Category Archives: benefits

Giving Parental Leave a Major Boost

480711436In the United States, paid maternity, paternity and adoption leave continues to be fairly rare. Indeed, the Society for Human Resource Management’s 2015 Employer Benefits Survey reports that about 21 percent of employers provided paid maternity leave in 2015 and 17 percent offered paid paternity or adoption leave.

Lately, it’s been “new-economy” companies like Apple, Netflix and Microsoft that have been getting much of the attention on this front. But as we were reminded earlier this week, “old-economy” companies are jumping on this bandwagon, too.

Dow Chemical, founded in 1897 by Herbert Henry Dow, announced on Wednesday the launch of its Global Parental Leave Policy, giving a minimum of 12 weeks paid leave to mothers and two weeks paid leave to non-birthing parents. Leave can be taken during the 12 months following the birth of a child.

The enhanced Dow policy also supports requests to limit travel for new mothers during the first year following the birth of a child and assists nursing mothers who are required to travel for company business through the reimbursement of the cost of packaging and shipping of breast milk.

Further, it provides company-wide nursing rooms and breast-pump assistance, a family illness policy, and counseling and support through its Health Services group.

Dow’s CHRO, Johanna Söderström, pointed out in a press release  that the expanded policy reinforces the company’s strong support for the well-being of its employees and their families.

As a piece featured last year on the Entrepreneur website notes, Dow Chemical joins other more traditional employers that offer “radically awesome” leave policies for new parents, such as Johnson & Johnson, Bank of America and Goldman Sachs.

Anecdotally, there seemed to be a decent amount of movement on the paid time-off-for-parents front for organizations of all types in 2015—so it wouldn’t be surprising to see the needle move some when SHRM releases its next survey.

Assuming that turns out to be the case, one would think the uptick was due in part not only to significant media coverage this issue has been getting in recent months, but also to the growing recognition by employers that it’s the right direction to be heading in—both for employees and themselves.

Twitter It!

Employee Weight Loss Takes More Than Money

Generally speaking, financial incentives seem like a pretty effective way of motivating employees to do many things.

New research from the University of Pennsylvania, however, suggests that it may take more than the promise of cold hard cash to help employees shed unwanted pounds.

In the study, which appears in the January issue of Health Affairs, 197 obese employees of the University of Pennsylvania health system were enrolled in a workplace wellness program. These workers were given a weight-loss goal equivalent to 5 percent of their weight at enrollment, and randomly assigned to either a control group that wasn’t offered any financial incentive for reaching that goal, or one of three “intervention arms” in which participants were offered an incentive valued at $550.

Two of these intervention arms used health insurance premium adjustments, which were either delayed until the beginning of the following year, or took effect in the first pay period after achieving the goal. Employees in the third intervention group, meanwhile, were entered into a daily lottery incentive. Twelve months after enrollment, the researchers saw no significant changes in average weight loss for participants in any of the groups.

While offering financial incentives didn’t yield vastly different results among this particular group of employees, the study’s authors point out that such incentives aren’t necessarily useless, and that a variety of factors may have contributed to this outcome.

For example, lead author Dr. Mitesh Patel, an assistant professor of medicine at the University of Pennsylvania’s Perelman School of Medicine, suggests in a press release that the discount offered to these employees may not have been substantial enough. Or, the way the reward was delivered may have affected some employees’ perception, he said, noting that the premium discount was rolled into a paycheck as opposed to being made in a separate payment.

“More than 80 percent of large employers use financial incentives for health promotion. Many use health insurance premium adjustments, but these incentives are often delayed, and even when they aren’t, they are typically hidden in paychecks along with other deductions and payments,” says Patel. “That makes them less noticeable. Our findings suggest that employers should consider testing designs alternative to the $550 premium-based incentives used in this study.”

In addition, the lottery incentives used in this study “were constrained by having to do weigh-ins in workplace settings,” adds Dr. Kevin Volpp, a professor of medicine and healthcare management and a co-author of the study. “That made sustained engagement and behavior change more challenging.”

Given such variables, co-author Dr. David Asch, a professor of medicine and healthcare management and director of the Penn Center for Health Care Innovation, agrees that the lack of significant weight loss among participants in this study “doesn’t mean that all incentive programs are ineffective.”

