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LaDonna Kearney

Employee Benefits
Employee Benefits: Set Your Company Apart 1024 577 LaDonna Kearney

Employee Benefits: Set Your Company Apart

Differentiate Your Business Through Benefits Offerings.

Most employers are in the crosshairs of the war for acquiring talent. Hiring is especially competitive for small businesses, which has prompted investments in ways to attract and retain staff. To stay ahead of the competition, consider new benefits that can ultimately lead to cost savings, such as giving employees decision support tools to choose compatible plans for their health savings accounts, concierge tools for streamlining and reducing health care spending, and disease management plans.

Flexible schedules go hand in hand with getting over the idea that employees are only working when you see them working. Set remote workforce policies making it clear to employees that your company is either a remote-first or office-first firm — and which is preferred and likely to be enforced. Hybrid work schedules are still popular and can differentiate you from another company when a candidate is deciding. Design a benefits platform that addresses the needs of your employees and makes mental health resources part of the equation.

Consider healthcare options

Health care is typically the most expensive benefit to offer, and coverage is only getting costlier. More companies have begun fully covering the cost of premiums, and a third of small-business employees are now enrolled in a plan where they aren’t paying out-of-pocket costs for single coverage. And lately, fewer employers are passing on premiums to their workforces.

Telehealth services should stay a part of your team’s coverage. Virtual and remote health care is here to stay but needs to evolve — there’s got to be integration with one’s overall health care plan to ensure the quality of care is paramount.

Expand the scope of your family leave policy beyond maternity leave to include more customizable options to support fathers, same-sex couples, adoptive parents, foster parents, grandparents who are caregivers for grandchildren, bereaved families, and those looking after elderly or sick loved ones. Since many employees will need to take care of someone else in their lives, think about how you provide an equitable experience for all staff. A short-term disability policy is another option to consider.

Think out of the box

Lifestyle spending accounts offer your employees coverage for physical wellness, athletic equipment, emotional wellness, meditation classes, retreats or even park passes. They’ll  have the flexibility to address everyday life expenses without burdensome compliance limitations.

Don’t overlook employee development opportunities to further your workers’ careers and to help develop soft skills. Reimburse employees for continuing education and/or industry conferences. And assist team members with personal or work-related problems such as substance abuse or neurodiversity.

And what about perks that were once so key? Reevaluate your benefits package to move away from once-touted trends such as unlimited time off. Instead, experiment with services that allow employees to cash out their unused time and add it to their retirement account or to pay down student loan debt.

Administratively, unlimited paid time off is cumbersome and difficult to manage. As the priorities of your team change, benefits that were once important can become obsolete. According to benefits managers, gym memberships and employee discounts are less impressive to many employees.

Employee benefits exist within the atmosphere of economic uncertainty, heightened employee expectations and the extension of hybrid work. Although not every benefit is feasible or appropriate for every company, smart employers are finding that benefits can set them apart even more than salary. Let us know whether we can help you with evaluating your benefits program.

©2023

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Travel Expenses
Travel Expenses: What You Need to Know 1024 577 LaDonna Kearney

Travel Expenses: What You Need to Know

Travel Expense Reports Are a Dreary Task

What is reasonable when it comes to expensing travel? Research from Certify, a company that tracks travel and expense claims, revealed some provocative items: One marketing department actually approved an employee renting a llama for $150 to accommodate a photographer’s request; one employee boarded a pet snake for $30 a day; and one salesperson transporting pungent garlic samples requested (but was denied) a separate $85 room for the samples. So, what’s considered reasonable?

What will and won’t raise eyebrows?

Employers can circumvent the issue of legitimate expenses by following a predetermined per diem amount for travel. It serves as an alternative to expense reports or can be used in combination with them. Short-term temps or substitutes, like teachers, may also file expense reports.

Companies follow different guidelines for establishing their per diem allowances. Private firms can structure them in line with federal mandates for government employees — typically, the General Services Administration for domestic rates and the U.S. Department of State for international travel. Per diem rates consider varying costs among locations; for example, it is more expensive to eat out in San Francisco than in Wichita, Kansas. Also, industries have varying expectations for business expenses. The time of year is another factor, as seasonal rates range widely.

Whether included in a per diem allowance or charged separately, the following expenses are normally acceptable, within reason:

  • Lodging (hotels, Airbnbs, private rentals, short-term apartments).
  • Gas and tolls for driving.
  • Taxis to and from airports, stations, conferences, lunches or client offices.
  • Internet access on flights or in hotels.
  • Printing and copying services when away from home.
  • Laundry and dry cleaning.
  • Checking luggage.
  • Meals, including room service.
  • Tips.
  • Visa fees.
  • Travel accident or travel medical insurance.

