must also iden-
tify and plan for future human capital needs at all levels—planning for the future
growth and success of the company. If the company is not prepared and has not
invested in its key employees, when the need to fill a position arises, the company
will likely find itself paying top dollar to attract talent from outside the organiza-
tion in a fierce competition with other public and private employers.
Study the demographics. Early in the process, it is important to analyze the cur-
rent workforce. Is brain drain going to present a significant problem for the com-
pany, and if so, when and in what areas or jobs? Knowing when and where there
will be key vacancies or a need to replace accumulated skills and knowledge will
help focus on future needs, as well as current vacancies when new employees are
recruited and hired.
Link strategic goals with human capital needs. Identify the talent, skills, and
experience the company will need over the next 5 to 10 years in order to achieve
goals and continue to be successful. This will include the knowledge, skills, abili-
ties, experience, education, core competencies, and even personality traits that
will be needed to fill top management positions and other positions that will be
essential to the company’s long-term success.
Senior management must play a role. Human Resources managers need to
involve senior managers in the planning process so that succession planning and
the development of employees are adopted as strategic goals. Senior management
will be more likely to participate in the process if it is linked to the long-term strate-
gic goals of the company.
Succession planning as a retention strategy. In a highly competitive labor mar-
ket such as the one predicted over the next 10 years, a working succession plan
can have a significant impact on staff retention. Employees who feel the company
is making an investment in their development and career planning are more likely
to be committed to the organization long term.

©Business & Legal Reports, Inc. 30610800 21


Measuring success. One way to keep the focus on succession planning and
developing employees is to track and measure the success of the plan at the
department and company level. One way to do this is through the use of metrics
and another is to make sure managers are evaluated on how well they implement
the plan. Suggestions include:
◆ Measuring the total number of open positions identified as key positions in the
succession plan that were filled by high-potential employees.
◆ Using 360-degree reviews for evaluating the mentoring process by having the
mentor evaluate the employee and vice versa.

Integrating a Multigenerational Workforce


As your“Radio Babies”(approximate ages 62 to 77) and Baby Boomers (roughly
ages 43 to 61) retire or begin to phase out, Generation X (ages 30 to 42, give or
take) simply can’t fill all the workforce gaps:That cohort is too small. So, despite
problems your older staffers may think they’ve had in adjusting to Gen X, you’d bet-
ter get ready to hire Gen Ys. They’re the biggest cohort since the Boomers, and
you’re going to need them. How do you cope?
In order to increase the amount of workplace interaction among employees of dif-
ferent ages, consider taking some of the following action steps:
◆ Establish a series of mentor relationships that pair older workers with younger
ones; encourage pairs to meet at least monthly for a year or more to work on
career goals set by the younger workers.
◆ Create focus groups of mixed generations to brainstorm ideas about achieving
company objectives.
◆ In populating ongoing project teams, strive for age diversity as well as diversity
of levels, race, and gender in addition to appropriate functional and depart-
mental representation.
◆ Make it easy for older workers to obtain either in-house or external training in
new technologies or methodologies. Pair older workers with younger workers
who may have more experience with new technologies.

#5 Recession Help

Across the nation, employers find it nearly impossible to ignore dropping revenues
and profits. A recent study by consulting firm Hay Group found that more than 30
percent of respondents are freezing or planning to freeze base salaries, with half
that number doing so for all employees. And some 20 percent will either freeze
workforce size or conduct layoffs in the near future. Respondents also reported
they will change training and development programs (28 percent), change health-
care benefit plans (27 percent), or change retirement savings plans (20 percent).
Furthermore, another survey done by Career Protection predicts a 37 percent
increase in layoffs this year compared to last, making this year’s forecast the worst

22 Top 10 Best Practices in HR Management for 2009


in 5 years. Survey respondents were nearly 1,400 corporate executives nationwide.
And DOL reported that the U.S. economy scuttled 80,000 jobs last March, boosting
the unemployment rate to 5.1 percent from 4.8 percent. BLR subscribers have told
us they’re considering such moves as suspending their company’s 401(k) match
and whether they should warn employees that layoffs may be necessary.
There’s a big contradiction here. The same Hay Group respondents who said
they were considering layoffs and benefit reductions also said that their number 1
concern about the recession was how to retain and motivate their top performers.
Clearly, then, employers have conflicting needs: they feel pressure both to cut
costs, with human capital usually being the biggest drain on expenses, and also to
hang onto the talent they really need.
Manny Avramidis, senior vice president of Human Resources for the American
Management Association (AMA), advises organizations to cope with the possibility
or the reality of recession in several ways. Avramidis points out that a rising rate of
unemployment doesn’t necessarily mitigate the war for talent; many available
workers lack the skills that employers seek. After all, you’re not just looking for
warm bodies. And, companies tend to be leaner than in past recessions because
of outsourcing, global mergers and acquisitions, and layoffs they may have con-
ducted in the early 2000s. “Companies should approach this downturn by continu-
ing to invest in human capital,” says Avramidis.
The first step in preparedness is a vibrant and accurate performance assessment
process that identifies where every employee stands in terms of the organization’s
goals, the employee’s contributions, and where he or she may need to improve.
That process will inform both front-line supervisors and HR pros about the key
players in the company, as well as who’s in line for important positions in terms of
succession planning.
Avramidis has been through at least one other recession, the one that began in
2001, in his tenure with AMA. He firmly believes that layoffs should be“resisted”
because talent is so scarce that if a firm downsizes, it may not be able to rally
when the recovery comes. The foundation of his approach to this recession is
communication. “Be transparent,” he advises. Not only do employees need their
individual feedback from the company’s performance management system but
they also need to know virtually everything that top management knows about the
organization’s ongoing results.
Armed with that information, employees need to be engaged in developing strate-
gies for the corporate response. Are there less profitable product lines that should
be dropped, or should marketing efforts at least be cut back for them? Do workers
have ideas about redundant processes or other kinds of activities that could be
eliminated to save money?
Given detailed and up-to-date information on their employer’s financial results,
employees will be more prepared for news of layoffs should they be necessary.
However, Avramidis suggests that employers go further by explaining beforehand
exactly what will happen if layoffs are conducted. Are they expected to be tempo-
rary or permanent? Will outplacement services and/or severance packages be
provided to those laid off? What services will be available for those not laid-off—
the survivors?

©Business & Legal Reports, Inc. 30610800 23


In addition, Avramidis recommends that the first candidates for layoff be chosen
based on where they work in the organization. That is, target first the employees in
less-profitable lines of business or activities the company may eliminate. Even
then, don’t let a top performer go simply because he or she is in the wrong line of
business. Then, if a second layer of jobs may need to be cut, shift the focus to
where employees stand in terms of their performance.
In order to resist layoffs, should employers take such preliminary measures as
freezing salaries and/or reducing such benefits as healthcare coverage or retire-
ment plans? Avramidis is reluctant to endorse such moves, because they penalize
all employees the same way rather than differentiating among them based on their
performance and their organizational roles. “Don’t force out your best people
because they can no longer afford to stay with you,” he cautions. Only an employer
that has developed significant credibility and employee loyalty may be able to get
away with such across-the-board penalties, Avramidis believes. “Do your best to
protect your most valuable human capital,” he concludes.

Best Practice: Mandatory Vacations at HP


Companies caught between a need to cut costs and a desire to avoid layoffs are
turning increasingly to forced vacations, according to the Christian Science Monitor.
These employers reduce their employees’ work hours by asking them to take vaca-
tions that are either paid or unpaid, depending on the company’s financial
circumstances. “I’m advising companies that it’s an excellent idea,” says Bruce
Katcher, president of The Discovery Group, a Boston-based consulting firm. “The
advantage for the organization is that you still keep people around for when busi-
ness turns around. And you’re telling employees that you still want them to be a
vital part of your organization, that you’re committed to them.”
Work slowdowns and subsequent cuts in employees’ workweeks are nothing new
in the manufacturing sector. Yet experts tell the Monitor that this recession marks
the first time a wide variety of businesses, both large and small and from many dif-
ferent sectors of the economy, have used employees’ time as a cost-cutting tool.
Hewlett Packard (HP) asked its employees last April to voluntarily take an addi-
tional 6 days of paid vacation time off before the end of the fiscal year in October.
In June, it asked them to voluntarily forfeit some earned vacation time, take a
small pay cut, or do a combination of the two through the end of the fiscal year.
And in December, HP closed all of its offices for a week at Christmas, which
included 3 days off with no pay.
HP tells the Monitor that 95 percent of its workforce joined in the June cost-cutting
measure, saving the firm $130 million. The other measures also saved an undis-
closed sum of money on two fronts. First, closing saved HP the cost of keeping
offices open. Second, asking employees to take paid vacation time—instead of
rolling it into another year—helped in accounting terms because paid vacation is
a funded liability that carries over from year to year on the company’s books.
Experts say the key to successful implementation of a time-off cost-cutting meas-
ure is in how it’s communicated to workers. The plan needs to be presented
clearly, in advance, with assurances that the company is committed to its staff.

