HR Guidebook 2019 by Crain's Cleveland Business

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Workplace tips and trends from local human resources professionals

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Protecting employees amid M&A uncertainty Change in Control agreements useful tools in managing workforce engagement By ANN-MARIE AHERN

hange in Control agreements have become a common feature of management-level compensation packages. In an era of increasing consolidation and private equity involvement, a potential for merger, acquisition or sale is a huge area of concern for employees. If key employees know the company is positioning for sale, how do you keep them fully engaged and committed, especially when such a transaction might result in their own job loss? How do you prevent the high-level employee from losing objectivity about a potential sale when closing the deal will likely result in unemployment? To retain top talent in an environment of M&A uncertainty, HR leaders often turn to CIC agreements. CIC agreements, generally speaking, provide that a designated employee will receive a set amount of compensation upon the occurrence of certain contractually defined events. Typically, CIC agreements are either “single trigger,” meaning that the payout occurs upon the sale of the business or a change in control, or “double trigger,” meaning that the benefit pays upon the sale or change in control, plus a job loss or material reduction in role or responsibilities within a certain time thereafter. If, however, the employee is permitted the opportunity to remain employed by the surviving entity,

in a double trigger agreement, the CIC benefits are not paid. Increasingly, modern CIC agreements are double trigger. Benefits under a Ahern CIC agreement often take the form of a severance payment that is in excess of standard company policy. CIC benefits are typically expressed in terms of a multiple of base salary — the more essential the executive is to a consummating sale, the higher the multiple. It is not uncommon for bonus and fringe benefits to be paid for a like period of time. In addition to or in lieu of severance pay, CIC agreements may involve accelerated vesting of equity that pays upon sale. This is an important consideration for those who have longterm incentive plans that involve multiyear vesting cliffs. Accelerated vesting of all unvested units can be of tremendous value and may allow an employee to realize the value of grants that would otherwise be subject to forfeiture upon separation from employment. CIC agreements vary widely and should be tailored to create a true win-win for the company and for the executive in whom the employer hopes to inspire loyalty. Ann-Marie Ahern is principal with McCarthy, Lebit, Crystal & Liffman Co. LPA. Contact her at 216-696-1422.

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The power of a positive work environment L ed by partners Dino Sciulli, Nancy Vice and Mike Rao, DS Benefits Group is an industryleading provider of group benefits, organizational development and HR services. Recently, the company was named one of the Best Employers in Ohio. Rao, who has dedicated his 30year career to helping businesses create environments that maximize employee satisfaction and performance, talks about the importance of creating a positive workplace and what makes DS Benefits Group tick. Why is it critical to build a culture where employees are happy? Rao: Research shows that employee engagement impacts nearly every major metric of your business — from productivity to retention to growth. Workers who are engaged feel a stronger connection to the mission of the company. As a result, they become more self-motivated and are more likely to offer ideas that help the company grow. What can companies do to create that environment? Rao: Listen to your employees. Ask

them what improvements they would like, and why. And then, invite them to develop solutions that address the challenges they’ve Rao identified. By doing so, you are dramatically improving your chance of success, as employees are more apt to implement the solutions at a high level and hold each other accountable. This strategy will also help build a true sense of teamwork and trust within your organization. Employee retention continues to be an issue. What can organizations do to keep their valued staff? Rao: Invest in your people. Sit down with your employees to understand their short-term and long-term goals. Then create a roadmap to help them achieve those goals. Whether that means giving them special training or giving them more authority within the company, make sure that you’re actively involved in their professional growth. When people feel valued, they work with passion and want to stay.

