The Best Parts of Working from Home

A while back I promised a deeper dive into working from home--something I'm currently doing everyday. Today we start with the pros of working from home--why it's great, why I love it and why companies should be very happy about providing that option for their employees.

Zero commute

It's nice to get out of the house, but in the Northeast, especially, there's way too many days where a commute entails dealing with the elements (rain, snow, extreme heat, humidity, etc) and delays (train delays, car traffic, buses breaking down, etc) that sometimes it's nice to not have to worry about what it's like outside and how that's going to affect your day. As an employer, that means more time working, and less time commuting. And for the the environment, that means one less person commuting to work.

Save money/time on lunch

Yes, we all could make lunch every day, but running out of the house every morning, making a sandwich or a salad or even grabbing leftovers is sometimes the last thing on the agenda. When you're working from home, you have time to run to the fridge and make a sandwich or prepare a salad or even cook something quickly. Not only is this quicker and cheaper, it is usually a healthier option than grabbing something to go at lunch time. All of this is great for employers who can not only save on subsidizing lunches but also on downtime for employees.

Dress Code: Optional

For a few summers I had an internship at a bank and the worst part about every morning was knowing that I had to put on a long sleeved shirt, dress pants, a tie, and sometimes a jacket when it was 90 degrees outside. Now, when it's 90 degrees outside like it's supposed to be later this week in NYC, I wear shorts. During the winter, when it was cold and I didn't want to get out of my pajamas--well, I didn't. When I go to visit clients I still put on appropriate wear but it saves me a lot of money, time, cleaning costs, and sweat not to have to put on that suit.

Get more done in all aspects of life

I think the number one reason that employers should love their employees working from home is the productivity that increases with it. If they're sick, they can work from home without infecting anyone else. When they have the cable guy coming, they can do work while they wait for him to arrive in his 4 hour window. When the babysitter forgets they have to be a concert that night, they can be home to take their kid back without having to travel all over town. And when they don't have to commute, they can work longer hours and be happier doing so.

There are certainly negatives to working from home--and we'll get into those in another post--but there are a lot of reasons an employee and their employer should love it. This is the start of the outlining of those but hopefully those are enough of a reason even before you get into the money saved from office space or the happiness the employee gets with the flexibility. It also helps when the employer gets over the idea that working from home doesn't mean "not working" and actually can mean "working more efficiently".

Saying Goodbye to The Office

Last Thursday was the last episode of The Office and with it ends a great workplace comedy. Between Office Space and The Office, the American workplace has been characterized and made fun of in great detail. But the best part of both of them--especially The Office in its better years--was that it was so relatable to our every day lives.

I mean who hasn't had a boss like Michael Scott (or Bill Lumbergh, for that matter)? Who hasn't had a by-the-book, cooky co-worker like Dwight? And we've all sat in a group of cubicles where it felt like we knew who was the Angela who was the Oscar and who was the Kevin. One of the show's most frustrating characters for most HR folks was Toby as he was unable to create the type of order needed to control this office, but, in the end, that led to all the hijinks that occurred.

But where the show really shined was showing a group of co-workers who were forced to spend their weekdays together and how they not only got through that as a group, but made the most of their relationship. Early on in the series Michael refers to his co-workers as his family and that's really what everyone became. And aren't the best offices you've been in where everyone feels that close and really works together towards a common goal (even if on The Office, the common goal was sometimes to get out of doing the work)?

So while we must say goodbye to The Office (and for a few seasons, I think most couldn't wait for it to happen), we won't lose the references and lessons that came along with it. It could get extremely cringe-worthy like in "Diversity Day" or the barrage of "that's what she said" jokes, but deep down the show was a really sweet look in the good in us all and how we can get through something as mundane as selling paper when we're able to get along with our co-workers. If Dundler Mifflin taught us anything, it's that we all work best when we work together.

Effective Performance Appraisal Processes

The yearly task of carrying out employee performance appraisals can be an arduous task when considering employee attitude and the clarity of communication between the employer and the employee.  In this edition of Astronology, we consider the topic of performance appraisals, how they can be instrumental in monitoring employee performance and rewarding employees, and techniques to make the process more effective for all involved.

There are several different methods for conduct performance appraisals. One is not the best, nor is there a “right” or “wrong” option.  The most effective approach is the one that facilitates communication and professional growth while taking into consideration the number of employees in the organization, the types of jobs employees hold, and the organization’s culture.  The four most common performance appraisal approaches, according to The Houston Chronicle Online, are the following:

• Rating Scales: The employer establishes the key areas used in evaluation, such as job skills, teamwork, communication skills, reliability, and flexibility.  Reviewers rate these areas accordingly on a scale, such as three points, five points, or even 10 points.  There are additional customization options to consider when implementing this approach.  For example, certain evaluation criteria may weigh more than others, depending on the nature of the position being reviewed.
• Critical Incidents: In this approach, recordkeeping is key.  Managers create a detailed analysis of occurrences where the employee performed well and / or needs improvement. Some employers combine this method with a rating system to give a rating for each performance occurrence.  For example, the scale can include key areas such as teamwork or communication skills, with employees reporting detailed incidences of when the employee performed well or poor in these areas.
• Management by Objectives: In this highly collaborative method, employers and employees together create a list of specific and measurable objectives that are realistic and practical.  The employee then receives these items as goals to strive towards within the coming year.  During the scheduled yearly employee review both the employee and his / her manager assess if the initial goals were met, where success was had, and where opportunities for enhancement lie.
• 360 Degree Feedback: This is another performance appraisal method that is quite collaborative. A 360 degree feedback approach includes input about the employee from the employee’s fellow co-workers, internal and external customers, and management.  This process of gathering feedback can be done via survey or interview, depending on the scope of outside involvement and the number of items to be evaluated.  Such feedback is then consolidated based on demographic, such as co-worker or customer, and shared with the employee.  This approach provides a more rounded perspective on the employee’s overall performance throughout the review period.

