Wednesday, May 30, 2018

Massachusetts Equal Pay Act (MEPA)

The Massachusetts Equal Pay Act (MEPA) comes into effect on July 1, 2018. The intention of this law is to ensure that employers are paying employees of different genders and are doing "comparable work", similar rates. It also prevents inquiries on salary history.

Although guidance issued on March 1st gave useful insights, many organizations should take advantage of conducting an analysis to ensure their pay structures are in compliance. Feel free to contact us through our Contact Page!

Paid Time Off – Back to Basics

In a 2017 small business survey conducted by Justworks and Squarefoot, it was reported that less than half (44%) of employees felt that unlimited Paid Time Off (PTO) is important. Only about 28% work at organizations that offer unlimited PTO. This week in Astronology® we discuss the basics of PTO.

In general, PTO is identified as vacation, sick leave, and / or personal days; in other words, allotted paid time away from work. While in some cases employers designate a specific amount of days / hours for each reason for being away from work, this article will focus on policies that allow employees to earn a bank of paid time off, and then use the time as they see fit.

The majority of organizations provide employees with paid time away from work, even though it’s not legally required (with the exception of sick leave in certain states and major cities). Paid time off is considered an excellent recruitment tool. As explained by, “…many job postings state that the company has a ‘generous vacation policy’ or ‘generous time-off policy’ to increase the company’s appeal to qualified applicants.” This is understandable as there has been an increased focus on work-life balance by the incoming generation of workers.

Two popular forms of awarding PTO are banked and accrued. Banked time is typically awarded at the beginning of the calendar or fiscal year. Accrued time is gained through a designated rate per days (and / or years) worked by the employee. Adds’s small business website, “if an employee takes time off before accruing the hours, the time is unpaid. An employer may decide to cut employee compensation costs by reducing the number of PTO hours an employee can accrue.”

Some advantages to having a PTO policy include the following:

  • Managers are no longer put in the position of policing and reporting employees’ use of benefits.
  • Unscheduled absences are more controlled.
  • Employees have more flexibility of use (they can use the time to take care of a sick child, or go on a restorative beach day, for example).

Some disadvantages include the following:

  • In cases where paid time off is banked, an employee could save his / her PTO, and leave an organization with a balance of banked time for which the organization would then have to pay the employee.
  • Sometimes employees view PTO only as vacation time and will attend work while sick.

Humana, a medical insurance company, gives some suggestions regarding specific elements to consider when building a PTO policy:

  • Who is eligible for PTO? (Full-Time, Part-Time, Interns, All?)
  • How much PTO will be offered?
  • How does PTO time accumulate? (What is the rate? Will it be banked?)
  • How can PTO time be taken? (Hour increments? Full days?)
  • Can unused time carry over from year to year? If so, how much?
  • Can an employee opt to cash out his / her unused days?

The Humana website also suggests that “many employees don’t take vacation because they simply feel they have too much work to do. Creating a culture that prioritizes work-life balance must start from the top.” To avoid some of the disadvantages listed earlier, employers can begin to emphasize the need for proper work-life balance and encourage proper use of the organization’s PTO policy.

Does your organization have a robust PTO policy? Are you considering adjusting the policy to appeal talent in the coming years? Feel free to share your thoughts in the comment section below!

Effectively Using Employees’ Opinions to Shape HR Strategy

Without a prompt and visible response, even the best designed employee opinion survey or exit interview process will fall prey to employee cynicism. If employees feel that management is ignoring their feedback, an effort to involve their opinions will likely cause a drop in morale.

Utilizing employee opinion and exit interview data well is a challenge. In this Astronology®, we share methods for strategic analysis that can help you turn your opinion-based data into concrete strategic objectives.

Strategic objectives in human resources are set to reinforce employee efforts and behaviors in support of an organization’s critical success factors – factors that will determine the future success or failure of an organization.

Many successful human resource functions have taken a page from the book of Drs. Kaplan and Norton and adapted the Balanced Scorecard approach to their strategies. In terms of HR, this approach involves viewing the organization through five strategic lenses:

  • Learning and growth
  • Customer
  • Financial
  • Quality
  • Human Resources

This approach involves developing metrics (criteria for measurement), collecting data, and analyzing it as it relates to each of these perspectives.

In the quest to link the needs of the organization and the needs of its employees, conflicts often arise. Whether they arise from miscommunication, lack of acceptance, or a discord between organizational and employee values, HR is at a disadvantage when it does not strive to understand these conflicts and their foundations.

Two powerful tools for collecting the data needed for this effort are employee opinion surveys and exit interviews.

Successful strategic planning in human resources begins with linking the information from opinion surveys and exit interviews. Trend analysis will become easier with time, but using both sources in tandem will reveal a clearer picture of working conditions. The following questions may be of use in this analysis:

  • What do both sources identify as common sources of dissatisfaction?
  • What do both sources identify as common motivators?
  • What perceptions of the organization and its leadership are common?
  • Are particular supervisors singled out as strong or weak leaders?
  • How is human resources perceived in both sources?
  • What are employee perceptions regarding the organization’s mission, vision, values, and objectives in both sources?

Once these sources of data are analyzed, it is the responsibility of human resources to conduct an internal analysis of its programs as they relate to communicating and reinforcing the strategic values of the organization. To this end, SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) is an excellent strategic tool.

SWOT Analysis is a flexible line of questioning that can be used for organizational, individual, or competitive ends. In this context, the data analysis described above will be further organized:

  • What are the current strengths of the organization?
  • What are the obvious weaknesses to be modified?
  • What opportunities exist to modify systems and / or programs that will better reinforce those employee activities and behaviors needed by the organization?
  • What threats could interfere with successful implementation of necessary changes?

HR has an obligation to provide the organization’s leadership with insights regarding employee perceptions, as well as with concrete recommendations for reinforcing what is working and what needs to be changed. Employee opinion survey and exit analysis data are prime sources of information in this endeavor, but their collection could result in a backlash if results are not both shared and acted upon. After analysis is complete, share some version of the results with your employees, and tell them what will be done about the problems they have identified.

For instance, if an employee opinion survey communicates a lack of understanding about the organization’s mission, vision, values, and objectives, a training program could be instituted to address the problem. As this information can be distributed via e-mail, a technically savvy organization can raise employee awareness with no greater cost than a few hours of writing time.

Effective use of employee opinion and exit interview data provides the backing and justification the organization’s senior leadership team needs to support HR’s recommendations. Linking this supportive data to concrete proposals and programs that demonstrate ROI, return on investment, is key. The lack of response to employee concerns raised in the collected data can lead to increased turnover, inability to recruit effectively, and, potentially, lower productivity and efficiency due to lower morale.

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