Companies can spend up to twice an employee’s annual salary to hire a new worker.

ith unemployment at a 49-year low, improving employee experience, or EX, requires more than making your workplace fun and offering progressive perks. Engaging and retaining top talent today means prioritizing employee experience in your company’s cultural, physical, technological and organizational strategies. Flexible work schedules; comfortable, functional work spaces; and updated equipment and applications are just a few of many job attributes that determine the overall degree of employee fulfillment. When businesses design EX into every facet of their planning and decisionmaking, employees are delivered personalized experiences that align with both individual and company values. Better employee experience leads to

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Keefe

Rao: Many of the solutions we implement with our clients we use ourselves. We’ve developed a high level of vulnerability-based trust, we encourage constructive conflict, and we ask employees to weigh in on decisions. Our core values were developed by our employees, so we all understand and connect with our purpose. Most important of all, we want our company to feel like family. So we celebrate the birthdays and the holidays. We’re always up for a party. Any parting words of wisdom for companies that want to build a positive culture? Rao: Stick to it. Company cultures don’t change overnight. So, understand what is working for you and what isn’t. And always make it a priority within your organization. Mike Rao is a partner at DS Benefits Group. Contact him at 330-760-9179 or mrao@ dsbenefitsgroup.com.

Hiring right the first time is critical. Hiring new employees can be tedious and inefficient for you and for the prospective new employee. Paperwork can be overwhelming and keeping track of piles of documents can be time consuming and frustrating. Streamline and improve your process so you attract and interview the right candidates the first time.

7 steps for creating a great employee experience By KELLY KEEFE

What has your organization done specifically to create a positive, productive culture?

better customer experience, which results in greater company performance — and greater emotional and financial gains for continued investment in EX.

Consider this process for building better experiences at your workplace: 1. Commit: To enhance systemwide EX, your leaders together must pledge to an employee-first business model and recognize staff satisfaction as a leading indicator of operational success. 2. Ask: Don’t decide for employees what matters to them. Inquire with an engagement survey, and devise your experience strategy to support those findings and your organization’s overall goals.

800.727.2849 www.ahola.com PAYROLL

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TIME & ATTENDANCE

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ONBOARDING

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What your employees want out of dental insurance By KARI BUSH

hile consumer preferences continue to evolve, the desire for dental insurance to be included as part of a benefits package still remains strong. Here are four trends to consider as you identify what your employees value most in dental insurance.

Making Workplaces Great.

1. The link between oral health and overall health is gaining awareness. Many studies have demonstrated that oral health is linked to overall health and quality of life. According to the National Association of Dental Plans, 47% of consumers are familiar with scientific evidence demonstrating a link between oral health and specific medical Bush conditions. However, there is still work to be done in educating employees about this connection. Regular preventive dental visits, paired with proper daily oral health routines, can have a major impact on overall health, something both employees and employers can value. Make sure your dental insurance carrier is well-positioned to help your employees avoid health issues that stem from oral health problems. For example: ● Look for a plan that covers 100% of preventive services and offers more than the standard two cleanings per year (for those who need them) so dental diseases are less likely to develop and overall health can be better managed. ● See if your dental insurance carrier will waive waiting periods, even if employees haven’t had continuous coverage. This enables employees to receive covered treatment for dental issues as soon as they arise and reduces the likelihood that conditions may worsen. ● Consider the unique needs among your employees. Look for customized plans that include specific coverage that may be needed, such as orthodontia, posterior composites (tooth-colored fillings on back teeth) and implants. According to the Centers for Disease Control and Prevention, more than 164 million hours of work are lost each year due to oral health problems or dental visits. While regular preventive checkups may take employees out of the office briefly, they can prevent lengthier procedures and oral pain, both of which impact employee morale, productivity and attendance.

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Keep the rock stars in your company. We can help. Your best employees want to do their best. The question is – are you providing the environment that will allow them to excel? We offer a number of programs, including leadership development, executive coaching and sales training, that can help every member of your team shine. And with our customized benefits, we can put together a plan that meets your employees’ unique needs. Let’s set the stage for some amazing performances. Call 330-725-0501 or visit dsbenefitsgroup.com today.

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2. Employees expect their employers to provide dental insurance. Employees value staying healthy. According to the National Association of Dental Plans, two-thirds of adults feel it is very important for their employer to provide dental coverage. Although the workforce is changing as older employees retire and younger people are hired, dental insurance shows no sign of declining in importance. Despite some employers’ perceptions

