The Institute for Corporate Productivity has recently published study findings which include an interactive graph that reveal the current benchmark for full time staff dedicated to human resources based on size of the organization and whether the organization is measured as a “high” performing organization or a “low” performing organization. Overall, the data reveals that 1.97 FTE are dedicated to HR for every 100 employees in high performing organizations while it is only slightly lower for low performing organizations. However, the difference between “high” and “low” is much greater when the results are narrowed down to specific sectors.

For example, if you are a non-commercial employer (this category includes public sector) in the US with less than 100 employees and measure yourself as a “high” performing organization, you report on average 1.08 full time HR employees. However, if measure yourself as a “low” performer, you report an average of 5.56 employees for the same size organization! 

Contrast this with organizations with between 100 and 1000 employees; high performing organizations report on average 2.51 FTEs dedicated to HR for every 100 employees and low performing report on average 1.74 FTEs for every 100 employees.

Even larger organizations, with more than 1000 and up to 10,000 employees, show a leaner number and smaller gap. They report on average 1.24 FTEs in HR for every 100 employees in high performing organizations and 1.38 FTEs in low performing organizations.

How do we interpret this data? First of all, the category of less than 100 employees does not contain enough data points be valid, and undoubtedly contains an outlier or two, but even as anecdotal information, it points out that the HR function must be performed in every organization, regardless of size, and the scope of concerns which must be addressed may create inefficiencies.  Therefore, organizations that report 0-1 dedicated staff likely outsource at least some of the HR function and those that report upwards of 5 or more are doing it all without sufficient resources and skill. The streamlined effect occurs when the organization is much larger and perhaps (we might speculate) dedicates more resources, i.e., technology and professional staff, to improving efficiencies.

In my recent newsletter I reported that the Civil Rights Division of the Department of Justice issued a report to a House Subcommittee on December 3, 2009 outlining a number of efforts to renew enforcement efforts in the area of Title VII and Disability Rights. Here are two excerpts from that report that have particular relevance to public sector.  I will continue to follow the reports and activities from this department and keep you informed.

Title VII

Restoring vigorous enforcement of Title VII, including pattern and practice cases, is one of our highest priorities. Since January 20th, we have filed three Title VII pattern or practice suits, obtained settlements in five pattern or practice cases that provided significant prospective and remedial relief, and opened ten full pattern or practice investigations of State and local governmental employers with respect to employment opportunities for African Americans, Latinos and women. Also, in July, we obtained a highly significant victory in U.S. v. City of New York, NY, when the district court granted summary judgment for the United States and plaintiffs-intervenors on the issue of liability. In the City of New York case, we challenged the city’s use of two written examinations for entry-level firefighters as having unlawful disparate impact on African Americans and Latinos. In the relief phase, we are seeking, among other things, priority hiring and monetary relief for nearly 300 African-American and Hispanic victims of the challenged examinations.

 Disability Rights

 The Division’s Disability Rights Section has been conducting a wide range of enforcement activities, including its Project Civic Access to increase compliance by State and local governments with Title II of the Americans with Disabilities Act of 1990 (ADA). The Project sends investigators, architects and attorneys to conduct on-site reviews of State and local government facilities. These reviews have resulted in agreements reached with the State and local government entities to address compliance issues by rectifying access issues at a wide range of facilities, including administrative buildings, courthouses, police and fire stations and jails, transportation facilities, parks and recreation facilities, libraries, museums, polling places, and emergency and domestic violence shelters.

 From, a sub-committee report by the Department of Justice “THE CIVIL RIGHTS DIVISION OF THE DEPARTMENT OF JUSTICE”PRESENTED DECEMBER 3, 2009  

 Timken Company Sued by EEOC for Disability and Sex Discrimination

On another but related front, the EEOC has recently decided to file a lawsuit against Timken, a global manufacturer, for discrimination against a woman with a disabled child. This is a reminder to all that complaints may be filed because of a person’s association with a disabled person.