24 Top 10 Best Practices in HR Management for 2009


Best Practice: Teach Workers Economics 101
Amid all the bad economic news, some companies are giving their workers crash
courses in basic economics and personal finance, so they will understand the
tough decisions managers must make these days.
One such employer, the Outokumpu American Brass factory in Buffalo, New York,
is showing that giving employees the big picture can bolster their morale and even
produce bigger profits, according to The New York Times. The factory was almost
shut down in 1984 because of flagging sales and labor unrest. Local investors
bought the plant and quickly turned it around. However, in 1990, they sold it to
Outokumpu Oyj, a Finnish mining and metals conglomerate.
Outokumpu had given the local investors a healthy profit, and it knew that it
would have to raise workers’ productivity over the long haul to make the invest-
ment pay off. One way to do that:Teach workers the economic and financial
basics of the company’s markets. When company-hired instructors from Cornell
University’s School of Industrial and Labor Relations arrived, they found a high
level of hostility toward Outokumpu.
The workers“saw it as us against them, a takeover by this evil foreign company,”
recalls Lou Jean Fleron, the school’s director. However, the Cornell instructors per-
sisted and ended up teaching on everything from the impact of technology on the
workplace and the dynamics of international competition to the intricacies of cor-
porate income statements and the factors that influence the pricing of commodi-
ties. Before long, workers were seeing connections between the classroom
discussions and their working conditions. After learning about manufacturing
costs in other countries, for instance, they came away with a more sophisticated
understanding of how their own wages were set.

Benefits and Retention Strategies in a Recession


The impact of current economic conditions is being felt in the workplace. In a
breakout session at the 21st Annual Benefits Forum & Expo held in National Har-
bor, Maryland, HR and benefits professionals were given some valuable tips for
retaining and engaging their workers during tough economic times.
In the face of slow growth, that some organizations would take measures such as
a reduction-in-force (RIF) is understandable, explains George Lane, principal at
Mercer, and an RIF will have a near-term impact on the bottom-line. However, you
must be careful not to lose valuable people that“you’ll need when you start up
again,” he explains.
According to Mercer’s 2008“Report on Human Capital Management for Slow
Growth Times,” employers should:
◆ Be looking for new ways to generate sustainable reductions in benefit costs
using innovative strategies that do not adversely affect perceived value;
◆ Implement creative, highly-targeted strategies to recruit and retain the optimal
workforce for long-term success; and
◆ Communicate often and honestly to employees to bolster flagging engagement
and productivity.

©Business & Legal Reports, Inc. 30610800 25


Lane asserts that you should be doing these three things all of the time, but a
recession underscores the importance of such actions.
Maia Lucier, director of compensation and benefits for Dimension Data, a global
specialist IT services and solutions provider, explained how her company has
added no- and low-cost ways to beef up its benefits in creative ways while continu-
ing to strive to attract and retain talent against the backdrop of a troubled econ-
omy. Lucier emphasized the importance of frequent and effective communication
to employees when it comes to their benefits, noting that the extent to which
employees value and understand their benefits package impacts job satisfaction
and loyalty to the organization.
With this in mind, Dimension Data has leveraged its relationship with a financial
advisor from its 401(k) plan, asking him to participate in new monthly“Think
Financial Wellness”conference calls for employees. These 30-minute conference
calls were created to address economic uncertainties for employees and consist of
the following:
◆ A 10-minute recap of recent economic developments (in plain English),
◆ A 10-minute interpretation of“what does this mean for me,” including retire-
ment and personal financial planning implications, and
◆ 10 minutes of Q&A.
Dimension Data is also providing health expense communications for employees,
such as an“around the office”feature in its monthly newsletter. This feature pro-
vides a profile of an employee and might explain, for example, how he or she
saved money by using mail order drugs. Showing how a specific employee utilized
a benefit program that saved him or her money is much more effective than just
explaining the benefit, Lucier has found.
The company has also created“What you should know as a Dimension Data
employee”webcasts which communicate to employees by promoting learning and
development opportunities, showing them how they can utilize their benefits to
the fullest extent, and communicating Dimension Data’s 401(k) investment review
process and due diligence (something more employees ask questions about dur-
ing tough times).
Lucier also avidly supports the use of total compensation statements. She says that
by providing detailed information regarding the value of their benefits, you may
be able to hold onto valuable employees who would otherwise be tempted to take
a job elsewhere for a small base salary increase.
Finally, in terms of communication, Dimension Data has a“Leading Talent”pro-
gram for its line managers. Dimension Data wants their managers to have the abil-
ity to manage the relationship between the employee and the company. In this
program, managers are taught how they can help attract, engage, develop, and
retain talent for high performance. They are also educated about company bene-
fits so that they can communicate benefits value to employees.

26 Top 10 Best Practices in HR Management for 2009


#6 Immigration

Immigration was a hot topic in the recent presidential primaries and national elec-
tion, and complying with immigration laws continues to be a challenge in Human
Resources management.

No-Match Letters
The Immigration Reform and Control Act of 1986 (IRCA) makes it illegal for an
employer to knowingly hire or to continue to employ an individual who is or may
become an unauthorized alien. On August 15, 2007, the Department of Homeland
Security (DHS) issued regulations that defined the term“knowing”to mean having
actual or constructive knowledge. In a no-match letter, the Social Security Admin-
istration (SSA) or DHS informs an employer that the name and Social Security
Number (SSN) reported for an employee or the immigrant status or employment
authorization documents do not match their records. A“no match”does not mean
that an individual is undocumented, but it could, in certain circumstances, consti-
tute constructive knowledge that an individual is undocumented.
DHS regulations set out steps that an employer may take after receiving a no-match
letter from DHS or SSA. If these steps are followed, an employer may avoid being
considered as having constructive knowledge that a particular individual is an
unauthorized alien based on a no-match letter from one of these agencies.
Regulations on hold. A federal district court judge has barred SSA from sending
no-match letters on the grounds that DHS exceeded its authority in issuing the reg-
ulations. The bar will last at least until there is a full trial on the question or the
order is reversed by a higher court. On November 23, 2007, DHS filed a motion
asking the judge to suspend this case so that it could rewrite the regulation to
address the court’s concerns, including conducting a survey of the impact of the
regulation on small business.
Regulations reproposed. In response to the lawsuit and the court order, DHS
has issued a supplemental proposed rule that leaves the August 15, 2007, regula-
tions intact. The preamble to the supplemental proposed rule includes an analysis
of DHS’s authority to issue the regulation and an analysis of the impact of the regu-
lation on small business intended to address the court’s concerns. The preamble
does clarify that the obligation of an employer to provide prompt notice to an
affected employee after the employer has completed its internal record checks
and has been unable to resolve the mismatch will ordinarily be satisfied if the
employer contacts the employee within 5 business days after completing its inter-
nal records review. In addition, DHS has made it clear that the regulation does not
have application to no-match letters that reference employees hired before
November 6, 1986, because the statutory bar against continuing to employ unau-
thorized workers does not apply to such employees.

The Suspended/Reproposed No-Match Letter Regulations


The status of the no-match letter regulations will likely be resolved by a final
court ruling either barring DHS from implementing the reproposed regulation
or that the reproposed regulations do address the court’s concerns and may go

©Business & Legal Reports, Inc. 30610800 27


into effect. The following is an analysis of the reproposed regulation that DHS
plans to implement.
Safe harbor. The DHS regulations provide that by taking“reasonable steps”after
receiving a no-match letter, the no-match letter may not serve as the basis for find-
ing that the employer has constructive knowledge that an individual is working
illegally. The DHS regulations set out the specific steps that, if taken, are automati-
cally deemed to be such reasonable steps and provide the protection of a“safe
harbor”from liability for violating IRCA based on a no-match letter.
Note: Employers may come upon information that an SSN might be invalid in
other ways—for instance, if two or more newly hired employees have the same or
consecutive numbers. In such situations, employers should also follow the safe-
harbor procedure. However, knowledge that an employee is unauthorized must
not be inferred from an employee’s foreign appearance or accent.

Procedures for Avoiding Liability


To qualify for the safe harbor, an employer must follow the procedures set out in
DHS regulations. The procedures, while similar, vary somewhat depending on
whether the no-match letter came from SSA or DHS.

SSA No-Match Letter


After receiving a no-match letter from SSA, employers should do the following:

Step 1—SSA No-Match Letter


◆ Check the employer’s records immediately to see whether the discrepancy was
caused by a typographical, transcription, or similar clerical error in the
employer’s records or in the employer’s communication to the SSA.
◆ If there are no typographical, transcription, or similar clerical errors, move on
to Step 2 immediately.
Warning: Time is critical because if the employee confirms that the records
are incorrect, the deadline to correct them is 30 days from receipt of the no-match
letter.
If there is a typographical, transcription, or similar clerical error:
1. Correct the records;
2. Inform the SSA;
3. Verify with the SSA that the discrepancy has been resolved;
4. Make a record of the manner, date, and time of the verification (this includes
documentation of telephone conversations, correspondence, computer-gener-
ated printouts, e-mails, and Social Security Number Verification System screen
shots); and
5. Store the record with the employee’s Form I-9.
In the safe harbor. If these five steps are completed within 30 days of receipt of
the no-match letter, the employer qualifies for the safe harbor.