The following are generally out of bounds:

  • Museums and personal entertainment.
  • Alcohol (unless entertaining clients).
  • Flight upgrades.
  • Child care or pet sitting.
  • Parking tickets.
  • Lost luggage.
  • Late/cancellation fees.

There is a key distinction between an employee’s daily commute and a journey to a different city. Business travel may include meeting clients or partners, attending events or conferences, visiting the company’s other offices, conducting research or making presentations.

When expenses do not fit into standard formats, companies may resort to out-of-pocket reimbursements.

Per diems versus itemized expenses

Per diems make life easier for companies and employees. Busy workers are thankful not to have to sort out receipts and document each outlay. They also offer predictability and flexibility, as employees themselves make spending choices. Plus, a generous expense account creates loyalty and attracts talent.

On the company’s side, per diems simplify expense tracking, which consumes time and effort when vetting expenditures and requires paperwork. They may help control costs by encouraging employees to be more frugal than if using plastic — it is too easy to pull out a credit card. They are also usually tax deductible for the employer, but be sure to have your accountant review any questionable matters.

Sometimes partial per diems can apply when traveling workers spend some of the first or last day in the office. And this story has an important buried lead: Employees normally do not need to return unused per diems!

Specify the process

Spell out guidelines and procedures in a policy document for all employees. In addition, create an expense form for them to fill out.

You can tackle common concerns up front. For example, do executives travel in business class? How much luggage can they take? (One regular suitcase and one carry-on are customary.) Do employees need approval to book their own transportation? Can they use their own noncompany-issued credit cards? If possible, specify amounts appropriate for different destinations. Can they bring an extra person, like a spouse? (Often yes, if it incurs no extra expense.)

Address the company’s policy for group entertainment. Normally, the senior executive pays for meals. Be clear about deadlines for required reimbursement requests and submissions of receipts.

The goal is to strike a balance between paying what the company can afford and satisfying your employees’ expectations.

©2023

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Apprenticeship
HR Insight: Earn as You Learn – Apprenticeship Programs 1024 577 LaDonna Kearney

HR Insight: Earn as You Learn – Apprenticeship Programs

Earn as You Learn – Is an Apprenticeship Program Right for Your Company?

According to U.S. Department of Labor data, registered national apprenticeships have increased by 64% since 2012, with over 241,000 new apprentices entering the system in 2021 and 593,000 actively engaged in programs. While those numbers appear respectable, they represent only a drop in the bucket of nationwide employees. Stigmas persist against hiring candidates who lack college degrees, along with misunderstandings about the potential scope for more industries. Is it time for your company to consider implementing an apprenticeship program?

Learning by doing

Companies unfamiliar with apprenticeship programs may be confused about the difference between apprentices and interns. Basically, interns operate in their own sphere and internships tend to be:

  • Much shorter term.
  • Less structured.
  • Limited to entry-level positions.
  • Frequently uncompensated.
  • Rarely leading to formal certifications.

Apprenticeships, on the other hand, typically run from one to six years and consist of a blend of hands-on and classroom learning. Work may be based on hours put in or skill levels achieved. Those who go by the clock typically work about 2,000 hours a year, supplemented by around 144 hours in the classroom. As an illustration, medical doctors train in an equivalent manner by incorporating both classroom and residency experience.

Consider the rules

Programs registered with the Department of Labor or a state apprenticeship agency must meet strict standards, such as raising pay rates in line with apprentices’ increased skills. Recent Labor Department estimates cover a wide range of industries. The starting pay averages about $50,000 annually for those who have completed programs.

Many people still hold a limited and old-fashioned attitude toward which industries should engage apprentices, reflecting a system launched 75 years ago. In the past, the most popular avenues were for electricians, plumbers, carpenters and other artisans. Now, the range of fields is broadening. New sectors include finance, technology, human relations, transportation, logistics, energy, fashion, law and defense. Others, such as tax preparers, database administrators, insurance underwriters, and customer service and sales reps, to name a few, are joining the ranks.

While programs vary in length, schedules and policies, most follow a similar set of practices.

Reaping the rewards

Everybody wins. From a company standpoint, firms these days are particularly focused on effective recruiting when so many face workforce shortages. It is also useful to draw from a pool of candidates with some company-specific experience or those who have already been tested as potential employees.

Firms are looking to apprenticeship programs to:

  • Help recruit and develop skilled workers.
  • Beef up productivity and profitability.
  • Create efficiencies.
  • Plug gaps in company teams.
  • Contain training costs.
  • Encourage mentorship.
  • Become eligible for certain tax credits.

