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THE SLIPPERY SLOPE OF EXEMPTION STATUS PDF Print E-mail

As companies begin to experience an up-tick in business they resign themselves to the probability of adding staff.
Immediate questions arise:
Is the increase in growth sustainable?
Do I need a person full time or part time?
Can I find a good person willing to work part time?
Can I engage an independent contractor?
Will they be exempt or non-exempt from overtime pay?
 
These are all critical questions but the last one plays havoc with employers who incorrectly classify their employees. When in doubt, the best course of action is to verify your classification by checking the Fair Labor Standards Act. 
 
The litmus test of correct classification is criteria that must be met. One of the criterions scrutinized is the “DUTIES TEST”. 
It is the measurable performance of the job duties that matters for classification. Which of these titles would carry an exemption?
 
EXECUTIVE, ADMINISTRATIVE, LEARNED PROFESSIONAL, CREATIVE PROFESSIONAL, COMPUTER, or OUTSIDE SALES.
 
It depends on the employee’s primary duty.
 
The Executive Exemption is based on the management of an enterprise or a recognized department or subdivision which involves regular direction of work of two or more other employees.
This person also has authority to hire or fire or their recommendation to hire, fire, promote other employees is given particular weight.
 
The Administrative Exemption (often misclassified) is based on performing office work directly related to the management or general business operation of the employer’s customers. This person also must be in a position to exercise discretion and independent judgment with respect to matters of significance.
 
The Learned Professional Exemption relates to performing work requiring advanced knowledge in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction.
 
The Creative Professional Exemption relates to performing work requiring invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor.
 
The Computer Exemption involves one of the below:
A. Application of systems analysis techniques and procedures including consulting with users to determine hardware, software, or system functional applications: OR
B. Design, development documentation, analysis, creation, testing, or modification of computer systems or program including prototypes based on and related to user of system design specifications: OR
C. Design, documentation, testing, creation, or modification of computer programs related to machine operating systems: OR
D. A combination of duties described in (A), (B),and (C) providing the performance of which requires the same level of skills.
This most often applies to computer systems analysts, computer programmers, software engineers or other similarly skilled workers in the computer field.
 
The Outside Sales Exemption involves making sales or obtaining orders or contracts for services or for the use of facilities for which consideration will be paid by the client or customer. This person will customarily engage in service away from the employer’s place of business.
 
As business owners it’s not only about our getting our ducks in a row; they’d best be in the right row!
 
 
 
 
 
 
Turnaround PDF Print E-mail

 

2010 - GROW AGAIN
 
It's the New Year and 52% of small business owners expect an economic turnaround this year, according to a Business Confidence Survey released by Administaff. 13% said they felt a rebound was already under way, while 21% didn’t think a recovery would come until 2011 or later. Hiring is expected to accelerate in the New Year.
With positive economic trends in sight, what is your company doing to prepare?
Some companies are focusing their hiring initiatives on sourcing qualified candidates from over-populated talent pools. 
Some companies are reviewing files of laid off employees to determine who to recall. 
Some companies are investigating the intriguing prospect of securing needed help and saving costs of a new hire by using 1099 independent contractors.
Some companies are increasing the hours of part-timers and making temporary workers permanent or leasing employees as permanent temps.  
Which method or perhaps combination of strategies could work for you?
Strategy #1   Tapping into the brimming talent pool seems fool-proof, but without a system in place, acquiring top talent can be a painstaking process. Companies may not be prepared to handle the tsunami of resumes their Career Builder or Craig’s List ad could cause. This pool of potential employees is populated by the very desirable and the flotsam and jetsam. Issues surrounding classic discrimination in the screening and interviewing process will surface exponentially to the number of job seekers crossing your threshold. At this critical juncture between moving quickly to catch market share and moving slowly to insure the right hire, missed deadlines or a wrong hire could create the perfect storm.
Strategy #2   Many employers who continue to operate conservatively are rethinking recall decisions. Employers want their most productive and efficient employees back as the company’s sustainable growth depends on its continued excellent service to customers. According to labor law attorneys, Peters & Lyons, Ltd., in the absence of a collective bargaining agreement or a written policy mandating terms and conditions of a recall, displaced employees generally have no right to be recalled in any particular order. Like any employment-related decision, employers’ decisions concerning recall are subject to legal scrutiny. When laid off employees are passed over for recall in favor of similarly situated laid-off co-workers and the passed over employees belong to different protected classes, classic discrimination issues can arise. It is recommended that recall decisions can be justified with legitimate, good-faith business reasons, and supported by a written policy, objective evidence or both.
Strategy # 3   The classification of whether a worker can legitimately be considered an independent contractor has been problematic for employers for years. The opportunity for an employer to stretch their dollars by classifying their employees as independent contractors must be weighed carefully. There has been a rise in misclassification of employees. The IRS, whose own coffers have been affected by these economic times, announced that it will conduct random audits of 6,000 employers as a benchmark. Unlike employees, independent contractors are not subject to payroll taxes, overtime, anti-discrimination and workers compensation. Misclassifying a worker can be disastrous. Federal and state agencies have their own criteria to determine the question. Employers should know the specific ‘tests’ in their state and if their process is in one of the ‘gray’ areas of the law.
 Strategy #4   In the case of companies who had reduced hours, designated furlough time and implemented job sharing as a means of cutting costs, reversing the pattern is easy enough. Adding back hours and expanding components of jobs that had been shaved heighten morale and keeps trained staff on the job. Letting jobs return to their full scope gives companies opportunities to expand product and services quickly and efficiently. Converting temporary staff to permanent hires can allow the companies tax credits in some circumstances.
According to the Administaff survey, 28% of the respondees said they would be adding new positions, up from 21% three months ago and 18% six months ago.
The trend is to return staff to full time and hire new people to be prepared to build on the projected increased sales and industry growth. Emerging strategies noted by Administaff, Career Builder, Challenger, Gray and Christmas, Inc. have merit and risk. 
What can your company tolerate?
 