Rather, the findings only signify that “we need to move to more creative designs,” he says, “that might better leverage predictable barriers to behavior change.”

Twitter It!

A Few Lessons from a Few HR-Related Fiascos

I thought this might be a good post the day before New Year’s Eve. Consider these Key Lessons from Recent HR Fiascos that O.C. Tanner’s 499235312 -- fiascosDavid Sturt and Todd Nordstrom posted on their company blog a while back some good reminders heading into the new year that what you think might work in the world of management and HR can easily backfire. So tread and think carefully before implementing your wonderful 2016 workforce-management ideas.

In all fairness and full disclosure, Sturt’s and Nordstrom’s first lesson isn’t really a fiasco unleashed by human resource professionals, but it does speak to HR’s compensation oversight and what can go very wrong with a good idea.

Remember Dan Price, the CEO of Gravity Payments, who announced his plan to raise the company’s minimum wage to $70,000 in order to do his part to lessen the pay gap between CEOs and the average worker? I spoke with Sturt about this. It seems Price had gotten hold of a Princeton University study back in 2010 indicating that, “when people were trying to meet their needs and they made generally less than $75,000, there was less contentment, happiness and a sense of well-being,” Sturt says.

But when you go over that amount, “the happiness quotient doesn’t rise in accordance and in step with raised increments,” he says. So Price brought top salaries — including his own — down while raising the minimum to a happy $70,000. Problem was, he didn’t run it by the other principles, including his own co-founder brother, who filed a lawsuit against Price that is now pending.

Sturt and Nordstrom write:

“As one disgruntled ex-employee of the company told the New York Times, it isn’t exactly fair for top performers to be compensated the same as slackers. That undermines motivation for people to go above and beyond. Whether you agree with this assessment or not is neither here nor there. At the end of the day, Dan’s good intentions brought him negative publicity, and he had to suffer the consequences.”

Then there’s the Amazon fiasco. We’ve all probably read the criticisms published in the New York Times of its hard/harsh-driving culture. What was behind it were all the metrics and measurements that were simply established to raise performance and productivity. Problem was, as the two write, “numbers don’t reveal the whole picture: not for employee engagement, not for performance, and not for [the] ability to lead and execute.”

The other culprit at Amazon, Sturt tells me, was HR itself. In his words, “Seems like HR got overrun there.” Amazon’s HR leaders did not have the self-confidence and guts, he says, to march into the offices of the CEO and other top leaders and voice their concerns — and they had to have had some, given their skills in people perceptions. “If HR isn’t stepping up,” he says, “then who is? Of course they’re taking their cues from the top, but it’s an important role for HR to be a company-culture fiduciary, if you will.”

Granted, he does see boldness growing among top HR leaders in general: “I do see it in personally strong chief human resource officers. You bump into them and you know their CEOs look at them as partners. You know they’re co-creating a culture that is both human and performance-driven.” Problem is, there still aren’t enough of them out there.

Sturt says he is seeing a fundamental shift among all top leaders, many of whom are now questioning, ” ‘What kind of place are we promoting as a place to work?’ ” And that, he says, “is creating an opportunity for HR leaders to really speak to that, and talk about principles and purpose; things that weren’t necessarily on the discussion board” a short while ago.

And No. 3 on this list of HR fiascos to mull? The fact that unlimited paid vacation and unlimited parental leave — and who hasn’t heard about this lately? (think Netflix, GE and, once again, Amazon) — come with strings attached. As Sturt and Nordstrom write,

“Offering all the paid-time-off in the world won’t fix your overworked employee problem unless the rest of your culture supports employees who take time off instead of punishing them.”

Sturt actually came back from a worldwide business tour and “saw the same kinds of things being played out in Bangalore, for instance,” he tells me. “They have the same problem we have in the states: If you really take that time, offered though it may be, you really aren’t a team player. [Those left holding the new parent’s bag, for example], are also left questioning why ‘I have to do your work.’ ”

His recommendation to HR?

“Just be mindful of the broader cultural norm you’re trying to set and weigh the initiative against it. You might make lots of changes without fitting them into the ultimate corporate goal.

“You may end up ‘Frankensteining’ it, with a bolt here and a stitch there, and you end up with a monster.

“Think before you say, ‘We gotta do this or we won’t compete’ [with all the bandwagon-hoppers].”

