Tuesday, May 30, 2017

The Ongoing War for Talent

As the United States approaches full employment, with the millennial generation a major component of the current workforce, the war for talent continues. In this issue of Astronology®, we will explore a few factors impacting the war for talent, as well as a few suggestions to help bolster an organization’s efforts at attracting, retaining, and growing talent in a tight labor market.

There are various factors to consider with respect to why talent moves. With an increasing full employment market developing here in the United States, employees are finding it easier to leave their current employers for work elsewhere. George Bradt suggests in an article with Forbes online that when employees feel that they are underemployed, or even underperforming, they will leave before they are fired. Disappointing decisions with respect to restructuring and cutbacks in benefits also have played a role in employees leaving. Bradt highlights that the millennial generation in particular has been exposed to such disappointing decisions and, as a result, are more inclined to search for new opportunities. A third, growing factor to consider is the burgeoning self-employment movement including the gig economy.

To combat the concerns raised by these factors, the following are suggested:
  • Competitive Pay: Ensuring you are paying within the market for specific jobs will make it easier to attract and retain talent.
  • Job Perks: Such perks do not have to be elaborate. Designing a flexible schedule option has become a popular perk. In a survey conducted of millennials by MetLife, 43% of respondents said they’d switch jobs if it gave them more flexible hours.
  • Meaningful Story: 60% of the millennials surveyed by MetLife also mentioned that “a sense of purpose” was part of the reason they work for their current employers. To attract talent that are seeking a sense of purpose, organizations will have to craft a more meaningful story of themselves.
  • Encourage Innovation: To further appease talent desiring to work with a sense of purpose, creating a culture of innovation will give employees room to grow and give meaningful contributions.
  • While Hiring, Be Inclusive: Instead of just involving a specific department when hiring, include other organizational members in the hiring of new staff. These employees can help vet and close candidates. This process also sends the message to potential employees that they will be exposed to a network of colleagues in various departments when working at the organization.
Do you have any further suggestions to include on our list? Please share your thoughts with us in our comments section below!

Tuesday, May 16, 2017

Freelance isn't Free Act

New York City Mayor Bill De Blasio signed the Freelance Isn’t Free Act (FIFA) back in November 2016. The law goes into effect May 15th, 2017. With an estimated four million freelancers in the New York City Metro area, the new law looks to rectify the payment challenges freelancers sometimes encounter. For instance, in 2014, the Freelancers Union discovered that 50% of reported freelancers had trouble collecting payments owed for their work. 81% of these freelancers experienced being paid late for their services, and 34% were not paid at all for some projects. Perhaps your organization currently employs freelance workers for various functions. If so, organizations that hire freelancers from the New York area, as well as organizations that function in the New York area, should take special note of this new law.

Temporary workers, contract workers, independent contractors, and freelance workers all fall into the growing category considered the “gig economy.” FIFA is considered one of the first attempts to deal with this segment of work, employment that covered just 10% of early 2005’s workforce. Ten years later, in late 2015, the gig economy encompassed 16% of the workforce. It is anticipated that this field will continue to grow and have a significant impact on employment in the coming years. To protect these freelance workers, FIFA creates a formal means for enforcement of freelancers’ labor rights. Highlighted features of the non-retroactive law include the following:
  • A contract must be written if a business hires a freelancer for $800 or more worth of labor over a period of 120 days. The contract must include:
    • The name and address of both parties
    • Itemized list of all services provided with the value of each service
    • Freelancer’s rate and method of compensation
    • Specific date when the freelancer must be paid
    • An understanding that the freelancer must be paid no later than 30 days from the completion of the work if no date is provided on the contract
  • The hiring party is prohibited from “threatening, intimidating, disciplining, harassing, denying a work opportunity to, or discriminating against a freelance worker, or taking any other action that penalizes a freelance worker for, or is reasonably likely to deter a freelancer worker from, exercising or attempting to exercise any right guaranteed under the new law, or from obtaining future work opportunity because the freelance worker has done so.”
  • If a freelancer succeeds in court with a claim, it is possible for the freelancer to recover
    • Contracted value of the services,
    • Double damages,
    • Reasonable Attorney’s fees and costs,
    • Injunctive relief,
    • Statutory damages, and
    • Other “such remedies as may be appropriate.”
  • The city can take additional civil action against a hiring party that demonstrates “a pattern or practice of violations of the new law and seek up to $25,000 in civil penalties.”
An Entrepreneur online article written by Carol Roth suggests that organizations review current contracts and practices with respect to hiring independent contractors / freelancers, and to consult a lawyer with any concerns. The New York City Office of Labor Standards website also should be referenced for more details on FIFA and sample contracts for both freelancer workers & hiring organizations. Roth also noted that even if FIFA currently does not cover your organization, pay close attention that local, state, and / or federal definitions, such as in the Fair Labor Standards Act, do not define a hire you consider to be a freelance worker as an employee.

