HR
News and Information
August 5, 2005
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NEWS IN THE COURTS
NEWS FROM THE BUSINESS AND LEGAL REVIEW
FROM IPMA-HR HR Bulletin
SITE OF INTEREST ON THE WEB
NEWS IN THE COURTS City's
written test for promotion in the police department discriminated against
African-American candidates Defendant-school
board did not deny plaintiff-teacher due process when it terminated
his employment Wrongful
Discharge at Dupont We have previously set out in great detail the unusual facts concerning the persecution and discrimination plaintiff suffered over a period of a year and a half at the hands of DuPont employees and managers before she was discharged. See Pollard v. E.I. DuPont de Nemours Co., 213 F.3d 933 (6th Cir. 2000).1 In remanding the case to the District Court for reconsideration of Pollard’s emotional distress claim, we held that the District Court had erred in granting summary judgment for DuPont on this issue. Pollard v. E.E. DuPont, (6th Circuit), 6/22/05, Case Number: 03-6611, 03-6612.
Police
lieutenant lacks qualified immunity for his failure to send pre-trial
detainee to hospital:
NEWS FROM THE BUSINESS AND LEGAL REVIEW Bush
Plan Cuts Survivors Benefits The
Effect of Unions on Employee Benefits: Recent Results from the Employer
Costs for Employee Compensation Data An important and longstanding question is, What is the relative importance of these two explanations? In particular, note that the welfare implications of each explanation are quite different. The monopoly face distorts competitive outcomes and reduces aggregate welfare, and monopolies of any kind are viewed as inefficient (and therefore less desirable) in standard economic thought. The collective voice face, however, can overcome market imperfections and increase aggregate welfare relative to what would result from individual, self-interested behavior. Thus, to evaluate accurately the aggregate welfare effects of labor unions on employee benefits, one must separate the positive and negative effects in empirical studies. The key to isolating these two effects is to note that the monopoly effect increases total compensation while the collective voice effect tends to rearrange the total compensation package rather than to increase it.4 In statistical terms, then, holding total compensation constant in empirical analyses will separate out the monopoly and collective voice effects. Freeman and Medoff use the BLS Employer Expenditures for Employee Compensation data from the 1970s5 and find that the union effect on employee benefits is roughly equally split between a monopoly and a collective voice effect. Widely available data sets like the public-use samples of the Current Population Survey, however, lack good measures of total compensation. Consequently, researchers have only rarely tested the continued currency of these early results. Recent research conducted by this author, which will be published later this year in the Journal of Labor Research, uses the BLS Employer Costs for Employee Compensation (ECEC) data from the March 2004 National Compensation Survey (NCS) to investigate whether the earlier results are still accurate 30 years later. The forthcoming analysis is based on 33,776 private-sector jobs in 7,863 establishments. The results suggest that the two-face framework of Freeman and Medoff continues to be relevant. More specifically, the analysis has three main findings: First, jobs that are represented by a union have total expenditures on non-mandatory benefit items that are 25 to 50 percent higher than similar nonunion jobs. Second, the union effect on benefits is particularly large for lower paid establishments and for small establishments. And third, the union effect on employee benefits consists of both a monopoly and a collective voice effect, though there is wide variation--depending on the specification, the collective voice effect might be as low as 25 percent or as high as 75 percent. But there always appears to be a nontrivial mix of both the monopoly and collective voice effects. These preliminary results underscore the importance of empirical analyses of significant employment-related questions and provide an example of the diverse applications of the NCS and other BLS data sources. Workers
On Flexible And Shift Schedules In May 2004 These findings were obtained from a supplement to the May 2004 Current Population Survey (CPS). The CPS is the monthly household survey that provides information on national employment and unemployment. In May 2004, the survey also collected information about flexible schedules, shift work, and other related topics. The data presented in this release pertain to wage and salary workers who usually worked full time (35 or more hours per week) on their main job. For further information about the survey, see the Technical Note. Flexible Schedules In May 2004, men continued to be somewhat more likely to have flexible schedules than women (28.1 and 26.7 percent, respectively). Flexible schedules were more common among white workers (28.7 percent) than among black (19.7 percent) or Hispanic or Latino workers (18.4 percent). The proportion of Asians who worked flexible schedules was 27.4 percent in May 2004. Among whites, 29.4 percent of men and 27.8 percent of women had flexible schedules. Among Asians as well, a greater proportion of men worked flexible schedules than women. In contrast, among blacks and Hispanics or Latinos, women were slightly more likely than men to work flexible schedules. (See tables A and 1.)
