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Starting a new venture is always exciting—you get to dip your toes into something fresh and decide what direction you’ll take to complete the endeavor. When starting your own business, however, multiple aspects must be considered—the culture, mission, values, employee size, procedures, management, etc.—and this is where business owners tend to overlook the importance of a human resources department. Small businesses are pressured to bring in sales in order to keep their doors open, but as more sales are made, workload increases and more employees are needed. This is where HR is crucial.
With the need for more employees comes the need for proper management training for supervisors. If there is little to no guidance on how to manage employees, the company may be more exposed to liability for illegal employment practices. There needs to be someone who is well versed in current employment laws—if your company continues to move forward and ignores the importance of being in compliance, you run a high risk of getting yourself into legal trouble. And as a small business, a single lawsuit may close your doors for good.
Furthermore, an HR department is needed for talent management purposes. If management only cares about the dollars coming in and disregards their employees’ needs and well-being, there is a great chance these vital employees may leave. Pressure from management to complete work as well as having a large workload may lead to employee burnout. Small businesses need to retain their talent and find ways to keep their employees present—incentives, rewards and recognition are some popular tactics. Management needs to show their employees that all their hard work is much appreciated, therefore a culture that values and balances both work and play may alleviate stress and simultaneously promote productivity and overall morale. All in all, small businesses cannot afford to have a high turnover rate because the longer a seat is vacant, the more money it costs the company…and the more burnt out employees may feel if the extra work load gets dispersed.
For small businesses who cannot afford an HR department, there are outsourcing options. e-VentExe has a special service called eBasicHR which serves as a full HR department. eBasicHR gives business owners access to documents and forms necessary for compliant purposes, as well as unlimited use of an expert HR consultant who will answer and advise any question or issues that may arise.
*e-VentExe is a full service human resource consulting firm specializing in compliance law, recruiting and selection, training and development, and assessment tools. If your company is interested in learning more about eBasicHR or any of the services listed above, please call e-VentExe at 916. 458-5820.
Please welcome our guest blogger , Carolyn Lewis, CEO of the Lewis Group. Carolyn has been recognized as an industry leader whose deep insights in the healthcare marketplace and broker channels mark her as a sought-out speaker and consultant.
- Self-Funding for Smaller Companies. Beginning in 2016, the Affordable Care Act or ACA will re-define companies with 51-99 employees as “small groups.” This will essentially eliminate a key risk to self-funding health insurance for mid-sized organizations. Self-funding a company group plan works by taking the medical premiums paid to a fully-insured medical plan carrier and breaking them into 3 parts: stop loss insurance, administration, and direct payment of medical claims. The problem hasn’t been finding stop loss policies for “healthy” self-funded plans; it’s been how to manage exposure when a few claims push the financial limits of the medical plan. The ACA in 2016 will allow mid-sized companies to move into the fully-insured guaranteed-issue small group market. That means a self-funded plan with high claims experience will no longer be “stuck” with significantly increased reinsurance premiums. Some advantages of self-funding for employers are:
- Avoidance of ACA premium taxes that range from 1.5% to 3%.
- Companies can create their own medical plan design and avoid some ACA requirements that apply only to fully-insured plans.
- Access to group medical claims leads to cost savings and better wellness program impact.
- Many employers save on annual plan cost compared to fully-insured plan premiums.
- Avoiding the ACA Cadillac Tax. In Mercer’s 2013 National Survey of Employer-Sponsored Health Plans, nearly a third of large employers say that concern over the excise tax influenced health plan decisions for 2014. In 2018, the cost of ACA’s Cadillac tax, a 40% tax on the value of medical benefits over a set threshold amount, will vary depending on the number of enrollees and the plan’s costs. Companies likely to hit the tax threshold have time to plan for a “soft landing” by phasing in changes that will reset benefit cost a a level below the threshold. The most common strategies from the Mercer survey are adding, or building enrollment in lower-cost consumer-driven health plans and eliminating the highest-cost plan offered today.