There are a number of indirect benefits. For example, apprenticeships offer a route toward greater workforce diversity. Hiring firms are likely to overly rely on college degrees as a proxy for skills, particularly in STEM (science, technology, engineering and math) fields. Such an emphasis on college diplomas may lead to racial and economic exclusions.

Apprenticeships also encourage greater morale and innovation. At the same time, employee turnover rates tend to decline and less supervision is required.

Yet, there are no free lunches. The programs do entail costs, not only wages but also materials, equipment and mentors’ time. There is some risk, too, that competitors might poach trained apprentices. Firms should be wary of shortening the training period to save money, though; costs are highest and benefits to firms are lowest in the earliest years.

As awareness grows, more employers and human resources departments will recognize the value of tapping this rich resource. Companies should consider it a capital investment, while workers receive a debt-free degree and practical education.

©2023

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Storytelling
Once Upon a Time: Storytelling at Your Company 1024 577 LaDonna Kearney

Once Upon a Time: Storytelling at Your Company

How do you effectively use Storytelling in your company?

The modern-day workplace has embraced the power of storytelling, which has become an increasingly popular mode of corporate communication. As a manager or team leader, you can also harness the force of a strong plotline to create lasting impressions and bind your workforce together.

Stories for every occasion

Storytelling can work magic in most situations, even for dressing up dry data and business metrics. In the workplace, they support leadership at all levels, from the C-suite to small operational units. Skillful and imaginative managers use them to:

  • Build a culture and create common ground for teams.
  • Share vision.
  • Engage and motivate.
  • Communicate strategy.
  • Support recruitment.
  • Drive change management.
  • Explain specialized knowledge.

A good story can function better than a memo or a white paper for defining a company’s purpose and desired impact. A story, in the right hands, becomes a potent teaching tool. People tend to think in metaphors and learn through anecdotes. The narrative gives employees a context for understanding the values and direction behind their labor. Vision stories, in particular, carry a message that hard work is worth the effort, linked to a specific outcome as an illustration.

You can use stories to build trust, whether among your team members or with superiors. Your listeners want to know more about your own motivations and agenda. You can use them to map out your own goals, accomplishments and background.

They can be taught throughout the entire organization to substantiate change management and decision-making. If the workforce buys in and the exercise is successful, employees will appreciate the firm’s values on a more concrete and personalized level.

You will have achieved a modest triumph by articulating and adding a building block to your corporate culture. You will take it even further if you can print the story in institutional memory. Amid the ocean of informational overload, workers need to not only comprehend but also remember the message. The key is to use stories to fit the patterns of your organization’s processes and dynamics. Stories can make that real by stirring emotions and making complicated concepts memorable.

The power of the parable

For full impact, the vision must be expressed and integrated with routine work activities that your team members can relate to. A well-crafted story, constructed as an emotional journey, can provide that connection and sell the idea.

Stories can strengthen all types of communication because they unite the right and left hemispheres of the human brain. The left side dominates logic, speech and language, while the right half focuses on creativity, intuition and spatial relationships. Yet in decision-making, emotion trumps logic in the end. That is why it is so important to weave emotion into your story.

For instance, if you are addressing change management, you might want to focus on turning points and emphasize how change agents overcame initial resistance. Change is hard. Everyone has experienced the fear of the unknown.

Engage your audience 101

Your high school English teacher probably told you all this, but the same rules apply. What makes a great story resonate is its simplicity, but that does not mean it is easy to tell.

The elements are universal:

  • Context.
  • Action.
  • Transformation.
  • Results.

The context kindles interest and provides background, the action lays out how a challenge or a setback was overcome, and the result uncovers a moral or learning experience.

Parachute right into the action to get attention, and quickly define the purpose (the big idea). Develop the journey, using setting, characters and conflict around the transformation. Try to build empathy with your hero. End with a bang on a finely tuned key theme.

Let’s end with a true story. Google, launched in 1996 by Larry Page and Sergey Brin, was originally called Backrub! The founders wanted to indicate how it is related to a website’s backlinks. Ugh. The new name, Google, chosen in 1997, refers to “1” with 100 zeroes. The story inspires by highlighting both the ingenuity and the common sense of two entrepreneurial students.

©2023

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Micromanagement
HR Insight: Are You Guilty of Micromanagement? 600 600 LaDonna Kearney

HR Insight: Are You Guilty of Micromanagement?