Health
Coverage Purchasing Patterns The study involved more than 1,400 employees of large and midsize organizations across the U.S., and used a technique that measures people's emotions on a topic -- in this case, views on health care coverage, care and health in general. According to the study, more than half of the survey respondents (52%) are negative about their current health coverage and most of those are intensely negative. Specifically, they worry that their current health plan doesn't provide adequate financial protection, cover the services they need (or may need) or deliver enough value for the cost. Interestingly, feelings about getting care (i.e., the health care experience itself) are even more striking -- fully 60% of survey participants express negative feelings. Fear is again the most prevalent reason for this, with concerns about quality and ability to make good decisions looming large. "This study offers a glimpse into the psyche of the U.S. health care consumer, revealing high levels of insecurity and skepticism," said Dave Guilmette, Managing Director, Towers Perrin and leader of the firm's HR Services business health and welfare consulting practice. "People are afraid, first of all, that their insurance won't protect them against financial hardship in the event of unforeseen medical needs. They also have serious concerns about navigating the provider system -- not finding the right doctor, not knowing which tests to take, what treatments are best or which hospitals would provide the best care. "Fear causes people to want to spend more than they need to," continued Guilmette. "People tend to think that by paying more for coverage, they will receive better value. They assume that more care is better care and that higher-priced providers are better. They are conscious of the risk of lack of care but not the risk of unnecessary care. And they tend to over-insure to minimize the risk of unbudgetable out-of-pocket cost. "In reality, however, health care quality does not correlate directly with cost, and most company-sponsored health plans provide ample financial protection when viewed over the span of a year. Even more important, the mentality that compels people to 'throw money at the problem' runs counter to employer efforts to control costs by encouraging employees to become more effective health care consumers. Our data indicate that, if they want 'consumerism' strategies to have an impact on costs, employers must find new ways to help employees understand their coverage alternatives and gain confidence in navigating the system," said Guilmette. In keeping with employees' desire for predictable expenses, the survey participants’ rank covered services highest in importance when selecting a health plan. Premium contributions and coinsurance also rank high on the list of decision factors. In other words, employees seem willing to contribute more up front if that investment limits their exposure to out-of-pocket costs. Along these same lines, more employees (55%) are willing to take on a portion of the increases in the predictable components of cost (premium) than are willing to face the risks of reduced benefits (23%). "Companies want employees to choose coverage carefully and use it appropriately. They want employees to understand care options, choose correct treatment and, most important, to live healthy lifestyles," notes Martha Terry, Principal, Towers Perrin. "Employees, on the other hand, want security, value and quality -- and they want to feel confident in their choices. Our study shows this confidence comes in part from believing their employer has a genuine concern for their health and demonstrates that concern through supportive programs and actions. Today, however, partly due to the legacy of managed care, most employers focus only on the company perspective -- costs, limitations, what to do and not to do. As a result, the fear factor -- created in part by employers themselves – creates skepticism among employees about company motives and intolerance for company actions." To counter the fear factor, the survey suggests that companies must consider their employees' emotional response when formulating and implementing their health care strategies. That will allow them to effectively align their interests with those of employees and create more positive employee health care decision-making and behavior. "Companies need to start engaging employees in a dialogue that focuses on employees as health care consumers, and demonstrates the value and quality of their health care choices and the value of managing risks over time," said Terry. "That focus should also address employees' fears and highlight how the employer and coverage options can meet their needs effectively." When companies demonstrate commitment, and support their employees' health care decision-making process, more positive behaviors emerge. In this survey, for example, among employees who said their company makes efforts to support affordable, quality care and good health for employees, over half (54%) qualified as relatively good health care consumers based on a set of 11 behavioral factors, such as carefully evaluating coverage options, having regular check ups and following doctors' recommendations. Of those who regarded their company as not being committed to employee health, only 36% reported behaviors that would qualify them as good consumers. Similarly, employees who have access to and use employer-provided health care resources and decision support tools -- such as online access to health care information, tools to support coverage decisions and care management programs -- are significantly more likely to report good consumer behaviors than those who do not have or use such resources (56% versus 30% of respondents). About the Towers Perrin study The new Towers Perrin survey is part of a multiyear, multidimensional study on the drivers of employee behavior in health care decision making and how employers can influence behavior as a way to reduce costs, enhance the work experience, and increase workforce productivity and engagement. This year's survey combined a traditional questionnaire with a technique most commonly used for marketing and product research. The technique, called ResonanceTM, was pioneered by Gang and Gang, Inc., and is designed to identify the level and nature of emotions that drive consumer decision-making. The survey asked participants about four aspects of health-related experience: their health care coverage, their care, their overall health and, specifically, their employer's support for good health. The survey also gathered data on actual consumer behaviors and health status as reported by the respondents themselves. The more than 1,400 respondents all work for midsize and large U.S. companies and participate in a company health plan.
FROM IPMA-HR HR Bulletin Employers