 
READY, SET, REBOUND! PDF Print E-mail

Economists are convinced that the U.S. has been in a recession since December 2007. Most businesses felt the crash last fall. Those same economists say that the average length of a recession is 10 months.

Basic math would indicate that we are overdue for a change and that a rebound is imminent.
No one will argue the need to anticipate better days ahead but are businesses ready?
 
If the rebound came half as slowly as the recession began for most, would your supply chain be prepared to meet demands?
 
Now is the time to evaluate your supply chain to ensure that it won’t snap apart when the long awaited, desperately needed rush of orders piles on your company. There is nothing more upsetting than a company which has weathered the storm only to find itself too far from shore to be an effective supplier. Companies that can ramp up to meet those demands quickly and accurately will experience the stronger and steadier growth for 2010. Not only will sales be stronger but credibility will increase which translates to a larger market share.
 
According to the Chicago Fed National Activity Index, inventories will be rebounding. Companies are regrouping to determine inventory forecasting. You can’t sell your customer what you don’t have; what’s worse is that your competitor will. Once that customer is forced to go elsewhere the next order from that customer may never come.
 
Companies that have put technology on the back burner will want to analyze and automate how they link departments and processes into the best solution for their customers. If your competitor can deliver the goods more effectively and at a lower cost because of technology, you run the risk of losing business and goodwill.
 
Flush inventories and hi-tech solutions will be meaningless without the personnel to support the growth models. Do you have a weak link?
 
If you find you are wanting on the last point of personnel, there are people available with better skills and experience than during any other recession in recent memory. These people are available for less money than used to be the case. When recessions last as long as this one has, excellent staff has hit the chopping block. 
 
In shorter recessions lasting only 8-10 months and when unemployment doesn’t hit double digits, many of the released personnel were let go for reasons other than an economic downturn. Employers use a recessionary economy as a catch all reason to “clean house” of less than stellar workers, or to offer buyouts to aging employees to make room for the next generation (which is waiting its turn but ready to bolt) or to cut the excess from over staffed department payrolls. 
As the economy moves forward, companies will more than likely restore hours first then begin to offer overtime to their employees and finally contract temp employees before hiring a full time person. This is a great time for employers to snap up the talent on the market.
 
“Take away my oil wells and factories. Simply leave me my 50 best people and I’ll have it all back double in 5 years. It’s not the business. It’s not the marketplace. It’s the people.”     Paul Getty
 
Do you have those people?
 
Echo-boomers, boomers, boomers… PDF Print E-mail

The Baby Boomers (1945-1964) vowed to change the world. Generation X (1964-1984) saw no significant change. This new generation is emerging, less naïve than the boomers, more confident than the X-ers.

The largest generation of young people since the 1960’s, those born between 1984 and 1996 (nearly 80 million of them) will be entering the work force and high school respectively. As the Baby Boom generation commanded attention because of the size, the same will hold true for their echo. It accounts for 26 percent of the U.S. population, compared with 29 percent saturation by the original generation. Generation X represents only 16 percent.
 
They’ve been called Generation Y and Millennials. As more research takes place a new name makes more sense and tags the entire generation. They are called Echo-Boomers because they’re the genetic offspring and the demographic echo of their parents, the baby boomers.
 