- Re-Thinking Dependent Coverage Strategies. New rules have relaxed the requirement for large companies to offer dependent coverage until 2016, but the ACA definition of “dependent” affects both large and small companies. Since a “spouse” is not included in the ACA definition of dependent, the law does not require that spouses be offered subsidized affordable coverage by large or small companies. Unfortunately, if any employee has access to coverage that could include their spouse, that spouse is prevented from receiving subsidized coverage through a state or federal healthcare exchange marketplace. This is known as the ACA “dependent glitch.” Plan sponsorship strategy should now include analysis of the pros and cons of allowing spouses and/or children for small group, to “peel off” and purchase coverage on an exchange.
- Next-Generation Company Wellness Strategies. The best way to stabilize premiums and reduce plan costs is to improve employee health and wellness. Most large companies have some sort of wellness program in place, and implementation for smaller firms is becoming more accessible and even integrated into small-group fully-insured plan designs. The ACA allows employers to increase the value of incentives from 20% to 30% of total plan costs, so many companies are planning to expand their programs in 2014. The Mercer Survey indicates a shift from participatory plans to those that focus on rewarding employees for improvements on measurable health standards. This means that wellness, as a key way to engage employees, will become more integrated with company culture and will require more structured year-round communications tied to benefits education.
- Growth in Defined-Contribution Approach & Year-Round Benefits Communication. Traditionally, companies pay a certain percent or dollar amount towards the cost of a narrow range of medical, dental, vision, and any other ancillary plans. In a defined contribution approach, the employer provides each employee a set amount of dollars to spend on a much-expanded variety of benefit plans. This allows employees to essentially “go shopping” to design a custom package based on their own needs. Because the ACA has significantly increased employee interest in learning more about their benefits, many employers are shifting to the new defined benefit strategy that capitalizes on this trend to consumerism. The ACA rules governing plan designs have also driven benefits to become more commoditized. One way to keep a group benefit plan attractive and competitive is to expand choice and allow employees to have more control on how they put together their annual elections. Investing in improved communication is supported by the latest annual Met Life Employee Benefit Trends Study that reports that 54% of Gen Y and 38% of Gen X employees say they need more help understanding how their benefits work and how they help meet their personal and family needs. Responding to these trends with a defined benefit approach can offer these advantages:
- A more predictable, stable benefits budget.
- Better engaged, happier employees.
- A more competitive benefits package to recruit and keep top talent.
The Lewis Group is an award-winning team of employee benefit, HR, technology, and compensation specialists committed to delivering unique solutions that are specifically tailored to an organization’s goals. They analyze and match businesses to exceptional brokers recruited from top agencies in California to boost in ROI on benefits spend and align with company goals for growth and profit. CEO, Carolyn Lewis, has been recognized as an industry leader whose deep insights in the healthcare marketplace and broker channels mark her as a sought-out speaker and consultant. She began her career as a senior executive at the innovative Sacramento non-profit now known as WellSpace Health in Sacramento. She then worked for 10 years at a senior level for a national insurance carrier and spent 8 years as a broker/consultant both at her own company and with the highly-regarded Benefits Done Right Insurance Agency. Carolyn earned her BS from the College of William & Mary in Virginia and her MBA from the Santa Clara University Leavey School of Business.
We have all been touched in some way by the economic downturn in our region, professionally and personally. Many have felt the cold hand of fate grabbing at our dreams and plans for our future/ business and personal goals. Companies that stayed open dealt with the uncertain business landscape in a variety of ways. Some CEO’s laid off long term employees to avoid the negative spiraling bottom line results. Other CEO’s modified positions, changed responsibilities and tried to right size the operation the best they knew how. And, there were those CEO’s who closed their doors completely; the burden was just too large to manage. Those days were very dark, doubtful and relentless. I am sure many leaders sat at their desks alone and wondered, “Did I make the right decision? Could I have done something different? Would the business outcome be different? What if…., Where do I turn? Who can I talk to?”
Today, hope for our business future is taking shape again. We are seeing a resurgence of focused energy and innovation from our leaders. It finally feels like a spring day—the sun is out and the birds are singing. People are smiling again. However, the economic downturn has left a deep scar that may never fully become invisible. I like to call this period of new growth a Period of Reengineering.