Continue to Increase Starting Salary Offers to New College Grads Many employers’ starting salary offers are higher than a year ago, according to the survey. For example, accounting services firms offered an average starting salary of $43,370 to new college grads, compared to $42,797 last year at this time. Offers from engineering services firms increased to $47,161 from $45,807; and consulting services employers upped their average offer to $46,856, compared to $45,278 a year ago. The Summer Salary Survey report also shows that average starting salaries in many fields are increasing, suggesting that competition for many new college graduates is heating up. In fact, among the 62 disciplines that reported a percentage change in salary offers over last year, 53 reported an increase. A number of business disciplines reported a healthy increase in their average starting salary offers. For example, accounting grads saw their average offer increase 5.3 percent to $43,269, while those earning marketing degrees saw their average salary offer rise 6.2 percent to $37,496. Economics/finance graduates also fared well, posting a 4.9 percent increase to their average starting salary offer, bringing it to $42,928. And business administration/management majors saw their average salary offer rise 3.6 percent to $39,553. However, computer science graduates saw a much more modest increase: Their average offer rose 2.3 percent to $50,820. Graduates with information sciences and systems degrees posted a solid increase of four percent, raising their average salary offer to $44,775. Graduates with majors in the liberal arts field posted some significant increases to their average starting salary offers. For example, liberal arts/general studies grads saw a whopping 13 percent increase in their average offer, boosting it to $32,457. The average offer to psychology graduates rose 7.4 percent to $29,861 and the average offer to sociology grads increased 7.1 percent to $31,798. NACE expects to publish its final look at salaries for the college class of 2005 in September. NACE also plans to provide a first look at hiring projections for the college class of 2006 in September. Since 1956, the National Association of Colleges and Employers (NACE) has been the leading source of information about he employment of college graduates. For more information, go to www.naceweb.org. Is
There a Bully Lurking Over Your Shoulder? Survey Shows That 13 Percent
of U.S. Workers Feel Their Supervisor is a Bully A recent Spherion® Workforce Snapshot Survey revealed that 13 percent of U.S. adult workers would describe their current manager as a bully. The survey of 1,280 employed adults was conducted by Harris Interactive® in the United States on behalf of Spherion Corporation (NYSE: SFN). In addition, the survey showed that 18 percent of respondents took the middle road, with a neutral response when asked if their boss is a bully. Spherion Corporation is a leader in the staffing industry in North America, providing value-added staffing, recruiting and workforce solutions. Spherion has helped companies improve their bottom line by efficiently planning, acquiring and optimizing talent since 1946. To learn more, visit www.spherion.com. Harris Interactive® Inc. (www.harrisinteractive.com), the 15th largest and fastest-growing market research firm in the world, is a Rochester, NY-based global research company that blends premier strategic consulting with innovative and efficient methods of investigation, analysis and application. Known for The Harris Poll® and for pioneering Internet-based research methods, Harris Interactive conducts proprietary and public research to help its clients achieve clear, material and enduring results. Harris Interactive combines its intellectual capital, databases and technology to advance market leadership through its U.S. offices and wholly owned subsidiaries, HI Europe in London (www.hieurope.com), Novatris in Paris (www.novatris.com), and through an independent global network of affiliate market research companies. Talking
on Phone is not ‘Caring for’ Pregnant Wife Under FMLA Tellis instead requested vacation on holiday leave for July 5, 6, and 7. He did call and request the appropriate forms and they were sent to him. His next regularly scheduled shift was for July 11. He was absent without leave and on July 18, Alaska Airlines fired him for the unexcused absences. Tellis’ only argument on appeal is that his leave was protected under the FMLA because he needed the time off to care for his wife. However, the facts show that Tellis was not at home caring for his wife, but instead, had flown to Atlanta to pick up a second vehicle that he and his wife owned. Tellis argues that the trip was necessary and covered by the FMLA because the car they had in Seattle broke down on July 6, and his wife need to know that they had reliable transportation. The FMLA allows unpaid leave to "to care for" a family member with a serious health condition. Tellis argues that he cared for his wife by providing moral support and comfort by talking to her via cell phone on his return trip. The United States Court of Appeals for the Ninth Circuit ruled in favor of Alaska Airlines, saying that, "Instead of participating in his wife’s ongoing treatment by staying with her, he left her for almost four days." The court explained that Tellis’ actions, traveling away from the person needing care, are not covered by the FMLA. The case is: Charles Tellis v. Alaska Airlines, Inc., Docket No. 04-35137, July 12, 2005. Legislative
Update The House of Representatives has passed all of the spending bills required to fund the government for fiscal year 2006, which begins October 1, 2005. The Senate is in the process of passing the bills, and if there are no conflicts with the House version, the bills can be sent to the president for his signature. Typically, passing the spending bills is a time consuming process that lasts long after the beginning of the fiscal year and requires several "continuing resolutions" to fund the government at the prior-year’s level. This year, the Senate has an added incentive to move quickly on appropriations legislation because in September, they are expected to hold confirmation hearings on the Supreme Court nominee who will take Justice Sandra Day O’Connor’s place. House Ways and Means Committee Chairman Bill Thomas (R-CA) is expected to introduce a comprehensive retirement bill this month. The Ways and Means Subcommittee on Social Security has been holding a series of hearings on retirement security and Social Security throughout the summer. A bill authorizing personnel reform government-wide is also expected to be introduced later this summer. The bill is expected to include reforms similar to those contained in legislation authorizing the Department of Homeland Security’s personnel system and the Department of Defense’s National Security Personnel System, and is likely to include the elimination of the general schedule "GS" system for classifying jobs. Bill
Introduction Automatic
Enrollment Could Have a Significant Impact On Raising 401(k) Balances
at Retirement, Study Finds The finding is important because employment-based 401(k) plans have become the dominant retirement savings option for millions of American workers. Beyond Social Security, the amount of retirement income many Americans will have when they reach 65 will depend to a large degree on how long they participate in a 401(k) plan, how much they contribute to the plan, and how they invest their 401(k) assets. The study is based on a model constructed by the nonpartisan Employee Benefit Research Institute (EBRI) and the Investment Company Institute (ICI), using their 401(k) Accumulation Projection Model. It is being published simultaneously in the July EBRI Issue Brief and ICI Perspective, and is available at both organizations’ Web sites at www.ebri.org and www.ici.org. Automatic enrollment changes a worker’s decision from having to choose to participate in a 401(k) plan when starting a new job to having to choose not to participate. If the worker does nothing, he or she is automatically enrolled. Typically with automatic enrollment, an employer notifies new workers that a certain percentage of their salary will be contributed to a 401(k) plan unless the worker takes the initiative to opt out within a specified period. The employer sets the initial contribution rate and allocates the contribution into a predetermined option (typically either a money market or "life-cycle" fund); these are known as default options. Not all employers offer their workers a 401(k) retirement