Twitter It!

Retirement: Expectations vs. Reality

A comprehensive survey of workers and retirees by the Transamerica Center for Retirement Studies reveals a big disconnect between employees’ expectations concerning retirement and what they — and their employers — are actually doing to prepare for it.

The survey finds that the majority of retirees (60 percent) retired earlier than they’d planned to, while 33 percent retired when they planned and 7 percent retired later than they planned to. Among retirement spreadsheetthose who retired earlier than planned, two-thirds say they retired for employment-related reasons such as organizational changes at their company, job loss, being unhappy with their job or career, or receiving a retirement incentive or buyout.

Fewer than 10 percent of retirees say their most recent employer offered flexible work arrangements, retirement seminars or financial counseling. Seventy-six percent of retirees wish they’d saved more on a consistent basis, while 53 percent agree they would have liked more information and advice from their employers on how to achieve retirement goals.

When asked how long they plan to live, 57 percent of retirees provided an estimate and are planning to live to age 90 (median). By comparing the difference between their retirement ages and planned life expectancies, the survey finds that retirees are expecting to spend 28 years (median) in retirement, with 41 percent expecting to spend more than three decades in retirement.

The majority of retirees (60 percent) say their standard of living has remained the same since they retired — a more-positive finding than the sentiment of workers aged 50-plus, only 46 percent of whom expect their standard of living to remain the same during retirement.

Although only 28 percent of retirees said they’ve experienced a decline in their standard of living since retiring, 35 percent report that their personal financial situation has declined during that period. Only 33 percent of retirees say they used a professional financial advisor before they retired, while 41 percent say they currently use on in retirement.

Among workers age 50-plus who are investing for retirement, 41 percent  use an advisor. Among workers age 50-plus, 65 percent have some form of “retirement strategy,” compared to 54 percent of retirees. Few of either age 50-plus workers (14 percent) or retirees (10 percent) have a written strategy, however. For those with a strategy, written or unwritten, benefits such as Social Security and Medicare, ongoing living expenses, investment returns, healthcare costs and savings-and-income needs factor into most. However, few strategies address pursuing retirement dreams, inflation, estate and tax planning and contingency plans.

A significant majority of retirees (68 percent) say they wished they’d been more knowledgeable about retirement saving and investing. Forty-eight percent say they waited too long to concern themselves with saving and investing for retirement, and 41 percent agree they should have relied more on outside experts to monitor and manage their retirement savings.

Twitter It!

The Cadillac Tax and Large Employers

Employers have held the line on healthcare cost increases for the third year in a row, reports Mercer in its just-released 2015 National Survey of Employer-Sponsored Health Plans. Nonetheless, 23 percent of large employers are at risk of hitting the Affordable Care Act’s widely despised 40 percent excise tax cost threshold in 2018 — and 45 percent are at risk of hitting it in 2022, according to the report.

Per-employee health benefits costs grew by only 3.8 percent this year, marking the third year in a row of a growth trend of below 4 percent, says Mercer. As in previous years, however, large companies fared better than smaller ones in holding the line: Costs rose by 5.9 percent for organizations with 10 to 499 employees, compared to just 2. 9 percent for those with 500 or more.

Large employers were helped by a jump in enrollment for high-deductible consumer-driven plans, says Mercer, while use of these plans among small employers has grown more slowly. At large companies, enrollment has grown from 15 percent to 28 percent of covered employees within the last three years. At small companies, however, it’s risen from 17 percent to just 19 percent.

Total health benefit costs averaged $11,635 per employee this year, Mercer finds, including employer and employee contributions for medical, dental and other health coverage for employees and their dependents. Employers predict their costs will rise by 4.3 percent on average next year, taking into account changes they expect to make to their health plans to reduce costs. They predict costs will rise by 6.3 percent if they make no changes to their plans.

Mercer credits these cost-containment (some would say “cost-shifting”) strategies with lowering the number of plans expected to be hit by the Cadillac tax in 2018. However, the report notes that a plan’s actuarial value is not the only factor that can drive up costs above the excise tax threshold. Health plan costs can vary significantly by geographic region, the degree of competition among providers in a particular market and workforce demographics, it says. Furthermore, it cautions, due to the way the excise tax threshold is indexed, the number of employers vulnerable to the tax will grow every year that medical inflation exceeds the general CPI — thus, by 2022 45 percent of large employers are estimated to be liable for the tax unless they make changes.