CEO’s have a fresh start, a new look at their organization and workforce. They can once again begin to build a thriving and prosperous business and create a positive and engaging employee culture. Vistage International can become that voice, that resource for executives and business owners who supports and guides them through extremely uncertain business decisions. The time is now to reach out, seek guidance and support from a confidential, peer advisory group of CEO’s.
Vistage International brings together successful CEO’s, executives and business owners into private advisory groups. Each group is purpose-built to help members help each other improve the performance and outcomes of their business and personal lives. Vistage International works with each CEO to be a better leader who can make better decisions and get better results. In fact, they have helped over 75,000 members since 1957 when they began. And the support does not look at one dimension of a CEO’s life; the business. Discussions also center on a person’s health and personal life—it is strongly believed that the “whole person” adds to the strategic direction of a company. If issues are present in any of the three categories listed above, they are freely discussed inside the confidence of a member meeting.
Although peer advisory groups are a great help towards success, leadership and management trainings and assessments should not be ignored. These tools allow those in management to be aware of their strengths and weaknesses, ultimately allowing them to build upon their skills.
For more information regarding Vistage International and e-VentExe, please call Amelya Stevenson, M.A., SPHR-CA Vistage Chair and owner of e-VentExe, a full service Human Resource Consulting Firm at 916.458.5820.
Founded in 2000 by Amelya and Craig Stevenson, e-VentExe provides businesses with strategic and compliance human resources tips and techniques, organizational effectiveness (or ineffectiveness) and overall strategic and healthy cultural influences in the workplace. We also make HR administration easy for small businesses with our eBasicHR and Compliance package. At e-VentExe, we keep the “Human” in Human Resources. Let us show our dedication to you! For more information, please visit us at www.e-ventexe.com,“LIKE” us on Facebook or follow us on Twitter!
“The best preparation for good work tomorrow is to do good work today.” – Elbert Hubbard
Free Webinar Series: A Guide to Understanding Human Resource Management Solutions & Employee Assessments
Spring has sprung! Spring is a time for renewal and rebirth of life and energy—plants and flowers begin to sprout and bloom, the annual “spring cleaning” spree ensues to remove unnecessary materials collected during the winter hibernation months, cleansing of the mind and body are encouraged. As such, spring is an essential time for leaders in organizations to review, rethink, and rejuvenate their overall culture by reevaluating their own skills.
Those holding leadership positions should ask themselves, “What can I do to make my organization better?” This “spring cleaning” may include tactics, ideas, strengths and weaknesses.
- Tactics: As a leader, making strategies and planning (whether long-term or short-term) are typical functions. Tactics on how to perform these strategies must be considered—what’s working now? What worked in the past? What have I done that seems to be working? Sure, every situation is different and plans need to be adjusted, but you, as a leader, must decide and eliminate strategies that may not be working (e.g. plans that are outdated and cannot reach the same caliber as current trends). In cases when sudden incidences rise without any warning, leaders must be quick and think on their feet without breaking a sweat.
- Ideas: Has your organization hit a plateau where innovation is nonexistent? Think outside of the box! Be inspired by creativity and if your ideas fail, at least you were brave enough to throw out suggestions that may seem out of the norm to others. After all, every accomplishment starts with the decision to try. With leaders making innovative and creative decisions, they can set a precedent for their employees to do the same; ignite the spark for creative thinking and see the results in action!
- Strengths and weaknesses: To be the best leader you can be, strengths and weaknesses must be acknowledged and carried out. Self reflect on what you need to work on and try tackling them a little bit everyday. If you want a more in-depth tool for seeking out your weaknesses (and strengths), consider conducting, or ask HR to conduct, a 360-degree feedback to see what your peers think of you and your effectiveness as a leader.
Keep a fresh open mind and see what you can accomplish for your organization. Now that spring has sprung, how are you planning to “renew” your leadership skills?
*e-VentExe is a full service human resource consulting firm specializing in leadership training and development. If you’re interested in conducting a 360-degree feedback, we can assist you in the process. Follow us on Facebook and/or LinkedIn to learn more about our company and see what interests us!
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