When considering the use of a 360 degree review system, think carefully before implementing.  A 2011 SHRM article quoted a leadership coach stating, “I’ve seen departments blow up and employees leave companies because the 360 wasn’t handled properly.”  Feelings may be hurt, reviewers may feel overwhelmed, and a general lack of understanding may prevail.  However, such issues are not limited to 360 degree reviews.  Proper execution should be considered before implementing any performance appraisal method. If a manager only provides negative feedback, without balancing the review with positive comments where truly applicable, or positive encouragement towards achieving professional growth, the employee may perceive the review as unfair or biased.  Similarly, reviews with all praise and no areas of improvement can provide employees with an inflated sense of accomplishment that could backfire, leading to casual performance afterward.

It’s essential to also remember that in order for any performance appraisal method to work, Human Resources and management need to be diligent and accurate in their recordkeeping. Moments of high performance, moments that lack professional performance, and disciplinary actions recorded for yearly review all help the appraisal team to achieve a well-balanced view of an employee and his / her contribution to organizational success.

               

When conducting a performance review with an employee, it’s essential to conduct homework first.  Begin with preparing the performance appraisal document. Some organizations have employees do self-evaluations to examine during the review.  Such an approach enables the reviewer to obtain both a better understanding as to where the employee feels his / her level of performance is for the year and the employee’s buy in.  Preparing a self-review also gives the employee time to prepare comments that he or she may want the opportunity to express, considering the privacy of such reviews.

For a performance review to be successful, it needs to become a way of working.  As such, always plan the next step: the follow-up action.  Follow up actions can include establishing new goals, discussing areas needing improvement and associated development steps, and when tied to salary increases, confirming the employee’s wage for the year. Schedule a follow up meeting for matters that can’t be resolved in the moment of the performance review.

Performance review need not be challenging from a technical perspective.  If you would like to learn more about your organization’s performance appraisal or performance management options, give Aston Solutions a call.  Our Web-Based Talent Management System Flare™ includes a performance appraisal module that will allow your organization to automate your performance appraisal in a web-based platform that will allow for easier performance review meetings!

“No matter your performance appraisal approach, it’s essential to take action and provide feedback to employees,” states National Director Michael Maciekowich.  “Performance appraisal is an essential part of the total rewards equation.  Those organizations not taking advantage of this opportunity to enhance performance risk disengagement and negative bottom line results.  In today’s competitive landscape, performance appraisals are essential to sustained organizational success.”

The Astron Road Show and Our Social Media

The Astron Road Show

With the end of April upon us, the 2013 Astron Road Show is beginning to take shape!  While our first official dates on the road won’t come until June, you can get a sneak peek by visiting our website!  We look forward to seeing you again this year at one of many upcoming HR related events.  Please be sure to let us know if you’ll be attending any of these conferences.  We’ll keep an eye out for you!

Connect with Astron on LinkedIn and Facebook

Did you know that Astron Solutions has a LinkedIn group and Facebook page?  We’d love to see you on these social media sites!  Please join us on LinkedIn and “like” us on Facebook!  We look forward to many conversations with you in these groups, and thank you in advance for your support!

Getting Paid Like a Superhero

You may feel like you're a superhero at work but are you being paid like one? Well 9GAG has a list of all the superheroes and what they're making per year:

So while Tony Stark and Bruce Wayne are occupying the 1%, Peter Parker, Clark Kent, and Steve Rogers are working hard to get by. Being Spider-man, Superman, and Captain America, respectively, doesn't hurt, though. And Thor, well, let's just say that he gets paid like a God.

This doesn't exactly jive with SimplyHired, however, who lists the average pay of a superhero as $71,000. But, as the website states, "average superhero salaries can vary greatly due to company, location, industry, experience and benefits." Let's just say that Clark Kent and The Daily Planet may have something to discuss next time he comes up for a performance review.

Harnessing the Power of Flare™

In November of last year, Astronology explored the basics of a Human Resource Information System, or HRIS. As we mentioned in that article, such technology can be beneficial in assisting with HR administration. It is also an effective tool for boosting efficiency & productivity, and removing physical paperwork off one’s desk.  In response to readers’ requests, in this Astronology article, we give you a closer look at Astron Solutions’ Flare™ and many of its different modules.

What is Flare™?

In short, Flare™ is a cloud-based framework that allows you to track your employees from their first days of work to their last days with your organization. You can customize your Flare™ suite to fit your organization’s needs. All data stored in the system is password protected and housed on secure servers with 99.9% uptime. You have the ability to upload employee information & reporting relations, and store an unlimited number of users and employees.  Some of Flare™’s most attractive features are the customizable modules and the individual, reasonable pricing per module. 

But what’s included in Flare™?  Let’s dig deeper into some of the more popular modules.

Performance Appraisal Module

According to a 2011 SHRM poll, 98% of organizations reported that they have a formal employee performance evaluation process. Although you may have one in place, are your performance reviews completed on paper?  Why not cut time and resources with an online performance review system? With Flare™’s performance appraisal module you can eliminate the hard copy and streamline everyone’s work by having employees’ appraisals pre-populated with their job description and other desired demographics.  In addition, this module is designed with features to ensure all sections are completed prior to submission, to perform mathematical calculations for accurate scoring, and to check for potential legal issues.  Other user favorites include these features:

• Self-Reviews,
• HR approvals,
• Summary reports, and
• Electronic or traditional paper signatures.

