Horizon Point Consulting

Author: Lorrie Coffey

  • To Offer or Not to Offer: Pros and Cons of Sign-on Bonuses Post Covid

    To Offer or Not to Offer: Pros and Cons of Sign-on Bonuses Post Covid

    Last week my colleague, Taylor, talked about the rise in hiring incentives that we are seeing in 2021. As of April, the national unemployment rate was 6.1%, and the rate in Alabama as of April was 3.6%, almost half of the national average. With the unemployment rate so low, employers who are now able to ramp their businesses back up post-Covid are finding it impossible to hire. So as Taylor mentioned, many are turning to offer sign-on bonuses or opportunities to win a prize such as a car in order to entice individuals to apply. It sounds great in theory, but what are the pros and cons of sign-on incentives that organizations need to consider? 

    Pros: 

    1. Sign-on bonuses get people in the door and on the clock. It’s definitely an attention-getter. Who wouldn’t like a few extra dollars in their pocket just for accepting a job? Promoting positions with a sign-on bonus is a great way to increase your application pool and find hires that may be needed just to keep your business running. 
    2. It can help you win over the competition. In the current market, employers are all fighting over the same candidates. What can you offer that the competition can’t? A higher sign-on bonus may be the tipping factor in which position a candidate applies to and/or accepts.
    3. It’s a one-time hit to your budget. Many employers are offering sign-on incentives right now because the market is so tight, and because they are trying to attract candidates away from an inflated unemployment payment. While offering a sign-on bonus may be putting a tight squeeze on many small businesses’ bank accounts, it’s a one-time hit to the financials. Once the hiring market shifts, which many predict will happen once states start eliminating the additional unemployment federal funds, employers will be able to cease the sign-on incentives and get their budgets back on track. 

    Cons: 

    1. Collect and bail. If your sign-on incentive is payable immediately upon hire, there is nothing keeping a new hire from collecting the sign-on bonus and walking away. If you defer payment until an employment period has been met (i.e. payable after 60 days of employment) that may be a deterrent to candidates if they can get an immediate payout elsewhere.
    2. Decreases employee morale. Offering sign-on incentives to new hires that weren’t available to current employees might not sit well with some. For example, you promote an employee to a shift supervisor and increase their hourly pay to $20/hour and then you hire an external candidate to fill a second shift supervisor position and pay them an hourly rate of $20/hour with a sign-on bonus of $500, how do you think that’s going to be viewed by the internal candidate you promoted? 
    3. Creates an unrealistic expectation for the future. While an employer offering a sign-on bonus views that as a one-time payment, many employees view it as a precursor of things to come. When review time comes around, they may expect an additional bonus or a pay increase equivalent to compensate them for the bonus they received the previous year. In other words, while the employer views the sign-on incentive as an “extra” many employees view it as part of a whole, including that amount when they calculate their annual salary. 

    While I’m not arguing for or against sign-on incentives, organizations need to evaluate the pros and cons when determining if it’s the right thing for the organization. While considering the option of offering sign-on incentives, organizations should also discuss how to incentivize current employees to help recruit talent. If your organization doesn’t currently offer referral bonuses, maybe that is an option to try first. The best candidates often come from current employees. 

    Is offering a sign-on incentive the right choice for your organization? 

     

  • Live from #ALSHRM21: Does Your Company Culture Attract Your Ideal Candidate?

    Live from #ALSHRM21: Does Your Company Culture Attract Your Ideal Candidate?

    The theme of the Alabama SHRM Conference and Expo for 2021 is “Embracing the Human in Human Resources” and organizational culture is a huge part of that goal. Craig Ellis, co-founder of our sister company MatchFIT, defined culture as “the unique way employers approach business and the unique way employees approach work” in his presentation Is Your Culture Attractive: What the Data Says Job Seekers are Looking for in an Organization’s Culture.

    According to Craig, 75% of candidates ask about an organization’s culture during the interview process. Unfortunately, the response too often given is a singular response. It’s the interviewer’s opinion and is based on their perspective, one that is most often very positive (or else they probably wouldn’t be an interviewer). 