28 Top 10 Best Practices in HR Management for 2009


Step 2—SSA No-Match Letter
◆ If the discrepancy is not resolved by following the procedures in Step 1, notify
the employee promptly (ordinarily within 5 business days after completing the
internal records review) of the no-match problem and request that the
employee confirm that the employer’s records are correct.
◆ If the employee confirms that the records are not correct, take the following
steps within 30 days of receipt of the no-match letter:
1. Take the actions needed to correct the records;
2. Inform the SSA;
3. Verify with the SSA that the discrepancy has been resolved;
4. Make a record of the manner, date, and time of the verification (this
includes documentation of telephone conversations, correspondence,
computer-generated printouts, e-mails, and Social Security Number
Verification System screen shots); and
5. Store the record with the employee’s Form I-9.
In the safe harbor. If these five steps are completed within 30 days of receipt of
the no-match letter, the employer qualifies for the safe harbor.
◆ If the employee confirms that the records are correct, ask the employee to pur-
sue and resolve the matter personally with the SSA within 90 days of receipt of
the no-match letter. (Be sure to give the employee the date by which this must
be completed.) The employee may pursue the matter by visiting a local SSA
office and bringing original documents or certified copies required by SSA,
such as documents that prove age, identity, citizenship or alien status, and
other relevant documents, such as proof of a name change, or mailing these
documents or certified copies to the SSA office, if permitted by the SSA.
◆ The employer should then take the following steps to verify the employee’s
information with the SSA:
1. Verify with the SSA that the employee’s name matches the number
assigned to that name in the SSA’s records;
2. Make a record of the manner, date, and time of any such verification, as the
SSA may not provide any documentation. (This includes documentation
of telephone conversations, correspondence, computer-generated printouts,
e-mails, and Social Security Number Verification System screen shots); and
3. Store the record with the employee’s Form I-9.
In the safe harbor. If these three steps are completed within 90 days of receipt of
the no-match letter, the employer qualifies for the safe harbor.
Note: Employers may verify an SSN with SSA by telephoning toll-free 800-772-6270
weekdays from 7 a.m. to 7 p.m. EST. For information on SSA’s online verification
procedure, go to www.ssa.gov. Employers should make a record of the manner, date,
and time of any such verification, as SSA may not provide any documentation.

©Business & Legal Reports, Inc. 30610800 29


If the discrepancy is not resolved within 90 days of receipt of the no-match letter
either by the employer correcting the mistaken records or the employee pursuing
and resolving the matter with SSA, the employer should move on to Step 3.

Step 3—SSA No-Match Letter


If the discrepancy is not resolved within 90 days of receipt of the no-match letter,
the employer should complete a new Form I-9 for the employee as if the employee
were newly hired, except that no document containing the SSN that is the subject
of the no-match letter may be used, and no receipt for an application for a replace-
ment of these numbers may be used to establish employment authorization, or
identity, or both; and no document without a photograph may be used to establish
identity or both identity and employment authorization. If a new I-9 is not com-
pleted within 93 days of receipt of the no-match letter, the employer should termi-
nate the employee.
In the safe harbor. If the new I-9 is completed or the employee is terminated
within 93 days of receipt of the no-match letter, the employer qualifies for the safe
harbor.

DHS No-Match Letter


After receiving a no-match letter from DHS, employers should do the following:

Step 1—DHS No-Match Letter


After receiving a no-match letter from DHS, employers should do the following:
◆ Contact the DHS and attempt to resolve the discrepancy within 30 days;
◆ Verify with the DHS that the employee’s name matches the number assigned to
that name in the DHS records, or verify the authorization with the DHS that
DHS records indicate that the immigration status document or employment
authorization document was, indeed, assigned to the employee;
◆ Verify with the DHS that the discrepancy has been resolved;
◆ Make a record of the manner, date, and time of the verification (this includes
documentation of telephone conversations, correspondence, computer-
generated printouts, e-mails, etc.); and
◆ Store the record with the employee’s Form I-9. You have now completed the
process.
In the safe harbor. If these steps are completed within 90 days of receipt of the
no-match letter, the employer qualifies for the safe harbor.
If the discrepancy is not resolved within 90 days of receipt of the no-match letter,
move on to Step 2.

Step 2—DHS No-Match Letter


If the discrepancy is not resolved within 90 days of receipt of the no-match letter,
the employer should complete a new Form I-9 for the employee as if the employee
were newly hired except that the alien number that is the subject of the no-match
letter and no receipt for an application for a replacement of these numbers may

30 Top 10 Best Practices in HR Management for 2009


be used to establish employment authorization, or identity, or both; and no docu-
ment without a photograph may be used to establish identity or both identity and
employment authorization. If a new I-9 is not completed within 93 days of receipt
of the no-match letter, the employer should terminate the employee.
In the safe harbor. If the new I-9 is completed or the employee is terminated
within 93 days of receipt of the no-match letter, the employer qualifies for the
safe harbor.

Antidiscrimination Guidance for Employers


Following the No-Match Letter Safe Harbor
Procedure
The U.S. Department of Justice (DOJ) Civil Rights Division’s Office of Special Coun-
sel for Immigration-Related Unfair Employment Practices (OSC) has issued guid-
ance for employers explaining how to avoid being charged with discrimination
while following the safe-harbor procedure. If an employer follows all of the safe-
harbor procedures outlined in DHS’s no-match rule but cannot determine that an
employee is authorized to work in the United States, and, therefore, terminates that
employee, and if that employer applied the same procedures to all employees ref-
erenced in the no-match letter(s) uniformly and without the purpose or intent to
discriminate on the basis of actual or perceived citizenship status or national ori-
gin, OSC will not find reasonable cause to believe that the employer has violated
the INA’s antidiscrimination provision. On the other hand, an employer that
receives an SSA no-match letter and terminates employees without attempting to
resolve the mismatches, or treats employees differently or otherwise acts with the
purpose or intent to discriminate based on national origin or other prohibited
characteristics, may be found by OSC to have engaged in unlawful discrimination.
OSC is required to investigate charges of discrimination and determine whether
there is reasonable cause to believe that the charge is true. OSC may, on its own
initiative, also conduct investigations of unfair immigration-related employment
practices. The guidance document notes, however, that it is OSC’s long-standing
practice to examine the totality of relevant circumstances in determining whether
there is reasonable cause to believe that an employer has engaged in unlawful dis-
crimination. OSC will not act on an allegation of discrimination by an employer in
applying the safe-harbor procedures until it determines that the alleged victim is
an authorized worker who is protected from discrimination. Employers that can
show that they followed the safe-harbor procedure uniformly and without intend-
ing to discriminate won’t be subject to discrimination charges by OSC.

Federal Contractors Must Now Use E-Verify


Effective January 15, 2009, many federal contractors and subcontractors are
required to use the E-Verify system to verify their employees’ eligibility to legally
work in the United States. The Federal Acquisition Regulation (FAR) has been
amended to implement Executive Order 12989 as amended on June 6, 2008,
directing federal agencies to require that federal contractors agree to electroni-
cally verify the employment eligibility of their employees (48 CFR Subpart 22). The
amended regulations require federal contractors to agree, through language
inserted into their federal contracts, to use E-Verify to confirm the employment

©Business & Legal Reports, Inc. 30610800 31


eligibility of all persons hired during a contract term, and to confirm the employ-
ment eligibility of federal contractors’ current employees who perform contract
services for the federal government within the United States.
Federal contracts awarded and solicitations issued after January 15, 2009, must
include a clause committing government contractors to use E-Verify. The same
clause is also required in subcontracts over $3,000 for services or construction.
The final regulation is designed to lighten the burden on small businesses that
decide to accept federal contracts and provide contractors with flexible means
of complying with the basic requirement that all persons working on federal
contracts be electronically verified.
Contract requirements. Covered contracts must include a clause that requires
federal contractors to:
◆ Enroll as federal contractors in E-Verify;
◆ Use E-Verify to verify employment eligibility of all new hires working in the
United States;
◆ Use E-Verify to verify employment eligibility of all employees assigned to the
contract; and
◆ Include these requirements in subcontracts for commercial or noncommercial
services, except for commercial services that are part of the purchase of a
commercially available off-the-shelf (COTS) item (or an item that would be a
COTS item, but for minor modifications), performed by the COTS provider,
and are normally provided for that COTS item; and construction.
Enrollment and verification requirements. If the contractor is not enrolled as
a federal contractor in E-Verify at the time of contract award, the contractor must:
◆ Enroll within 30 calendar days of the contract award;
◆ Verify all new employees within 90 calendar days of enrollment and begin to
use E-Verify to initiate verification of employment eligibility of all new hires
who are working in the United States, whether or not assigned to the contract,
within 3 business days after the date of hire; and
◆ Initiate verification of each employee assigned to the contract within
90 calendar days after the date of enrollment or within 30 calendar days
of the employee’s assignment to the contract, whichever is later.
If the contractor is enrolled as a federal contractor in E-Verify at the time of
contract award, the contractor must:
◆ Either initiate verification of all new hires who are working in the United
States, whether or not assigned to the contract, within 3 business days after the
date of hire if the contractor has been enrolled for 90 days or more or within
90 calendar days after enrollment as a federal contractor in E-Verify, or
◆ Initiate verification of each employee assigned to the contract within 90 calen-
dar days after the date of contract award or within 30 days after assignment to
the contract, whichever is later.
Coverage. The federal contractor E-Verify requirement applies to prime contracts
that exceed $100,000, but does not cover those that:

32 Top 10 Best Practices in HR Management for 2009


◆ Are only for work that will be performed outside the United States;
◆ Have a period of performance of fewer than 120 days;
◆ Are only for COTS items;
◆ Are only for items that would be COTS items, but for minor modifications;
◆ Are only for items that would be COTS items if they were not bulk cargo; or
◆ Are only for commercial services that are part of the purchase of a COTS item
(or an item that would be a COTS item, but for minor modifications), per-
formed by the COTS provider, and are normally provided for that COTS item.
Exception from requirement to verify all new hires. A contractor may
choose to verify only new hires assigned to the contract if the contractor is:
◆ An institution of higher education,
◆ A state or local government or the government of a federally recognized
Indian tribe, or
◆ A surety performing under a takeover agreement entered into with a federal
agency pursuant to a performance bond.
Option to E-Verify all employees. Contractors may elect to verify employment
eligibility of all existing employees working in the United States who were hired
after November 6, 1986, instead of just those employees assigned to the contract.
In such as case, the contractor is not required to verify employment eligibility of:
◆ Employees who hold an active security clearance of confidential, secret, or
top secret; or
◆ Employees for whom background investigations have been completed and
credentials issued pursuant to Homeland Security Presidential Directive
(HSPD) 12.
The contractor must initiate verification for each existing employee working in the
United States who was hired after November 6, 1986, within 180 calendar days of
enrollment in the E-Verify program, or notification to E-Verify Operations of the
contractor’s decision to exercise this option, using the contact information
provided in the E-Verify program memorandum of understanding (MOU).
Enforcement. A contractor must comply with the requirements of the E-Verify
program MOU for the period of performance of this contract. DHS or the SSA may
terminate a contractor’s MOU and deny access to the E-Verify system if the MOU is
violated. In such case, the contractor will be referred to a suspension or debar-
ment official. During the period between termination of the MOU and a decision
by the suspension or debarment official, a contractor is excused from the enroll-
ment and verification requirements. If the official decides not to suspend or debar
the contractor, the contractor must reenroll in E-Verify.
Individuals previously verified. A contractor is not required to perform addi-
tional employment verification using E-Verify for any employee:
◆ Whose employment eligibility was previously verified by the contractor
through the E-Verify program;

©Business & Legal Reports, Inc. 30610800 33


◆ Who has been granted and holds an active U.S. government security clearance
for access to confidential, secret, or top secret information in accordance with
the National Industrial Security Program Operating Manual; or
◆ Who has undergone a completed background investigation and been issued
credentials pursuant to HSPD 12, Policy for a Common Identification Standard
for Federal Employees and Contractors.

#7 Privacy and Identity Theft

The increased role and use of computers in the workplace has presented employ-
ers with an entire set of new problems to worry about in the form of privacy issues,
identity theft, and security breaches.

Privacy
Several states have enacted statutory or constitutional provisions guaranteeing
their citizens the right to privacy from certain intrusions. In the absence of a state
constitutional provision or existing law, however, private employees enjoy relatively
little freedom from workplace intrusion. Therefore, private employees must look to
common or judge-made law to find privacy protections. There are essentially four
common-law privacy claims available to private employees. These are:
1. Intrusion into an individual’s private solitude or seclusion. An
employee may allege this form of privacy invasion when an employer unrea-
sonably searches (e.g., a locker or desk drawer) or conducts surveillance (e.g.,
dressing rooms) in areas in which an employee has a legitimate expectation of
privacy. An employer’s improper questioning of an employee (e.g., sexual
habits or orientation) may also give rise to this type of claim. Under this claim,
the employer’s intrusion into the employee’s private affairs must involve a gen-
uinely private matter and must also be of such a nature that a reasonable per-
son would deem the intrusion to be“offensive.”
2. Public disclosure of private facts. An employee may claim this form of pri-
vacy invasion when an employer publicly discloses private and arguably
embarrassing facts about an employee to a wide audience without his or her
permission. In order to sustain such a claim, however, an employee must be
able to show that the information was genuinely private, the employer’s publi-
cation of the information was offensive by reasonable standards, and the
employee suffered a resulting injury.
3. Portraying an individual in a false light. Under this theory, if an employer
attributes a false or offensive conduct or characteristic to an employee that is
not true (e.g., criminal activity), the employee may claim invasion of privacy.
4. Use of an individual’s name or likeness. When an employer uses an
employee’s photograph, likeness, or attributes specific statements to an
employee without his or her permission, an individual may have a valid
misappropriation claim (e.g., the employer publishes an employee’s

34 Top 10 Best Practices in HR Management for 2009


photograph or likeness on company brochures without first obtaining the
employee’s consent).

New Federal Privacy Law Barring Genetic Bias


The new Genetic Information Nondiscrimination Act (GINA) protects the confi-
dentiality of individual genetic information. Under the law, “genetic information”is
defined to include information about an individual’s genetic tests, genetic tests
of family members, and a disease or disorder in the family. GINA applies to both
insurers and employers.
Group and individual health insurers are prohibited from using genetic informa-
tion to determine insurance eligibility. Increasing an insurance premium based on
genetic information is also prohibited.
GINA prohibits employers from discriminating against employees or applicants based
on genetic information. The law applies to all public employers, private employers
with 15 or more employees, employment agencies, and labor organizations.
Both insurers and employers are prohibited from requesting or requiring individu-
als to undergo genetic testing. However, an employer can collect information to
monitor the biological effects of toxic substances in the workplace if: (1) written
notice is given to the employee; (2) the individual gives written informed consent
in advance or the monitoring is required by law; (3) the individual receives the
results; (4) the monitoring is in compliance with federal or state regulations; and
(5) the employer receives only aggregated monitoring results without information
about specific individuals. There are other exceptions, including one for bona fide
wellness programs that protect individually identifiable information.
GINA also has confidentiality requirements. Any genetic information that an
employer lawfully possesses must be treated as a confidential medical record.
GINA’s requirements for confidentiality are the same as the requirements under the
Americans with Disabilities Act (ADA). Therefore, if employers comply with the
ADA’s confidentiality requirements and keep medical information on separate
forms and in separate medical files, they’ll be in compliance with GINA.
Covered employers should update their nondiscrimination policies to reflect
GINA’s provisions. In addition, requests for information from healthcare providers
should be reviewed to avoid obtaining genetic information from care providers.
Specific language that reminds the provider not to send genetic information can
be added, depending on the type of request. The law’s provisions for insurers take
effect in June 2009 and for employers, in November 2009.

Employer Procedures for Handling Address


Discrepancies on Consumer Reports
Under the federal Fair and Accurate Credit Transactions Act of 2003 (FACTA)
(15 USC 1681c), two rules dictate how employers must handle address discrepan-
cies on consumer reports.
Section 113 applies to all employers. When providing a consumer report to an
employer (or any consumer report user), a nationwide consumer reporting
agency (CRA) must provide a notice of discrepancy to the employer if the address

©Business & Legal Reports, Inc. 30610800 35


provided by the employer in its request for the report“substantially differs”from
the address CRA has on file. All employers must develop and implement policies
and procedures for verifying the identity of the consumer when there is an address
discrepancy. These policies and procedures could include:
◆ Verifying the address with the consumer about whom it has requested the
report
◆ Verifying the consumer’s identity in accordance with the requirements of the
Customer Information Program (CIP) rules
◆ Reviewing the employer’s own records (such as applications, change of
address notifications, customer account records, or retained CIP documenta-
tion) to verify the address of the consumer
◆ Verifying the address through third-party sources
◆ Using other reasonable means
After reconciling the address, an employer must send a confirmed address back to
CRA if the following three conditions are met:
1. The employer has formed a reasonable belief that the consumer is in fact the
same person as the person identified in the consumer report;
2. The employer has a continuing relationship with the consumer; and
3. The employer regularly and in the ordinary course of business provides
information to CRA.
FACTA Section 114 contains additional requirements for financial institutions and
creditors. Financial institutions and creditors must also develop and implement a
written Identity Theft Prevention Program that is designed to prevent and mitigate
identity theft by detecting and responding to red flags that indicate there may be
identity theft occurring in one or more of a company’s accounts (15 USC 1681m).

