Culture and the Company It Keeps

In January, I will be hosting a seminar discussing “How to Create a Killer Culture,” and thought it would be apropos to start the mind working in that direction.  I recently watched the “Best Practice HR Tips from Liane Hornsey, Google VP Operations”.  Laine and her interviewer do a fabulous job of demonstrating how effective it can be when a company creates their “ideal” cultural values; lives by those values; and assesses performance based on those values.  Ms. Hornsey describes the reputation of Google as a place where people want to be: “it doesn’t happen by accident, it is by design.”  She went on to describe the ideal values within the Google culture, which seem complex at a glance… and it all begins with their famous lengthy hiring practices.  Where Laine went through 14 interviews (across multiple countries), she has shored that up to now be between 4-8 interviews.  They use 360-degree hiring tools which essentially allow for assessing how upper management, peers, and employees of that individual will all work together.  A separate Culture and Change Management Survey conducted in 2013 showed that only 53% of businesspeople view culture as an important part of the leadership agenda at their company…yet only 35% agreed that their management does an effective job of managing culture.  However, when listening to Laine, I was completely convinced that Google has Culture Management handled.  They have a clear understanding of expectations (informal dress code and work hours, formal decision-making); which are evaluated and adjusted on a daily basis.  She describes the approach to their management as “common sense” in how they balance management layers; allow for promotion rotation to develop skills and increase knowledge of the team; and create expectations based on time in a position.  What resonated the most with me what how they focus on results (output) rather than hours worked in a day.

As my mind is decompressing the 11+ minutes I spent with Laine Hornsey, I do wonder what the employees think. Does Google really live this culture on a daily basis? Does your company have an outline of their cultural values? How do you keep that alive?

–Laura Brand

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Language and Financial Decision Making

I ran across this video from Ted Talks “Keith Chen: Could your language affect your ability to save money?”. The argument is that the language you speak directly affects how you view finances (and therefor your ability to save money). Interesting, though I would like to see more of the science than what is provided.

My Rates are WHAT?!?!

The Truth Behind State Unemployment Rates

I recently spoke to a company who was unaware that their State Unemployment rates were drastically higher than average.  Not only was their State Unemployment rate significantly higher than average (about a point); but they were also being assessed an annual fine of nearly 2% on top of their State Unemployment Tax. It made me wonder how many General Managers or Business Owners actually know what their State Unemployment rates are and what events affect the rate.

State Unemployment rates are given to a company who will employ W2 workers.  These rates vary based on three factors:
1. Staff turnover
2. Number of State-approved unemployment claims
3. Money in Reserve Account (Every year, an employee will pay State Unemployment Taxes (SUTA), up to $11,300.00 per person.  The taxes go into a “reserve” account per employer in order to cover the costs of unemployment).

The organization who I was working with recently re-branded themselves; and in the process they lost several staff members. Because these prior employees also were eligible to receive unemployment, the company had what seemed to the State as “excessive” claims being approved against their company. Also, as short-term employees, they had not contributed much towards the “reserve account”. The State was “paying out” to the claims, but did not have enough funding available for this company to cover the claims.

So, you ask yourself, how can we minimize this risk? There are a few ways to avoid this situation. The first step is to respond to every unemployment claim that crosses your desk.  When you take the 2 minutes to fill in the questionnaire, it not only buys you time to have to fund the claim, but it makes the prior employee responsible to provide documentation supporting their claim.  In most cases, the employee will fail to pursue or fail to show for any follow-up necessary.  Oftentimes, you as an employer can avoid paying unnecessary claims by simply responding. The next step is to assess why you are experiencing turnover and make a decision to train, manage, or otherwise “fix” the reason behind the increased turnover.

Related to State Unemployment, there are two distinct advantages of joining forces with a PEO like HRBenefix.  I can provide my State Unemployment Tax rates to my clients (typically lowering their payroll costs); and I also manage any/all unemployment claims coming through the door.

–Laura Brand

Outsourcing your Business, Payroll

I’m often asked what I do, and why. So, here I am: creating a blog to tell anyone, who wishes to listen, all about the life and times in the “HR” world. [I have spent many years in the “recruiting” world which falls under the same umbrella.  Recruiting is a 2-glass-of-wine conversation, which I will reserve for later].  When I say to others “I represent a PEO“, the look on their faces is absolutely priceless…I know they are thinking “A p-e-huh?”; but their PC question comes out “What, exactly, is that?”

A PEO is a Professional Employer Organization. The most understandable way to describe the PEO is this: when you work with me, you become part of the “SEP Plan” (“somebody else’s problem” plan). I literally take on your “problems”: risk, compliance, personnel, Benefits Administration, insurance, payroll, taxes, filings, training…the list is long! One study I ran across showed when organizations outsourced multiple functions (listed above) to a single vendor, they saw an average 32% stronger cost efficiency than businesses using multiple vendors (thanks to PricewaterhouseCoopersLLP for their whitepaper on the costs of HR and Payroll). What would you do with that savings? Many people are familiar with the outsourcing of Payroll, but not many people understand the tax benefits and how much risk they can avoid by bundling everything with a PEO.

Feel free to reach me with questions, comments, or anything you deem appropriate.