Pay for Performance / Merit Increase Module

               

“While there are pros and cons to using a merit increase approach, in today’s world a majority of organizations attempt to link pay increases to employee performance,” explains National Director Jennifer Loftus.  “With limited merit increase budgets typically around three percent of pay, it’s essential that organizations make clear distinctions in pay increases between the high performers and low performers.”

If the thought of working with multiple spreadsheets and checking formulas makes you dizzy, however, consider Flare™’s pay for performance module.  In three easy steps you will be able to assign all employees with proper merit increases, meeting your merit increase budget and having the necessary reports for senior management. This module is able to calculate increases as a percent of base pay, lump sum, or a combination of both. Factors such as position in range and performance appraisal score can also be taken into consideration.

Job Description Module

               

According to Jennifer, “the Department of Labor is stepping up their investigations of wage and hour complaints.  One of your best defenses in an FLSA audit is up to date and accurate job descriptions.”

Need an accessible place to keep record of your job descriptions?  Need reminders to update your organization’s descriptions more frequently than every five to ten years?  Flare™’s job description module is for you.  This module allows you to design a job description template so all job descriptions are consistent in content type. Authorized staff can prepare draft updates to job description content to be approved by HR.  The Flare™ job description module also contains tests for FLSA compliance and a point factor job evaluation system to streamline your work and reporting systems.

Staff Advancement Monitor™

About 52% of respondents from the 2013 Global Assessment Trends report listed developing leaders as a top priority for their organization. Is leadership development a priority for yours?  If so, Flare™’s Staff Advancement Monitor™ module assists you in developing custom primary and secondary competencies and developmental activities for future leaders.  The results tracked in this module can be used for employee promotion recommendations.  Additional features include a listing of all participating employees, their mentors, and targeted goal positions.

Finders Keepers™

The 2013 Global Assessment Trends report also mentioned that 55% of respondents cite engagement of the workforce as a priority this year. Do you want to know if your valued employees are engaged with their work… or with your organization? Would you like to get opinions on where managers can make improvements? With the Finders Keepers™ module, you can! This module allows authorized users to create much needed customized surveys to gather employee opinions, new hire perspectives, and even exit interview data.  On-line, real-time reporting makes data analysis a breeze!

Total Rewards Statements

77% of organizations feel as though they communicate employee benefits effectively. If you want to ensure that your employees are aware of your organization’s reward program, consider Flare™’s Total Rewards Statement module!  With this module, you will be able to securely inform your employees of the value of their total compensation packages in real-time.  Information captured and reported by Flare™ in both narrative and graphic formats include and are not limited to salary, variable compensation, and benefit cost and value information.

Flare™ has many more modules for you to explore, including Applicant Tracking and On-Boarding, Time and Attendance, Pre-Employment Testing, Human Capital Audit, HRIS, and Learning Management System.  Are you curious to see where Flare™ could fit in your organization, and with your existing HR technology?  Reach out to Astron Solutions today and inquire about a demo!

From A(ctuary) to Zzzzzzz, the Best and Worst of Jobs (200 of them)

I like to post about the best and worst jobs sometimes to give you an idea that either you're not alone in liking or disliking your job or to make you feel like maybe you're suffering from a case of "the grass is only greener on the other side". But the tough part of most of those rankings is that you get a top 5 or so to choose from and most professions rarely fit into the list. Well how about 200 jobs, in order, with a searchable format? Well CareerCast.com and the Wall Street Journal have just that for you in this post.

Spoiler alert:

Top 3

1. Actuary
2. Biomedical Engineer
3. Software Engineer

Bottom 3

1. Reporter (Newspaper)
2. Lumberjack
3. Enlisted Military Personnel

The 4th worth job is actor, though, to be honest, I'm not sure that you'll see Tom Cruise, Robert Downey, Jr, or Anne Hathaway complaining too much. Though, I guess you may see the Anne Hathaway crying a lot, but she'll probably be winning prestigious awards while doing so.

The Top Two Reasons for Turnover

A 2010 Deloitte Shift Index survey indicated that about 80% of workers hate their jobs. Such a statistic can be alarming for every organization. With dissatisfied employees lies the high probability of constant turnover, a formidable challenge organizations try their hardest to avoid.

By means of a collection of over 14 years of exit interview data, Astron Solutions has compiled a list of top reasons why employees leave their places of employment for seemingly greener pastures. In this issue of Astronology, we will explore the top two reasons for employee turnover, and techniques you can use to avoid losing your employees.

Reason #2: Dissatisfaction with the Supervisor

Dissatisfaction of employees with their supervisors is a serious concern for all employers.  Inevitably, personality clashes will happen.  However, an overall cohesive environment is needed to keep everyone happy.  A large contributor to this dissatisfaction is lack of communication.  An NBRII article mentions, “The biggest problem with any relationship is lack of communication. And that extends beyond the personal life and into the work life.” Employees may be shy about speaking of concerns they may have, especially if those concerns may run against the grain and contrary to what a superior would like to hear. Something must be done to encourage this type of honest communication before it is too late. Conducting yearly satisfaction surveys is an excellent way to promote this communication.

