October 5th. 2016
Open enrollment for individual and family healthcare plans for 2017 is rapidly approaching. It begins on November 1, and many employers choose a similar timeline when allowing workers to sign up for, or make changes to, their participation in the company’s benefits offerings. As such, now is a vital time to review your benefits package and ensure your plans are in compliance with all government regulations before you roll them out to your workers during the open enrollment period.
In April, the U.S. Department of Labor (DOL), issued a final rule to address conflicts of interest in retirement advice. This fiduciary standard applies to anyone who provides investment advice to sponsors and participants in workplace retirement plans and individual retirement accounts including 401(k)s and IRAs, and is expected to impact compliance issues and costs for employers who offer employer-sponsored retirement plans as part of their benefits package.
In essence, the definition of ‘fiduciary’ has been expanded by the new rule, and many vendors who service employer-sponsored retirement plans who were not formerly considered fiduciaries now will be. This includes broker-dealers and mutual-fund representatives. Experts recommend that employers carefully evaluate all of their retirement plan advisors and services and cut ties with those who do not want to comply with the new fiduciary standard.
The Department of Health and Human Services continues to update regulations that can have direct effects on the healthcare benefit employers offer. Before you roll out your non-grandfathered 2017 healthcare insurance selections to your workforce, you’ll want to makes sure each one covers all essential health benefits including:
- Ambulatory patient services
- Emergency services
- Maternity and newborn care
- Behavioral health treatment for mental health and substance use disorders
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventative and wellness services (including chronic disease management)
- Pediatric services (including dental and vision care)
The medical options offered must also meet established minimum value, minimum essential coverage and affordability standards. For example, in order to avoid making employer shared responsibility payments to the IRS, your employer-sponsored plan must cover at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan.
Finally, you must make sure that the healthcare plans you’re offering—and the insurers who back them—meet the final Department of Health and Human Services (HHS) regulations under the Patient Protection and Affordable Care Act (ACA, section 1557) which prohibit any discrimination on the basis of race, color, national origin, sex, age or disability when offering or providing health coverage. This includes denying or limiting coverage for health services provided to transgender individuals, categorically excluding all coverage for health services related to gender transition, or denying or limiting coverage for specific health services related to gender transition.
If your employee wellness program includes a health risk assessment, biometric screening, asks for a spouse’s information, or includes a financial incentive for participants, you’ll want to ensure it meets new Equal Employment Opportunity Commission (EEOC) rules.
While the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA) generally prohibit employers from asking for information about their workers’ health conditions or the health conditions of their family members, they do not prevent employers from asking health-related questions or conducting certain medical examinations to determine risk factors as part of a voluntary wellness program.
Under the Health Insurance Portability and Accountability Act (HIPAA) as amended by the ACA, wellness programs are only considered voluntary if they offer incentives that are 30 percent or less than the cost of an individual’s health insurance premium. The maximum incentive for spouse participants is also limited to 30 percent. No additional incentives are allowed in exchange for specific genetic information (such as family history or genetic test results) of an employee, employee’s spouse, or employee’s children. Smoking cessation programs can offer an incentive up to 50 percent of the cost of individual healthcare coverage.
The Bottom Line
Benefits plan compliance has always been complicated and has only become more so in recent years. If you’re uncertain that your 2017 offerings meet government standards and regulations, contact your benefits professional for a review and assistance.
October 5th, 2016
Unlike motor vehicle insurance, homeowner’s insurance is not required by law. However, if you purchased your home with a mortgage, your lender likely required you to buy a homeowner’s insurance policy to protect their investment in case of a fire or natural disaster. It’s important coverage to have—even if you own your home free and clear—and you may even be able to reduce your annual premium once you understand the factors that generally affect homeowner’s insurance rates.
1. Your home’s age and construction.
When setting a homeowner’s insurance rate, the insurer estimates how much it will cost to rebuild the property in question should it be damaged or destroyed. Materials and features common in older homes—such as hardwood floors and ornate details—cost more to repair and replace. Whether the exterior was constructed out of brick or wood will also factor into the cost, as will the age of the electrical, heating/cooling and plumbing systems. Upgrades reduce the likelihood of loss and often lower homeowner’s insurance premiums.
2. Pools and hot tubs on the property.
If your home includes a swimming pool, spa or hot tub, your homeowner’s insurance is going to be more expensive because additional liability coverage will be required. While most policies include a minimum $100,000 in liability protection, your insurance agent may recommend increasing it to between $300,000 and $500,000 as well as adding an umbrella policy with at least $1 million in protection. If you want to minimize your homeowner’s insurance costs, avoid purchasing properties without outdoor pools and hot tubs.
