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August 2010

Aug 01
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ADEA CLAIMS: WHAT’S REASONABLE?

By Your Employee Matters

In light of recent U.S. Supreme Court cases, the EEOC has proposed regulations to address the scope of the “reasonable factors other than age” (RFOA) defense available to employers under the Age Discrimination Employment Act (ADEA). According to the EEOC, there are six non-exhaustive factors to consider in determining whether an employment practice is reasonable.

  1. Where the employment practice and manner of its implementation are common business practices.
  2. The extent to which the factor is related to the employer’s stated business goals.
  3. The extent to which the employer took steps to define the factor accurately and apply it accurately and fairly (e.g., training, guidance, instruction of managers).
  4. The extent to which the employer took steps to assess the adverse impact of its employment practices on older workers.
  5. The severity of the harm to the individuals within the protected age group, in terms of both the degree of injury and number of persons affected adversely, and the extent to which the employer took preventative or corrective steps to minimize the severity of the harm, in light of the burden of undertaking such steps.
  6. Whether other options were available and the reasons the employer selected the option it did

The EEOC said that it also looks into whether supervisors (a) have unchecked discretion to assess employees subjectively;( b) evaluate employees based on factors known to be subject of age-based stereotypes; and (c) receive guidance or training about how to apply the factors and avoid discrimination. To avoid unnecessary disparate impact and other discrimination type claims, consider these factors whenever you make an employment-related decision, especially if you terminate a group of employees.

Aug 01
Love0

EDITOR’S COLUMN: THE BIG HR SHOW

By Your Employee Matters

Since I hadn’t been to a SHRM convention in a number of years, I felt it was my duty to attend one since it was occurring here in San Diego. After poring through the workshops, speaking to dozens of HR professionals and vendors, and roaming the entire exhibit hall, here’s what I observed:

  1. HR is BIG business. There are approximately 10,000 attendees and the convention takes up the entire San Diego Convention Center (which is quite large). There were more than 150 concurrent sessions over the four days of the convention. The keynote speakers were Al Gore and Steve Forbes, (neither of which I had any interest in listening to- and neither of whom have anything to share about HR. Just ask the folks who heard them!). Other well- known names included Marcus Buckingham, Dave Ramsey, and David Ulrich.
  2. I’m sure many of the attendees were there to earn up to 29 recertification credits in one lump toward their PHR, SPHR, or GPHR certifications (60 are required every three years).
  3. The convention discussed a wide variety of subjects, broken down into: * Employment law and legislation * Strategic management * International management * International HR * Total rewards * Personal and skilled development
  4. The breadth of workshops offered was as broad as the HR experience itself: Everything from hiring employees to letting them go and everything in between. Frankly, I didn’t see much new except everybody’s increased panic on how to manage healthcare benefits.
  5. For an HR professional to attend the program it cost at least $1,200 in registration fees, plus $750 on room and board, and $500 in plane fare unless they drove here. This expense alone rules out many small company practitioners.
  6. The company size of attendee broke down this way:
    • Fewer than 100: 16.59%
    • 101-499: 22.90%
    • 500-999: 12.25%
    • 1,000-9,999: 27.09%
    • Greater than 10,000: 21.80%

When it comes to the “weight” of the total employee population, companies with more than 1,000 employees dwarfed the conference.

I spent time going through the enormous vendor floor. According to SHRM, there were more than 565 executive exhibitors in a variety of groups:

  • Compensation and benefits
  • Employee relations
  • Employee selection/staffing
  • Health, wellness, and safety
  • HRM services * HR information and systems
  • Training and Development

By far, the largest vendors were the recruitment sites (Monster, Yahoo, HotJobs, etc.) and the Payroll/PEOs vendors (ADP, Ceridian, PayChex, etc.).

In trying to get a sense of where the “buzz” was, the longest line I witnessed was roughly 30 women waiting for Erik Estrada’s (yes, that Erik Estrada from CHIPs) autograph.

Experts were doing live presentations to small audiences, some with very interactive screenings of their programs, and there were surprisingly large number of educational providers. All in all, the experience reminded me very much of the last convention I attended in San Diego.