Reassuring employees that their thoughts will be completely anonymous will allow employees to speak up on the matters that most concern them.  Designing a survey to include employees’ thoughts on their direct superiors will allow for more honest views and feedback. An anonymous survey will also give each supervisor a starting point to address, and hopefully correct, issues that fall squarely on the supervisor’s shoulders. Besides allowing employees an opportunity to voice their opinions, it is also important for the employer to communicate to these employees that their opinions have been heard, are being considered, and there will be action taken. Employees need to know that their opinions matter…that the employee matters to the organization.  Not sharing a high level overview of the survey results with the employees, on the other hand, is an excellent way to breed additional discontent among employees.

Reason #1: Change of Career Objectives

The number one reason employees leave an organization is for a career change. Ironically, many of your employees may not be aware of their opportunities that exist right within your organization.  Are you continually communicating the opportunities for growth that employees have with your organization? During the annual performance appraisal process, do all leaders take the time to find out where the employee sees himself in the future?  Do all managers jointly set career development goals with employees?  These approaches can facilitate employee retention among individuals who think it is necessary to change employers to move up the corporate ladder or onto a different career path. 

Employee mentoring is another valuable approach for keeping employees on track with their career goals, giving them valuable reasons to stay with an organization. There are many options to mentoring, ranging from project-oriented mentoring, formal (structured program) mentoring, and even informal mentoring (schedule and monitoring designed by mentor and mentee). These programs are affordable, as the mentors are employees with experience in the organization and the profession for a minimum number of years. Although some employees will leave despite one’s best efforts to support their career objectives, taking the initiative builds trust.  Providing the chance to map out an employee’s goals, and using the assistance of the organization in order to achieve these goals, can be an enticing incentive to stay. 

Is your organization experiencing turnover woes?  “Even in an uncertain economy, employment opportunities await top talent – talent your organization can’t afford to lose,” explains Jennifer Loftus, National Director for Astron Solutions.  “All organizations must proactively continue to re-recruit their employees every day.  If not, another employer will!”  If you need assistance with your employee retention game plan, Astron Solutions offers consulting and services and various areas such as:

• Compensation Review
• Incentive/Variable Compensation Programs
• Performance Appraisals
• Employee Communications
• Succession Planning
• Exit Interviews

Reach out to us and schedule a complimentary consultation today!

A Break from the Regularly Scheduled Program

I was about to post another article but I felt like it would be bereft of duties not to send our sympathy, thoughts, and prayers from the entire Astron Solutions community to the people of Boston. As a New York-based company, we certainly know the horror that accompanies terror attacks and we understand what you're going through right now.

There is a lot of rivalry between New York and Boston but as Jon Stewart elegantly said on The Daily Show, it's a sibling rivalry and we love you like brothers. Here's to hoping the people who committed these acts get brought to a swift justice and those who are injured are healed just as quickly.

And now we will do the best thing we know how--go on with the regularly schedule program since we won't let anyone stand in the way of being who we are or destroying our way of life. Stay Strong Boston--New York carries you in our hearts

Attracting the Best Candidates

A few years back, when the economy was really looking poor and the job market was in shambles, a headhunter friend of mine told me that it was the best time to be hiring. Granted, they weren't so happy about the situation, but companies didn't have to be all that great at recruiting or impressing candidates as many highly qualified candidates were looking for jobs. Instead of trying to pick from the bottom of the barrel, they were able to choose from highly skilled candidates for even the most junior of jobs.

Well the tide has turned and some of those companies are now having a harder time finding those qualified candidates to fill their top positions. They can find someone right out of college to be an analyst but managers and VPs are harder to come by nowadays. Sure the headhunter is happy as he no longer has to impress his clients with lavish dinners and nice seats at the Yankee games, but now the onus is on both of them to attract the best and the brightest. And some of that attracting has to start with your social media presence.

Recruiter.com has some advice on how to impress candidates. The first has to do with social media:

Did you know that a whopping 24 percent of Millennials said that a company’s social media policy would be a key factor in accepting a position? This particular group puts a huge emphasis on their gadget and social media freedoms, so create your social media policies with this in mind and make it known. Until just recently, social media policies didn’t even exist, and now people are accepting or rejecting job offers based on them! Who cares if other companies aren’t doing it, tweet your policy, Facebook it, include it in job listings. Like it or not, this is a major factor today. This is a cost-free and really simple bullet for your recruiting arsenal. Companies like Coca-Cola and Apple make theirs public and so do all these companies.

Career Cloud looks at one company, in particular, that does a great job of social recruiting--GEICO. This one ad caught their attention and with good reason--they take advantage of both in-person recruiting as well as a strong Twitter presence. "Job hunting has never been more complex and time consuming. If you help people understand it better and teach them, you can use it as a branding opportunity & recruit them at the same time."

There are certain jobs that you can post and sit back and let the resumes roll in but the best job postings that result in the best candidates are now going to involve some instances on social media on your end. The key is to make sure that your social media presence is clean, professional and fun. But most of all, it should be another avenue to differentiate yourselves from your competition in the job market.

The Do's and Don't's of Resume Building

A lot of people offer advice on resumes but the truth is for the most part, they are suggestions: a resume is your own voice to a potential employer. So whether you have the perfect template for your resume or put it on pink paper with a nice scent and maybe a video, well, own it. But there are some pieces of advice I think are helpful. Two recent articles put it in good terms.

From Brazen Life:

A recruiter will glaze right over large chunks of text on a resume because paragraphs don’t stand out. List your accomplishments in bullets to improve the chances of catching the recruiter’s eye. If you submit most of your resumes through online applications, you may be tempted to write in paragraphs because bullets don’t always copy well into form fields. Don’t give in to this temptation! 

