COVID & the Future of Work:

INSIGHTS FROM PAYCOR’S C-SUITE

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 EXECUTIVE SUMMARY
INTRODUCTION:

In just a few months, everything changed:

31M+
unemployed

• 30 million unemployed and counting

• An economic contraction that might extend through 2021
• Remote employees juggling work and family under the same roof Recession until

2021?
• On-site workers faced with temperature checks and health screenings

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 The long-term future is impossible to predict,
but what might all this mean, and how will
work change, over the next year?
Talent Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Workforce Planning. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Benefits Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Employee Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

These last few months have been challenging, to say the

least, for everyone. I’m an optimist by nature though. I really
am. After every crisis, financial or otherwise, we’ve always
come back stronger, smarter, more innovative.

We’re going to do it again.

– Raul Villar,
CEO, Paycor

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Talent Management
Recruiting, hiring, onboarding

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 TALENT MANAGEMENT
Talent Management in 2020.
Whiplash doesn’t even accurately describe the last few months.
In January there were more jobs than workers. By May, economists were
forecasting 20-25% unemployment. Ten years of U.S. job growth got nearly wiped
out in a month. Recruiting in 2020 will be all over the map. Hiring in the retail,
tourism and airline sectors will continue to plummet. But there will be bright
spots, too. Paycor is seeing hiring activity for HR, finance and IT roles, as
many organizations fast-track business transformation and digitization.

Ten years
of U.S. job growth got nearly wiped out in a month.

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 TALENT MANAGEMENT
For companies that are hiring…
It’s all about intentional messaging.

The labor market is on the rebound. Thousands of companies will

once again vie for converting the most exceptional profiles into
candidates. Intentional messaging will separate the have’s from the
have not’s as far as sourcing is considered. It’s as critical now as ever
to pull at the heart strings of candidates while crafting individually
targeted messages through your ATS (vs. a one size fits all message).”

– Bill Neese,
SVP, Talent Acquisition

See How the Right ATS

Helps You Hire Chevron-Right

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 TALENT MANAGEMENT
For companies that
are not
hiring…
Now is the time to build a recruiting pipeline.
Even if reopening proceeds in fits and starts, the job market will
come back, fast in some geographies, slow in others, but when
hiring comes back, we may find competition for top talent in
certain industries comes back just as intense as ever. I do believe
voluntary turnover will come back with a vengeance.

The reality is no matter what an employer does to encourage

career development and loyalty, there’s always going to be a
certain percentage of people who took a pay cut in April who
will start looking for opportunities in July. This is a golden
opportunity to leapfrog your competition. If your competitors
aren’t building a pipeline now, they might never catch up.
If you’ve got a talent pipeline in place, it could be a decisive
strategic edge for your business in the coming months.

– Karen Crone,
CHRO, Paycor

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 TALENT MANAGEMENT
Everyone needs to be on
the lookout for poachers.

There’s a much larger talent pool available, great

qualified candidates who through no fault of their
own are out of work.

For people who have kept their jobs, recruiters will see them as
top talent, so there’s going to be a lot of poaching in the coming
months. And an interesting side effect of working from home is,
it’s a lot easier for a recruiter to get in touch with a candidate and
have a long phone call in the middle of the day.”

– Jon Toelke,
Senior Manager, Talent Acquisition

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 TALENT MANAGEMENT: COMPLIANCE
COMPLIANCE WATCH OUT

Employers will make testing

for the virus part of the hiring process.
Look for many organizations, especially those in states that
will see coronavirus caseloads peak this summer, to follow the
lead of Amazon, Walmart and others and require on-the-job
medical screening and temperature checks.

The CDC is actively encouraging temperature checks as an important first line

of defense. The Equal Employment Opportunity Commission (EEOC) recently
released guidance on testing job applicants for coronavirus “to reassure
employers that they may screen job applicants after making a conditional offer,
as long as the employer does so for all entering employees in the same type of
job.” Keep in mind though, any testing you do must be kept confidential, just as
you would all medical records.

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Workforce Planning
Labor costs, analytics, forecasting

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 WORKFORCE PLANNING
Workforce Planning in 2020.
HR and Finance will no longer work in silos.
In a more forgiving business environment, HR and Finance could live in their
respective bubbles. But in the new COVID world of work, SMBs are being
forced to run both more efficiently and more creatively. A 2019 Paycor
study found that the typical HR professional spends only 15% of their
time on labor costs. Forty-three percent of HR teams aren’t involved in
managing costs at all. Look for this legacy division of labor to give way to a
new, necessarily more collaborative reality in 2020.

43%of HR teams aren’t involved in managing costs at all.

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 WORKFORCE PLANNING
Waste of any kind
is no longer an option.

To solve problems and grow, HR and Finance

need to share a brain.

For most SMBs, waste of any kind—time or money—is no

longer an option. That’s one reason you need the Finance
brain. Similarly, for most SMBs, talent—skilled workers
who feel good about their careers and proud of their
companies—is a key driver of success. That’s where HR
comes in. Bring both disciplines into the decision-making
process and you’ll arrive at much better outcomes.