In the press release issued by the EEOC, Tina Burnside, supervisory trial attorney in the EEOC’s Charlotte District Office stated:

Under the ADA and Title VII, employers cannot make employment decisions based on stereo­typical assumptions that a female employee with a disabled child would have to miss  work or could not perform the job because the employee provides care for a  disabled person.

The take home lesson here is to the same as always, develop job descriptions and clear hiring standards, be consistent and objective in your selection practices. Steer clear of questions that invite disclosure of information that is irrelevant to performance of the job. If a candidate offers information without prompting, do not tarry, but re-focus the discussion on job-related matters.

POLICY ON RELATIONSHIPS IN THE WORKPLACE

Organizations vary in  the way they set policy around dating relationships dependent upon the size of the organization and the design of the work. However, for most employers, especially smaller size organizations, this is an important issue that is frequently overlooked in personnel policies. One potential problem is the relationship gone bad scenario which results in lingering resentments which lead to more insidious workplace problems, not least of which is the potential for harassment complaints. Another serious issue is the fall-out from two people who marry and continue working together which is not only bad for department morale but sets the stage for a whole host of conflicts within reporting structures.

Recently, I helped a client arrive at a policy that was minimal in nature, but sufficient to address the most serious aspects of this issue. Here is what we came up with:

Romantic relationships between employees in the same work unit, while not prohibited, may not interfere with the department business, and employees will be disciplined for any disruption to the workplace caused as a result of the relationship. Furthermore, if two employees enter into marriage, subsequent to being employed in the same work unit, one of the persons affected must give up his or her position no later than 6 months from the date of their announced engagement.  Within 30 days after the employees announce their intentions to marry, both employees must inform (in writing) the manager to whom the unit in which he or she is employed reports that they intend to marry and must state which of the affected persons will relinquish his or her position. Should the written notification fail to specify which of the affected persons will give up his or her position, it will be assumed that the party with the least seniority (length of continuous service from the last date of hire) will relinquish his or her position.  The person giving up his or her position may be re-employed in another department, subject to the needs of organization. 

 Any thoughts on this from your neck of the woods?

I know you are busy, which is why I am going to start you off this year with a quick sampling of some recent stories of interest in the HR world.  If you want to read more, just click and go to the source!

Is Text Messaging Private in the Workplace?

Does a police officer have a reasonable expectation of privacy when he text messages using a department issued pager? The United States Supreme Court has decided to take the case. Read more on this…….WorldofWork Blog

Yammer, you might want to try it.

Yammer? What’s that? Just when you thought you had a grip on social media, a new outlet bursts upon the scene. This one is anticipated by many to be the next big one, and it could be part of your workplace strategies. Instead of the Twitter question, “What’s happening?” Yammer asks the question, “What are you working on?”  Instead of being open to the universe, it is designed for employees in a single organization. Imagine having a dashboard of sorts on your computer screen, a stream of “yaps” that tell you what others in the organization are working on throughout the day.  Think about the possibilities. It has the potential to be a great communication and collaboration tool.  Instant messaging that is transparent to all and keeps people informed about who is working on what.  And it is free. Check it out here

http://www.yammer.com

More on Social Media

Jon Hyman, at the Ohio Employment Law Blog, gets it right when he sums up the top ten law stories of 2009 with social media in first place. He provides a series of law articles that discuss the risks associated with social media and what you might need to include in your personnel policies.

Read more at the The Ohio Employment Law Blog

Employees are on the move.

Right Management surveyed more than 900 workers in North America and asked: Do you plan to pursue new job opportunities as the economy improves in 2010?

A whopping 60% said they intend to leave, and another 21% said, maybe, they are networking to consider other opportunities.

Have employees had enough? What does this portend? Read more here

Salary Budgets, Still Unsettled.

In the words of Ann Bares, a fellow compensation consultant, we are on our way to a new normalcy.