It's hard for some people to keep it short and sweet but each job should be able to be broken down into quick bulletpoints. Save the paragraphs for the cover letter.

And from US News and World Report on red flags on a resume:

Grammatical or spelling mistakes. Mistakes can get your resume immediately tossed, because they convey to an employer that you don't pay attention to detail. Employers assume that you've polished your resume more than you will most documents, so if you have mistakes in it, they assume your work will have even more errors.

Not every job requires you be a good writer but it shows that you don't give a hoot about your work if your most personal document--your resume--can't be given the care needed.

Most of the real do's and don'ts with resumes are common sense but some of them require a little more thought. Make sure that as a resume writer that you are following a format that you would want to receive as a potential hiring manager and if you're a hiring manager, understand that not every resume needs to be cookie cutter to be accepted

Compensation 106: Variable Pay

The final feature in our Astronology six part series is here! In this issue of Astronology, we will discuss variable pay. WorldatWork’s 2012 Compensation Programs and Practices Survey found that 84% of organizations use some form of bonuses or incentive compensation to reward employees. With the popularity of variable pay, there also come questions, such as: what are the pros and cons of some different variable pay design options?  Does one variable pay design fit all?  Should the variable pay design change over time?  We will explore these questions and more in our final Compensation Practice Basics article.

Variable pay is a form of compensation that typically is earned by accomplishing specific goals, and is not equally paid throughout the year. It is also referred to as “performance pay.”  Variable pay is used to “recognize and reward employee contribution toward company productivity, profitability, team work, safety, quality or some other metric deemed important.”  When it comes to variable pay, one size does not fit all.  Variable pay can take one of several forms, including the following:

• Incentive
• Profit sharing
• Bonus
• Holiday bonus
• Deferred compensation
• Cash
• Goods or services

Many organizations look to variable pay during uncertain economic environments. It is easier for employees to accept and understand a reward that is tailored to one’s personal performance and the organization’s overall performance, than to understand low or no salary increases. As such, many organizations in both the for profit and non-profit worlds have issued employees bonuses instead of annual salary increases in order to retain their top-performing workers.

The practice of variable pay has also fostered an increase in productivity. Employee engagement increases as workers become highly engaged in achieving goals to receive rewards. Employees take a larger role in the responsibility for their work outcome, which also drives commitment to the organization.

Some drawbacks related to variable pay can include execution. If a variable pay plan focuses on quantity, the end results can be a lack of quality. Tangible measurements become more valuable than innovative techniques or genuine customer satisfaction. While an increase in performance is always welcomed, if not careful a variable pay plan could result in outright cutthroat competition…thus ruining an organization’s cohesiveness.

As there are different forms of variable pay, every organization that wants to include it in their compensation mix must consider their individual circumstances. It is suggested that a task team should be appointed to consider variable pay as an option. When planning and designing the program this team should consider the following:

• Identify if more than one plan is needed based on employee groups,
• Identify plan participants,
• Determine how to encourage the entire organization to success through positive communication,
• Determine how the plan will be funded, and
• Determine the plan’s key aspects, weightings, and measurement methodologies.

Once a plan has been selected, thoroughly develop the modeling criteria, methodologies, and formulas. Create a document that outlines the plan, policies, and procedures. In non-profit organizations, ensure that the maximum potential payouts have been included in the organization’s budget to address the legal and tax considerations.  Conduct focus group sessions to determine if the plan is easily understood by employees, while paying close attention to the motivation the focus group members demonstrate. If needed, revise the plan based on the focus group results.  Ensure that focus group members understand that the payouts from the plan are at risk – not a guaranteed payment that employees can rely on to pay the mortgage or other critical bills. 

This task team and focus group approach should be revisited every few years.  Variable pay plans generally have a window of greatest effectiveness.  Once employees have achieved the targeted goals, it may be time to revisit the plan or eliminate it altogether. 

As with every new initiative in an organization, it’s important to have full cooperation with all of its members. In order for this to happen, clear communication must be made on the full details of the variable pay. All must be able to understand how this new system will work, how it will benefit them, and what is expected of them once the new pay variable plan goes into effect.

Are you considering introducing variable pay to your organization or updating an existing plan? Need some help getting started? Astron Solutions is here to help! We offer compensation consulting and can assist in introducing a variable pay plan through our cloud-based Talent Management system, FLARE™.  Please contact us today with any specific questions you’d like us to explore with you!

The Best of Jobs and the Worst of Jobs

Forbes and CareerBliss just released the data of their research looking into the happiest and unhappiest jobs in the world. A few observations from the list:

1. I am pretty shocked to see Real Estate Agent at number one. With the downturn in the housing market, the last job I expected to see on top would be one which is commission based on house purchases. But it is
2. 2 out of the top 3 occupations on the list are usually highly commission-based. In an era where base salaries aren't going up a lot, maybe that is where the money is being made and the happiness factor is the highest
3. Another commonality among the "happiest jobs"--a lot involve blue color jobs and quite a few involve some sort of IT/technology background.
4. 3 of the 7 most unhappy professions are in law. Again, why are people going to law school? 
5. It's not just law school that seems to be a mistake, 60% of the most unhappy professions usually require some sort of post-college degree. So while you're sitting in loads of debt, you're also miserable at your job? Pass!
6. I still think the best job ever was Tom Hanks in BIG testing toys:

 

More Reason Why Companies Should Care about DOMA Arguments

Listening to NPR yesterday, the coverage was heavily-centered around the two cases that are being tried before the Supreme Court--about Proposition 8 and the Defense of Marriage Act (DOMA). While there are people who feel strongly about the issue on both sides, the tide is turning towards people supporting marriage equality--not just in the general public and politics, but in the business world as well. And here are some reasons from NPR why you may want to follow this a bit more closely (hint: it's bad for business)

The Defense of Marriage Act prevents same-sex couples from getting medical coverage and other tax and retirement benefits that other employees receive for their spouses. And that complicates things for any business that employs people in any of the nine states and Washington, D.C., where same-sex couples are lawfully married.