The reality is that most of the companies in the HR That Works range of 15-500 employees get very little play at this conference. There’s certainly plenty geared toward large organizations. I can see every reason why vendors have an incentive to focus there. Not a single vendor said that they focus on smaller employers.

Most of the companies that use our program don’t send their employees off for MBA programs, buy FMLA tracking software, use elaborate employee incentive programs, recruit globally, or need an elaborate performance management system. What these companies do need is to be great at HR basics — the blocking and tackling stuff:

  • Hiring the right people
  • Knowing how to make them productive
  • Making sure that you can keep productive and trustworthy employees
  • Training them to ratchet up their performance
  • Getting them to play team ball
  • Keeping your managers and employees from doing anything stupid that would get you sued

I came away from this convention ever more assured that we’re going down the right path by focusing on the needs of companies with 15 to 500 employees. Let me know how we can help your company!

Aug 01
Love0

PONDER THE TOP TEN REASONS TO PURCHASE LIFE INSURANCE

By Life and Health

We hear the stories every day. People dying suddenly from heart attacks or freak car accidents. That makes us think, what if that happened to me? Consider these 10 reasons for owning Life insurance:

  1. Debts – What happens to your debts if you die right now? Existing bills, medical and funeral costs. It’s a debtor Mount Everest on which you strand your family without Life insurance. Who covers the expenses you have amassed already and those you leave behind?
  2. Your family may lose their home – Will they face foreclosure? Be forced to sell? They’ve just lost you now they may lose their home, too. Who will be there to pay the mortgage when you can’t be?
  3. Family lifestyle – Most couples in this day and age must both work to sustain their families. Think of the vacations and Christmas mornings your income provides.
  4. Income for necessities – What about school for your children? Do you envision them going on to college? Who will pay when you’re gone?
  5. Your spouse’s sleepless nights – They already have to deal with an empty bed. How many sleepless nights will there be for him/her? Life insurance assures peace of mind
  6. The legalities – There may well be taxes and legal and probate costs to cover. Life insurance can leave tax-free money to your beneficiary to cover such expenses.
  7. Quality care for your kids – What about the expenses that health insurance doesn’t cover? Will they go to the better doctors? Does your son depend upon asthma medication? Does your daughter need braces? Will they one day? If so, who pays for that without you?
  8. Your extended family – With uncertain times, with retirement benefits vanishing, who will care for your parents as they are too old to care for themselves? Will you be there for them as they were there for you?
  9. The Unexpected – A young mother killed in a car crash. Six months later, her husband dies of a heart attack. They left five minor children. You may think “my spouse will take care of them” but what if he/she can’t?
  10. Pride – How do you want to be remembered? As someone who thought of his family enough to provide for them in your absence?

In closing, are you even eligible for Life insurance? At rates you can afford? As we age, our health issues become paramount. Tomorrow you will be older than you are today. Tomorrow is promised to no one. The time to think of Life insurance is today.

Aug 01
Love0

PROTECT YOUR STANDARD OF LIVING WITH DISABILITY INSURANCE

By Life and Health

Almost everyone needs Disability insurance. Think about it. Your capacity to earn a living is crucial. Your income makes it possible to buy food, make mortgage payments, provide for your children, take a vacation, and countless other things. Many faithfully pay premiums for car, life, homeowner’s insurance, and perhaps even a pet’s medical insurance, but they neglect this extremely important protection, Disability insurance.

There are few things as disruptive to a family’s happiness as having a parent, or maybe both, lose his/her income due to accident or illness. When income is drastically reduced, it creates stress and unmet needs and expectations. It often creates feelings of guilt in a parent. Life is hard without a reliable source of income.

A LIFE Foundation study states that 70% of working Americans could not be without income for more than one month without serious financial difficulty. Surprisingly, the same study states that one of every four Americans couldn’t last a week if they were seriously injured and unable to work. Clearly, the answer to the question, “Does almost everyone need Disability insurance?” is a resounding “Yes!”

It is important for an individual, and especially important for a family, to have a financial plan. Disability insurance should be one of the foundation stones of everyone’s financial plan, because it protects such an important asset – your income.