Twitter It!

Parental Leave Enters Political Storm, Too

Paid parental leave has certainly taken over the media waves of big businesses trying to one-up each other in just how accommodating 510042321-- parents & newbornto new parents they can be. (See our most recent HRE Daily posts on large companies announcing such leave accommodations, including Michael J. O’Brien’s post just Wednesday on Amazon’s plan to up its allotted leave for new parents and allow them to share their paid time with partners not employed there.)

In addition to this race toward better policies, however, paid parental leave has entered a political-football frenzy of late as well. Just as Amazon was making its announcement Monday via a memo to all employees, newly elected Speaker of the House Paul Ryan, R-Wis., was in the news for resisting calls to back a federal paid-family-leave law.

And this despite his outspoken desire to spend more time with his own family, according to this Huffington Post piece and this — far-more critical — piece on dailykos.com, as well as the fact that he provides his own staff with paid family leave.

“Because I love my children and I want to be home on Sundays and Saturdays like most people doesn’t mean I’m for taking money from hardworking taxpayers to create a brand new entitlement program,” Ryan told Meet the Press in a recent taping. He thinks offering such leave is up to employers; it’s their role, not the government’s.

Yes, that’s the common Republican stance — less federal control in favor of more individual control — but personally, says Terri L. Rhodes, CEO of the San Diego-based Disability Management Employer Coalition, the Paul Ryans of the world, as well as most all businesses and politicians from both sides of the aisle, “are all probably thinking mandated paid family leave is a good thing.”

Small and mid-sized businesses, especially, tend to be in favor of a federal mandate, she says, because they can’t necessarily afford the sweeping changes and allowances big businesses can in their attempts to stay one step ahead of their competition.

This mad race is further compounded by the fact that some states — including New Jersey,  California and Rhode Island — already offer some kind of paid family leave, and some states, and many companies, are backing paid sick leave as well.

“For big multi-state or global companies,” says Rhodes, “they can afford to figure how all this fits in with their policies and costs.” They can find a way to make it all work. But for smaller and mid-sized businesses, it’s much more complex “when it comes to considering provisions and accruals” and such.

“If we had a mandated paid leave,” she says, the playing field would be leveled more in terms of “what is expected; it would be more cut-and-dried.”

What’s more, she adds, many large corporations may espouse more liberal parental-leave policies, but don’t actually “support the policy that’s just been announced” when it comes to the corporate culture. The actual taking of the leave may still be frowned upon internally, but the external employer brand comes out smelling like a rose.

The sad reality — in the United States, anyway — is that “having a family still isn’t looked on as a great career path,” Rhodes says. “That’s a problem for everyone” — big business, small business … and Paul Ryan.

Twitter It!

Amazon’s New Approach to Parental Leave

From a public relations—and maybe an employee relations—perspective, it could take a while for Amazon to sweep away all of the debris left behind by this recent New York Times article.

But you can’t say the company isn’t trying.

Last month, the ubiquitous online retailer was back in the news, as it expanded its Amazon Connections program in an effort to solicit more frequent feedback from employees with regard to their job satisfaction, leadership opportunities within Amazon and more.

And, just this week, a number of media outlets have picked up on an Amazon memo sent to employees on Monday, which effectively announced a revamped parental leave policy that increases the amount of paid family leave time available to full-time hourly and salaried employees as well as Amazon’s fulfillment center and customer service workers. The new policy affords birth mothers with up to four weeks of paid pre-partum medical leave, followed by 10 weeks of paid maternity leave. Birth mothers and all other new parents who have been with the company for more than one year can also take a new six-week paid parental leave.

Not all of these reports, however, touched on what seems like an especially unusual aspect of the new policy.

In addition to allotting more paid time off to new mothers at Amazon, the company has also unveiled its “Leave Share” program, which allows eligible employees to share all or some of their six weeks of parental leave with a spouse or partner who doesn’t receive paid leave from his or her employer.

Amazon shared details of Leave Share with the Chicago Tribune, offering an example of how an employee could take advantage of this new benefit.