"We're basically treating people differently," says Mark Roellig, general counsel at MassMutual Financial. He says DOMA forces his company to keep track of a dual system, and that costs time and money.

"You have to keep separate sets of books. You've got to continually be adjusting. And then also picking up the potential legal risk if you make a mistake," he says. "So it's ongoing administrative costs that are pretty significant."

His company does not want to discriminate, Roelling says. So MassMutual uses a workaround to give employees benefits for their same-sex spouses. But then DOMA forces those employees to pay more in taxes and MassMutual pays more, too.

Profit cuts are not the only reason businesses are complaining about the law — it's also about the work environment. Hannah Grove, executive vice president at State Street, a financial firm, says DOMA is hurting company's ability to create an inclusive atmosphere.

"In order to compete in today's global competitive environment, our employees are one of our greatest assets," Grove says...

...Overall, 278 employers signed on to oppose the Defense of Marriage Act. The number of companies that filed a brief arguing DOMA is good for business? Zero.

Just something to keep in mind...

Compensation 105: Pay Communications

Compensation Programs and Practices 2012, conducted by WorldatWork, found that 80 percent of organizations relay pay information to their employees via brief written or oral communications. This may leave us wondering, what would be the most effective way to communicate with an employee about his or her pay?  Is there just one right way to share this information? Are there legal considerations that impact pay communications? The focus for this issue of Astronology on compensation basics is Pay Communications.

Why is pay communication important? One Bloomberg BusinessWeek article explains that, “a pay-related communication from a manager has three times the impact on engagement, performance, and retention as that same communication coming from a central function such as HR.”  Pay communication is so critical, that how the information is relayed and by whom can impact an employee’s work contribution to the organization. The article also pointed out that only 10 percent of managers effectively communicate pay to their employees. While quite a few managers do not feel adequate in relaying pay information, these skills can be acquired through active learning training.

The human resources section of about.com mentions that if employees cannot fully understand the organization’s compensation philosophy, it is a sure sign that communication has been done poorly. Although a manager may not be responsible for selecting and establishing the pay philosophy, they do play a significant role in executing on that philosophy. Managers, in a nutshell, should be able to:

• Understand their roles and the value that they add when they communicate employee pay information.
• Understand the organization’s pay philosophy and be able to explain it clearly.
• Communicate the employee’s pay raise in such a manner that the employee feels rewarded and acknowledges that the organization values the employee.

One of the most effective ways to share compensation information is a formal meeting between an employee and his / her manager. Depending on the environment, or type of work done in an organization, e-mail or instant messaging may be popular choices in regular communication between workers. However, due to the sensitive nature of the subject of compensation, nothing demonstrates value more than a personable, one on one chat. It is said that 90 percent of how we communicate is through our nonverbal cues such as facial expressions and gestures. These nonverbal cues help in conveying sincerity to employees, particularly in delicate conversations surrounding pay.

Here are a few more Do’s and Don’ts when communicating pay:

• Don’t fail to communicate the context of a possible pay increase. If pay increases are awarded by merit and contribution, clearly define what would be considered merits and qualifying forms of contribution.
• Do explain why the employee may be receiving a pay raise. Be specific in his / her contributions.
• Don’t inform employees of the percentage of the increase. In an environment where nationally the pay increase is at an average of 2.5%-3.5%, in the eyes of the employee such an increase may not be motivating.
• Do give the employee the salary increase in a dollar amount.
• Don’t compare one employee’s increase to another’s employee’s increase.
• Do thank the employee for HIS / HER hard work and commitment, and express confidence in the employee’s continued contributions to the organization.
• Don’t focus on why the pay isn’t larger. Do confer with HR if the employee requests more information on why the pay isn’t larger. Be able to clearly explain what criteria were used to make the decision on the employee’s pay.
• Do follow up with HR with a written document to be included in the employee’s file regarding the amount of the increase.  In addition, a personal copy should be sent to the employee’s home address, or given to the employee in person.

With respect to this last “do,” in some cases there may be state laws that require not only verbal communication but also written communication of employee’s pay history. For instance, in 2011 New York introduced The Wage Theft Prevention ACT (WTPA), which requires that employers give written notices of wage rates to each new hire, all employees by February 1 of each new year, and any time an employee’s pay rate is changed.  Be sure to check your state laws for similar requirements, as what each notice must include may be different from state to state.

A comfortable time to have a conversation with an employee with respect to pay can be when the employee is first hired.  That initial conversation is only the starting point, however.  Such conversations must happen on an on-going basis, after the annual review with the employee.  The employee will be already anticipating the conversation, and such timing will facilitate both parties feeling comfortable to voice their opinions and also to be more openly heard.  In addition, the more information an employer shares with its employees regarding compensation philosophy and the reasons and criteria behind pay increase decisions on an on-going basis, higher levels of trust continue to build.  Such trust is essential for truly attracting, retaining, and motivating an organization’s human capital.