Looking Over Your Team’s Shoulders

There is nothing so demoralizing as reporting to a boss who makes every single discussion feel like a performance review, wants every trivial decision green-lighted and signed off on, and makes every comment a nitpick.

Often, these types of managers are not intrinsically hostile or malicious. Their obsessive modus operandi is more likely rooted in insecurity and inexperience. In some cases, a micromanager may be suffering from their own isolation. Suppose they have been promoted from a hands-on, operational position to a more senior and strategic level. Uneasy in the transition, they may still cling to their former, accustomed role. They feel more comfortable supervising their teams in familiar territory.

Too much on your plate

If you have ever suspected you may be overly demanding, especially regarding minor matters, ask yourself these questions: Do you sense discomfort from your team? Is your mentorship unhealthy?

The symptoms of a micromanager are all too evident to subordinates:

  • Avoids delegating.
  • Edits and fixes mistakes themselves.
  • Demands frequent updates, status and progress reports, and revisions.
  • Obsesses over every detail and ignores the big picture.
  • Sets unrealistic deadlines.
  • Must be cc’d on everything.
  • Fixates on minor errors.
  • Rarely offers praise or recognition.
  • Likes to know employees’ whereabouts at all times.
  • Watches every move and keeps tabs.
  • Monitors constantly.

Teams cringe when their manager brings ego into meetings or makes every decision personal. Their distress can increase if their boss wants all tasks executed their (boss’s) own way yet fails to provide enough support or advice to direct them. It becomes a guessing game to perform when context is withheld.

While no one likes to be hounded, there are, nevertheless, times when a high-touch approach can be productive. Attention and expert guidance may be appropriate for situations like training or onboarding. Micromanagement may even be the optimal style for directing crunch projects where a steep learning curve comes into play.

When the perfect becomes the enemy of the good

Micromanagement takes a destructive toll on both managers and team members. It damages workflow, suppresses initiative, stifles motivation and impedes productivity. The constant check-ins lead to bottlenecks and the pace of the entire department slows down. Managers find themselves working longer hours and accomplishing less in the time frame — a recipe for burnout. Trust is compromised and employees’ turnover rates are likely to increase.

Overinvolvement with the minutiae of teams’ tasks is rarely scalable in the long run. Consider what happens as teams scale up and take on new and more complicated duties. As activities become more complex, they require a whole new level of information or even skill sets. As the business and team functions grow, at a tipping point the manager’s techniques will not be able to keep pace with the pressure of the new dynamic. Trouble adapting is often palpable in startup companies that begin to expand. The founders, who might be typical micromanagers, find the developing scale overwhelming.

Micromanagement also undermines morale when every job requires specific approval. If employees have no autonomy or participation in decision making, personal development and creativity are stymied. They may resent restrictions, especially if they believe an assignment is well within their capabilities. Team members become reluctant to share opinions for fear of being shot down. Why should they risk originality?

Letting go

If you suspect you might be micromanaging, you can still take steps to rebuild trust and communication. And you’ll probably need to relinquish some control, allowing your team more space to work independently.

The first move is to ask them for honest feedback. Listen carefully and be willing to implement suggestions they may offer.

Restoring trust is a long process, but it can be based on good communication. In fact, overcommunicate. Make it clear you are willing to learn alongside them, even if that means making some mistakes. Be more open to letting them explore alternatives. Tell them your expectations, give them room to work it out and only check in when they are ready to unveil the result.

©2023

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W-2
HR Insight: Are Your W-2 Forms Correct? 1024 577 LaDonna Kearney

HR Insight: Are Your W-2 Forms Correct?

How To Avoid Incorrect W-2 Forms 

In addition to regular paychecks, employees receive another payroll document from the company they work for. That document is known as Form W-2. This important document provides a comprehensive overview of their income, including both gross income and taxable wages.

W-2s also display the total amount of money that was withheld from someone’s pay over the course of the relevant tax year. Money may be withheld for various reasons, including benefits, 401(k) contributions and a Health Savings Account.

The W-2 serves as a crucial and proof-oriented record for employees. It not only summarizes key financial information related to their employment, but it also must be submitted by both you and your employees come tax-filing season.

What’s the difference between payroll then and payroll now?

In the past, W-2s were typically required to be provided to employees by Jan. 31. This denoted the conclusion of the prior tax year. Paper filings were required to be submitted to the Social Security Administration by the end of February. On the other hand, electronic filings had a deadline of March 31. These rules have changed, however.

Nowadays, W-2s must be submitted to the SSA by Jan. 31. This aligns with the deadline by which employers must provide W-2s to employees. Additionally, penalties for failure to file a W-2 on time have changed. So have the deadlines for not providing the necessary and accurate information in order to account for inflation. These penalties now exceed $250 per return.