Other statistics need to be considered. The Senate Finance Committee states that 70% of people between the ages of 35 and 65 will become disabled for three months or longer and that 90% of injuries will occur away from work.

After you make the decision to purchase Disability insurance, there are still important questions to be answered and decisions to be made. “How large a benefit do I need; how much will it cost to purchase a plan with that level of protection?” “Does my spouse need this kind of policy even if he/she doesn’t work or has a small income?” “How long is the waiting period before I start receiving checks?” “Does my employer offer a disability plan that I am not aware of?” “Will I need this kind of insurance after I reach age 65?” All these and many other questions need to be taken to a capable, experienced insurance agent who is a specialist in this type of insurance. This is an important decision with a great number of complicated considerations, such as, “Is the plan guaranteed to be renewable?”, “What is the maximum benefit period?”, and “Which occupation class does my job fall into?”

Once the decision is made and the policy is purchased and in effect, you can breathe a sigh of relief. You have done what is necessary to protect your happiness with Disability insurance. More importantly, you have protected your family by providing for them if your ability to work is interrupted.

Aug 01
Love0

WHEN BUYING LIFE INSURANCE, AVOID COSTLY MISTAKES

By Life and Health

When considering Life insurance, many consumers believe term insurance is the best option. However, this assumption is not always accurate. It is true that term Life insurance, which covers you for a specified amount of time, such as 10, 20 or 30 years, is almost always less expensive than other forms of permanent insurance. The reason is that term insurance only pays out when you die (that is, if you die while the policy is in force); whereas, permanent insurance provides coverage for your entire life, assuming premiums are paid when due, and may also include a cash value component. To make the best decision, it is crucial that you understand just what you’re buying when you shop for term Life insurance. Even an inexpensive policy, if not designed to meet your particular financial needs, can result in money down the drain. Below are five of the most common, and costly, mistakes consumers make when buying Life insurance.

  1. Selecting term insurance based solely on the price tag. Shopping for Life insurance only by comparing premiums is asking for trouble. You should compare company ratings to determine financial strength and policy features, such as convertibility options. While the policy’s premium should be considered, ensuring that your policy matches your financial needs is more important.
  2. Believing that term insurance is permanent. That’s why it’s called “term” insurance — because you buy it for a specified period of time, most commonly 20 years. This is fine for satisfying temporary needs such as insuring yourself until your mortgage is paid off, or funding your children’s college expenses in the event of your premature death. A 20-year level-term insurance policy you bought when you were 30 would expire when you’re only 50. At that point, you may still need to carry insurance, but your age and health conditions might make it impossible or very expensive to do so. If your policy has a convertibility option you may be able to get coverage, but it may be cost prohibitive.
  3. Buying from an unstable insurance company. Don’t be afraid to ask about an insurance company’s ratings. You can also look for an insurer’s Standard & Poor’s, Moody’s or A.M. Best ratings on the Internet. There are many insurance carriers with high financial ratings (A+ or better) so you shouldn’t have to purchase insurance from a lower rated company. However, keep in mind that ratings can and will change, so ratings should not be the only consideration.
  4. Basing your insurance coverage needs on a pre-determined formula. You may have heard that a good rule of thumb is to buy Life insurance coverage equal to 10 times your annual salary or 10 times your beneficiary’s annual financial need. The idea is that if your surviving beneficiary invests the Life insurance proceeds in the stock market (getting an average 10% annual return), they’ll have a steady income stream and never need to tap the investment principal. Although this formula isn’t a bad place to start, everyone has different needs, so don’t assume that 10 times your salary is what you need to carry in Life insurance. The best advice here is to sit down with a knowledgeable agent that will take the time to learn about your needs.
  5. Failing to revisit your policy on a regular basis. Is your former spouse still the beneficiary of your Life insurance policy? Did you buy term insurance to cover you while you pay off your mortgage? If you refinanced during the latest rate drop and restarted the clock on your loan, you might also need to update your insurance term. Life definitely has a way of throwing changes your way. Just make certain your Life insurance changes along with you.

The bottom line is that it all comes down to doing your homework. Whatever your Life insurance needs might be, we can help you evaluate the best options for you to protect your family’s financial future.