“Julia is an associate at an Amazon Fulfillment Center and recently had a baby. She’s taken 10 weeks of paid maternity leave and would like to come back to work.

“Ideally, she’d like her husband to take some time off at this point, which would make her return to work easier. However, her husband’s employer provides only unpaid paternity leave, and it’s going to be financially difficult for him to take time off. That’s where the Leave Share Program can help. Julia can share all or a portion of her paid parental leave with her husband, and he can stay home and help with their new baby.”

While this example involves a birth mother, the Leave Share concept works the same way for Amazon fathers and same-sex couples, according to the company.

Of course, Amazon isn’t the first high-profile organization to broaden the scope of its parental leave policy. But it will be interesting to see if other large companies follow suit, and start offering employees the ability to share their paid leave time with spouses and partners.

You can count Kristin Rowe-Finkbeiner, executive director and CEO of MomsRising.org, among those who think workers should already have such options at their disposal.

In a statement released within hours of Amazon’s Monday memo hitting the media, Rowe-Finkbeiner called for action on a national level to make that happen.

“While we celebrate Amazon.com’s announcement, it is long past time that our elected officials take a comprehensive, national approach that will guarantee that ALL working families will have the ability to earn paid family and medical leave insurance,” she said. “You shouldn’t have to win the ‘boss lottery’ to be covered by this critically important policy that studies show boosts families, businesses and our economy.”

Twitter It!

The Ongoing Expansion of Worksite Health

Affordable Care Act uncertainties be damned—employers are going ahead with their plans to launch on-site health centers.

That seems to be the overarching message to emerge from Mercer’s new targeted survey on worksite clinics.

The New York-based consultancy’s poll is actually a follow-up of sorts to last year’s National Survey of Employer-Sponsored Health Plans, in which 29 percent of organizations with 5,000-plus employees that provide an on-site or near-site clinical site said they offer primary care services. (That figure marks a 5 percent increase in the number of companies saying the same in 2013.)

For this recent survey, all participants from the 2014 poll that reported offering a worksite clinic were invited to answer detailed follow-up questions about their clinic operations. Among the 134 respondents, 91 percent of those with clinics identified controlling total health spend as a “very important” or “important” objective in establishing an on-site center. For 77 percent of survey participants, reducing lost employee productivity was also a key goal, with 68 percent saying they consider improving member access to healthcare important or very important.

These findings are very much in line with what Towers Watson’s 2015 Employer-Sponsored Health Care Centers Survey uncovered earlier this year. In that survey, 75 percent of 105 organizations currently offering employer-sponsored health centers cited increasing productivity as a key goal, with 74 percent indicating the same about reducing healthcare costs, and 66 percent reporting they hope to improve employee access to healthcare services.

What experts at both Towers Watson and Mercer find most interesting about these figures, however, is the suggestion that the ACA’s infamous excise tax hasn’t deterred many employers from building new on-site health clinics, or from expanding existing centers.

“ … Companies are adding centers despite concerns around the Affordable Care Act and its excise tax, which [requires] that the cost of an on-site center has to be included in the cost of delivering healthcare to employees,” Allan Khoury, senior health management consultant at Towers Watson, told HRE in June.

“If that cost goes too high, you violate the Cadillac tax. But we’re still seeing great support for these clinics among employers.”

That’s not to say companies aren’t concerned that on-site health centers’ operational costs could help push them over the threshold for the excise tax, of course. But, by and large, most organizations remain convinced that their clinics “will deliver positive net value,” said David Keyt, principal and National Onsite Clinic Center of Excellence leader at Mercer, in a statement.

In the latest Mercer survey, 15 percent of respondents said they believe their general medical clinic will hurt them in terms of the excise tax calculation, but 11 percent said they think it will help, “presumably by helping to hold down the cost of the company’s health plan,” according to Mercer. Twenty-eight percent think it won’t have an effect either way.

And, ultimately, most companies aren’t really using cost as a barometer for the value of their on-site health centers anyway, according to Keyt.

“For many employers, employee satisfaction is a more important measure of success than ROI,” he said. “If employees are using the clinic, it means they haven’t been taking time off work to visit a doctor, and that they’re getting the medical care they need to stay healthy and productive.”

Twitter It!

Diagnosing the State of Vehicle Benefits

Woman driving car

Workers and their employers like vehicle benefits.