3. The location of the nearest fire department.
Direct property loss as a result of home fires has been estimated at $7.3 billion annually. If your home is near a fire department (or even a fire hydrant), you’ll pay less for your homeowner’s insurance as a result. Homes in urban and suburban areas usually have better fire protection than those in rural areas as well. So if you want to keep your homeowner’s insurance costs as low as possible, consider location when buying a home.
4. The location of the nearest body of water.
If your home is near a coastline, large body of water, or in a floodplain, you’re going to pay higher homeowner’s insurance premiums. Depending on your location, your policy may have a separate deductible for hurricanes and windstorms. And flood damage—from any exterior source—is not covered by standard homeowner’s insurance policies. You’ll need a policy specifically for flood insurance if you’re in a high-risk area.
5. Your past insurance claims history.
Even if you’ve purchased a new home and changed insurance companies, any claims you made at your previous residence will be considered when setting your homeowner’s insurance rate. Insurers can access this information through the Comprehensive Loss Underwriting Exchange, which reports filed claims for seven years. In general, the amount of the claim carries more weight than the reason for the claim.
Whether you’re in the process of looking for your next home or just want to explore ways to lower your current homeowner’s insurance rates, your insurance professional is your best resource for information on these and other factors that will affect your premium.
August 30th, 2016
In light of the Department of Labor’s (DOL) recent changes to overtime pay rules—issued on May 18, 2016—more business owners are concerned about controlling overtime costs. The increase in the minimum salary an employee has to earn in order to be exempt from overtime pay (from $23,660 to $47,476) is expected to increase the number of workers eligible for overtime by 4.2 million. Complying with this change will add to companies’ payroll costs and may also impact their administrative and legal expenses as well. Fortunately, there are steps you can take to minimize the effects of the new rule on your business bottom line and remain in compliance.
Review your workers’ job classifications. Exemption isn’t just based on earnings; it’s also determined by the type of work the employee does. Workers who earn more than the threshold amount ($47,476) but who do not perform primarily executive, administrative or professional duties(all relatively high-level work), cannot be classified as exempt and are eligible for overtime pay. A summary of exempt job duties can be found here. Carefully examine the job descriptions, roll requirements and hours worked for all positions within your organization. If you have workers performing those duties but earning less than the threshold, you’ll need to reclassify them.
Compare the costs of payment options. Let’s say you have a previously exempt worker who is earning a salary of $46,000 a year and whose position regularly requires him to put in more than 50 hours a week. You’ll probably save money in the long run by raising his salary to $47,500 and continuing to classify him as exempt than by keeping it where it’s at and paying him overtime every week.
On the other hand, maybe you have a previously exempt employee who earns a salary of $23,000 a year and who usually works 50 hours or more a week. Raising the employee’s salary above the new threshold may cost more than reclassifying him as non-exempt and paying overtime. You could also look at hiring a part-time employee to take on some of the work (eliminating the need for him to work overtime altogether) or otherwise redistributing duties to reduce his workload.
Monitor employee hours carefully. In the event of a lawsuit or DOL investigation, you’ll need to be able to document the number of hours your non-exempt employees worked and any overtime hours for which they were paid. Wage and hour claims account for the greatest percentage of litigation in employment law, and many of those lawsuits arise as a result of misclassification issues and wage violations. While the DOL does not require employers to use automated time-management systems, manual time tracking can increase errors and reduce the accuracy of your payroll process. Automated systems not only continuously track time worked but can also help you more closely monitor overtime and creative cost-effective work schedules.
August 30th, 2016
Traditional house keys may soon go the way of rotary phones thanks to new lock technology. From fingerprint sensors to Bluetooth and Wi-Fi enabled systems, keyless entry products are rapidly transforming the way Americans secure the doors to their homes. Are these easy-access locks the right choice for you? If you’re not comfortable with technology, they probably won’t be. However, if you have no problem programming your DVR, universal remote and household thermostat, a keyless lock may be a good option.
Types of Keyless Locks Available Now
- Biometric locks recognize your fingerprint, allowing you to unlock your home with a swipe of your finger. This type of keyless lock requires you to program it with your fingerprint as well as those of the rest of your family or others you want to allow to access your home.
- Proximity locks use RFID technology and work with a key fob that you carry with you. Much like electronic car door locks, you can unlock or lock them with a press of the fob button. Some don’t require you to remove the fob from your pocket or purse first, either—a handy feature if you regularly enter or exit your home after dark or often have your hands full.
- Smartphone-controlled locks synch with your mobile phone via Bluetooth. This allows you to control entry to your home remotely as well as track who is coming and going. Some of these locks will actually text you when someone else opens your home’s door. Others will automatically unlock your door when you approach it.