Aug 01
Love0

EVALUATE YOUR PROPERTY AND CONSIDER FLOOD INSURANCE

By Personal Perspective

Don’t wait until the weather forecast calls for prolonged heavy rains before buying flood insurance. While this practical insurance can be purchased anytime, the policy does not take effect for 30 days. As the most common natural disaster in the country, flooding ruins millions of dollars of homes and property every year. Even so, flooding is not commonly covered in your typical homeowner’s insurance policy, making it necessary to purchase additional coverage for this costly, devastating disaster.

If you are in a high-risk flood zone, a federally regulated lender will require a would-be borrower to buy flood insurance in order to qualify for a mortgage loan. To satisfy the lender, flood insurance must be purchased in an amount that sufficiently covers the loan.

A homeowner should also buy flood insurance if he or she resides in a flood plain with no failsafe controls, such as a dam. Flood policies even pay off if the President does not declare the area a federal disaster area, which can prove to be invaluable. Because the nation’s Chief Executive Officer rarely issues such a declaration, protecting yourself is extremely important. Besides, you have to repay the federal aid you receive for home repairs related to a natural disaster so providing your own protection is the only way to ensure financial recovery suffered from flooding.

Not all homes qualify for flood coverage. For instance, flood insurance for beachfront or ocean-side property may not be available for the obvious reasons.

The Federal Emergency Management Association (FEMA) reports that more than 20,000 communities have agreed to tighter zoning and building measures to control floods. Residents of these communities can buy flood coverage from the National Flood Insurance Program (NFIP), which FEMA oversees. As of 2009, NFIP had 5.7 million flood policies inforce nationwide.

Premiums for flood insurance vary widely, depending primarily on individual risk. In determining price, flood insurance underwriters consider several factors including the property’s elevation, proximity to bodies of water, and whether the dwelling has a basement. Flood insurance is available to homeowners, renters, condo owners/renters, and commercial owners/renters.

Call our office today! We’d be happy to assist you through the murky waters.

Aug 01
Love0

AVOID AGGRESSIVE DRIVING AND ROAD RAGE: SAVE LIVES

By Personal Perspective

Basic decency during driving can seem hard to come by these days. “Road rage” refers to the ability of perfectly sane people to become angry maniacs when behind the wheel of a car. On average, at least fifteen hundred people including men, women and children are killed or injured each year in America due to aggressive driving. Aggressive driving such as tailgating, cutting off other vehicles, and giving the one-finger salute are unfortunately quite common in the United States.

In fact, the problem of discourtesy when driving is responsible for as much as thirty percent of all traffic collisions. Drivers routinely ignore the basic rules of driving, engaging in overtly aggressive behaviors even to the point of murder. One of the most important situations where discourtesy results in injuries or death to other drivers is in right-of-way situations. Whenever two vehicles are driving along a path that puts them at odds with one another, the problem of right-of-way becomes boiled down to who goes first.

Right-of-way is always granted by the other driver, but the problem becomes exacerbated when drivers do not follow the rules concerning right-of-way. Unfortunately, being legally right does not mean being safe. Drivers who cede their right-of-way to the other driver might actually put themselves at risk.

Consider a common situation where, in congested traffic, a driver wants to be let in to the neighboring lane and the driver gives it to them. Before doing so, the driver must check for traffic coming from the rear. If there are two or more lanes going in the same direction, the driver also has to be aware of drivers passing him on the left, since the other driver could pass into that left lane. Other drivers who are not aware of the first driver may not understand that they are yielding their right-of-way.

Drivers must also remember to consider alternate routes. Sometimes avoiding left turns altogether can be the best choice. If a driver has missed a turn and needs to get back to the intersection, performing a U-turn might actually be very dangerous.

When you head it on the road today set an example, so that other drivers can be reassured that there is at least someone who is attempting to drive responsibly.