– Adam Ante,
CFO, Paycor

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 WORKFORCE PLANNING
Businesses need a complete
picture of labor costs.
When HR and Finance share a brain, they can better
diagnose and solve complex talent-related problems.

But first, they need to share data. For many businesses, data is
spread across disparate, incompatible systems that don’t talk to each
other. For growing companies that still rely on manual workarounds,
the data they need may be practically inaccessible. For example, when
your company faces tough questions—to drive better performance and
outcomes, do we tweak salaries, benefits, training or our hiring profile?—
HR and Finance can’t even talk about possible scenarios if they can’t
locate and agree on what data is driving the decision.

To overcome the data gap, HR and Finance need a core HR

solution for all employee data. (If you have to switch platforms,
log-in to multiple systems, re-key information or open multiple
spreadsheets to find data, you don’t have a core HR solution.)

Learn Why and How to Switch

HR & Payroll Providers Chevron-Right

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 WORKFORCE PLANNING
The next challengebig
will be the skills gap.
HR & Finance will tackle big problems in 2020 and beyond,
starting with the skills gap, a fundamental feature of the
talent landscape that COVID hasn’t changed.
In 2019, the World Economic Forum reported that 54% of all
employees will require significant reskilling and upskilling in
just three years. Add to that the stark demographics of an aging U.S.
workforce. The U.S. fertility rate is 1.6. compared to 3.5 in 1960. (See Japan’s
decades-long stagnation for an example of where low birth rate leads.)
And while there are 61 million potential Gen Z workers in the pipeline,
they’re not an instant fix. More than half of HR leaders told SHRM they
fear a skills shortage and believe schools have done little or nothing to
make up the skills gap. And attracting highly skilled young (or young-ish)
people, assuming you can find them, isn’t easy (just ask manufacturers.)

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 WORKFORCE PLANNING
SMBs will , create
not just recruit, talent.

We see organizations of all sizes investing

in a learning culture.

Over the years, employee development has evolved from

basic instructor-led classroom training to full-on experiential
learning. Self-directed, easily accessible training is such a win/
win. If your people are constantly learning, it’s good for them,
good for their careers and their confidence, and it’s good for
the business, as you’re training your highest-potential
employees to be more versatile and valuable, and
ultimately to fill those job reqs of the future.”

– Greg Goold,
Director, Talent Development & Learning, Paycor

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 WORKFORCE PLANNING: COMPLIANCE
COMPLIANCE WATCH OUT

State tax implications

Let’s say your office in Ohio went virtual and you have employees working
from homes in a neighboring state, say Kentucky. The taxing jurisdiction where
the employee is working from home might expect you, the employer, to
withhold payroll taxes for their state, not yours. Your payroll software should
automatically adjust accordingly, though there are exceptions. Some states
have reciprocal agreements that allow a business to withhold only in the state
where the employee lives. Others make a distinction between employees who
choose to work from home versus ones who do at the request of an employer.

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Benefits Strategy
Healthcare benefits, employee wellbeing, open enrollment

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 BENEFITS STRATEGY
Benefits Strategy in 2020.
What employee wellbeing means now.
A third of Americans show signs of clinical anxiety, according to the Census
Bureau. And a recent SHRM study found similar numbers: 35% of employees
report feeling depressive symptoms often. By some estimations, that’s nearly
a twofold increase year over year. To make matters worse, sixty percent of
counties in the U.S. lack a single psychiatrist, according to research from New
American Economy.

1/3 of Americans show signs of clinical anxiety.

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 BENEFITS STRATEGY
I think HR will work with their brokers now more
than ever before on mental health and wellbeing.

Insurance carriers are extending EAPs [Employee Assistance

Programs] at no cost and some offer free trials. In the past, EAP
might have had a negative connotation, but not anymore.
There are great apps that can be part of a wellbeing program,
apps for sleep, for meditation and some programs even offer
online therapy. For business owners, the key is to work with
a broker who can match you with an EAP with a top-notch
network of specialists.

– Shaun Scott,
SVP, Paycor

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 BENEFITS STRATEGY
Defining wellbeing
At Paycor, we define ‘wellbeing’ broadly and
generously to include more than just health
and wellness.

Providing comprehensive support for our employees is core to our

mission and values and it makes good business sense, too.

– Jennifer Gessendorf,
Senior Director, HR, Paycor

The components of holistic well-being:

Mental health – Condition of psychological and emotional well-being
Financial health – State of personal and family financial security
Social health – Ability to form satisfying interpersonal relationships with other
Physical health – Level of illness, injury and general lifestyle
Source: Metlife, 2020

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 BENEFITS STRATEGY
Virtual healthcare
is here to stay.
The practice of meeting with a doctor online through
video chat or over the phone was catching on slowly
but surely before COVID.

AMA reports that telehealth increased by 53% from 2016 to 2017, but
it still had a long way to go. In 2018, 96% of large employers offered
telehealth but only 20% of those companies said that at least 8% of
their workforce used the services. Fast forward to today: a recent poll
by the Kaiser Family Foundation found that 23% of adults have used
telehealth services in light of the pandemic. In March 2020, the White
House lifted Medicare requirements for telehealth visits to make it
easier for patients and doctors to use the technology. Now, more
providers accept Medicare payments for virtual visits.