- Keypad locks, the earliest type of keyless locks available for homes, are still a good option as well. They all require you to program an entry code, though newer, more complex models may allow you to have individual codes for specific people or even program a greeting that will play when the door is unlocked. Surveillance varieties take photos of whoever opens the door.
Prices for electronic door locks range from $100 to more than $1,000, depending on the type of lock and features included. While they can make entering and exiting your home easier—unless there’s a power outage or the circuit board fails—they aren’t necessarily more secure than traditional keyed locks are.
Burglars generally enter homes through unlocked doors or windows or by forcing open a window or door. If security is your main concern, you’re probably better off investing in solid wood or steel exterior doors rather than the latest electronic lock technology. Door jams reinforced with steel plates will also make it more difficult for an intruder to kick in the door.
Whether you opt for traditional keys or a new, high tech electronic lock for your home, it’s important your property is adequately insured in the event of a break in. If you don’t currently have homeowner’s or renter’s insurance, talk to an insurance professional about your options. If you already have a policy, it’s wise to review your coverage at least once a year and make appropriate adjustments.
August 17th, 2016
A 2014 survey of business leaders found that 71 percent prefer to develop their current employees’ skills and then move them into more-senior rolls versus hiring an external candidate for the same position. There are many reasons why this is so, from performance to improving morale and reducing turnover. However, there are also situations in which an external candidate might be a better option. The trick is determining when; you’ll need to consider the following factors to figure it out.
If you’re worried about hiring costs, you might want to look to internal candidates first. Outside recruiting fees can run as high as 25 percent of a position’s salary. And if you choose to recruit externally yourself, you’ll incur costs for posting job ads as well as promoting them. You’ll also need to spend more time screening and interviewing candidates you’ve never met versus reviewing the skills and performance of an employee who already works for you.
If you want to pay a lower salary, you might want to look to internal candidates first. According to the Society for Human Resource Management, external hires often get paid 18 to 20 percent more than internal hires do. If you have employees within your organization who are capable of the job, it may make more financial sense to promote them—and increase their compensation accordingly—than to hire an external candidate with the same skills and a much higher price tag.
If you want to reduce your onboarding and training costs, you might want to look to internal candidates first. In many cases, an external hire will require more training than an internal hire will. You’ll also have to devote time to communicating your organization’s policies, processing employment paperwork including retirement accounts and health insurance, and introducing them to the existing team.
If you’re interested in tax incentives, you might want to look to external candidates first. Federal and state governments offer many tax credits to help offset the costs of hiring and training new employees. For example, the Department of Labor Work Opportunity Tax Credit is available to organizations that hire workers from certain target groups including unemployed veterans, food stamp recipient and ex-felons.
If you’re expanding or diversifying and adding a brand new role, you might want to look to external candidates first. If you’ve created a new position that is unlike any other in your organization, you may not have any current employees who can successfully fill it without a significant investment in training and/or education. In this case, it likely makes more sense—financially and in terms of productivity—to seek an experienced candidate outside your company.
August 15th, 2016
According to the Centers for Disease Control and Prevention (CDC), motor vehicle injuries are the leading cause of death among children in the United States. In 2013, 638 children ages 12 and younger died in motor vehicle crashes. Another 127,250 were injured.
Many of these deaths and injuries could have been prevented with the use of a proper child safety seat. Car seat use reduces the risk of death for children under age 1 by 71 percent and children ages 1 to 4 by 54 percent. Booster seat use reduces the risk for serious injury in children ages 4 to 8 by 45 percent compared to the use of seatbelts alone.
If you want to ensure children riding in your car are doing so safely, you’ll need to do the following:
- Know your state’s child passenger safety laws. While requirements vary based on age, weight and height, all states require child safety seats for infants and certain children. Many require children to ride in the rear seat whenever possible, as well as the use of rear-facing infant seats, forward-facing child safety seats, and booster seats for older children. You can review state-by-state laws here.
- Make sure the car seat is appropriate for your child’s size and age. Rear-facing car seats should be used from birth to age 1 at minimum. However, it’s wise to keep your child in a rear-facing car seat until he/she reaches age 3 or outgrows the height and weight limit specified by the manufacturer. At this point you can transition your child to a forward-facing car seat until he/she is age 7 or again outgrows the manufacturer’s height and weight specifications. Booster seats are recommended for children age 7 and older who cannot fit in a seat belt correctly without one.
- Only buy car seats rated and recommended by the National Highway Traffic Safety Administration (NHTSA). These seats meet Federal Safety Standards as well as strict crash performance standards. You can find a list of NHTSA rated car seats, along with information on their ease of use, here.