Identity Theft
The Federal Trade Commission (FTC) estimates that as many as 9 million Ameri-
cans have their identities stolen each year. Identity theft has been the fastest grow-
ing crime in the United States for the past 3 years, according to the FTC, which
predicts that in 5 years, the majority of Americans will have been victimized by
identity theft.
Much of the identity theft that occurs in the workplace happens when employees
steal personal information of the company’s co-workers, customers, or clients via
their employer’s computer system. Identity theft also threatens enterprise security,
enabling corporate espionage and fraud, and theft of hard assets and intellectual
property. Large scale or frequent identity thefts also result in significant negative
publicity, impacting sales, partnerships, and employee recruiting and retention.
Therefore, employers need to carefully control access to employee and customer
financial information (via password protection); carefully control the transfer
of such information; and carefully control the destruction and/or recycling of
company documents.

36 Top 10 Best Practices in HR Management for 2009


Employers also suffer other significant costs when their employees experience
identity theft. Conservative calculations based on current identity theft figures
indicate that an employer with 1,000 employees, who make an average salary
of $40,000 per year, should expect to incur productivity losses of more than
$600,000 per year.
Employers who are concerned about identity theft hire outside consultants to
perform a“penetration test”to assess the security of their computer systems.
Such consultants will try to hack into your computer system (and will most likely
succeed) and in doing so, will discover your weak points and help you fix them.

Identity Theft Law Requires Employer Compliance


A provision of FACTA states that any employer whose action or inaction results in
the loss of employee information can be fined by federal and state government
and sued in civil court. An employee is entitled to recover actual damages sus-
tained if his or her identity is stolen because of the employer’s inaction or statutory
damages up to $1,000. Employees may also bring class action suits against employ-
ers for actual and punitive damages. In addition, federal fines of up to $2,500 per
employee and state fines of up to $1,000 per employee also may be levied.

Protection as an Employee Benefit


One solution that provides an affirmative defense against potential fines, fees, and
lawsuits is to offer some sort of identity theft protection as an employee benefit.
An employer can choose whether to pay for this benefit. The key is to make the
protection available and have a mandatory employee meeting on identity theft
and the protection you are making available, similar to what most employers do
for health insurance.

Most Workers Trust that Employers Protect


Personal Info
Eighty-eight percent of employees are confident their company protects their per-
sonal information from identity theft, according to a survey by the American Pay-
roll Association. The online survey asked respondents:“How confident are you that
your employer adequately protects your vital personal information from data
breaches/identity theft?”Nearly 40,000 of the 45,180 respondents indicated they
were either confident or very confident that their employer adequately protects
their personal information.
When choosing the best alternative for protecting your employees and your com-
pany from identity theft, consider the four types of protection available:
1. Computer protection. Antivirus, antispyware, wireless security, etc.
2. Guidance on protecting against a variety of exposures of personal data
from shredding documents, to opting out of marketing databases, to tracking
data in Social Security, driver’s license, medical, and financial databases
3. Credit monitoring at varying levels of frequency, sometimes with alert
services in the event of credit inquiries or changes

©Business & Legal Reports, Inc. 30610800 37


4. Insurance coverage, sometimes including assistance with identity recovery
activities
A common theme to all of the“state of the art”issues discussed in this section is
the balance between a company’s interest in operating a profitable and safe work-
place and the employee’s interest in maintaining his or her privacy in an increas-
ingly public world.
When formulating policies that balance the employer’s interest with the
employee’s interest in privacy, consider the following suggestions:
◆ Create appropriate notifications to employees about what you will monitor
and when you will have the right to search or conduct surveillance. Dissemi-
nate your policies frequently to reduce employees’ expectations of privacy.
◆ Tell employees specifically how you will protect their personal health
information.
◆ Adopt a“minimum necessary”standard for monitoring, searching, or collect-
ing medical information. Avoid using a baseball bat if a flyswatter would
accomplish what you want. If you’re concerned only about computer visits to
porn sites, say so, and don’t penalize people who shop online unless you note
low productivity.
◆ Implement other safeguards, beyond those for personal health information,
to protect personal information such as Social Security numbers, home
addresses, and other data that can be used in identity theft.
◆ Train your supervisors and managers to abide carefully by your privacy
policies. For example, remind them not to disclose a subordinate’s medical
condition to co-workers or other supervisors without the employee’s express
permission. Tell them to ask Human Resources should questions arise.
◆ Review not only federal privacy protections but also, more importantly, the
laws particular to the states where you do business.

State Data Breach Notification Laws


Most states now have laws requiring employers to give notice to affected residents
in the event of a security breach. This is important in the context of HR records
because these records often contain the personal information these laws aim
to protect.
Providing notice under these security breach laws is both time consuming and
expensive. One way employers can help prevent identity theft and unauthorized
access to confidential records is encryption software. Many state security breach
laws provide an exception for records that have been encrypted, or rendered
unreadable. The cost of purchasing and installing this type of software may save
employers many headaches down the road.
State data breach notification laws started in California, as so many trends,
legal and otherwise, do. When most of us were just beginning to worry about
identity theft, California passed a“breach of security”law. It required any business
or industry that collects personal information about individuals to notify all
affected individuals if it learns that those data have been stolen or accessed by
an unauthorized person.

38 Top 10 Best Practices in HR Management for 2009


Although California’s law was passed in 2002, most other states didn’t begin enact-
ing similar legislation until 2005 or later. There was a much-publicized trigger: Early
in 2005, Georgia-based ChoicePoint confessed that it had inadvertently sold data
on approximately 145,000 U.S. consumers to Nigerian thieves during the second
half of 2004. But the company, which conducts background checks and drug tests
and verifies identity and credentials for thousands of people, followed the only
breach of security law that existed then—California’s. Individuals around that state
whose data had been stolen were individually notified. That got the attention of
legislators in other states, who have been rushing ever since to put their own notifi-
cation laws in place.
These statutes cover companies that maintain confidential data containing per-
sonal information, including an individual’s name accompanied by, for instance, a
Social Security number, driver’s license number, credit or debit card or financial
account information, and access code or password. Once the firm is aware that
such data are no longer secure, it must determine whether there is a reasonable
possibility that the data will be misused. If that’s possible, the company must notify
all affected state residents as promptly as possible.
In most states, notice must be given in writing, by telephone, or, if that’s the way the
firm usually communicates with the consumer, by e-mail. Many statutes provide
that if the number of individuals involved makes the notification overly burden-
some, or the firm doesn’t have enough consumer contact information to handle the
task, other media can be used—usually e-mail, posting on the company’s website,
and notice in major statewide media.

#8 The Green Movement and


Corporate Social Responsibility

While corporate social responsibility (CSR) plays an increasing role of importance


in companies today, incorporating“green”environmental assurance functions into
CSR programs will be a focus in 2009.

Commuter Benefits Bring Financial and


Environmental Relief
While the definition of the word“green”has expanded in recent decades, if you
provide your employees access to commuting benefits, you’ll actually be using
two definitions of the word:You’re helping keep the environment cleaner, and
you’re putting some cash back in employees’ wallets. Larry Filler, president and
CEO of TransitCenter, Inc., says that you can provide commuter benefits at little
cost, which goes a long way toward environmental and employee relations goals.
TransitCenter (www.transitcenter.com) has been around for about 22 years
and was originally intended as a way to reduce congestion in New York City.
“There was a lot of driving coming into the central business district of New York,
Manhattan really. We were looking for an incentive to get people to commute.”

©Business & Legal Reports, Inc. 30610800 39


The program evolved from transit vouchers of $15 per month to include other
forms of commuting benefits, and from transportation only in and around New
York City to cities across the entire United States.
Along with its role as an advocacy group for commuter benefits, TransitCenter is
also a provider. TransitChek is the name of their nationally available program.
“There are two basic parts of the commuter benefit,” says Filler. “There is the
transit/vanpooling benefit, which is a tax-free amount up to $120 a month that
employees can use to pay for expenses associated with either transit or vanpool-
ing. The other part is commuter parking. Parking is set at $230 a month tax-free, to
cover the cost of commuter parking”[dollar amounts for 2009].
If you’re wondering why the parking benefit, which after all, encourages people
to drive, is set at a higher limit than is the transit/vanpooling benefit, Filler
explains the history. Originally, the parking benefit was unlimited and there was
no transit benefit. By 1993, the cap on parking was set at $155, and the transit
benefit was $60 per month. The disparity continues, even as the figures are
adjusted for the cost of living.
“We’ve tried to narrow the gap,” says Filler. “We’ve been working the last 2 or 3 years
with various members of Congress to equalize the benefits to promote transit over
driving.” In the meantime, though, the allowable uses of the parking benefit are
broader than you might expect. “It includes not only parking at a facility at or near
a location where an employee works, but also it includes parking at a facility from
which an employee commutes by transit, vanpools, or carpools. That is a result of
our hope to support transit and ridesharing.”
Study on commuter benefits. Many Americans are concerned about the high
cost of gas continually inching upward, as well as global warming and how com-
muting by car contributes to the problem. Perhaps that’s why tax-free commuter
benefits have risen to the number one new benefit that employers are planning to
add to their employee benefits program, according to a recent study.
The 2007 Commuter Impact Survey results state that the percentage of employers
planning to add the benefit grew from 5 percent of respondents in 2006 to 17 per-
cent in 2007. This survey of HR professionals throughout the United States at the
2007 Society for Human Resource Management’s annual conference also reported
that in major U.S. metro markets, the number of employers offering tax-free com-
muter benefits has grown from 28 percent in 2006 to 44 percent in 2007.