As 74 million Baby Boomers leave the workplace over the next 7-10 years, their progeny will be filling the gap over the same period. As this population ages they will become, as their parents before them, the next dominant generation. Advertisers, demographers, sociologists, retailers, are reaching over Generation X (now in their 30’s and 40’s) to engage and embrace this fresh, easy going generation.
 
Few are eligible to vote, few are old enough for positions of authority yet they are one of the most studied groups in history. Clients like NBC, Chanel, Nike, Coca- Cola, Discover Card and Levi Strauss hire marketing consultants to gather information.
 
What does this mean to employers? Why are some large corporations developing hiring practices and training programs to target this group rather than “re-tool” their current work force of Baby Boomers and Generation X?
 
Baby Boomers are staying the workplace longer. Some because they love to work (the mantra of that generation) and because they have not nurtured non-work activities or hobbies to a great extent. Some Boomers have been forced to delay retirement due to the recent economic debacle that left their savings decimated and their plans on indefinite hold.
 
Employers like the idea of keeping Boomers at their desks for another 5 years. Where does that leave the Generation X? It leaves them biding their time waiting for a “desk” to open up. However, some companies have decided that Generation X doesn’t have the same work ethic and drive as Boomers. Generation X doesn’t have the natural “plugged in” affinity as does the Echo-Boomer generation.
 
Echo-Boomers are a reflection of the changes in American over the last quarter century. They are the first to grow up with computers in their homes, in a universe of 500 channels. They are natural multi-taskers with cells phones, IPods, Twitter, Facebook and Instant Messaging.
 
Employers also like the demographic data that tags this generation as an echo of the Baby Boomer group they value. This generation tends to over-achieve and be over-managed and extremely pressured. Of this generation on the whole, 63% rated their parents in a positive, 29% were neutral and only 7% held a negative view. This statistic tells employers that Echo-Boomers are respectful in general and more easily assimilated into structure.
 
Volunteerism is very high in this group. Where the Baby Boomers were going to change the world, the Echo Boomers seem to focus on things closer to home: family and community. This desire to contribute works well in companies with strong community involvement. Mentoring programs work better with that mind set.
 
A contrast from Gen X (the first latch key kid generation) Echo-Boomers have been scheduled from toddler hood and whisked off to organized group activities or structured play dates by parents who felt their children needed to learn time management and diversity skills.
 
This constant scheduling and herding has had as much to do with shaping this generation as technology. They have been programmed by adults with a mission to keep them safe, keep them engaged in everything from martial arts, to music, to religious studies. Because of this total adult supervision and involvement this is a generation that aims to please. They wanted to please their parents, their friends, their teachers and now their bosses.
 
Information gathered from focus groups implies that Echo-Boomers have listened to what their Woodstock, Sex, Drugs and Rock ‘n Roll Baby Boomer parents said rather than followed their footsteps. Rules for Echo-Boomers seem to have replaced rebellion. Convention (group achievement) seems to be leading individualism. Their values are more traditional than Gen X who on the demographic whole was told to “fend for itself”.
 
Again, what is the benefit to employers to skip over Gen X and focus on this younger generation? Employers see a diverse population (more than ever in the workplace): 35 percent are non-white. Their life style is extremely tolerant, believing in inclusion for all in whatever community they become involved. This translates to a work force that wants to get along with co-workers, wants to please their bosses, and feels obligated to help their team achieve success. 
 
The trend seems to be following a preference for this younger group. The explanation from some consulting firms is that companies will be able to leap frog the higher salaries of the Gen X workforce. Companies are also looking at reducing benefits and pension/retirement funding. Rather than take benefits away from their existing workforce, companies find it easier to recruit new employees and offering their leaner benefit package. 
 
The Gen X workforce has, more than the Boomers, left the structure of Corporate America to strike out on their own. Since they are the smallest workforce this entrepreneurial exodus contributes to their dwindling numbers. Some of the ‘cusp’ (mid – late forties) Gen X employees are taking offered packages thereby lowering their numbers even more as an available workforce.
 
Employers are poised at a unique junction in workplace history. They are able to re-design company goals and policies around a work force that promises the ‘throwback’ qualities of stability and loyalty and the cutting edge technological skills that are as natural to them as breathing. This ‘best of both worlds’ blend might be the generation of American workers ideally suited to carry America forward in a wired world where the pace of competition ever accelerates.
                                  
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
Welcome PDF Print E-mail

WELCOME TO THE HIRE SOLUTION

The business of recruiting, testing and hiring qualified personnel becomes increasingly time consuming and cost prohibitive as companies change the way they do business.

THE HIRE SOLUTION offers new and alternative ways to manage your company’s staffing process.

THE HIRE SOLUTION  will help you improve your productivity and lower your costs.  We will work with you to design a program that meets your needs and allows you to manage your employment process more effectively.


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