savings plan, or have an automatic enrollment feature. The report notes that without automatic enrollment 401(k) participation depends strongly on age and income, and ranges from a low of 37 percent among the young, lowest-income workers who are eligible to a high of 90 percent among the older, highest-income eligible workers. "The effects of automatic enrollment on [income] replacement rates at retirement depend heavily on the default contribution rate and default investment option that the plan sponsor selects," the study says. "Everything else being equal, the higher the default contribution, the higher the replacement rates at retirement." The study also finds that the median income replacement rate from 401(k) accumulations depends primarily on whether current participants will continue to work for employers that sponsor a 401(k) plan. For example, the lowest-income participants currently between ages 26–35 are estimated to have a median income replacement rate of 25 percent when they turn 65 if future 401(k) coverage is random; however, they would have a 51 percent replacement rate if each subsequent job is covered by a 401(k) plan. The trend also holds for the highest-income participants of that age group, who would have a 30 percent replacement ratio under random coverage and 67 percent if 401(k) coverage is continuous. The study makes these additional points on automatic enrollment: Automatic enrollment has the greatest impact on lower-income workers because members of this group are least likely to participate in a 401(k) plan on their own volition. Among eligible workers currently between 26-35, the median salary replacement from 401(k) accumulations would more than double from 23 percent without automatic enrollment to 52 percent of salary when the default contribution rate is 6 percent of salary invested in a life-cycle fund. "Adding automatic enrollment creates a larger percentage of new participants from this group," the study says. The impact of automatic enrollment on higher-income groups is less dramatic and, in some cases, is reversed because workers in this group tend to have higher 401(k) participation rates. In addition, higher-income workers tend to contribute more of their income in a 401(k) retirement savings plan and place it in more aggressive investments than is typically the case through automatic enrollment, the study notes. Given the historical tendency of equity securities to generate higher returns than fixed-income securities, 401(k) plans that set a life-cycle fund as the default investment option have higher forecasted income replacement rates than plans that have a money market fund as the default investment option, the study reports. Life-cycle funds invest more aggressively in stocks (equities) when a worker is young and gradually shift to more conservative and fixed-income investments as a worker ages. The EBRI/ICI study indicates that 401(k) catch-up contributions—available to participants who are age 50 and older and are already contributing the limit—primarily increase higher income participants’ projected income replacement rates. In addition, the study looks at whether IRAs can make up for missed 401(k) contributions and finds significant differences based on income levels. For instance, if employees contribute to IRAs during lapses in 401(k) coverage, lower-income participants are not likely to fall as far behind in retirement savings as are higher-income workers, because contributions from low-income workers to 401(k) accounts tend to be close to IRA limits. But higher-income workers who are not offered a 401(k) plan at work will not be able to duplicate through IRAs the amounts they tend to contribute to a 401(k) plan. EBRI and ICI have worked together on 401(k) research in the past in the creation of the EBRI/ICI Participant-Directed Retirement Plan Data Collection Project, the largest analytical resource of its kind in the nation. The EBRI/ICI 401(k) Accumulation Projection Model was developed to examine the extent to which 401(k) assets will contribute to retirement income for future retirees who had these plans available to them for their entire careers. Sarah Holden, senior economist at ICI, and Jack VanDerhei, Temple University, and research director of the EBRI fellows program, are co-authors of the study. A close examination of 401(k) plans is central to understanding a shift that has occurred in the retirement landscape in the United States. A quarter-century ago, 401(k)s had just come into existence and defined contribution plans held assets of $184.5 billion. By the end of 2004, about 43 million 401(k) participants had accumulated $2.1 trillion in assets. The Investment Company Institute, founded in 1940, is the national association of U.S. investment companies, with a membership of more than 9,300 mutual funds, closed-end funds, and exchange-traded funds. Established in 1978, EBRI is an independent nonprofit organization committed exclusively to data dissemination, policy research, and education on economic security and employee benefits. EBRI does not lobby and does not take positions on policy questions. EBRI
Study Addresses Effects of Social Security Disability Payments on Retirement
Benefits The study, released today as part of an ongoing EBRI examination of Social Security restructuring options, looks at how retiree benefits would be affected if policymakers adhered to an oft-stated goal of preserving disability benefits. The study also examines issues involved in annuitizing a system of individual accounts within Social Security so as to ensure payment of continued benefits over a person’s lifetime. Annuities typically pay a monthly benefit for life. EBRI does not have a position on any of the proposals policymakers are considering. Although most of the debate over Social Security has focused on retirement benefits, the program also pays disability and survivor benefits as well. According to the EBRI study, if disability benefits are to be preserved at the level provided in current law—as many policymakers say they should—then retiree benefits would face cuts of 25 percent to 40 percent in addition to what would be needed to close Social Security’s projected long-term funding gap. The alternative would be an equivalent tax increase. Closing Social Security’s long-term gap alone, the study says, would require a one-time 38 percent cut in all benefits starting the year the Social Security Trust Fund surplus is exhausted (estimated in 2041) or a combination of benefit cuts and tax increases equaling 38 percent or a combination of benefit cuts or tax increases equal to 33 percent over a 50-year period starting in 2015. "Regardless of the reform proposal, maintaining disability benefits and/or survivor benefits could force even deeper cuts on the retirement side of the program, or increase the revenue necessary to bring Social Security out of its projected actuarial deficit," said Dallas Salisbury, EBRI president. The study, "Social Security Reform: The Importance of Disability Insurance and Annuities in Individual Accounts," is published in the July EBRI Notes and is available on the Internet at www.ebri.org, Social Security Trustees reported earlier this year that 39.6 million people receive retiree and survivor benefits, compared with 7.8 million disabled workers and their dependents who receive disability benefits. The average monthly benefit this year is $955 for all retirees and $895 for all disabled workers. Individual Accounts and Annuities A second part of the study notes that creating individual accounts within Social Security—as President Bush has advocated—could change the nature of Social Security payouts by possibly including "lump-sum" distributions, rather than