Want to Attract More Generation Y Job Candidates? Go Green!


According to an April survey conducted by Experience, Inc., a provider of career
services for college students and alumni, “84 percent of Generation Y individuals
are actively concerned about the climate crisis—and many say the green move-
ment relates to their career choices.” Other highlights from the survey include:
◆ Eighty-one percent of respondents said it is important to work for a green
company—meaning they are green-friendly, green-conscious, or green-certified.
◆ Seventy-nine percent reported that they would be more likely to accept a job
offer at a green company over another company when evaluating two similar
job offers.

40 Top 10 Best Practices in HR Management for 2009


Generation Y respondents also noted that they wanted more green product
options (20 percent) and wanted more education about actions they could take to
help the green movement (19 percent). Also, 16 percent said they need to be bet-
ter educated about the issues.

Corporate Social Responsibility and Ethics


After the recent publicity about the ethics and social responsibility of banks, bro-
kerage houses, and mortgage corporations, companies will find these topics of
increasing importance.

Employees Continue to Criticize Leaders’ and Staff’s Ethical


Behavior
According to the Ethics Resource Center’s (ERC) 2007 National Business Ethics Sur-
vey® (NBES) released at the end of November 2007, “Six years after high-profile cor-
porate scandals rocked American business, there has been little if any meaningful
reduction in the enterprisewide risk of unethical behavior at U.S. companies.”
The ERC conducts a survey every 2 years of U.S. public and private company
employees; there were almost 2,000 for the last survey. According to the survey
report, “More than half (56 percent) of employees surveyed had personally
observed violations of company ethics standards, policy, or the law. Many saw mul-
tiple violations. More than two of five employees (42 percent) who witnessed mis-
conduct did not report it through any company channels.”

Why Ethics Programs Fail and How to Help Yours Succeed


Lack of leadership buy-in, limited resources, and a misconception that certain
decisions are solely business issues are among the common problems that derail
workplace ethics programs, says Dr. Patricia Harned, ERC president. Harned says
the generally accepted definition of an effective ethics and compliance program
encompasses six key components outlined in the Federal Sentencing Guidelines,
used by federal judges to evaluate whether a company has an effective program in
place:
1. Written standards of ethical workplace conduct
2. A way for employees to report ethical misconduct anonymously
3. Ethics training for all employees and board members
4. A specific office, telephone line, e-mail address, or website where employees
can ask ethics-related questions
5. Evaluation of ethical conduct as part of employees’ regular performance
appraisals
6. Discipline for those who commit ethics violations
In a recent study by ERC and the Society for Human Resource Management, “The
Ethics Landscape in American Business,” only 23 percent of HR professionals indi-
cated that their companies have implemented a comprehensive ethics and com-
pliance program, and 7 percent said their organization did not have such a
program. Harned offers a few tips to help HR and ethics professionals work
together to promote an effective program:

©Business & Legal Reports, Inc. 30610800 41


◆ Make sure the program is well implemented. Provide training and tailor
the ethics message to different segments of the workforce. For example, senior
managers need to understand that they set the tone for the entire organization;
supervisors need to reinforce management’s ethics message; and nonmanage-
ment employees should understand the company’s standards and the
resources available to them.
◆ Focus on the culture. Only 43 percent of HR professionals in the survey
report that their organizations include ethical conduct in employees’ perform-
ance appraisals, but Harned says such accountability drives compliance.
“What gets rewarded, gets done.” In addition, she says managers and supervi-
sors can reinforce ethical conduct daily. For example, if employees ask hard
questions during a staff meeting, managers can thank them for their courage.
In cases where employees cut corners, she recommends making sure others
understand that such behavior is not acceptable.

Establish a Code of Ethics


For senior management and HR executives of many small companies, it may seem
a formidable task to undertake the development of a code of ethics. However, con-
structing one may have long-lasting, positive effects on the business culture in your
organization. It may also enhance your employees’ dedication and commitment to
their work and positively influence their behavior in the workplace.
A code of ethics illustrates for customers, employees, and the community your
organization’s expectations for corporate conduct. The code of ethics becomes
the game plan from which employees can develop appropriate business strategies,
and managers can implement work policies and procedures.
The basis for the code of ethics should be the standard to which the organization
aspires to reach and wishes to be measured against. For example:
Our organization will put its customers first in respect to both
service and the quality of the products that we sell.
A code of ethics can be specific—denoting purposeful, detailed statements
requiring adherence on the part of management and employees. Or, it can be
more general. For example:
We will respect every customer and every employee as a val-
ued and equal individual with whom we interact every day,
regardless of the rank of the employee or the amount of the
customer’s business that we can expect to fulfill. We will stand
behind the quality and value of the products that we produce
and will be honest and forthright in our communication with
customers, employees, and the community.
One helpful resource that can be used by employers in developing their own code
of ethics was developed by the U.S. Department of Commerce nearly a decade
ago. This document encourages businesses to“adopt a code of conduct for doing
business around the world.” The basic principles suggested by the Department
were the following:
◆ Provision of a safe and healthy workplace
◆ Fair employment practices, including avoidance of any type of discrimination

42 Top 10 Best Practices in HR Management for 2009


◆ A maintained responsibility for environmental protection and practices
◆ Compliance with laws promoting good business practices and ensuring fair
competition
◆ Maintenance of a corporate culture that respects free expression consistent
with legitimate business concerns and does not condone political coercion in
the workplace; that encourages good corporate citizenship and makes a posi-
tive contribution to the communities in which the company operates; and
where ethical conduct is recognized, valued, and exemplified by all employees
Promoting the code. The CEO may introduce the new company code of ethics
with great fanfare to all staff at an employee meeting, and HR may post it in promi-
nent areas throughout the firm’s location(s). After the initial introduction of the
code, it should be presented to all new employees during employee orientation,
or even to employment candidates during the recruitment and interviewing
process. Senior management should require that each employee review the code
of ethics and sign a statement that requires him or her to agree to follow the code.
Reviewing the code. Once a code of ethics has been put into place, HR execu-
tives and senior leadership should review the code on an annual basis and solicit
employee feedback with a mechanism such as an anonymous employee survey or
discussion facilitated by an outside objective resource. Such practices allow
employees to share their experiences with adhering to the code of ethics and their
observation of other employees and managers regarding their ethical behavior.
Adjustments and changes to the code may be implemented as necessary to reflect
any changes in the firm’s structure, business strategies, or in response to changes
in the business environment. In addition, regular conversation about the code
should be commonplace in department meetings and ongoing employee training.
A code of ethics should not be a statement that is developed and put on the shelf.
It should become a living document that is followed every day.
Other statements on ethics. In addition to an ethical code, employers may wish
to integrate ethics standards into other company messages and policies. The fol-
lowing are some other ethical messages your company might want to communi-
cate in company publications, handbooks, and training and orientation sessions:
◆ All company stakeholders (employees, management, stockholders, vendors,
etc.) share the common goal of delivering the highest quality product or serv-
ice on time and on budget.
◆ Individuals are responsible and accountable for their actions and behavior as
they relate to colleagues and the organization as a whole.
◆ Fairness is a company focus requiring commitment and cooperation among
all interest groups.
◆ Illegal, immoral, and questionable behavior in the workplace will not be tolerated.
◆ Good manners and respect for all other employees and customers are
expected at all times.
It is important to note that just saying that the company is committed to high
ethical standards isn’t enough; the standards must be communicated frequently,
clearly, and consistently.

©Business & Legal Reports, Inc. 30610800 43


#9 HR Metrics

Metrics are not unique to the HR profession. They are used in almost every area of
business, in government, and in education. A metric is simply a way to measure
and track key performance indicators. In education, the key metric is often stu-
dent performance on standardized tests, which is then used to drive educational
priorities to improve performance on the next round of tests.
In Human Resources, metrics are used to measure and track the performance of a
company’s largest investment, its investment in human capital. More to the point,
HR metrics measure the performance of a company’s investment in hiring, train-
ing, and retaining employees.