She reports on a recent study by Towers, Perrin that finds that most salary budgets will be unfrozen in the coming year, but that companies are planning to spend with greater care, using more differentiation in distributing the limited salary dollars they will have available. You can read more at her blog compforce

When does lunch constitute work time?

It never hurts to brush up on the FLSA overtime rules, especially today when the filings with Wage Hour are at an all time high. The Overtime Advisor reminds us of the DOL rules governing employees who work through lunch.  Read More Here

Another FLSA story that brings home the point that it is harder to exempt employees than you think!

According to a story on MSNBC, a United States District Court for the Northern District of Georgia says first-level managers for Bell South are not exempt because they are on the lowest rung of the managerial ladder and have only minimal supervision.  Read More Here

If you need an employee to recertify FMLA Leave, be sure to follow the rules.

Finally, another excellent blog post by Jon Hyman that is a more technical summary of do’s and don’ts regarding recertifying FMLA leave.  Read More Here

Next time I will write about a city in Ohio that made bold changes to its health care programs which brought about significant savings by engaging its employees.  And yes, they have unions!

Home again, after a successful CCAP (County Commissioners Association of Pennsylvania) conference at Seven Springs Pennsylvania, with some great memories and new contacts. Everyone has a different experience and perspective, but here are some of the highlights for me:

• Monday morning, I sat between Lancaster Commissioner Dennis Stuckey and Timi Kirchner of Stevens & Lee, for the Keynote, Michael Hoffman of Igniting Performance, and when he told us to stand up and greet five other people as if we were at a family reunion, we looked at one another with a discernable “UH oh” and a quick glance around for the closest exit. But by the end of the session I was wiping tears from my eyes from laughing so hard. I think we all needed the relief (who really wants to listen to more about how bad things are?) and the message, which was about relationship building and caring about others as a mark of leadership. Especially when we feel we are at the center of a tornado, which these days, is not so unusual. Think about making relationship building a priority!
• Met an interesting person in the exhibit area names Mike Baker, of GOV DEALS. He described his business as an EBAY for government. Cool! For those who are working on GOING GREEN, this is a good resource. www.govdeals.com.
• I was also impressed by another consulting group, Delta Development Group, Inc. (www.deltaone.com) that can provide local government with a host of services, but right now they are helping government get and comply with the reporting requirements for economic stimulus monies. And they can also help you leverage your IT which is critical in this time of restructuring and “resizing”. John Mizerak was the person I spoke with and very helpful.
• Did you know that it is possible to utilize merit hire systems other than the State Civil Service Commission?  At a breakout session, we heard from DPW and others close to the developments in this area. Although still in initial stages, this is worthwhile to investigate as it is critical our human services programs secure a more efficient and effective system for hiring and promotion. Kristin Woellner is a contact person at CCAP (www.pacounties.org) if you would like more info. You can also download a report on the status of civil service at this site http://lbfc.legis.state.pa.us/reports.cfm  (look under Oct 2004).
• Unsure of which session I should attend next, I followed a friend to the Offender Rehabilitation session, and WOW, was I impressed! Pittsburgh is doing a lot of things right these days, and the County is no exception to this rule. The Jail and Human Services staff formed an integrated team to coordinate better re-entry and transition services to reduce the burden on the jail system, and the results have been so impressive they are soon to be a Center of Excellence.
• In the last session I attended Michael McDavid, Regional Director of Penn State Cooperative Extension, walked participants through the Center for Leadership Studies, Situational Leadership assessment tool. We learned that each leader not only has a primary style of leadership but has different degrees of adaptability to other styles.  As leaders, we must adapt to a variety of styles and match our style to the needs presented by the situation.
• C.S. McKee hosted another awesome barbecue Tuesday evening that was accompanied by the No Bad Ju Ju band. What a great dance band!

This is a small glimpse, there was plenty more to recommend this conference. The annual fun run/walk, the golf event, great hospitality rooms (thanks especially, Kimball Associates and Benecon!) informative sessions on funding opportunities through the ARRA and economic development.  And as always, legislative and legal updates

Hats off to the CCAP staff-

 Look forward to seeing everyone at the next conference event!