the current system of a monthly annuity payment for life. To protect against the risk of beneficiaries outliving their income, however, most individual account proposals have stipulated that some or all of the account must be annuitized. Using Model 2 from the 2001 President’s Commission to Strengthen Social Security (the closest individual account proposal to what Bush as endorsed), the study reports that 60 percent of the individuals who would receive retiree benefits would need to annuitize some or all of their individual account by 2015 to have a total benefit that exceeds the poverty level. The study notes that some critical issues remain to be resolved in annuitizing individual accounts. These include how many people would be affected by the annuity requirement, how much of an individual account would be used for the annuity, who would provide the annuities, and how much the annuities would cost beneficiaries. "These are very important administrative factors in determining how successful the provision of benefits under an individual account system might be," the study says. The new study builds on the May 2005 EBRI Issue Brief, which compared the impact of a Model 2 individual account retiree benefit system with three other options for Social Security in the future. The May study, "Comparing Social Security Reform Options," also is available on the Internet at www.ebri.org. Craig Copeland, director of EBRI’s Social Security Reform Evaluation Research Program, was the chief author of both studies. His work was based on assumptions contained in the 2004 Social Security Trustees report, the final report of the President’s Commission to Strengthen Social Security, and utilized SSASIM and GEMINI computer-based simulation models developed by the Policy Simulation Group. Established in 1978, EBRI is an independent nonprofit organization committed exclusively to data dissemination, policy research, and education on economic security and employee benefits. The Institute's mission is to advance understanding of employee benefits and their importance to the nation's economy. EBRI does not lobby and does not take positions on policy questions. Internships
Pay Well, Give Students Experience Nearly 98 percent of the employers responding to NACE’s 2005 Experiential Education Survey reported that they pay their interns and nearly 95 percent said they pay their co-op students. Employers reported paying interns at the undergraduate level an average of $15.44 an hour, while they said they pay undergraduate co-op students an average of $15.64 an hour. "Typically, employers consider more than one factor when determining the salary for an intern or co-op student, but the biggest factor is the student’s year of study," says Camille Luckenbaugh, NACE research director. "At the undergraduate level, salaries tend to be highest for seniors, lowest for freshmen." In addition, internships and co-op assignments give students an edge in the job market by providing them with work experience. "When employers are looking at job candidates, work experience is one of the things they look for," explains Luckenbaugh. "Employers told us that three out of five of their new college hires in 2004 had internship experience and nearly one-third had participated in a co-op assignment." Since 1956, NACE has been the leading source of information about the college job market. For more information, go to http://www.naceweb.org/press/. Survey
Shows Workers Take Fewer Business Trips Today Than Five Years Ago The survey was developed by Robert Half Management Resources (RHMR). RHMR is the world’s premier provider of senior-level accounting and finance professionals on a project and interim basis. It was conducted by an independent research firm and includes responses from 972 men and women 18 years of age and older who are employed in professional environments. Workers were asked, "Are you currently traveling for business more or less frequently than you were five years ago?" Fifteen percent said they were traveling "much more frequently," 21 percent said they were traveling "somewhat more frequently," 16 percent responded that there was no change in the frequency of their travel compared to five years ago, and 27 percent reported that they were traveling much less frequently than they were five years ago. "Companies that scaled back travel allowances over the past several years continue to closely monitor expenses, despite an improving economy," said Paul McDonald, executive director of RHMR. "Many firms are capitalizing on less costly communication channels, such as Web casts and videoconferences to facilitate project management and information sharing between remote parties." McDonald cautioned that while virtual interaction might save time and money, it often cannot replace the value of a handshake. "Meeting with clients or vendors in person, even if it requires occasional travel, strengthens business relationships by encouraging open dialogue on critical issues. Face to face discussions allow for more direct communication, enable participants to pick up on each other’s nonverbal cues and reduce the potential for misunderstandings. Robert Half Management Resources has more than 100 offices throughout North America, Europe and Australia. They can be found online at www.rhmr.com. IPMA-HR
Exclusive Member Discount on Monster.com Job Postings Your IPMA-HR membership entitles you to receive an exclusive member discount of more than 40 percent off the Monster list price for a single job posting—IPMA-HR members pay only $200! Post your jobs through IPMA-HR’s Career Center and your position listing will instantly be posted on Monster.com for 60 consecutive days. Start receiving resumes today! To post your positions on IPMA-HR’s Career Center, visit the IPMA-HR Web site at www.ipma-hr.org and click on "Advertising and Job Posting." Or visit www.ipma-hr.org/index.cfm?navid=146. Top
Disability Employment Official Participates in 15th Anniversary Celebration
of the Americans with Disabilities Act Grizzard addressed disability employment issues at the event. He presented key findings from focus groups of employers and employment data among participants of ODEP's customized employment initiatives. "ODEP will continue to advance the issues that will put more and more people with disabilities into the workforce by listening closely to the sources—workers with disabilities and the employers who hire them," Grizzard said. A leading authority on disability employment issues, Grizzard reported on ODEP's efforts during its first four years of existence on both the supply and demand sides of the employment equation to enable employers to take advantage of the strengths and skills of individuals with disabilities as a source of reliable qualified workers. The seminar in which Grizzard participated featured leaders of federal agencies in the forefront of disability employment. These experts presented the fundamental and groundbreaking work, policy to practice, they have undertaken to increase the recruiting, hiring, retention and promotion of people with disabilities. Panelists discussed candidate education, preparation and support, in addition to workforce conditions and employer expectations. ODEP’s mission is to develop research-based policy that results in lowering barriers to employment for youth and adults with disabilities. The ADA, enacted in 1990, prohibits discrimination against individuals with disabilities in the areas of employment, state and local government services, public accommodation, transportation and telecommunications services. For more information about the ADA and other disability-related issues, visit www.Disabilityinfo.gov, a one-stop website for disability-related information and resources. Disabilityinfo.gov is managed by ODEP in collaboration with 16 federal agencies and averages more than 3,000 visitors a day. Contingent