Aug 01
Love0

DON’T BE AN EASY TARGET: STEER CLEAR OF CAR BREAK-INS

By Personal Perspective

One Saturday, Jenny stopped by the mall for some afternoon shopping. The parking lot was packed, but she found a space at the very back of the lot. After she ate some lunch and shopped for a few hours, Jenny strolled back to her car—only to find that her passenger window was broken, and her laptop and iPod were missing. Her heart plummeted into her stomach, and she wasn’t sure what to do. If you’ve ever walked into a parking lot or your own driveway to discover a thief has broken into your car, you’re probably all too familiar with that terrible sinking feeling. Fortunately, there are some steps you can take to stop car robbers in their tracks. These criminals go for the simple jobs, so they usually choose vehicles that are parked in remote areas and have valuables in plain view.

Don’t make yourself an easy target. Follow these five easy tips to steer clear of car break-ins:

Tip #1: Choose your parking spot carefully. Car thieves generally target vehicles that are parked in remote areas so they don’t run the risk of getting caught red-handed. That’s why you should always park in a busy, well-lit area where your car is easily seen from the store or restaurant. Try to avoid parking between two larger vehicles or up against bushes, dumpsters or fences.

Tip #2: Hide your loot. If you were to peer into your car windows right now, what would you see? A hand-held GPS attached to the windshield? An iPod plugged into your radio? A camera on the passenger seat? A laptop in the floorboard? If so, you’ve made yourself an easy target for car thieves. Car robbers would be salivating over a car with so many treasures in plain view. That’s why you should hide all of your electronics, shopping bags and valuables under the seats or lock them in the trunk—or better yet take them into the store with you!

Tip #3: Lock the doors and roll up the windows. This may seem like a no-brainer—but police departments across the nation receive countless reports every year from drivers who have items stolen from their unlocked cars. Even if you’re just running into the store for a minute to pay for gas or pick up your pizza, you should always roll up the windows and lock the door. (If you like to take your dog for rides, have an extra key made. That way, you can roll up the windows and keep the air conditioning on for your pup while you run into the store with your second key.)

Tip #4: Don’t store your home address in your GPS. You’ve probably heard the horror stories or read the elaborate sensationalized email forwards about car thieves who steal GPS devices from cars. Once they snatch the device, they find the driver’s address stored under “Home.” They then rush to the house and clear out the place. Although it sounds like the stuff of urban legends, this has actually happened to some drivers. And it’s entirely possible that this kind of thing could happen again. That’s why you should not store your home address in your GPS device. Instead, store the address of a nearby intersection or even your neighborhood grocery store under “Home.” Better yet, take your hand-held GPS device with you instead of leaving it in the car.

Tip #5: Install a car alarm. The last thing a car thief wants to do is draw attention to himself. That’s why car alarms are so effective. If your car starts beeping and wailing as soon as they try to break into it, they won’t stick around for very long. Many car alarm systems also come with a “panic button” for your key fob—which could come in handy if a suspicious stranger approaches you while you’re entering your car.

When it comes to protecting your car from break-ins, an ounce of prevention is worth a pound of cure. Take these five simple steps, and you’ll be much less likely to become a car thief target. If a thief does break into your car, report the theft to your local police department immediately.

Aug 01
Love0

GET THE PROTECTION YOU NEED BY PURCHASING BUSINESS INSURANCE

By Business Protection Bulletin

Most business owners would agree that it’s important to maintain insurance to protect business assets. When they think about insurance, business owners generally consider protection against hazards such as fire, flood or theft at their company sites. This is obviously an important protection to have. However, there are other types of hazards that may not be quite as high on the list, but protection could be every bit as important to offset significant financial losses. Here are five examples that underscore the need for comprehensive business insurance protection:

Company vehicle contents: If you operate a business with employees on the road making service calls to customers, chances are there is valuable equipment contained in the company vehicles. But a typical auto insurance policy would probably not cover the contents of a company vehicle if that valuable equipment is lost or stolen.

Tenant property improvement insurance: Do you rent space to conduct your business? Have you built out the interior of your space or made improvements to accommodate your business needs? If so, you probably made a considerable investment in the improvements. But many property insurance policies don’t include the value of the improvements made by a tenant to the existing structure. If you’ve invested in improvements, it’s worth taking a look at securing coverage to protect it.

