The HRK Blog

What You Need To Know About HCTC:Health Coverage Trade Adjustment

Health Coverage Tax Credit and Advance Payment has been Extended

President Obama recently signed the Trade Adjustment Assistance Extension Act of 2011 (HR 2832).    This new law, HR 2832 extends HCTC (Health Coverage Tax Credit) through the end of 2013 and increases credit for "trade-displaced workers" from 65% to 72.5% for coverage months commencing before February 13, 2011.

Provisions of  ARRA, the American Recovery and Reinvestment Act of 2009 included changes to Health Coverage Tax Credit (HCTC).   ARRA includes increased tax credits,  greater definition of what is an eligible individual and defines qualified health insurance and extends the length of coverage under COBRA for certain HCTC eligible individuals through 2010.

As of May 1, 2009,  the HCTC premium subsidy to purchase qualified health insurance increased from 65% to 80% through most of 2010.  Legislation  in December of 2010 extended the 80% HCTC subsidy through February 12, 2011.  The credit reverted down to 65% as of February 13, 2011.

In addition to an increased subsidy, HR 2832 reinstated eligibiliy for trade-displaced workers to elect COBRA continuation coverage if they failed to do so during the initial 60-day election period.  Under the reinstated COBRA provisions, Trade Adjustment Assistance (TAA) eligible individuals may keep COBRA until TAA eligibility is lost, and Pension Benefits Guaranty Corporation (PBGC) eligible individuals may keep COBRA coverage for life.

The HR 2832 COBRA duration requirements may expire if not extended by future legislative action for 2013.  If no extension is provided, TAA and PBGC eligible individuals will be subject to the normal limits on coverage periods as of January 1, 2014.

For a copy of HR 2832, please click on the link provided below.
 
The IRS HCTC website has updated information.

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

Open Enrollment, What to do?

Q:  It's that time of year again - Open Enrollment. 

How can employees better determine the benefits coverage they need to protect themselves and their families?

A:  This is a great question.  Far too often, employees make mistakes in their benefits coverage decisions which can cost them a lot more money in the long run or even influence their health care decisions when their coverage is insufficient.  Two of the most common mistakes are not meeting deductible amounts and failing to contribute enough to their flexible spending accounts.

Typically, when it comes to health insurance, employees rarely have a thorough understanding of what their policy covers.  A benefits consultant or broker, who not only has a thorough understanding of the various providers and plans, but knows the most common mistakes employees make, can help employees better navigate the insurance selection process. 

Communication is key.  Employees cannot be expected to make informed decisions about insurance when overwhelmed with information during the hiring process or at open enrollment.  A benefits consultant or broker will take the time to understand the needs and preferences of employees and advise them accordingly.  Not only will employees be able to make an educated decision about their benefits coverage, but ultimately, they will be well-protected and more satisfied overall with their benefits coverage.

FSA's can be either very complicated to understand or if explained properly can be easily understood.  We recommend an Open Enrollment Meeting for all employees to help them better understand all of their options with benefits.

For more comprehensive guidance, contact HR Knowledge, Inc.at Sales@hrknowledge.com or call at 508-339-1300

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

Hiring Employees with I-9 Compliance

Our most recent hire worked for almost a full week before it was discovered that she failed to meet I-9 eligibility criteria.  How are we supposed to pay her?

It is a challenge to pay someone for work performed when there is no proper documentation, but she must be paid, period.

The Department of Labor’s (DOL) states “work not requested but suffered or permitted to be performed is work time that must be paid for by the employer…The reason is immaterial. The hours are work time and are compensable.”

And, regardless of her I-9 status, the Internal Revenue Service (IRS) expects you to withhold payroll taxes.

There's really only one way to avoid this type of situation and that is by planning carefully.  Here are some tips to follow in order to ensure there is no violation of the Fair Labor Standards Act or IRS rules:

• Pay the employee to ensure you fulfill the requirements of DOL and IRS.  You may pay the wages owed the employee in cash or by check (via the company's payroll system) minus the amount deducted for taxes.
• When hiring, be sure to require work authorization PRIOR to the commencement of work
• Obtain and complete ALL paperwork on new employees BEFORE any work is performed, which of course includes the I-9.  And, be sure Payroll has a copy of the employee's Social Security card on file

For more comprehensive guidance, contact HR Knowledge, Inc. at Sales@hrknowledge.com or call at 508-339-1300.

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

How do you incentivize sales people and compensate them correctly?

Compensating your Sales people correctly can be a great challenge to the average business manager/owner.  If you don’t compensate them correctly or adequately, your sales people's production may suffer, which will directly affect business growth and profit.  If you do incentivize them correctly but pay them too much, it could create future problems related to growth and or profitability of your business.