Some payroll issues that you must address

It is essential to rectify any instances of overwithholding of Social Security or Medicare taxes. You must promptly refund the excess amount to the employee. Also, if there has been an instance of underpayment, it is crucial to report and remit the accurate amount as soon as you are made aware of it.

Simultaneously, take into account both the employee’s and employer’s shares. In the event of underwithholding, you’ll have the option to recover the shortfall from future payments made to the employee.

However, it’s important to note that any overwithholding or underwithholding related to the additional Medicare tax cannot be corrected. When it comes to income tax withholding errors, it is not possible to make corrections once the taxes have already been deposited.

In such cases, employees are responsible for making up any shortfall or obtaining refunds by filing their tax returns accordingly. It is important to ensure accuracy in income tax withholding to minimize any potential discrepancies or issues that may arise for both the company and its employees.

The general rule of payroll

If there is an error in the amount shown on Form W-2, it is necessary to make a correction. While it is not possible to correct federal income tax withholding errors, it is crucial to rectify any discrepancies between the amount of withholding stated on the W-2 and the actual amount withheld.

In cases where the incorrect amount is within $100, no penalties are imposed for inadvertent errors. Ensuring that employees receive accurate Social Security credit for their earnings is ultimately what is of utmost importance.

Proper documentation of your employees’ earnings via Form W-2 will help maintain the integrity of their Social Security records. It will also ensure that they receive the appropriate credit for the income they have earned and received.

How to avoid common payroll errors

Did you know that the W-2 changes every year? Therefore, it’s important to make sure you purchase the appropriate form for each tax year. For this reason, you cannot use any leftover forms from years prior. Always print the current Form W-2 for each tax year. Not only will outdated W-2s not be accepted, neither will handwritten documents.

Formatting errors, according to the IRS

Be very mindful of formatting errors as defined by the IRS. When writing numbers, use decimal points and include cents rather than rounding up to the next dollar. Speaking of dollars, do not use dollar signs. And fill out W-2s only with black ink.

Make sure what you put in the boxes does not go outside the black lines. However, do not make the letters so small that they are illegible. Pay close attention to all the boxes, namely Box 13. This one is very important to pay attention to because there are three checkboxes included as part of Box 13.

Additionally, double-check that the boxes you fill in are applicable to the employee in question. Last but not least, if you find that you have made a mistake after filling out a W-2, know that it is not the end of the world. Simply fill out a Form W-2c and submit it as soon as possible. 

How to improve the effectiveness of a payroll management system

Make sure the human resources department has access to the proper tools for automating payroll processes. Ensure that HR is in compliance with all legal mandates, regulations and requirements. This can help your HR team not only accurately process W-2s but also increase the accuracy of the payroll management program overall.

Set up clear and well-defined payroll policies

Establish clear policies for payroll operations. Cover various aspects such as exceptions, review processes, approval procedures, records management and legal compliance. Clearly define the process for handling exceptions. Establish robust review and approval procedures.

Also, develop a comprehensive policy for records management and retention. Familiarize yourself with relevant legal requirements and ensure that your company complies with those requirements. Clear policies promote consistency, accuracy and compliance. Keep this in mind as you put together a guide for your payroll team.

Look closely at your payroll process and any relevant providers

Assess your payroll provider and current processes to identify any inefficiencies. Consider switching to a provider that better suits your needs if you come face-to-face with frequent errors or issues. Identify payroll priorities and specific requirements to guide your decision.

Facilitate a smooth transition by coordinating change with your provider. Then, transfer the necessary data, set up the proper systems and communicate the changes to your employees. Proper planning and execution minimize disruptions for a successful switch to a new payroll solution.

What makes a payroll system successful?

Implementing an integrated payroll system offers multiple benefits to nearly everyone involved in your company. It streamlines processes, eliminates manual data entry and enhances paper workflows. It also connects payroll activities with time tracking, scheduling and benefits-related features.

A unified system ensures accurate pay classifications, reduces errors and facilitates adjustments. Make sure you prioritize accuracy when creating W-2s for your employees. That way, you can avoid complications, penalties and additional work later on. Thoroughly review each W-2 before submitting it to the SSA. Also, send each W-2 to the appropriate employee so they can file on time and you can experience a smoother tax-filing process while complying with regulations.

©2023

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Healthy workspace
HR Insight: Creating a Healthy Workspace 1024 577 LaDonna Kearney

HR Insight: Creating a Healthy Workspace

Creating a Healthier Work Environment

Employers are accepting the critical importance of updating offices to meet employees’ new expectations for a healthy workplace. From office floors to entire buildings, there are many potential improvements for higher and middle management to consider.