Watson Wyatt has just issued a report on how employers are responding to the economic crisis. The results are surprising, and perhaps a bit shocking. Salary budgets for 2009 continue to be slashed, and projections are at the lowest point reported yet – 1.5% increases are the average for the coming year.

Here is the link: https://www.watsonwyatt.com/news/pdfs/WT-2009-11232.pdf

Other important strategies being given high priorities by HR executives in the private sector include:

·         Hiring Freeze

·         Reductions in Force

·         Eliminating or reduce hiring of seasonal workers

·         Organization-wide restructuring

·         Salary Freeze

·         Raising employee contributions to health care premiums

·         Increasing communication to employees about their pay and benefits

·         Restricting travel

·         Eliminating or reducing training and other employee programs

What are public sector employers doing to meet the challenges of the economic crisis? Traditionally, government has been thought to be recession proof, but that is proving to be less true in the current environment, perhaps because the intersections between government and business have increased. Governments have spent the last several decades examining ways of improving efficiency and being more business driven without losing sight of the essential core of government – public service. 

We are confronted with what many say is unprecedented in recent memory, in terms of what is required of managers and leaders in government. Will public sector employers act on this opportunity for change, or wait to react to pressures from the environment, mainly in the form of public opinion? Attention to accountability and strategies to improve services and cost efficiency, as always, remain at the heart of the matter.

[Thank you Compensation Force for the tip on the Watson Wyatt Report.]

Perhaps you read the recent USA Today Article that cites the latest BLS statistics on growth of public sector benefits in the wake of slowing private sector pay gains. Apparently, the gap in total compensation (pay plus benefits) has grown since 2007 with public sector at $39.25 /hr and the private sector average at $27.35 / hour.

No doubt my colleagues in the public sector will scoff at these statistics. Why? Because a shortage of local government managers exists nationwide due to the fact that people with college and graduate degrees do not exactly flock to a career in government. Surely these numbers do not reflect the market operating at optimum levels. What do they reflect then?

In fact, a severe shortage of municipal managers looms as far as one can see in the horizon. Even so, pay setting in government rarely reflects best practices, and for that reason, starting pay rates remain depressed in many places. Rather than increase manager pay, elected officials often look for candidates who may not come from public administration schools, but would like to try their hand at local government. Despite the overarching growth of professional models of management in government, many elected officials are still convinced that the guy who owned a few businesses, and is willing to come out of retirement to run the municipality, is still the best choice.

However, these statistics do point to some glaring differences between the public and the private sector, particularly in the area of employee benefits. One difference that might be interesting to examine is the difference in levels of unionization and labor laws, particularly the right of public sector employees to mandatory arbitration provisions. Look out private sector, this is coming your way if the Employee Free Choice Act (EFCA) swings into gear, and all indicators point to that eventuality. Check out Michael Moore’s post at Pennsylvania Labor and Employment Blog here.

BLS states that labor costs account for half of state and local spending, and benefits consume 34% of those costs. We are at a cross-road in this country because the only area of employment that is realizing a decrease in benefit costs, is the non-unionized sector. Since we all think benefits are important, should we encourage unions? Or, do we prefer to mandate that employers provide some standard of benefits, thereby decreasing the importance of unions? Or, maybe we think the government should take it out of the hands of the unions and employers altogether.

Regardless of how we work out this conundrum, let it be said that if public sector manager jobs are still not lucrative enough for there to be an excess of qualified candidates in the labor market, then they are probably not over-paid. And if managers could negotiate with their unions, without facing unabashedly pro-labor laws in most states, the benefit gap would be substantially smaller. However, who will blame the public sector employee for unionizing when benefits are at stake? What safety net exists for them? We have to work this out, together, public and private, union and non-union. These statistics are thought provoking, but not instructive with respect to the way forward.

]]> http://njhessassociates.com/blog/2009/04/14/government-benefits-and-the-total-compensation-gap/feed/ 0