- Make sure you install and use your car seat or booster seat properly. Seats must be carefully installed according to the owner’s manual instructions. If you need assistance, you can consult a child passenger safety technician (find one here) or visit a car seat inspection station (find one here) in your area. Local law enforcement agencies may also hold periodic car seat inspection events.
- Put your child in the middle of the vehicle. When travelling with one child or only one child in a safety seat, place it in the center of the backseat. In the event of an automobile collision, this is the safest location in the vehicle.
- Register your car seat with the NHTSA. Unfortunately, recalls happen. If you want to avoid using an unsafe car seat that has been recalled, you can register with the NHTSA to receive notices about safety-related defects and recalls.
August 9th, 2016
Americans are notoriously bad at taking vacations. According to a study commissioned by Project: Time Off, 55 percent of workers had unused vacation days in 2015. This was equal to 658 million days, of which 222 million could not be rolled over or paid out in any way. While that might sound like good news for the employers who didn’t have to work around their employees’ time off or pay for the unused vacation days, constant work without adequate downtime can actually lead to higher stress and lower productivity. And a workforce suffering from either of those is not healthy for your bottom line.
How can you encourage your employees to use their hard-earned vacation time? You can start by reducing their guilt. An Alamo Rent A Car study found that 47 percent of workers feel shame or guilt when asking for vacation time. The percentage jumps to 59 percent among Millennial employees, 42 percent of which do not hesitate to shame their co-workers who do decided to take vacations.
In addition, consider implementing the following best practices at your workplace:
- Formulate a solid vacation policy. Whether you choose to offer a set number of days off for all employees or enable them to earn more vacation days with additional years of service, put your terms in writing. This includes determining how many days—if any—employees can roll over to the next year or setting a cap on the total amount they can accrue, two policies that may help prevent employees from sitting on unused vacation time.
- Communicate it frequently. Don’t just talk about vacation time when interviewing potential hires. Make sure your vacation benefit is spelled out in your employee handbook and periodically review the details at staff meetings. Keep an eye on vacation time accrued by each employee and encourage them to use it.
- Help workers redistribute their workloads. The Project: Time Off study also found that 30 percent of employees don’t take time off because they don’t think anyone else can do their job. Thirty-seven percent are afraid they’ll return to a mountain of work. You can encourage your team to use their vacation time by offering to aid in the redistribution of their workload and cross training other employees to cover vital duties.
Set a good example. It’s important for your employees to see you—and your management team—take vacation time off.
July 27th, 2016
Mental illness affects more of your workforce than you may realize. According to the National Alliance on Mental Illness, 43.8 million U.S. adults—or approximately one in five—experiences a mental illness in a given year. For 10 million of them, the mental illness is serious enough to substantially interfere with or limit one or more of their major life activities.
While depression and anxiety disorders—including posttraumatic stress disorder, obsessive-compulsive disorder and specific phobias—are the most common, your employees may also be dealing with other mental illnesses such as bipolar disorder and schizophrenia. It is estimated that serious mental illness costs America $193.2 billion in lost earnings every year.
Most of your employees who suffer from mental illnesses will do their best to never have to tell you about them. However, it’s up to employers to be proactive and establish ways to handle employee mental health issues at work when they arise. Experts advise addressing them on a case-by-case basis using the following steps.
- Acknowledge the issue. Whether an employee comes to you directly or you notice signs and symptoms that seem to point to a possible mental illness, the first step is to acknowledge the issue and speak candidly yet sensitively with the employee.
- Gather the facts. Evaluate the effect of the mental health issue on your employee’s job performance. You should discuss this with the employee as well as his or her supervisors and managers. Consider reasonable accommodations you may be able to make to help the employee continue functioning productively.
- Learn more about the mental illness itself. Consider speaking with a healthcare provider as well as a lawyer to learn more about reasonable expectations, possible accommodations and any legal requirements associated with the particular mental health issue. Legal obligations in regards to mental health accommodations may vary from state to state. Many mental illnesses are considered disabilities and protected accordingly under the Americans with Disabilities Act.
- Make any necessary changes. Based on your conversations, legal obligations and what you’ve learned about the nature of the mental health issue your employee is dealing with, adjust job duties and/or expectations. Continue to check in with your employee to make sure the changes are working for them and progress is being made.
Managing mental health issues in the workplace can be challenging. In addition to the steps above, adding an employee assistance program (EAP) to your benefits package may help. EAPs are voluntary, confidential programs that benefit any employee with a personal or work-related problem—not just those suffering from mental illness. Short-term counseling and assessments can help workers deal with alcohol and substance abuse problems, stress, grief and family difficulties as well as psychological disorders. To learn more about your EAP options, contact us today.