Below are 7 key points to building a strong sales team:

1. Consider a Compensation Model prior to targeting and hiring sales people.  It helps to have a good understanding of what makes some people "tick", yet not others.  Maslow’s Hierarchy of Needs states that there are a number of aspects that generate needs for any person, some of which may be of more interest to one person and less interest to another.  Once you understand which aspect(s) motivate people, you can create a better environment to help create greater success.  According to Malsow, people are motivated by need, from the most basic biological/ physical needs (food, shelter, sleep, etc.) and safety needs (security, protection, stability) to the more emotional needs of belongingness (relationships, work group) and esteem needs (achievement and reputation) to self-actualization needs (personal growth and fulfillment).  For example, someone who is unemployed would be motivated through the fulfillment of the more basic physical and safety needs, whereas a person who already has job security, would be more motivated through promised fulfillment of esteem or self-actualization needs.

2. Hire the right team of sales people.  Before hiring, understand the type of sales person you need and then target them.  Are you looking for an “order taker”? This is a person who can call on existing accounts and build great relationship with the client.  Are you looking for a sales person who can “make it rain”?  This person has the ability to create and generate business.  If they are able to "find" business then they are the “hunter”. Understand what type of sales person you need and then target them in recruiting.

3. Adhere to the "Three A's" when hiring.  Once you understand the type of sales person you are looking for, remember the "Three A’s" when hiring for a sales position in your company.  The first and most important "A" is Attitude. The right attitude is everything when hiring people.  If they have the right attitude they will go through the wall for you to close business and follow the direction of the company.  Attitude is vital and without it, you have the wrong person on your team. The second "A" is Aptitude.  Ask yourself if s/he has the aptitude for the position of the company. Webster Dictionary defines aptitude as “capability; ability; innate or acquired capacity for something; talent".  If they don’t have the aptitude or capability or ability to take the sales position, then s/he is the wrong person for the company as well.  The final "A" is Altitude, meaning, how high can they go? How high do you need them to go? Will they plateau at a certain point and coast?

4. Beware of complacency.  The next concern when hiring sales people and thus managing them is complacency.  Most sales people will reach a point of complacency and then coast in the job.  Less work and more play becomes their mantra. The key challenge for management is to do all you can do to prevent complacency by your sales people.  Most people become satisfied (and have obtained fulfillment of Maslow's higher level of emotional needs) once they attain job satisfaction or reach a particular level of income or status.  With sales people, the challenge is to prevent this from happening.

5. Utilize your Compensation Model.  It is vital to keep sales people motivated and “in the game”.  From a managerial standpoint, it is far easier to compensate sales people and steer them in the direction the company wants them to go than it is to create compensation models to drive operations people, where you have to rely on coaching and management techniques.  Sales people are experts in understanding compensation models and how they can maximize their income in the quickest time frame.  They are usually very highly motivated and understand how the game works. This being the case, it is imperative that you find a compensation model to drive the sales team to do what you want them to do.

6. Understand what your company’s objectives are and then create the compensation model to attain those objectives.  For example, if your interest is to expand and grow your client base, then the compensation model needs to reward your sales team for new business and retention. You can create additional incentives to ensure that a large portion of their pay will be derived from new business acquisition.  If it is imperative that your sales team be involved in the retention of clients, then you need to find a compensation model which will reward them for retaining and maintaining great relationships with clients. If they lose clientele, you must ensure that this will affect their compensation. This is a delicate area because if your operations team is not equally committed to retaining clients and the service or product you are delivering is not up to standard, then the sales team has no chance to retain the business no matter how great their relationship is with that client.

7. Do all that you can to ensure that the product or service you deliver is “remarkable!"  Make sure that your company is setting the tone and the barometer in the marketplace for what you do. This will allow your sales people to confidently and comfortably sell your product or service. Without this, no sales person of any quality can survive and thrive in today’s business environment.  Make sure that your operations team are as committed and passionate about clients as your sales team.

For more information about compensation, HR and or benefits please feel free to contact Jeff Garr, CEO at HR Knowledge or 508-339-1300 www.hrknowledge.com

 

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

Top Reasons Companies are Struggling with Staffing

How are companies going to handle the increased demand for qualified candidates when so many companies are struggling with staffing now?  Why are these companies struggling?  Here are the top reasons:

Feast.  With the economic downturn, employers have been faced with a deluge of job applicants and the vast majority of these applicants are not suited to those job positions. 

Famine.  Skilled people are still hard to find, even in this economy. Many positions go unfilled simply for a lack of qualified candidates, particularly in many skilled trades.

Fewer “job changers”.  Many people are risk averse in today’s economy and would rather play it safe and stay with a current employer than risk a job move.

Benefits costs are soaring.  An increasing number of employers are deciding to put off hiring or rely on temporary workers to avoid such uncertainty.