Features of a healthy workspace

Contemporary design goes beyond air quality, lighting, cleanliness and gyms. It also spans physical, mental and social elements.

An office location site is the first criterion. How walkable is the route to the property and surrounding area? What is the access to local amenities, such as a shopping mall or transportation? Does your nearby outdoor space offer views of nature and greenery? Is it in a vulnerable location, prone to flooding or downwind of pollutants? If it is urban, does the neighborhood have buildings that are covered in graffiti, which surely undermines mental health? Management should be open to the prospect of a long-term office move if the surroundings require it.

Design cues are the next element. Imagine you have now arrived and are entering the premises of an organization. If you see a welcoming and attractive staircase, research indicates you are 50% more likely to use it than to take the elevator (which you might otherwise do if a steel door had blocked the stairs). Better still, if a posted sign reminds you that stairclimbing is good for you, you are more likely to mount them. In other words, communication and signage can strongly reinforce a design message. Unattractive stairwells serve for emergencies. Consider opening them up and adding appealing murals to make them more inviting.

Assess the quality of social, ergonomic and comfort levels, and not just environmental standards. For example, provide standing desks so reception staff can choose to stand or sit, allowing more active working conditions. Offer free fresh fruit at the reception desk, free for all occupants and visitors. Place convenient water bottle refilling stations. Ample bicycle storage and shower facilities encourage more active commuting. These small innovations demonstrate commitment to both health and sustainability.

Building operating policy is another criterion. Strategies range from pest control to optimizing noise, light and humidity. Follow strict criteria for how often bathrooms are cleaned, using with well-established hygiene protocols

Ventilation may work counter to energy use

In the wake of the pandemic, fresh air is at the center of all these strategies. No one would argue against the health benefits of good ventilation as a measure of virus containment. Equally, one cannot ignore an ironic paradox: The best energy rating — which theoretically means no lights or air conditioning — may not be the healthiest place for a building’s occupants.

You may need to balance energy versus wellness: If you want to increase fresh air, it may work against your energy consumption. If carbon dioxide rises over 1,000, employees tend to tire and lose concentration.

A sustainability dilemma emerged with the advent of the pandemic. Air handling units need to be powered up, which costs money and takes energy. In fact, after COVID-19 struck, there was even talk that buildings should perhaps ventilate 24/7 rather than in just their core business areas. It may be more expensive, but it can do wonders for physical and mental well-being.

Steps to take

You can get the best out of employees by making the office space more welcoming. Some lower-cost ideas for upgrading include:

  • Providing areas with comfortable seating for breaks.
  • Ensuring excellent air quality with filtration and smart controls.
  • Enforcing an effective smoking policy.
  • Optimizing temperature and lighting.
  • Offering free healthy foods.
  • Supplying ergonomic equipment — computer screens, furniture, keyboards, etc.
  • Furnishing the office with plants and greenery.
  • Installing color and artwork on walls.

Technology has proved we can work away from the traditional office, so offices must now work harder to compete with the home as an alternative. They must be a lure to draw people together to reinforce the firm’s culture and need to be more than four walls.

dangers; if the dApp isn’t up to par, the community can duplicate and launch an alternative version, giving developers a solid incentive to play fair, which isn’t often the case with standard apps.

This is just an introduction to a complex and rapidly growing field. To see whether dApps are right for you, work with IT and financial professionals.

©2023

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Retirement Plans
HR Insight: Retirement Plans that Deliver a Paycheck 1024 577 LaDonna Kearney

HR Insight: Retirement Plans that Deliver a Paycheck

Retirement Plans – The Gift that Keeps Giving

Defined contribution retirement plans have always prioritized their participants’ retirement security in their plan designs. They now realize that the savings or accumulation phase is only one element of the mission. Income solutions that provide a paycheck-like experience in retirement are required too.

Participants want lifetime income

More employees want to stay in their plans after retirement. The employer is a source they trust. Plans also want them to stay for a host of reasons — including the belief that in-plan solutions will better serve participants. If employers want to retain people in the plan, they must also offer solutions for the postretirement phase of life.

Participants face many spending dilemmas in retirement: overspending, financial uncertainty due to market volatility, inflation and the longevity risk of outliving their money. One reason participants overspend is that they have no idea how to create a sustainable withdrawal rate for drawing down their nest egg, which should probably be far lower than most people currently assume.

Plans can help. DC retirement plans need to start by shifting their focus to the individual, not the average participant. A holistic framework needs to account for the impact of all types of potential risks — mortality, longevity, liquidity and inflation.