Home-based business equipment: More and more people are working at home at least part of the time, even if they maintain an office or site elsewhere. Most don’t have insurance on the business equipment they keep at home; many assume their homeowner’s insurance would cover it. However, homeowner’s insurance generally does not cover business equipment. If you have expensive business equipment at home, you may want to consider purchasing additional protection.

Business interruption insurance: Remember the series of hurricanes that hit Florida? The wild fires that damaged cities and towns in California? The flooding that disrupted life in the Midwest? In addition to the effect that disasters have on individuals, they can bring businesses to a standstill for weeks or even months. Business interruption insurance can provide a way to get back on your feet.

Key person insurance: In many companies, the knowledge and skills of a single person or a top few are absolutely essential to the enterprise’s success. Key person insurance can help a company recover if an essential employee dies or becomes disabled for a lengthy time. The coverage can provide needed funds that allow the company to continue operating during a search for a successor or until the key employee returns.

As you can see, there are many hazards businesses face that aren’t covered under a typical insurance policy. However, you can get extra protection with the types of coverage outlined here. Since you invest so much time, money and effort into your business, it pays to make sure you have the protection you need. Call us for a consultation today!

Aug 01
Love0

BE PROACTIVE TO PREVENT CYBERCRIME AT YOUR BUSINESS

By Business Protection Bulletin

Legendary bank robber Willie Sutton supposedly said that he robbed banks because that was where the money was. Many small business owners follow this logic when it comes to computer system security. They believe that people who rob with a mouse and a keyboard rather than a gun target large corporations, because those businesses have the most money. This leads them to the misguided belief that cybercriminals will not bother them. In fact, the NACHA – The Electronic Payments Association – reports that Eastern European criminal syndicates have targeted small businesses precisely because they have allowed themselves to become easy marks.

Experts in the field estimate that one in five small businesses do not use antivirus software, 60% do not encrypt data on their wireless networks, and two-thirds lack a data security plan. This failure to take precautions makes a small business easy pickings for computer hackers. However, there are several things business owners can do to protect themselves.

  1. Use two-factor authentication. This is a mechanism that requires the user to do more than one thing for authentication. It ordinarily has two components — one thing the user knows (such as a password), the other a randomly generated number that the user must input. The number comes from an electronic token card, which generates a new number every few seconds. If the user enters a number that the system is expecting, the system will authenticate the user.
  2. Inoculate systems against the Clampi Trojan virus. This virus resides on a computer, waiting for the user to long onto financial websites. It captures log-in and password information, relays it to servers run by the criminals, instructs the computer to send money to accounts that they control, or steals credit card information and uses it to make unauthorized purchases. The trojan monitors more than 4,500 finance-related websites.
  3. Be on guard against “phishing” e-mails and pop-up messages. These messages purport to be from legitimate businesses with which the recipient does business. They ask the user to update or verify information, often threatening negative consequences if she fails to do so. Clicking on the links in the messages brings the user to an authentic looking Web site. However, it is actually bogus; the site collects personal information that the collector can use to steal the user’s identity. System users should ignore these messages.
  4. Arrange for financial institutions to alert the business owner should they spot unusual activity involving the firm’s accounts.
  5. Install firewalls and encryption technology to block uninvited visitors from uploading to or retrieving data from the firm’s servers and to protect data sent on public networks. Intrusion detection systems can inform the business owner of attempts to hack into the network.
  6. Be cautious about opening attachments to e-mails, especially if the sender is someone unfamiliar to the user. Attachments may contain viruses or Trojan horses that can steal login information and passwords or corrupt a system.
  7. Protect against intrusion by disgruntled former or current employees. Deactivate passwords for former employees, erect barriers to keep employees from accessing systems unrelated to their jobs, and implement sound accounting procedures for financial transactions.

In addition to these safeguards, small businesses may want to consider purchasing computer fraud and employee theft insurance. These policies will protect the business against those losses that still occur; insurance companies are likely to offer favorable pricing to businesses that take precautions against cybercrime. One of our professional insurance agents can give advice on the appropriate types and amounts of coverage. Modern technology gives businesses unprecedented abilities, but it also presents significant risks. Every business owner must take steps to keep the cybercriminals out.

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