    So how can organizations accurately define their culture and describe it to candidates to ensure a compatible fit? According to Craig, organizations need to ask those in the know; employees. Don’t look to leadership alone to define your organization’s culture, ask those who live it day in and day out. How they view your culture may be very different than how leadership would define your culture. Conduct employee surveys, find out why employees are voluntarily leaving your organization through exit interviews, and conduct stay interviews to find out what it is about your organization that makes people want to stay.

    Once you have collected data and used it to help define your organization’s culture, you can better determine who your ideal candidate is and what it is about your culture that would attract that candidate? What does your ideal candidate care about in an organization’s culture? If you have a culture that is exacting and procedural, meaning the organization values structure and diligence, a candidate that values a relaxed, informal culture won’t be a good fit for your organization. If you find that you’re interviewing candidates that you feel are your ideal but they turn down your offer, don’t be afraid to ask them why they have chosen not to come work for you. While you may not be able to convince them that it’s a good fit for both them and you, the data you collect can help you to close the gaps in how you present your cultural values to candidates and what values you seek in candidates. 

    According to Craig, an important part of the process is to “take the time to articulate your culture and share that with employees and leadership.” Ensure that everyone is on the same page and can communicate your culture in a consistent way. 

    How do you define your organization’s culture to candidates and is it making them want to sign on or sending them running for the hills?  

  • The Amazon Union Vote and the Fate of the PRO Act

    The Amazon Union Vote and the Fate of the PRO Act

    All eyes have been on the small town of Bessemer, Alabama in recent weeks. Proponents and opponents alike waited with bated breath as employees of the largest U.S. online retailer, Amazon, voted on unionization. Stories of poor working conditions have been spreading like wildfire, and as a result, many thought the vote to unionize was a sure bet. Even President Biden threw his two cents in, expressing his support for unionization at Amazon. And it makes sense that he would do so, given that Democrats are pushing for legislation that would lead to the biggest shift in labor law we’ve seen in decades.

    The Protecting the Right to Organize (PRO) Act of 2021 was introduced by Democrats into the House on February 4th of this year. The House quickly passed it with a vote of 225-206; a similar vote to the original bill that was introduced in the House during the 116th Congress. It currently sits in committee in the Senate and its fate is questionable.

    As we know, the Democratic party is very employee-focused and very pro-union. In 1983 the Bureau of Labor Statistics began tracking union membership and found that 20.1% of employees were union members. In the decades since, that number has slowly dropped. In 2020, only 10.8% of employees were members of unions. The Democrats believe that they can increase union membership if they can overhaul the National Labor Relations Act.

    What makes the PRO Act so important to employers? Among other things, the PRO Act would:

    • Eliminate Right-to-Work laws and allow unions to collect dues from employees regardless of membership. Currently, 27 states, including Alabama, have Right-to-Work laws.
    • Expand the definition of “employee” by making it harder to classify someone as an Independent Contractor and narrowing the definition of “supervisor” so that more employees are covered under the NLRA.
    • Require employers to allow employees to use company equipment to organize and engage in protected concerted efforts.
    • Prohibit mandatory arbitration agreements and class action waivers.
    • Limit employer rights by expanding financial penalties, limiting the ability of an employer to seek legal advice and requiring disclosure of such communication, and requiring labor attorneys to disclose information regarding the client/attorney relationship.
    • Limit employer ability to contest election petitions and allow unions to use coercive tactics.
    • Make it illegal for employers to permanently replace striking employees and allow for secondary boycotts.
    • Require employers to provide employee personal information, including home address, home phone, and personal email, to unions without the consent of employees.