and Alternative Employment Arrangements, February 2005 Using three alternative measures, contingent workers accounted for 1.8 to 4.1 percent of total employment in February 2005. In February 2001, the last time the Contingent and Alternative Employee Arrangements survey, a supplement to the Current Population Survey (CPS), was conducted (see http://www.bls.gov/news.release/conemp.nr0.htm for more details), they ranged from 1.7 to 4.0 percent. The first time the survey was conducted in February 1995 the estimates ranged from 2.2 to 4.9 percent. The analysis in a July 27 BLS news release focuses on the broadest estimate of contingent workers—all those who do not expect their current job to last. In addition to contingent workers, the survey also identified those workers who have alternative work arrangements. In February 2005, there were 10.3 million independent contractors (7.4 percent of total employment), 2.5 million on-call workers (1.8 percent of total employment), 1.2 million temporary help agency workers (0.9 percent of total employment), and 813,000 workers provided by contract firms (0.6 percent of total employment). The proportion of the total employed who were independent contractors increased from 6.4 percent in February 2001. The proportions for the other three alternative work arrangements showed little or no change from February 2001. An employment arrangement may be defined as both contingent and alternative, but this is not automatically the case because contingency is defined separately from the four alternative work arrangements. In February 2005 the proportion of workers employed in alternative arrangements who also were classified as contingent workers ranged from three percent of independent contractors to 61 percent of temporary help agency workers. Data on contingent and alternative employment arrangements have been collected periodically in supplements to the CPS since February 1995. The CPS is a monthly nationwide survey of about 60,000 households that obtains information on employment, unemployment, earnings, demographics, and other characteristics of the civilian non-institutionalized population age 16 and over. Survey
Shows Executives Spend One-Third of Their Time Putting Out Office ‘Fires’ The Creative Group, a specialized staffing service that provides marketing, advertising, creative and Web professionals on a project basis, developed the survey. It was conducted by an independent research firm and includes 250 responses—125 from advertising executives with the nation’s 1,000 largest advertising agencies and 125 from senior marketing executives with the nation’s 1,000 largest companies. The Creative Group has offices in major markets across the United States and in Canada, and offers online job search services at www.creativegroup.com. Study
Reveals Statistics of Criminal Records Uncovered In Background Checks InfoLink’s 2004 Hit Ratio Analysis, summarized below, is calculated based upon the aggregate number of hits as a percentage of the services InfoLink conducted in 2004. The chart includes an average of all clients and details on specific industries, and hit ratios vary from industry to industry. This information, in chart form, including other categories such as derogatory motor vehicle, drug testing, credit history, past employment, social security, and workman’s compensation issues, is also available at http://www.infolinkscreening.com/InfoLink/Background/applicant_hit_ratio.aspx
Barry Nadell is President and co-founder of InfoLink Screening Services, Inc., a national provider of employment background screening, drug testing and physicals. He speaks nationally on the subject and has been a featured speaker at national conventions, and has appeared on more than 100 radio and television programs, including The Bloomberg Report and ABC News with Peter Jennings. He is the author of Sleuthing 101, Background Checks and the Law. Websites: www.greathire.com and www.infolinkscreening.com. Dispelling
the Leadership Myth: Why 71% of Americans are Complacent at Work So much has been written on the subject of leadership. In fact a search on Amazon.com resulted in more than 16,000 books with the word "leadership" in the title… so by now we should know everything there is to know on the subject? And after reading all of those books, everyone in leadership role is doing a fantastic job, right? Wrong! If that were true, Gallup research would be showing a lot more than 29 percent of the U.S. workforce was actively engaged in their job. Isn’t that what great leaders do… they get people to be excited about and committed to their organization’s vision? Let’s get something clear—leaders either increase engagement or they decrease it. There is no middle ground. Everything a leader does either increases or diminishes engagement. Five Leadership Skills that Increase Engagement After almost 30 years of research I have determined that there are five essential skills that leaders must have if they are going to succeed in increasing employee engagement. They are:
The reality is that these skills don’t come naturally to very many managers. They can be learned, though. Developing these skills often requires the unlearning of old habits. It will take time, reinforcement, practice, and a serious commitment from both the organization and each manager. Keith Ayers, is the president of Integro Learning Company LLC, an Australian based consulting company that helps organizations create cultures that will achieve business results. Now based in West Chester, Penn., Ayers has been a consultant for 26 years. He has been the international distributor for Inscape Publishing products in Australia and News Zealand since 1985, and has been one of their most successful distributors for that entire period. He specializes in working with CEOs and senior executive teams to help them develop a culture which will support their other business initiatives. He has worked with executive teams in Australia, New Zealand, Hong Kong, China and the U.S., and has been a speaker at conferences in Germany, the UK and throughout the U.S. Will
O’Connor’s Retirement Affect HR? Justice O’Connor played a critical role on the Court. Her vote was often the deciding one in close cases. While her colleagues on the court lined up in a traditional fashion with Justices Ruth Bader Ginsburg, Stephen Breyer, David Hackett Souter and John Paul Stevens on one side and Antonin Scalia, Clarence Thomas, Anthony M. Kennedy and Chief Justice William H. Rehnquist on the other, it was never certain how O’Connor would vote on any one case. Justice O’Connor delivered the majority opinion (5-4) in the recent Title IX case, Roderick Jackson v. Birmingham Board of Education, Docket No. 02-1672 (2004). In that case the Court upheld a girl’s basketball coach’s right to bring a discrimination claim under Title IX, alleging that the girls’ team received less equipment and access to facilities than did the boys’ team. O’Connor also delivered the majority opinion in a closely divided (5-4) affirmative action case, Barbara Grutter v. Lee Bollinger, Docket No. 02-0241 (2003). That case allowed universities to continue using race as a factor in admissions as long as it was only one factor and was used as a "plus factor." (This case should be read in conjunction with the companion case Jennifer Gratz v. Lee Bollinger, Docket No. 02-0516 (2003) where a 6-3 majority of the Court struck down the University of Michigan’s undergraduate admission’s policy awarding points based on race.) Because of her pivotal role on the Court, her absence is almost certain to affect