Default options

Sponsors (that set up and oversee retirement plans) need to complement the flexibility of existing structures with the ability to provide guaranteed income. They seek solutions that are:

  • Simple.
  • Flexible, to meet the needs of different types of participants.
  • Transparent in terms of costs.
  • Operationally feasible.

To impact a broad percentage of their population, lifetime income solutions must be part of the default option. That is where participants are automatically slotted unless they opt out. These one-size-fits-all defaults are still overly generalized. They should also offer flexibility in the guaranteed income level, the retirement date and the date the participant will begin to secure income.

The industry has put in place fixes to shore up a number of shortcomings. For instance, defaults, auto-escalation and target-date funds address poor participation, contributions and investment diversification. (An auto-escalation allows plan participants to regularly increase their contributions until they reach a preset level. Target-date funds periodically rebalance asset classes, inching toward a more conservative mix.) The time has now come to fix the retirement income side as has been accomplished for accumulation.

In that context, any investment used as a default still needs to provide liquidity, even if a portion is allocated to guaranteed lifetime income. You can’t default someone into something that requires them to make an irrevocable decision. Most participants don’t want to become portfolio managers, especially in something as complex as providing income for life. They want income for life, regardless of the market environment and how long they live.

Factors driving success

Plans and employers should understand participants’ other income sources, calculating the income replacement rates provided by Social Security or perhaps a defined benefit plan. Make the retirement income solution complementary to these other income sources. A plan’s demographics matter. For instance, a relatively low-earning participant population may find that Social Security alone could provide sufficient income replacement, reducing the need for a dedicated retirement income solution.

Develop appropriate educational messaging for those nearing or in retirement. When you introduce retirement income, rely on communications to address features that participants haven’t previously encountered.

Increasingly, the line between working and retirement will blend. The implications for structuring retirement income include the need for flexibility and liquidity while still providing longevity protection. Retirement income should help participants meet their spending needs through a phased or full retirement while ensuring against the risk of outliving their savings.

An overarching message for plans is to keep it simple. Many people don’t know how to spend in retirement — it is something they need guidance with. Participants are looking for flexibility, with a preference for a total-return strategy that offers options for guaranteed income.

Talk to your financial advisers about how to structure a retirement plan that offers your retirees long-term income security.

©2023

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DApps
Why You Need to Know What a dApp Is 1024 709 LaDonna Kearney

Why You Need to Know What a dApp Is

Most apps today run on centralized networks. While centralization is efficient, it generates huge amounts of user data for unwanted exposure to hacking, clickbait and third parties profiting from stealing your data. DApps are stored across many distributed computers or nodes that make up a blockchain network.

Data security issues have generated interest in peer-to-peer solutions, which eliminate intermediaries and prevent data collection by blocking ads and trackers, letting you control your data and how it’s used. DApps can help businesses reduce the barriers preventing customers from accessing services, affording a competitive advantage.

Without a central authority, blockchains use consensus mechanisms to ensure the validity of transactions. The entire network is responsible for verification. There’s no single point of failure, making dApps reliable — blockchain networks span multiple nodes — each would have to fail simultaneously to produce an outage. And dApps are accessible through conventional web browsers.

Many institutions are attempting to improve the efficiency of financial markets by moving to blockchain solutions to develop a more democratized financial paradigm as an alternative to traditional financial services: parallel services without the need for centralized custody or fees from intermediaries. Insurance companies can promote easier settlements and faster payouts. There’s potential to unlock efficiencies in asset trading and settlement, investing, lending and borrowing, as well as real estate — and even health care.

But it’s true, too, that presently dApps need regulatory clarity to be fully effective for real-world payments. Custody activities, asset and derivatives trading, and automatic contract settlements need to be more clearly defined with greater transparency required across the board.

What are the positives of dApps?

  • They operate using computing power from different computers, not a central server. DApps don’t require personal information from users to grant access.
    • The anonymous nature of dApps makes them guarantee data privacy and increase consumer trust. For example, while cloud storage has improved information storage for business, the trade-off is lower data safety.
    • Malicious individuals can target data silos and take over company databases.
    • Blockchain-powered apps ditch this arrangement, relying on distributed computing systems. Accessing stored files would require hacking the entire network, which is difficult if not impossible. The data stored can only be decrypted by those with access to the cryptographic keys.
  • They improve customer privacy, better data safety, reduced downtime — there’s no single point of failure, preventing service interruptions and reducing application downtime.