What has your organization done to prepare for the newly enacted Freelance Isn’t Free Act? If you’re not in the New York City area, what actions might you take in advance of potential future state or local legislation? We’d love to hear your thoughts in our comments section below!

Tuesday, May 02, 2017

Forgoing Annual Performance Reviews: What Are the Alternatives?

A 2014 survey report from the Society for Human Resource Management (SHRM) finds that 70% of organizations use annual performance reviews and 16% use semi-annual performance reviews. However, only 32% of surveyed organizations believe that managers are able differentiate between poor, average, and strong performers. Such stats can help us understand why there are mixed feelings when the topic of performance reviews is mentioned. In this Astronology®, we discuss the current trend of replacing or enhancing the annual performance review with regular communication.

Why are performance reviews conducted? Performance assessment became popular in part due to labor union contracts requiring annual reviews to grant merit raises. Over the years, performance reviews became the go-to method to help organizations formally set goals for their employees, make employees feel valued, and keep employees focused on the organizations’ visions. Performance reviews also served as a critical source document – proof of legitimate grounds for terminating an employee.

Times have changed, however. Depending on the nature of the work and organizational culture, performance reviews can be viewed as time consuming and / or too complicated to properly conduct. As a result, confidence can wane on whether the assessment not only is accurate…but also if the feedback and goals are worthy of consideration.

In some cases, the nature of work can change so frequently that a yearly assessment may not be sufficient to engage employees. In response, The GAP INC conducts regular coaching sessions between employees and management, replacing the need for yearly feedback. Rob Ollander-Krane, the Director of Talent and Performance at GAP INC, explains in a Forbes online article that “We call it GPS. If a GPS waited until you got to the destination to tell you that you took the wrong turn, you would never get where you wanted to go. This is how individuals benefit from regular feedback; there is an alignment and re-calculation that helps them get to their goal. From a company perspective, there are parts of our company that are doing well and some less so. I am more of the mindset that we should use performance management to help individuals achieve their goals.”

Another company that uses continuous communication in performance assessment is General Electric Co. (GE). Last year, GE introduced a phone app called “PD@GE” that employees use to assess both employees and managers, replacing the once-a- year performance assessment conversation with rolling feedback. The new system is being tested on the company’s 185,000 white-collar employees. This frequent communication method also allows for immediate adjustment if a goal or method to complete a task is working – or not – for an employee.

Back in 2012, Adobe made waves by revealing it was replacing the annual performance assessment with a program called “Check-In.” Donna Morris, in a 2014 Business Insider interview, explains “The check-in is far more informal. While the check-in process is regular and on-going, it starts at the beginning of the year, since it’s tied to people having yearly expectations.” After that initial meeting, an employee has established the year’s expectations. With regular on-going feedback, employees can perform better with the understanding of where they stand. Adobe boasts that within the first year of using the “Check-In” approach to performance, they saved 80,000 manager hours (equivalent to 40 full-time employees).

Astron National Director Jennifer Loftus notes that she regularly encounters the “should I eliminate performance reviews in my organization?” question when meeting with HR professionals across the country. “That question doesn’t necessarily have an easy answer,” explains Loftus. “The most effective advice I can provide is this: if your organization’s culture is supportive of honest, open, and regular weekly communication between managers and employees, then eliminating annual performance appraisals might be the right move. If, however, this switch will lead to even less communication between employees and managers, stay where you are. Strong communication systems are essential to making a performance review-free environment successful.”

While it looks appealing to completely scrap your performance assessment method, it’s important to think of how such changes could affect your organization. In some cases, perhaps adopting a hybrid method of constant communication included with an annual overview maybe more suitable. We here at Astronology® would love to hear your insights on the trend of changing annual performance reviews. Feel free to share in our comments section below!

Stat Counter