the Court’s decisions on employment and labor laws. According to Larry Lorber, a partner in law firm Proskauer Rose LLP and employment law expert, "Justice O’Connor has had a unique impact on the development of employment law. She clearly understood that the workplace was not a forum for academic dispute but rather required a common sense view of the appropriate means of limiting discrete workplace wrongs." Lorber continued, "Justice O’Connor wrote the Court’s opinion in Watson v. Ft. Worth Bank & Trust in the 1988 term, which held that while the concept of disparate impact could be applied to subjective employment standards, the disparate impact standard was stringent enough to avoid such cases to result in quota responses to statistical cases. Thus Justice O’Connor always took care to balance the theoretical with the practical and thereby influenced the development of the employment laws in a particularly helpful manner, providing intellectual and practical underpinning to the delicate balancing which is constantly needed." How the Court addresses employment and labor cases in the future depends greatly on who is appointed to replace O’Connor. This will be President Bush’s first opportunity to nominate a Justice and he is widely expected to nominate a conservative jurist. Yet, as his father learned in appointing Justice Souter, who often sides with the so-called liberals on the bench, it is not always easy to determine how a future justice will vote. In addition to Justice O’Connor, Chief Justice Rehnquist is expected to retire soon as well, due to his own health. The Chief Justice has thyroid cancer and many expected him to announce his retirement before O’Connor. With a second Bush appointee, the composition of the Court during the 2005-2006 term could be vastly different than this one. Stateline.org
Staff Writer Addresses Thaw of State Salary, Hiring Freezes Kelderman wrote "many state workers will get modest raises in the new fiscal year that began July 1—one of the signs that states’ bottom lines are looking better." State personnel managers are still facing growing pressure to lure new employees who are qualified, however, and to replace the aging workers who are continuing to leave the workforce. All of this Kelderman writes, is "in the face of higher-paying jobs in local governments or private companies." Thus far, 12 states are raising the salaries for workers represented by the American Federation of State, County and Municipal Employees (AFSCME), the nation’s largest and fastest growing public service employees union, with more than 1.4 million members. AFSCME organizes for social and economic justice in the workplace and through political action and legislative advocacy. The pay increases that employees are getting range from 1.5 percent in Maryland to five percent in Illinois. The union also won raises for members in Connecticut, Iowa, Massachusetts, Nebraska, New Jersey, New Mexico, New York, Ohio, Pennsylvania and Washington. Employees—union and non-union alike—from California, Delaware, Georgia, Nevada, North Carolina, Tennessee and Texas, are also expected to receive pay raises, according to information from those states obtained by Kelderman. According to a June report from the Nelson A. Rockefeller Institute of Government, which was also obtained by Kelderman, "state revenues have risen 11.5 percent compared to the same period last year—strongest first quarter growth since 1991," he writes. "While 26 states had to close budget gaps for the fiscal year that began on July 1, only three were left with deficits at the end of June, compared with 10 states last year and 31 states two years ago." Sam Wilkins, the human resources director for South Carolina and the president of the National Association of State Personnel Executives, said, according to Kelderman, that "the fiscal gaps resulted from the recession that took hold after the technology bust and terrorist attacks in 2001, when many states halted basic cost-of-living adjustments and merit pay to help balance their budgets." Employees in South Carolina got a four percent increase in pay this month. Kelderman also got comments from Sally Coleman Selden, who teaches management at Lynchburg College in Virginia. She "said the trends have left many state workforces with low morale as they face a potential turnover crisis," writes Kelderman. "In more than half the states, 20 percent of state workers could retire in the next five years, according to the GPP," he continued. According to the Stateline.org article, Wilkins said if salaries don’t continue improving, states could have a hard time keeping their current workers and replacing retirees. "Personnel directors across the country report that they are competing for employees with higher-paying private sector jobs and municipal and county governments, where pay scales may be buoyed by strong property tax revenues, he said," Kelderman writes of Wilkins’ comments. Funded entirely by The Pew Charitable Trusts as a public service, Stateline.org has published online every weekday except holidays since Jan. 25, 1999. The Web site, Stateline.org, is an independent element of the Pew Research Center and is based in Washington, DC. In addition to online newsgathering activities, Stateline.org periodically publishes printed reference materials that are free for the asking, including a State of the States report released every January. They also sponsor professional development conferences and workshops for the news media, including the annual conference of Capitol Beat, the Association of Capitol Reporters and Editors. For further information, e-mail editor@stateline.org or contact them at 202-419-4470. State & Local News Briefs
Mayors
Say Unfunded Mandates Still Costly Despite Legislation On June 25, the United States Conference of Mayors released a report, "Impact of Unfunded Federal Mandates and Cost Shifts on U.S. Cities: A Preliminary Report on Costs in 59 Cities." The report studied the impact of 11 laws passed in the last nine years that impose unfunded mandates on cities. In explaining the need for further action on this topic, the report sites a study by the National Conference of State Legislatures (NCSL) that revealed a cost shift from the federal government to states and localities totaling $51 billion for fiscal years 2004 and 2005 and a looming cost shift of $30 billion in 2006. While much of the report examines the impact of environmental laws such as the Clean Water Act and the Safe Drinking Water Act, the report also looked at the impact of the Americans with Disabilities Act (ADA) and the Fair Labor Standards Act (FLSA). Preliminary data shows a recurring annual cost to cities under Title II of the ADA of $24 million for 38 cities and a one-time cost to 20 cities of $10 million. For the FLSA, which includes the minimum wage and overtime laws, the recurring annual cost to 25 cities was $81 million and one time costs for eight cities reporting was $353,869. The full report is available online at http://usmayors.org/73rdAnnualMeeting/mandates2005.pdf. State
Report Puts High Premium on Writing Skills NEW YORK – Despite the high value that state employers put on writing skills, a significant number of their employees do not meet states’ expectations. Providing writing training costs taxpayers nearly a quarter of a billion dollars annually, according to an estimate based on a survey released July 5 by the National Commission on Writing. The
report, Writing: A Powerful Message from State Government, available