Know the full story

Instead of using a username and password, you access decentralized applications with a private and public key, which can be awkward. Other possible drawbacks:

  • It’s not easy to modify the source code after deploying it — it’s difficult to launch a dApp and add new features to encourage scalability and maintenance. Developers can’t fix bugs and improve the system unless each peer on the network updates its node software.
  • There are major risks that need to be mitigated before decentralized finance can substantially displace traditional finance. There’s potential for growth, but a whole host of risks remain. Financial institutions and central banks are exploring how to combine the innovative aspects of decentralized finance with appropriate safeguards.

Basic governance requirements — especially in risk management — need to be mandated. Crypto asset investors and other stakeholders have seen risks from weak regulation and governance. It seems apt to compare dApps to the early days of the internet. DApps may seem mainly unproven, and skepticism is high, but there’s the promise of useful innovations.

Networks will have to gain scale and there needs to be interoperability across networks. DApps are open source, meaning that anyone can examine the inner works to ensure there are no hidden dangers; if the dApp isn’t up to par, the community can duplicate and launch an alternative version, giving developers a solid incentive to play fair, which isn’t often the case with standard apps.

This is just an introduction to a complex and rapidly growing field. To see whether dApps are right for you, work with IT and financial professionals.

©2023

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Whistleblower
HR Insight: Whistleblowers 940 788 LaDonna Kearney

HR Insight: Whistleblowers

Blowing the Whistle

Ralph Nader coined the term “whistleblower” in the 1970s when he hosted a conference on professional responsibility. His linguistic hack was designed to counter negative connotations of labels like “rat” and “snitch.”

As opposed to a grievance, which likely describes a personal complaint against a fellow employee, a whistleblower generally airs an accusation against the company. Whether the charge results from a long-simmering vendetta or a well-intentioned heads-up does not matter; the underlying motives are irrelevant. All that counts is that the whistleblower sincerely believes the complaint to be true.

Businesses create whistleblower policies and procedures to reinforce a transparent and supportive office culture. Ideally, the objective is to identify, investigate and address misconduct before events reach the level of a criminal charge or public relations debacle.

More recently, the focus of what constitutes wrongdoing has widened. Years ago, the violation tended to be illegal financial misbehavior, such as fraud, embezzlement or theft. Today, in keeping with current social trends, it is likely to be harassment, discrimination or bullying.  Firms take especially seriously any reported risks to worker safety with potential moral and legal implications. Companies recognize that all these offenses can damage their hard-earned brands, incur legal costs and destroy valuable business relationships.

Protected by law

Rules and regulations surrounding whistleblowing and reporting have also evolved and been codified into federal and state statutes. The Whistleblower Protection Act of 1989 was enacted to shield federal workers from reprisals when reporting mismanagement, abuse, and public health and safety violations. In 2002, the Sarbanes-Oxley Act was passed to guard investors from fraudulent corporate practices. In the wake of the 2008 financial crisis, lawmakers followed suit with the Dodd-Frank Wall Street Reform and Consumer Protection Act, which also prohibits employers from retaliating against workers.

Corporate retaliation can take many forms, both overt and subtle:

  • Firing.
  • Demotion.
  • Reduction of benefits.
  • Garnishment of wages.
  • Reduction or increase in work hours.
  • Blacklisting.
  • Sidelining.
  • Reassignment.
  • Bad references.

In addition, a variety of other laws pertain to specific industries, such as automotive, nuclear, trucking, chemical, and gas and oil.

Taking steps

Before trouble arises, a business should have ready its own book of policy rules. Historically, whistleblower issues were typically handled by legal, compliance or risk departments, but nowadays, HR is likely to be first on the scene.

Your policy document may begin by defining what whistleblowing actually is: bringing wrongdoing, committed by the employer or co-workers, to the attention of management. It will go on to lay out in more detail how to raise the concerns and to whom. It should highlight the intention to treat the entire issue fairly and confidentially, and possibly provide some time frame and a method for resolution.

With its policy statements prepared, the company should advertise the system across the workforce and thank employees for coming forward. A haphazard approach will not work well. Every complaint needs to be investigated. It will be necessary to train managers in the reporting process and prepare them for the types of alleged behavior they are likely to confront. They should be alert to false allegations and reprisals, too.

Some companies may add an anonymous hotline to encourage a safe speak-up culture.  Employees doubtless know that they are risking ridicule or ostracism if their complaints backfire or their anonymity is breached. It is up to the employer to instill confidence that they will be secure, despite potentially exposing colleagues. Employees must believe in the reporting system and that management will take seriously the issues raised. They must also have confidence that they are empowered to help create positive change.

©2023

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