Reluctance to fill vacant positions causing increased employee stress.  With companies reluctant to hire, the workload of existing employees, with regard to the scope of responsibilities and total number of hours worked, is increasing noticeably. 

Increase in litigation by the unemployed.  When faced with the loss of employment and income, people are much more apt to seek legal redress than when jobs are plentiful. 

Low levels of employee commitment and productivity.  Studies suggest that employee loyalty is at an all time low, due largely in part to the prevalance of downsizing.   Such feelings generally result in decreased productivity; reduced attention to the quality of work and increased risk for customer dissatisfaction.

Perhaps the answer to the staffing challenges of feast or famine lies in retained searches.  These days, retained searches are typically conducted for only the highest levels of staff, namely the CEO, CIO and CTO.  There seems to be a reluctance to use retained searches for non-senior staff.  The argument being that qualified applicants may be found by employee referral or via Craigslist and similar mediums. 

Or, maybe less technology, more “hands on” is the answer.  Could it be that the candidate selection process depends too much on technology and companies are inadvertently eliminating qualified candidates solely on the basis of not having enough “key terms” listed in their electronically submitted resumés?

Thankfully, a few of the staffing problems we mentioned should resolve on their own in time as the economy improves.  We should start to see an improvement in employee productivity and loyalty; people who are more willing to change jobs and a decrease in employee stress as vacancies are filled and the workload is redistributed.

By Jeff Garr, CEO and Frank Zych, Director of HR Services, HR Knowledge, Inc.

To read more, visit http://www.busex.com/article/operations-human-resources.HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

Health, Disability, Life, Dental, Vision Insurance: paying too much?

Do you know if you are overpaying for your company sponsored Health, Dental, Life & Disability plans?

One question we frequently hear from potential clients is - "Is there is any way to tell if our sponsored group benefit plan rates are set correctly by the insurance companies?"  The answer is "yes".  And, there's also a way to find out how much profit your insurance company yields from your company premiums.

At HR Knowledge, we consistently reduce premiums of group benefit plans through our proprietary algorithm which can accurately determine the profitability of your group plans with the carriers.

Here are a couple of examples of companies we have helped:

A major health insurance company assessed that for the $3 million that Company A received in premiums, the insurance company had paid out $3.3 million in claims and associated expenses. The health insurer was requiring an annual

premium increase of $385,000. After running the plan financial data through our proprietary algorithm, we were able to leverage the results to secure a reduction off Company A’s renewal of $400,000, which actually resulted in a rate reduction for the client.

A major health insurance company received $1.9 million in premium and paid $2.275 million in claims, a loss of $375,000. They were requiring an increase from Company B of $271,000.  After running the group’s plan data through our proprietary algorithm, we discovered that the losses were not as high as the insurance company had represented.  The renewal increase was subsequently reduced to $100,000.

How we can help your company?

• We can review your benefit costs, provide a detailed analysis utilizing the proprietary algorithm to accurately determine the profitability of your group plans with the carriers.  Then we'll determine more equitable pricing of these benefits. 

• This analysis helps HR Knowledge negotiate your benefit group plan rates with compelling indisputable data, that the carrier underwriters clearly understand and adopt to ensure more AFFORDABLE pricing on your benefits

We impact 80% of the companies we analyze, yielding substantial savings on benefit plans.  To receive a no obligation quote or “second opinion” on your group benefit plans, contact HR Knowledge at 508-339-1300

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

Employee/Employer Benefits Costs are too High!

Trends in Employee Benefits -

More and more business are moving to medical plans with deductibles. Medical plans with deductibles generally provide lower premiums for the employer and employee.  The challenge faced with a deductible plan is that employees have to burden a greater portion of the insurance costs.  There are ways to help manage this by utilizing an outsourced HR Service provider like HR Knowledge, Inc.

A recent trend to help curtail the rising costs of health insurance is to increase the deductible, but to also implement a Health Reimbursement Arrangement (HRA). By doing so, the premiums are further reduced due to the higher deductibles, but the company “self insures” a portion of the deductible through a HRA. The HRA protects the employee as the company shares in the deductible expense. We are seeing premiums decrease by 10-20% when this strategy is implemented. After paying its portion of the HRA, a company will likely see savings of 5-10% while maintaining strong benefits.

As a licensed broker providing "Best in Class" benefits, HR Knowledge, Inc. can help your company contain costs, minimize risk, and relieve the HR administrative burden. For more comprehensive guidance on a HRA, contact HR Knowledge, Inc.at Sales@hrknowledge.com or call at 508-339-1300.

 

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

HR Knowledge Recognized by Harvard Pilgrim

HR Knowledge was recently recognized as a Top Broker by Harvard Pilgrim Healthcare.  The combination of new clients and high retention, HR Knowledge was named a Gold level Broker. 