    Amazon employees voted two-to-one not to unionize. This historical vote may or may not have an impact on the PRO Act. That is yet to be determined. What is known is that the PRO Act will have a difficult time making it through the Senate. The 116th Senate sent the bill to committee where it stayed and stalled. The 117th Senate may allow the bill to meet the same fate. If it actually makes it to the floor, Republicans have vowed to block the vote. Some analysts believe that the only way the PRO Act would succeed is if the Democrats can change the rules of the filibuster, which would be near impossible. President Biden has said that if it makes it through Congress, he will not hesitate to sign it. So stay tuned.

  • What the New Administration Means for HR

    What the New Administration Means for HR

    I often hear HR professionals and business leaders alike comment on how hard it is to keep up with the constant changes in labor and employment laws. HR is an ever-changing world and even more so when a new administration takes office. Many employers have questions and concerns about what this new administration will mean for their businesses and changes they will need to make in how they manage HR.  

    The Biden administration promises a focus that will push for more employee-friendly legislation and a strengthening of policy enforcement. There are a number of areas to keep an eye on this year and in the coming years of this administration, including: 

    • Labor Relations
    • Immigration
    • Retirement Benefits
    • Wage and Hour Regulations
    • Affordable Care Act/Healthcare
    • Paid Leave
    • Discrimination

    So how can employers stay updated on these issues? 

    1. Network: Talk to other business leaders and HR professionals. Join associations that help keep employers informed and help them navigate these changes. Your local Society of Human Resource Management (SHRM) chapter is a good resource as are industry-specific associations. 
    2. Subscribe: There are so many resources out there, including newsletters created by employment attorneys and HR professionals, podcasts, and government publications. You can subscribe to the Horizon Point newsletter here.
    3. Attend: Seek out opportunities to attend workshops on employment and labor law. A few great places to find these workshops are your local SHRM chapter, employment attorneys, industry associations, and your local Chamber of Commerce. 
    4. Contract: Seek out help from the professionals. Consider contracting with an HR Outsourcing/Consulting agency or an employment attorney that can help your organization stay up to date on labor and employment laws and ensure that your organization is compliant. 

    For more information on what to expect from the new administration, join Horizon Point Consulting and Redstone Government Contracting on April 6th for our New Administration, New Rules: Navigating the Workplace in 2021 workshop. 

  • Four Simple Steps to Improve Your Business Writing

    Four Simple Steps to Improve Your Business Writing

    I often work with clients who aim to improve communication within their organizations. Many of them naturally focus their concerns on the verbal communication issues within their company but fail to evaluate the impact that their written communication may have. 

    Here are four simple steps to help improve your written communication: 

    1. Consider your audience. When preparing to draft written communication, whether it’s an email, marketing materials, or a business report, consider your audience. How you address a customer may be very different from how you would address an employee. How you present information on your company’s fourth-quarter earnings and goals for the next quarter will be very different when addressing top leadership versus addressing an all-staff meeting. 
    2. Plan out what you want and need to say. What is the purpose of your written communication? Think about what you need to say before you actually start writing. What are your key points and how can you best address those points? If you’re writing a report or preparing a presentation, create an outline of key points and the order in which you want to address them. 
    3. Write and review. Write with purpose and don’t rush through it. And review what you’ve written as you go, and often. Does what you’ve written get the right point across and does it flow well? As I’m writing this now, I’ve already gone back and re-read it four times from the start. After I wrote #1 and #2, I re-read them two or three times and made adjustments. 
    4. Have someone proofread it. While I’m not suggesting you have someone proof every email you send, if you’re drafting longer documents such as reports or proposals, or materials that will go out to the public such as marketing materials or articles, have a second set of eyes look it over. They may just find some minor typos or grammar adjustments, or they may provide feedback on how to improve certain sections or points. When I finish writing this article, one of my colleagues will proof it before we post it.  

    Evaluation is also key to improving your written communication skills. As you implement the four steps above to help improve your written communication, consider ways to measure your success. This may include having employees fill out a brief survey after a staff meeting, evaluating sales after a new marketing campaign, or tracking the number of proposals submitted and how many contracts were won or the feedback that was returned. 

    What is one way that you can evaluate the success of your written communication?