Ask the Expert: First-Time Manager

We got two excellent questions recently which spurred two awesome answer from Jennifer. Today's is about something that many people my age are going through: the anxiety that comes from being a manager for the first time and your responsibility to the people you are to manage. Here's the Q&A:
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David Asks

I was recently made a real manager for the first time in my career but I'm a little nervous since I've never really been in charge of people before and I'm not sure what I'm doing is correct (there isn't much guidance from my company and the past inhabitants of this position weren't exactly role models of good managing skills). Is this something that people go into or are there courses that should be taught to managers to make sure they're doing the right thing? Or is there something I could suggest to my employer to do that may be beneficial not just for me but the whole company? I don't want to seem incompetent and unworthy of the new role but I also don't want to be a fish out of a water. Any advice?

Jennifer Answers

Congratulations on your promotion! How exciting for you! Managing employees can be one of the most rewarding aspects of work, and also one of the most challenging.

I am thrilled to see that you are proactively interested in developing your management skills. Many times, employers promote individuals who are technically savvy and experts in their positions, but lack the necessary skills to manage people. These individuals continue on for decades, not realizing their people skills could use some help! Your employees are lucky to have someone as caring as you for their manager.

Both Dale Carnegie Training (http://www.dalecarnegie.com/events/individuals/) and the American Management Association (http://www.amanet.org/training/seminars/management-and-supervisory-skills-training.aspx) offer courses designed to help managers – both new and seasoned – excel in their roles!

You could also ask your employer about providing you with a mentor, someone within the organization who you perceive to be an effective manager. You could learn from him / her at your pace, with less out of pocket cost than a formal training course. One on one coaching could also be another option if you organization has internal coaches available. You could even explore all three of these options – they’re not mutually exclusive!

Good luck with your new role! I hope you enjoy the professional development opportunities this growth position offers you.

Ask The Expert: Obligation to New Employer

I took a little while but we're now back to our "Ask the Expert Series", where our resident expert, Jennifer Loftus, answers your questions. Feel free to submit one and we will post the best of them here on the blog. The latest is about what happens when you get a new job...but a better one comes along?
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Anonymous asks 

I recently took a new job but at another company, a position that I interviewed for that's better overall (pay, location, benefits, etc.), said that they would get back to me next week--what is my obligation to my new employer to stay and is there any repercussions to my leaving? (I'm just trying to really figure out if there is a "good" way to handle this tough situation and be fair to the company that I just started at since I don't want to burn bridges)

Answer from Jennifer

Congratulations on being accepted at two positions! That is great for you, particularly in this economy! However, moving between jobs very quickly does pose challenges. On the one hand, you want to do what’s best for you and your career. On the other, you don’t want to do something that potentially could come back to haunt down the road.

Assuming that your job with your new employer is “at will,” meaning that you don’t have a contract for employment for a set period of time, there’s no legal obligation to stay. If you do have a contract, however, leaving before the contract is up could put you in a breach of contract situation.

Legal issues aside, you do have the ethical dilemma to address. Your employer has spent time interviewing, on-boarding, and training you. Those activities have cost the organization time and money. How would it feel to you to leave after only a few weeks? Would you feel comfortable with your decision to leave? Think carefully about your decision to accept the new position. While pay, benefits, and work location are important considerations, you must also reflect on the culture and work environment of the potential employer. Will you like working for this organization? Does the culture match your style? How do your current manager and your potential manager compare, in terms of work styles, expectations, and reputations? While more money is appealing to most people, many have found that a few less dollars in salary is worth the peace of mind that comes from working with a fair and pleasant manager in a supportive work culture.

If you have made the decision to leave, you still should give your two weeks’ notice, even though your employment has been relatively short. As for the reasons why you’re leaving, this is challenging. If the change in the commute is great, such as 20 minutes as opposed to two hours, focus on that. We’ve all known people who left positions because they didn’t realize how grueling the commute would be every day. If that’s not the case, is the job offer one that is for very different work than your current role? A change in career direction can also be an effective way to start the conversation. If neither of those options fits, however, you can be honest and say that the total compensation package is much larger than your current one, and to pass it up would be a disservice to your family.

No matter what reason you give for leaving, end the relationship on positive terms. Do you know someone who would be a good fit for the job? If yes, bring their resume to the meeting to demonstrate your support for your employer and not wanting to leave them in the lurch. Do your best to show that you care for your employer, even though you’ve been there only a short while. While the employer may not want to serve as a reference for you, the more you can do to help them get through this sudden transition, the less negatively they’ll view the bad news that you’re leaving.

Good luck with one of life’s hard conversations, and good luck with your new role!

2013 Survey of Human Resource Priorities

"Human resource management is responsible for how people are treated in organizations. It is responsible for bringing people into the organization, helping them perform their work, compensating them for their labors, and solving problems that arise."  
Cherrington, David J. (1995). The Management of Human Resources. Englewood Cliffs, NJ: Prentice-Hall. 

 Astron Solutions, LLC (www.astronsolutions.com) is reaching out to clients, associates, and colleagues to conduct a survey of 2013 Human Resource management priorities. The results of this short survey will be provided to participants free of charge, as part of our continued efforts to support HR professionals in the challenges they face on a daily basis. The results will provide you with a guide for setting strategic priorities and determining the allocation of limited HR resources. Thank you in advance for your participation.