online at http://www.writingcommission.org/prod_downloads/writingcom/ "Clear communication is an essential government function in a democratic society," said Bob Kerrey, president of New School University in New York, former governor and senator from Nebraska, and chair of the Commission. "Because writing is how agencies communicate with each other and their constituents, all of us have a stake in the clarity and accuracy of government writing," he said. The report follows a similar analysis of writing in corporate America released last year by the Commission, which found that while advanced technology in the workplace is requiring employees to write more than ever, many college graduates don’t have the writing skills they need. Writing: A Ticket to Work . . . Or a Ticket Out (September 2004) surveyed members of the Business Roundtable, an association of chief executive officers from U.S. corporations. According
to Writing: A Powerful Message from State Government: More than 75 percent of respondents report taking writing into account in hiring and promoting state employees. "I’d say there’s a premium placed on well-developed writing skills," said one human resources director. Ninety-one percent of the states that "almost always" take writing into account when hiring, report that they also require writing samples from applicants for professional positions. "Oral and writing skills are absolutely essential in a service- and knowledge-based economy. This is a very different economy from one based on agriculture or industry," noted a respondent. Poorly written application materials are likely to doom the job-seeker’s chances of state employment. More than 80 percent of respondents agree that poorly written applications count against professional applicants. "Managers notice written submissions around the application process," commented one. More than two-thirds of responding officials say they routinely offer writing training for professional employees with deficient skills. "We might have up to 300 employees each year [both professional and clerical] with some need for training in writing and composition," reported one personnel director. Approximately one-third of respondents indicate that, at most, one-third of professional employees possess the writing skills valued in government. States that report placing a higher value on writing are also more likely to report that a larger percentage of their professional employees have the writing skills they need. However, based on survey responses, the Commission estimates that providing writing training for those employees who do not meet state standards costs state agencies about $221 million annually. The human resources directors surveyed in the report oversee civil servants working in state agencies, a group roughly equal in number to employees of the federal government, the two largest public workforces after local government. The report does not include the close to two million other state employees who work in state hospitals and educational institutions because they are hired and supervised locally. Survey responses also revealed officials’ concern that widespread use of e-mail encourages miscommunication. "The sender is composing on the spot. You might do a spell-check, but you can’t do a ‘thought-check,’" noted one official. "It’s like blurting out something without thinking it through." Despite generally high levels of education among public employees, many state respondents expressed concerns about their employees’ writing skills. One official noted, "In our state, 99 percent of state employees have completed high school . . . 54 percent [have] a bachelor's degree or beyond. This compares to the state’s general workforce where just 84 percent of workers have completed high school and 22 percent have bachelor's degrees or beyond.’ On paper, state employees are highly qualified. "This survey confirms what governors and educators already know: strong writing skills, and the critical thinking skills associated with the ability to write well, are important prerequisites for success in college and work," said Virginia Governor Mark Warner. "The next generation of workers needs strong communication skills to compete for the best jobs in a global economy." Arkansas Governor Mike Huckabee said: "The high value that states put on writing is commendable and appropriate. From the Department of Education to emergency management to family and child services, civil servants need to express themselves precisely and humanely in order to meet the needs of their fellow citizens." The National Commission on Writing for America's Families, Schools, and Colleges is a blue-ribbon group of leaders from public schools, higher education, and the business and writing communities, founded by the College Board. Commission members are committed to doubling the amount of time students in American schools and colleges spend writing. "In the end, communication is what makes government work," said Commission member Gaston Caperton, president of the College Board and former governor of West Virginia. "That’s why it’s important for schools and colleges to ensure that all graduates learn how to communicate clearly and concisely on paper." In an effort to focus national attention on the teaching and learning of writing, the College Board established the National Commission on Writing for America’s Families, Schools, and Colleges (NCW) in September 2002. The decision to create the Commission was animated in part by the Board’s plans to offer a writing assessment in 2005 as part of the new SAT®, but the larger motivation lay in the growing concern within the education, business, and policy-making communities that the level of writing in the United States is not what it should be. Although there is much good work taking place in classrooms, the NCW believes the quality of writing must be improved if students are to succeed in college and in life. The addition of a writing component to the SAT and the establishment of a writing commission respond directly to that concern. NCW hopes that the work of the Commission and the agenda it lays out will help create a writing revolution in the United States. The NCW can be found online at www.writingcommission.org. Employee
Output Weakest Late in Day, Survey Shows The national poll includes responses from 150 senior executives—including those from human resources, finance and marketing departments—with the nation’s 1,000 largest companies. It was conducted by an independent research firm and developed by Accountemps, the world’s first and largest specialized staffing service for temporary accounting, finance and bookkeeping professionals. Max Messmer, chairman of Accountemps and author of Managing Your Career for Dummies® (John Wiley & Sons, Inc.), offers the following tips for avoiding the afternoon lull: Planning makes perfect. Don’t delay difficult activities until the end of the day, when your energy and enthusiasm may wane. Use this time to catch up on basic tasks such as filing, responding to routine e-mails, updating contact lists and organizing files. Get a breath of fresh air. Periodically stretch or take a short walk to refuel your energy. Enjoy your lunch outside. Even a few minutes away from your desk can help you recharge and be more productive. Food for thought. Missing meals is a recipe for malaise. No matter how busy you are, remember to make time for a complete meal midway through the day and nutritious snacks in between. Take a mental break. Putting work issues out of your mind even for a few minutes can provide the boost you need to finish the day on a strong note. Accountemps has more than 330 offices throughout North America, Europe, Australia and New Zealand. For more information, go to www.accountemps.com.
SITE OF INTEREST ON THE WEB The
Employment Situation: July 2005 http://www.bls.gov/news.release/pdf/empsit.pdf Supplemental
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