Despite up-and-down gas prices and clogged freeways, the American love affair with the car continues, as does the enthusiasm among American workers and their companies for vehicle-related benefits. A recent WorldatWork survey of more than 400 comp specialists finds that nine out of 10 of the organizations surveyed offer a car allowance, company car, fuel reimbursement or other vehicle benefit to at least some of their employees.

Vehicle-related benefits are far more prevalent among American companies than among their foreign brethren: 74 percent of U.S. companies surveyed offer them, compared to 24 percent in Canada, 21 percent in Western Europe and 20 percent in the U.K.

The most-common vehicle-related benefit is fuel or mileage reimbursement (70 percent), while 69 percent say car allowances are the “most popular” program. Car allowances are typically offered to executives (75 percent), while 66 percent of organizations provide their executives with a personal vehicle.

Interestingly, many companies use their vehicle-related benefits as a recruiting tool: Two thirds (66 percent) say they always or sometimes promote these benefits as a “key employee benefit” to attract recruits. This makes sense, given that 64 percent say vehicle benefits have a positive impact on employee satisfaction.

Increasingly, vehicle benefits are taking a new turn as the popularity of electric cars continues to grow. In the Atlanta region (the nation’s second-largest market for electric vehicles), Nissan and Georgia Power have teamed up to help companies with at least 100 employees purchase EV charging stations. Employers can receive a $1,000 rebate for each 240-volt, Level 2 charger they install — half the amount comes from GP, and the remainder comes from Nissan (maker of the Nissan Leaf, incidentally).

Twitter It!

Not So Fast on the Netflix Good News, Says Group

Invariably, any large company — especially one that’s in the news — attracts its detractors as well as its fans. Just try “Googling” “anti-494368457 -- mother and infantWalmart websites” and see what comes up on the nation’s largest employer.

So no surprise, really, that Netflix’s recent announcement — that it would offer unlimited leave to new moms and dads, allowing them to take off as much time as they want during the first year after a child’s birth or adoption — has yielded an “anti-stir.”

A women’s group calling itself UltraViolet just rolled out an ad campaign last week against what it claims are Netflix’s discriminatory practices in not opening its new leave program to the poorest among its ranks instead of just the wealthiest. (Here’s the actual petition for those who want to join the fight.)

According to an emailed announcement about this new uprising, “more than 47,700 UV members have demanded Netflix give its hourly workers the same ‘unlimited’ parental-leave benefits that workers who make $300,000 receive.” As Nita Chaudhary, UV’s co-founder, puts it:

“People are taking notice that Netflix is expecting praise for extending parental leave to its higher-paid employees, yet it doesn’t extend those benefits to the hourly employees who need it most.

“It’s important that Netflix set an example for the rest of employers and companies nationwide: With one in four moms going back to work less than two weeks after giving birth, Netflix can turn the tide by giving ALL employees equal benefits — not just reserve those benefits [for the wealthiest ones].”

The women’s group contends this exemption was somehow left out of the company’s announcement, the latter of which has certainly been reverberating positively throughout the business community, as this feature about the move in Fortune indicates. And this, from BuzzFeed News, indicating other big Silicon Valley companies have been following suit — including Microsoft and Adobe — in announcing similar unlimited paternity leave programs since Netflix’s announcement.

Indeed, I saw no mention of any exemption in the announcement. Nor was it mentioned in Andrew R. McIlvanie’s blog post that included news of the announcement. (Though that post does examine the problem of unlimited leave policies being launched in corporate cultures that don’t support them … which may or may not be the case at Netflix.)

I did reach out to the company about all this, and got the following back from a company spokesperson:

“Across Netflix, we compare salary and benefits to those of employees at businesses performing similar work. Those comparisons show we provide all of our employees with comparable or better pay and benefits than at other companies. For example, medical and life insurance for DVD workers exceeds market standards. All DVD employees including hourly are also eligible for a minimum of 12 weeks off for maternity or paternity leave. We are regularly reviewing policies across our business to ensure they are competitive and help us attract and keep the best employees.”

Nothing on the UV ad campaign. Nothing on any exemption in its new policy. Like so many other big-splash initiatives and subsequent fallout, I guess we’ll just have to let this one play out.

 

Twitter It!