 

Compensation 104: Pay for Performance

Continuing our series of compensation topics, this week’s Astronology will review the basics of Pay for Performance programs. About 71% of organizations have a formal employee performance appraisal system. Linking pay to performance through that appraisal system raises questions: How flexible can an employee performance appraisal system be? How can HR ensure that the performance appraisal system is fair? Does compensation link with performance appraisal score? Should it?

A pay for performance program is used to reward employees based on measurements of their performance through an appraisal system. These programs are heavily used in many industries, including healthcare. Pilot studies in some hospitals found using a pay for performance program led to an increase in efficiency.  Major concerns with pay for performance in the healthcare industry, however, are system validity, patient and physician autonomy / privacy, and the increase of administrative responsibility. Concerns regarding validity and workload can apply in other industries as well.  In addition, one must determine if the reward for high performance is an adjustment to an employee’s base pay, or an incentive or bonus reward.  While salary adjustments may have limited flexibility, in many industries, these “incentive-based compensation” or “bonus plans” are easily adaptable to meet a variety of needs.

Many organizations find pay for performance programs an answer to the complex problem of keeping up with a competitive market. Here are a few of the advantages of using pay for performance:

• Pay for performance makes it clear to the employee what areas should receive priority attention.

• Employees motivated by financial rewards are driven to achieve high levels of performance.

• The organization enjoys high performance from its staff and rewards such performers appropriately.

Given that the performance appraisal is linked to an employee’s pay, it is essential that the performance appraisal is fair.  The following are some aspects to consider when designing or updating a performance appraisal system used in a pay for performance program:

-The relative balance between the base salary and performance based pay: Many employees are willing to accept a below-market base salary if the incentive could add up to above market pay.

-How will the criteria be weighted?:  To over-reward employees for short-term accomplishments can be quite costly to an organization. It is important to clearly define what would be considered short-term versus long-term actions.

-How will the organization guard against score inflation or other manipulation?:  Manipulation of performance appraisal scores by raters and managers undermines the fairness of the employee appraisal and pay for performance systems.  Employees will perceive management as “gaming the system,” and the rewards become meaningless.  To guard against this demoralizing effect, Human Resources must continually review score results across departments and managers to identify scoring trends, and address score inflation or manipulation sooner rather than later.

-Will there be a partial incentive or reward if goals are partially achieved?: To have an “all or nothing” incentive or other reward can work for some industries, but not all. Establish at what rate rewards will be provided and what constitutes a “partial reward.”

-How will the criteria be established? How are the accomplishments measured?: Tapping into the expertise of an HR consulting firm is recommended when it comes to answering these questions. Utilizing an external third party enables the organization to explore the types of systems the competition uses, performance management trends, best practices, and pitfalls to avoid.  For example, Astron Solutions’ Web-Based Talent Management program, Flare™, combined with supportive consulting, has helped many organizations efficiently manage the challenges of creating and implementing a pay for performance program. Why not request a demonstration to learn more?

-Can we establish any of the rewards to be paid out on a discretionary basis?: Perhaps an employee may handle an unforeseen task so masterfully that those responsible for handling bonus awards or merit increase awards may deem it necessary to reward the employee outside the scope of the formal pay for performance program. Keep in mind, however, that it can be demotivating to have compensation based on unknown criteria. When using this type of discretionary plan, be discreet and make payout decisions wisely.

Pay for performance programs run contrary to the thought that performance should not be linked to compensation. This is especially so when one questions the structure of a pay for performance program. One person writing for the Harvard Business Review recently said, “When you try to institutionalize pay for performance you actually ruin the concept.” Others even question whether board members or HR professionals in an organization would know enough about what it takes – skill and difficulty – to perform at current levels.  As such, it is important to make sure when creating the pay for performance program design team that all sides or concerns are represented and considered. Examining the experience each team member has in areas such as compensation and management is critical.

When structured appropriately for the organization’s jobs and industry, pay for performance can provide multiple benefits to the employer.  Without careful development and on-going monitoring, however, the program may run contrary to the organization’s Human Resource goals.  Pay for performance is an important part of the compensation world that must be considered carefully by all organizations.

Working from Home Is the Wave of the Future

There are memos and then there are MEMOS like the one from Office Space about the TPS reports or the one sent by the Yahoo! CEO Marissa Myers (outed by AllThingsD) which banned working from home. There have been a myriad of reactions from the memo (mostly negative) and some of them are worth getting more into--and we'll do so right now.

Huffington Post (H/T Shira) wrote about why it's good for everything from the environment to the employee turnover and productivity. CNN wrote why this is a women's issue, followed up by TIME saying that is a men's issue as well. But the biggest thing of all is that Yahoo! is missing the point here, and missing the wave of the future according to Today:

By focusing more on measuring how well employees are doing their job, and worrying less about where the work gets done, companies with flexible work policies are seeing productivity go up, according to human resources experts. 

That may be one more reason American companies are adopting flexible work policies. As of last year, nearly two-thirds of employers offered flexible work rules to at least some of their employees – up from about a third in 2005, according to a national study by the Society for Human Resource Management. 

“We don’t see this trend going away,” said Michael Aitken, SHRM’s vice president of government affairs. "This is the way that work will get done in the future. I spend a great deal of time and energy in educating our members about the value that it offers.”

The key is the last part. Employers know about certain benefits of working from home (and the disadvantages of not allowing employees to take advantage of it), but it's the education of companies and those in charge of decisions like these that need to understand the pros and the cons. Not every type of job (and not every employee) will be able to work in this environment. But for the ones that are, the wave of the future is telecommuting and you better at least get educated about it before you get left behind.

(We'll discuss this more later in the week)