What to Measure
Deciding what to measure is very important. Metrics should be tied directly to the
business issues facing the company. These might include a need to cut costs
because of price competition, improve customer satisfaction, or develop new
technology to keep pace with competitors.
To be effective, the metric should not just report results, but should show a cause
and effect relationship. In addition, to the extent possible, the HR professional
should try to use formulas, ratios, and language commonly used by the organiza-
tion’s other business leaders. For instance, ROI, or return on investment, is univer-
sally understood in the business world. A company’s investment in human capital
(its employees) is usually its largest investment. And the HR professional needs to
take the lead in identifying where these resources can best be allocated to meet
the company’s goals and how to hire, develop, and retain the human capital the
company needs to stay competitive now and in the future.
A good metric is one that provides decision makers with the data needed to make
fact-based decisions. One example of a metric is measuring turnover in an organi-
zation. It is helpful to know what percent of the total number of employees left the
company during the year. However, it is probably more useful to know how many
of those people left voluntarily as opposed to those who left involuntarily.
When choosing what to measure in your organization, consider the following:
◆ Use data that are readily available and can be gathered at regular intervals.
◆ Use the ratios, formulas, key performance measures, and language used by
business leaders.
◆ Include measures of results and don’t limit the focus to costs.
◆ Tie metrics directly to the key challenges facing the business and the results
that must be achieved.
◆ Use only metrics that add value in making decisions.
◆ Keep it simple. Metrics don’t have to be complicated.
◆ Identify and compare results to key competitors whenever possible.

44 Top 10 Best Practices in HR Management for 2009


◆ Measure ROI, cost/benefit ratios, and impact on problems identified by busi-
ness leaders.
◆ Avoid soft metrics based on feelings or intuition about a program, and use
hard metrics or data to drive fact-based decision making.

Types of Metrics Available to HR


Metrics generally measure one of the following:
◆ Increased job performance (e.g., new recruiting program resulted in new
employees with first year job performance ratings that are 30 percent higher
than under the old program)
◆ Return on investment (e.g., new commission plan resulted in $100 of
increased sales for each additional commission dollar paid)
◆ Impact of a program on revenue
◆ Decreased costs
A potentially endless number of metrics are available to the HR professional. The
key is to pick metrics that focus on key issues and tell the story. It may be that a
series of single metrics when viewed together tell the story better than a single
metric examined in isolation.
Following are some of the metrics the HR professional may want to consider for
each functional area of human resources:

Metrics for the Recruiting Function


The recruiting or employment area is focused on hiring the employees the organi-
zation needs to meet its goals. Measurements include:
◆ Time to fill a vacancy
◆ Quantity and quality of applications based on recruiting source
◆ HR cost per hire
◆ Voluntary turnover rate of new hires during first year of employment
◆ Percent of new hires performing above average by the end of the first year
◆ Percent of new hires performing below expectations by the end of the first year
◆ Involuntary turnover rate during the first year of employment
◆ Satisfaction of managers with the hiring process based on survey of hiring
managers
◆ Quality and retention rates of new hires by recruiting source
◆ Diversity ratios of new hires
In most cases, no single metric will adequately gauge the performance of the
recruiting function. Rather, some combination of the metrics listed above along
with others created by the organization will provide the information necessary to
measure performance and effectiveness. The use of several individual metrics to

©Business & Legal Reports, Inc. 30610800 45


measure a function is often referred to as an HR scorecard and will provide a
more complete story of how the recruiting function is meeting goals.

Metrics for the Employee Relations Function


The employee relations function is different from the other HR functions in that it
is a little harder to quantify. However, if the employee relations professionals are
doing the job right, the company should see fewer lawsuits and complaints filed
with state agencies, lower settlements when complaints are filed, and better out-
comes when there are performance issues and/or conflicts in the workplace.
Some of the metrics that can be used to measure employee relations include:
◆ Number of complaints filed by employees
◆ Percent of complaints that proceed to a state agency, court, or other external
dispute resolution
◆ Amount of time taken to resolve an internal complaint
◆ Percent of cases resolved with no money paid out by the company
◆ Percent of cases where large financial settlements or awards were made
◆ Breakdown of the types of complaints made by employees by department
(e.g., sexual harassment, race)
◆ Costs associated with employee relations as percent of total operating costs
◆ Percent of cases where documentation was inadequate
◆ Number of sexual harassment complaints
◆ Number of complaints of unfair treatment
◆ Number of hours spent on training managers on employee relations issues
◆ Data from employee surveys on various employee relations issues such as
understanding of policies
◆ Dollars spent on attorney’s fees
◆ Dollars spent on attorney’s fees as a percent of total employee-relations costs
As with recruiting, companies will probably want to use some combination of
these metrics as their employee relations dashboard. Comparisons from year to
year will help evaluate the effectiveness of the employee relations function.

Metrics for Compensation Programs


Compensation programs are all about the numbers and, as a result, metrics are
relatively easy to apply. Measurements may include:
◆ Compensation costs per dollar of profit
◆ Compensation costs per dollar of revenue
◆ Analysis of performance and production levels of employees paid in the
top 30 percent of their salary range
◆ Total compensation costs as a percent of total company operating costs

46 Top 10 Best Practices in HR Management for 2009


◆ Analysis of compensation levels to the marketplace and key competitors
◆ Forecast compensation needs based on future plans
◆ Compensation mix, meaning fixed salaries versus performance-driven
compensation

Metrics for Training Programs


Training is another area that can be difficult to quantify. However, it may be help-
ful to look at metrics that target the type of training and what it was intended to
accomplish.
For instance, metrics for training programs can include:
◆ Cost of sales training as a percent of total sales
◆ Increase in hours of sales training compared to increases in sales
◆ Changes in performance levels of employees who received training
◆ Percentage of employees that cite lack of training or advancement as a reason
for leaving
◆ Identification of key employees and percent that have received training
◆ Percent of performance appraisals that include training goals for employees

Strategic Alignment
The role of HR is changing as fast as technology and the global marketplace. Histor-
ically, the HR department was viewed as administrative overhead. HR processed
payroll, handled benefits administration, kept personnel files and other records,
managed the hiring process, and provided other administrative support to the busi-
ness. These functions were viewed as administrative necessities but not as integral
parts of the core business. Today, many of these old administrative functions have
been automated and/or outsourced. The positive result of these changes is that HR
professionals have the opportunity to play a more strategic role in the business.
Business leaders focus on revenue, profit growth, market share, new products,
and increasing capacity. These can all be measured using metrics that describe
the current situation, compare current numbers with previous years’ or with a
competitor’s position, and quantify goals and measure progress. By measuring
the current situation compared with quantifiable goals, business leaders make
data-driven decisions. In order to be a business leader, the HR professional must
utilize a similar approach to decision making, one based on data and facts. Deci-
sions related to the allocation of resources, technology purchases, succession
planning, hiring and retention, training, employee performance, compensation
programs, and outsourcing HR functions can all be based on data compiled
through the use of appropriate metrics.

Measuring Your Results


Don’t forget that the quality of results is as important as quantity or cost. Calculate
ROI whenever possible to make the business case for HR. Use metrics to identify

©Business & Legal Reports, Inc. 30610800 47


trends and head off problems on the horizon. Don’t be afraid of data or of measur-
ing results. Metrics can add to the HR professional’s credibility and garner support
for HR programs.

#10 Communications

In most instances, when employees are asked what they like least about their jobs,
they will cite a problem with communication. In fact, in BLR’s 2007 National
Employee Attitudes Survey (NEAS), participating organizations across the board
were rated lowest on questions related to communication, while at the same time,
employees who took the survey said communication was very important to them.
Because communication is a very important factor in employee satisfaction and
engagement, making sure the right information is communicated effectively is
very important to human resources professionals and managers.
It is important to understand what types of information employees feel they aren’t
getting. It might be that employees don’t have a good understanding of what is
expected of them or how they fit in the organization. In other cases, it might be
that management does not provide employees with information about how the
organization is doing or the direction in which it is heading. Employees might feel
they aren’t well compensated because they don’t have any information on the
value of benefits and their total compensation package. They might feel they are
not being acknowledged for their hard work. Another problem area related to
communication is how conflict is handled in the workplace, which requires a
unique set of communication skills.
Effective communication is the foundation of positive and cooperative working rela-
tionships. Good communication benefits the workplace in many ways, including:
◆ Improving the flow of vital information
◆ Improving employee morale by making sure employees know what is
expected and what the rewards are for a job well done
◆ Serving as the basis of effective teamwork
◆ Ensuring accountability in a department because all employees know who’s
responsible for what
◆ Providing greater consistency, because all employees have gotten the same
messages about procedures and work rules
◆ Leading to better quality because mistakes are avoided
◆ Improving productivity

Tools for Better Communicating


It is important to consider your audience when you determine what communication
tools you will use to communicate a certain piece of information. Do all of your
employees have access to e-mail? Are all of your employees on-site? Do some of your
employees work only on specific days? Do some of your employees have jobs on the