This honor is bestowed upon the top 2% of benefit brokers in the New England market.  Dan Hughes, President, Operations and HR Services was on site to accept the prestigious award.  This is the 5^th year in a row HR Knowledge has been recognized, 2010 was the first year it reached the Gold level.

Harvard Pilgrim Healthcare has been ranked the #1 Health Plan in America 7 years in a row by JD Power and Associates. 

HR Knowledge, Inc. provides a unique blend of services to businesses by providing outsourced, integrated HR/Payroll/Benefits services to their clients.  This allows for great economy of scale in handling these time consuming and tedious tasks as a business owner. 

Contact Information:  www.hrknowledge.com or call 508-339-1300

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

What Employer Should do if an Employee Advises of a Medical Condition

Question:

What must HR do if an employee advises of a medical condition?

Answer:

Full Question: If an employee advises her supervisor/manager that she has been diagnosed with a medical condition (MS), but has not provided any documentation or advised that she is unable to perform her job, is there anything that HR must do? The supervisor did advise her that she may want to see HR if she has any questions, however, she has not done so. Also, she does not have any personal/vacation time remaining for the year and this condition. Answer: If the employee in question has merely disclosed her medical condition, but has not requested a reasonable accommodation, and if it is not obvious that she needs one, the employer should simply continue to treat her as it would any other employee, and as it would have treated her had she never made known her condition. Unless and until the employee requests a reasonable accommodation, or it becomes clear to the employer that she needs one to perform essential functions of her job, the best thing to do is to just ignore the fact that she has any disability at all. Treating the employee differently (better or worse) can create exposure to a disability discrimination claim and is ill advised. To the extent she subsequently seeks reasonable accommodation or the employer, based on objective evidence (and not rumor or speculation), reasonably believes that she may require one in order to perform essential functions or to prevent a direct threat, at that point the employer can and should explore with the employee what kind of accommodation she needs in order to be able to perform essential job functions, and whether such accommodation can be provided without undue hardship to the employer. The following guidance published by the EEOC may assist you in addressing reasonable accommodation and undue hardship, should it subsequently become an issue (it does not appear that it is now, based on the inquiry): http://www.eeoc.gov/policy/docs/accommodation.html. Also keep in mind that if the employee's performance slips or she engages in misconduct or a policy violation, the employer should not assume that her medical issue caused it, nor must the employer tolerate unsatisfactory performance or conduct merely because the employee has previously disclosed a medical condition. Indeed, while the fact of an employee's disability protects the employee against unfair treatment or discrimination in the workplace, it does not entitle the employee to any treatment that is better or more preferential. For specific guidance in managing performance and conduct of a disabled employee within the confines of the Americans with Disabilities Act, should this become an issue, please see: http://www.eeoc.gov/facts/performance-conduct.html. www.hrknowledge.com Call today for more questions 508-339-1300

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.

When do we offer COBRA to Employees on FMLA?

Typically, eligibility ends after the 12 weeks of FMLA leave is complete.  In general, employers or plan administrators are required to offer COBRA when the employee no longer meets the eligibility requirements of a benefit plan, and the employee no longer is protected by federal or state leave laws. A review of the plan’s summary plan description (SPD) will confirm eligibility requirements.

An employee should be offered COBRA if the employee no longer is eligible to remain on the group health plan.  The COBRA participant will be eligible for either 18 months of COBRA coverage or an extension of COBRA to 29 months of coverage if specific criteria for a disability extension are met, to which all of the following conditions must be met:

• The Social Security Administration (SSA) must determine the beneficiary to be “disabled” by the on any day before electing COBRA coverage.

 

• The employee has qualified for COBRA coverage on the basis of her/his reduction of hours or termination.

 

• The beneficiary must notify the plan administrator of his or her disability within 60 days after the latest of any of the following: 

 

• The date of the Social Security Administration’s determination of disability (as provided in a letter from the Social Security Administration).

 

• The date of the qualifying event (i.e., reduction of hours or termination) in which s/he lost coverage under the health plan.

 

• The date on which s/he would lose coverage under the plan.

 

• The date s/he is provided employer notification and is informed of her or his obligation to provide notice of the disability to the plan administrator.

 

• The beneficiary must notify the plan administrator before the original 18-month maximum coverage period ends.

The maximum coverage period for COBRA will be 29 months, if all conditions are met.  This is measured from the same date the original coverage started. 11 additional months are added on from the date the original coverage of 18 months began to total the 29 months.

Disclaimer:  The response above is in general terms.  Every plan administrator and employee situation is different.  Please contact HR Knowledge, Inc. at Sales@hrknowledge.com or call at 508-339-1300 for more comprehensive guidance.

HR Knowledge is a provider of integrated HR, payroll and benefits services.  Our offices are located in the Boston, MA metro area and we service companies throughout the United States.