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 BENEFITS STRATEGY
There really is a tremendous upside with
telemedicine and I feel like we’ve just scratched the
surface with what’s coming.

It’s cost-efficient for the employer, as you’re reducing fees,

especially from high-cost events like ER and urgent care visits.
You’re also going to realize productivity gains. Just think of how
much time an employee saves when they don’t have to drive to a
doctor’s office. I’ve seen studies that show a routine primary care
physician appointment takes about two hours and an urgent care
visit takes four. A telehealth visit takes an average of 5 minutes.
That alone is a game-changer.

– Jennifer Gessendorf
Senior Director, HR, Paycor

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 BENEFIT STRATEGY: COMPLIANCE
COMPLIANCE WATCH OUT

PPP & HSA

In response to COVID-19, the federal government issued new rules
that allow employed workers to use HSA funds to cover telemedicine.
If the employee is laid off, they can use HSA to cover COBRA premiums
tax-free. Employers that received PPP loans can use some of the PPP funds
to begin or increase contributions to their employees’ HSA accounts.
However, the employer can’t deploy those funds selectively; if you do it for
one employee, you have to do it for everyone. Talk to your broker before
you make a move, as PPP has been notoriously complex and accurate
documentation is key to getting your loans forgiven.

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Employee Experience
Career development, company culture, internal communications

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 EMPLOYEE EXPERIENCE
Employee Experience in 2020.
Don’t let company culture be a casualty of COVID.
No matter if your company is on-site, virtual, or a little bit of both, your
company culture is changing. COVID disrupted everything, especially
your employees’ relationships with each other, their managers, and the
organization. Don’t let company culture be a casualty of COVID. In a time
of rapid change, Paycor’s Chief HR Officer Karen Crone believes the
most important thing HR leaders can do is listen.

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 EMPLOYEE EXPERIENCE
You can’t reassure your team, much less get them excited
and engaged again, until you know how they’re feeling.
And in many cases, they might not even know how they’re feeling
until someone asks. Here’s where HR can really help.

We recommend surveying your team frequently. Ideally,

surveys are anonymous because you’ll want to ask sensitive
questions and track how sentiment changes over time. How
engaged are they? How satisfied are they with their career
growth, their job challenge? Are they confident in company
leadership? You might even ask questions that under normal
circumstances might seem too personal, like if they have the
right support network outside of work. Gather continuous input
and design interventions and communications based on data.
Leaders need to inspire trust now more than ever, and listening
is the first and most crucial step toward creating that high-trust
environment.

– Karen Crone,
CHRO, Paycor

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 EMPLOYEE EXPERIENCE
Companies that get remote
work right will have an edge.
If your organization can develop and maintain a
virtual environment that is healthy, productive and
enjoyable, you’ll be much more effective in recruiting
and retaining top talent.

But that’s easier said than done. Fifty-three percent of at-home

workers told Gallup they want to continue to work remotely after
shelter in place orders are lifted, although it’s interesting to note
that a month ago, when remote work still felt new, that number
was 62%. Global Workplace Analyitics estimates that when the
pandemic is over, 30% of us will work from home at least part of
the time. Before the pandemic, less than 10% worked from home.
Bottom line: most organizations are not prepared for remote work.
It’s one thing to quickly stand up a virtual office and take all your
calls on Zoom. It’s another thing to get an entire organization to
be as productive virtually as they were in-person, and to do so
consistently for the long haul.

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 EMPLOYEE EXPERIENCE
The way forward is to invest in learning

Before the crisis that was true as a general principle, but

now training has taken on a whole new dimension. There’s an
immediate need for technical training, how to use remote work
tools, how to maintain network security, how to set up your home
office. Step two is how to thrive. How to have really effective
online meetings. How to collaborate with coworkers online,
sometimes in real time, sometimes asynchronously.

– Mark Wilson,
VP, Organizational Development, Paycor

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 EMPLOYEE EXPERIENCE: COMPLIANCE
COMPLIANCE WATCH OUT

What if an employee is afraid

to come back to work?
In general, employers are not required to allow employees to
work from home, so long as the company has complied with
all federal and state workplace safety guidelines.

There are exceptions, so you’ll need legal advice on a case-by-case basis. The
key in most cases will be to determine why exactly the employee is reluctant
to work on-site. If the employee (or, here’s where it gets complicated, a family
member) has a disability as defined by the Americans with Disabilities Act or
has a documented comorbidity that makes them more suspectable to serious
illness as a result of COVID, they could have legal justification for not returning
to work. Whether an employer can be held liable for an employee’s exposure
to COVID-19 is unclear. The first COVID-19 related lawsuit, Toney Evans v.
Walmart, Inc., is working its way through court now. Big legal issues are at
stake, including how causation can be established and what reasonable care
looks like in a pandemic.

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How Paycor Helps
For 30 years, we’ve been listening to
and partnering with leaders, so we
know what they need. That’s why
40K+ SMBs trust Paycor to help them
achieve their goals.

VISIT PAYCOR.COM/HCM-SOFTWARE

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