48 Top 10 Best Practices in HR Management for 2009


line that prevent them from attending meetings? Keeping these things in mind, there
are a variety of methods for enhancing communication in the workplace.
Intranet. A company intranet is a great place for posting information on a variety
of topics for employees, particularly if most employees have a computer. For those
employees without a computer, consider having one or a few computers, depend-
ing on the number of employees without computers, centrally located and avail-
able for employees to check the intranet.
Company newsletter. Company newsletters are a great way to communicate
changes, successes, and important information to your employees. Traditionally
print newsletters are still used, but more and more companies are leaning toward
electronic newsletters to either replace or supplement their print newsletters. Elec-
tronic newsletters are less expensive and information can be dispensed in almost
real time if needed. Newsletters can be published daily, weekly, monthly, etc. Once
again, it is important to make sure all employees have access to newsletters distrib-
uted electronically.
Meetings. Meetings are an effective way to bring employees face-to-face, which is
particularly appreciated when the news is good and the purpose of the meeting is
to show employees they are valued. Meetings are also a good forum for allowing
employee questions or discussion on a topic and for obtaining employee
thoughts, concerns, and ideas. Meetings can be companywide, or held at the
department, team, or individual level, depending on the nature of the information
to be communicated. Meetings can be a difficult method of communication when
certain employees are unable to leave their post—for example, employees work-
ing on an assembly line or on a customer service hotline.
Telephone and conference calls. Telephones and conference calls are effective
tools for communicating with individuals or groups of employees who are not
present at the worksite. If materials or printed information will be distributed at a
meeting, arrangements will have to be made to ensure access to the material for
those participating by phone.
Web conferencing and webinars. Web conferencing and webinars allow
employees to hold live meetings or presentations over the Internet. Employees can
sit at their computers at different office locations and attend a Web conference.
This type of conference can be very effective when members of a team are work-
ing at different locations, or for those employees who telecommute.
E-Mail. E-mail is an easy way to disperse information to a large group of people at
once. Unfortunately, the overuse of e-mail can make employees feel isolated, lack-
ing face-to-face contact. In addition, many people consider e-mail to be a casual
form of communication and don’t take the time to make sure the information they
intend to convey is actually conveyed. Often, a short, succinct e-mail is interpreted
by the reader as a sign that the sender is unhappy. Because neither the sender nor
the recipient of the e-mail can see or hear the other, there are no cues that would
help them interpret the message. For this reason, the sender of an e-mail must
take care to consider how the message might be received and whether it is better
delivered in person or by telephone.
Bulletin boards. Well-organized and up-to-date bulletin boards are an effective,
convenient, and inexpensive way to communicate with employees, especially
workers who do not have access to a computer at their workstations. Whether or

©Business & Legal Reports, Inc. 30610800 49


not an organization provides separate bulletin boards for employees’ use, there
should be a written policy on the type of information that may be posted and
who must approve any information before it is posted.
Internal podcasts. Daily, weekly, or as-needed podcasts can provide a venue for
managers and executives to talk to their employees via the intranet. Employees
can listen to the podcasts from their computers. While this is a great way to com-
municate with all employees at once, it shouldn’t be a complete substitute for
face-to-face communication.
Letters or memos to staff. Letters and memos to staff are a good way to docu-
ment that a communication has been made. It is important that the communica-
tion be very clear. An unclear message provided in a letter or memo might leave
employees feeling they have no way to ask questions or clear up any concerns.
Employee surveys. Employee surveys can be an effective and efficient way to
obtain information from a large group of employees. A well-written survey pro-
vides feedback on how employees feel about the organization, their role in the
organization, their compensation and benefits, and communication at each level
of the organization. For larger organizations, it may be possible to look at and
compare results for different parts of the organization. In addition, conducting the
survey year after year provides information on how management is doing in areas
in which the survey results showed improvement was needed.

Organizational Success Through Honest,


Ethical Communication
How can an organization become a place where everyone is focused on the best
successes and outcomes for the entire organization, instead of every individual
being out for him or herself? Honest, ethical communication between leaders and
employees and among peers is the basis for a more successful organization. This
communication, framed as adult-to-adult communication and described by Jamie
Showkeir and Maren Showkeir in their book, Authentic Conversations: Moving from
Manipulation to Truth and Commitment, replaces the traditional parent-to-child (or
manager-to-employee) type of communication generally found in organizations,
which does not bode well for organizational success.
In many organizations, there are so many rules that workers may feel that they are
not empowered to make any decisions at all. They may be inclined to pass every
issue and customer concern up the ladder to someone else in a higher-level job.
They may feel powerless.
Human Resources can lead by example, making a fundamental shift in bringing
people together by moving to adult-to-adult relationships within its own workforce,
providing a role model for the rest of the organization, notes Jamie. Your organiza-
tion or department can start changing its environment to become a more truthful,
ethical, open one where adult-to-adult relationships reign. An important beginning
is probably to create a more transparent environment.
Maren suggests that the more transparent an organization, the better, and that HR
can be instrumental in moving the organization in the direction to achieve adult-to-
adult relationships and communication. “The more people learn about each other
and the organization’s place in the marketplace, the more powerful the organization

50 Top 10 Best Practices in HR Management for 2009


will become. Tell your employees how the business works; its place in the market-
place; and what risks there are,” Maren added. That provides staff with the back-
ground to make suggestions to improve business processes and serve customers
better; empowers them to make important frontline decisions regarding customer or
client service; and solidifies their feelings of being part of the organization’s team.
Jamie suggests, “If we want to move toward a more ethical environment in our
community [the organization], a fundamental element is to tell the truth. The sec-
ond most important element is to try to get a good handle on what other points of
view are and understand where other people are coming from so you can keep
the [overall] good of the organization in mind.”
In adult-to-adult communication, all opinions and ideas are sought, no matter
what a person’s position is in the company hierarchy or what their functional role.
The people closest to the front line, the customers, and the actual work are often
the most knowledgeable and often have the best ideas that will positively impact
the bottom line, help to solve business problems, and move the company to a
higher level of success.

Best Practice: Ethical Culture at All Levels of


Organization
Tough economic times are a true test of a company’s ethics program, says Allan
McKisson, vice president of Human Resources for Manpower, Inc., in the United
States. “It’s easy to be ethical and philanthropic when you’re making tons of money.”
In spite of the economy, Manpower has not strayed from its commitment to ethics
and social responsibility, according to McKisson. The global company, which was
recently named to the second-annual World’s Most Ethical Companies list by the
Ethisphere Institute, offers permanent, temporary, and contract recruitment;
employee assessment and selection; training; outplacement; outsourcing;
and consulting.
Manpower was recognized because of its“impressive and meaningful ethical busi-
ness practices”and because it goes“well beyond legal minimums, opting instead
to bring about innovative ideas that contribute to the public well being,” says
Alexander Brigham, executive director of the Ethisphere Institute. “We take a
pretty visible stance on different issues. One is human trafficking,” McKisson
explains, noting that Manpower has worked with the United Nations to prevent
people from being moved from one country to another against their will. “We are
very specific about clients we won’t work with that may, in fact, participate in that.”
In addition, under the company’s“Right Clients, Right Terms”strategy in the United
States, Manpower will not work with a client that, for example, operates an unsafe
factory or that sells unsafe products, he says.
Message relayed in various ways. Manpower’s commitment to ethics is relayed
and reinforced during interviews and throughout employees’ careers. For example,
during interviews for most management positions, Manpower uses a questionnaire
to assess applicants’ honesty and integrity, asking what choices they would make
in certain situations, McKisson says. The company plans to make that standard
procedure in interviews for all positions.

©Business & Legal Reports, Inc. 30610800 51


During the onboarding process, new hires learn about Manpower’s Code of Con-
duct and hear from senior leadership about the company’s“commitment to being
ethical and doing the right thing,” McKisson says.
Among other things, managers are trained on decision making and treating peo-
ple appropriately, and each of Manpower’s approximately 30,000 internal employ-
ees is required to complete an online ethics training course annually. The online
training addresses such topics as not compromising decisions based on personal
gains, treating people fairly, avoiding harassment, and complying with the com-
pany’s Code of Conduct, according to McKisson.
Although the company had considered offering the online training in alternate
years, it decided to continue training annually. “It doesn’t take that long,” McKisson
says, estimating that the course takes about 20 to 30 minutes to complete, and it’s a
good way to reinforce ethics within the culture and demonstrate that Manpower is
serious about it.
The Code of Conduct, which is posted on the company’s website, addresses a vari-
ety of issues, including conflicts of interest, confidentiality, fair dealing, proper use
of company assets, compliance issues, ways to report violations, and penalties.
Employees who believe that a violation of the Code has occurred are encouraged
to talk to their supervisor or HR representative for guidance on how to proceed,
McKisson says. Those who believe that their supervisor or HR rep is involved in a
violation, or those who are not comfortable talking with either of them first, are
encouraged to call an anonymous hotline.
Since the ethics message is so strong and so integral to Manpower’s culture,
employees at all levels of the organization reinforce it and encourage new
employees to make ethical decisions, too.

Conclusion

We hope that you have enjoyed this special report, and that you found the informa-
tion contained in this report useful. BLR strives to provide Human Resources pro-
fessionals with practical and easy-to-use information on a wide variety of topics. If
you would like to see the complete library of publications available through BLR,
please visit our website at www.blr.com or call our Customer Service Department
at 800-727-5257.

52 Top 10 Best Practices in HR Management for 2009


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