July 26th, 2016
Fires, floods, tornados, hurricanes, high winds, hail and lightning… Mother Nature has some serious weapons in her arsenal, and she’s not afraid to use them. With extreme weather becoming more common in many parts of the country, every home is likely at risk of incurring damage from more than one type of natural disaster. In some cases, even with insurance, the outcome is financially dangerous. Consider the following monetary hardships you may encounter.
You’ll probably pay clean-up costs out of pocket.
Even if these expenses are covered by your homeowner’s insurance, you may want to pay for them upfront in order to speed up the process. From removing downed trees to ripping out water damaged drywall and flooring, clean-up can run in the thousands. If you don’t have that kind of cash on hand, you’ll have to live surrounded by debris until you receive the check from your insurance company. Talk to your insurance agent about what your policy covers as well as how quickly payouts are usually made.
You’re going to need vital paperwork.
From your insurance paperwork to birth certificates, social security cards, bank account and credit card information, there are many important documents you’re likely to need in order to get your life back in order after a natural disaster. If they’re lost or cannot easily be accessed, it could delay the processing of your insurance claims and receipt of any government assistance to which you may be entitled. Experts advise making copies of important paperwork and storing it electronically using a cloud-based storage provider such as Dropbox. You might also consider keeping hardcopies of important documents in a safe or safe deposit box.
You might be on the hook for more than you realize.
You knew you needed insurance, but you also wanted to keep your premiums low. You may have bought a policy with a higher deductible as a result, and you’ll have to put that much cash towards clean-up and repairs before your insurer will cover any difference. Talk to your insurance agent now—before a natural disaster strikes—about the deductible and coverage limits on your insurance policies. If you live in an area where certain types of extreme weather are common, it might make financial sense to increase coverage and reduce your deductible.
You’re probably going to need access to cash.
After a major natural disaster, power outages are not uncommon—and they can last weeks and cover large areas as well. Whether you need to secure a hotel room for your family, buy clothing and toiletries, or just pay for pizza delivery until you can use your stove again, you may need to use cash if debit and credit card machines are down. Consider putting some cash in a safety deposit box at a bank in a neighboring town. Set up direct deposit with your employer so your earnings will automatically go into your bank account as well.
Do you know what your insurance policies cover? Are you concerned about the financial implications of a natural disaster? Call us today to review your coverage and discuss options to lessen the financial burden should Mother Nature decide to strike your home.
July 23rd, 2016
Today’s employees consider schedule flexibility an attractive benefit. According to a survey by FlexJobs, an online job search website, the options these workers are most interested in are telecommuting all of the time (79 percent), alternative/flexible schedules (47 percent), and telecommuting part of the time (44 percent). While working from home full time isn’t possible in many positions, there are more reasons than you may think to allow your employees to work from home one or more days a week.
1. It will make them more productive.
Among the respondents of the FlexJobs survey, 54 percent reported that their home offers the best environment for working on important assignments. Only 19 percent felt they could get more done at the office during regular working hours. Another survey by ConnectSolutions, a private-cloud solutions provider, found that 77 percent of the respondents who worked off site at least a few times each month reported greater productivity. Additionally, 52 percent were less likely to take time off when sick if they could work remotely instead.
2. It will reduce their stress levels.
Among the respondents of the FlexJobs survey, 88 percent reported that working remotely reduces their overall stress. Eighty percent said it helps them be healthier all around. Another survey found that this reduction in stress due to the ability to work off site improved morale for 80 percent of the employees. Sixty-nine percent reported it improved absenteeism as well.
3. It will make them more loyal.
Employee retention is a big deal at most companies. No one wants to lose a good worker after making significant investments in his or her training and career development. However, allowing these high performers to work from home on occasion may go a long way towards ensuring they remain engaged, happy and loyally employed with you. A Stanford study found that remote work options decreased employee turnover by 50 percent. Among the respondents of the FlexJobs survey, 82 percent said they’d be more loyal to their employer if they had flexible work options.
4. It could even reduce your costs.
The FlexJobs survey also found that 20 percent of workers would be willing to take a 10 percent pay cut in exchange for flexible work options. Twenty-two percent would give up health benefits, and 18 percent would be willing to work more hours if they were allowed to work from home. Additionally, there is some evidence that allowing your team to work remotely can also reduce your real estate expenses and overhead.
If your employee benefits package does not currently include schedule flexibility or remote work opportunities, you may want to consider adding these popular options. To learn more about how to make off site work a practical benefit at your organization, contact us today.