that younger employees do not care about dental insurance as much as older employees, an industry study found that the equivalent share, 78%, of employees older than age 40 and employees under age 40 rate dental insurance as an important benefit. These findings impact all companies, large and small. In fact, small businesses might gain the most by adding dental benefits to their benefit offerings. Research shows that only 14% of employers with two to nine employees offer dental insurance, identifying a key area for small companies to distinguish their benefits packages from those of their peer organizations. One option is for plans to be implemented on a voluntary basis, allowing employees to use pre-tax dollars to pay into and receive dental insurance through their employers. This provides a significant benefit for employees, as they would have access to group rates, and often in the case of larger groups, customized plans. 3. Employees increasingly are becoming interested in services such as implants and orthodontia. NADP’s 2018 consumer survey found that people wish procedures such as implants and elective orthodontia were included in their dental coverage over other benefits that were not provided. The survey also found that people were willing to pay higher monthly premiums to secure these benefits. Of those who have dental insurance and would like implant coverage included in their plan, 78% reported that they would be willing to pay more toward their monthly premium for additional coverage. Among individuals who have dental insurance and would like elective orthodontia coverage included in their plan, 57% would pay more in their monthly premium to obtain extra coverage. 4. As employee wellness programs grow, dental benefits can play a role. According to the Society for Human Resource Management (SHRM), 70% of U.S. employers offer employee wellness programs, and data suggest these programs are continuing to grow in popularity. SHRM attributes some of the rising popularity of wellness programs to the rising cost of health care. Wellness initiatives can prevent costly and more time-consuming procedures later on. This makes dental benefits, and incentives to get preventive dental care, an ideal fit for employee wellness programs because of the link between oral health and overall health. Keep these trends in mind as you work with your dental insurance carrier to build the right plan for your employees to ensure the best oral health care possible. Kari Bush is a sales executive at TruAssure Insurance Co. Contact Kari at kbush@truassure.com.

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Building the framework of a strong organization Foundation begins with establishing a set of core values that reflect mission, culture what values or beliefs are top of mind for employees. Core values should be simple concepts such as “integrity” and “guest focus,” but they should be defined as to how they relate to the organization. For instance, “integrity” for a public agency can define not only employee ethics but also finances and its management of taxpayer contributions. Consider how many core values are necessary for the entirety of the organization and its mission. Rather than having a dozen core values – six values that encompass multiple ideals may be easier for employees to focus on. For instance, “dependability,” “punctuality” and “attention to detail” could all exist under the core value of “professionalism.” Once an initial set of words and definitions is established, facilitating small group conversations or focus groups can help employees brainstorm what principles are essential. Depending on the particular organization, holding focus groups with a diverse set of employees across multiple locations can help produce a dialogue that is equally diverse and inclusive of the entire organization. Employee peers should be defining

background, I feel that core values should be similar to a school’s anthem, strong organization is consis- and employees should respond to them tent in its mission and built with enthusiasm. When I initiated this from passionate and dedicated process, I traveled to Disney World employees who share similar core val- and got a close look at how one of the ues. Whether the mission is to protect world’s most successful companies the environment, innovate a new prod- keeps their employees engaged and uct or so on, a checklist of core goal-oriented. I walked organizational values can help away more conﬁdent in the guide each employee toward premise that behind every that shared mission. In a way, strong organization’s mission the core values “prop up” an orstatement are passionate ganization’s mission statement. workers with shared beliefs. Equal time should be dedicated It’s important to to establishing a set of values Harrison remember that establishing that is true to both the organization and an organization’s core values is not the employees who drive it. about creating a moral rulebook for When electing to create or employees — it’s about establishing establish a set of core values for your an organizational culture to help organization, it’s important to ensure employees thrive. And that requires that the core values are not just a employee buy-in from the beginning. set of ideals but are made up of the While external research or assistance culture that is already interwoven into can help when preparing to establish the organization’s framework. The such an encompassing organizational human resources professional’s job in initiative, it’s even more important establishing core values should be to to look internally, and ensure that open up a dialogue on what values are employees have ownership in the important rather than to try initiate an organization’s governing principles. entirely new organizational culture. An internal survey or questionnaire This process can and should distributed to a wide variety of take time. Coming from an athletics employees is a good start in gauging By HAROLD HARRISON

“We Have To Let You Go.”

these values, not leadership. Aside from gathering employee buy-in, brainstorm sessions can help build momentum toward that ultimate organizational goal and may even refocus or re-engage long-time employees. Once core values are established among employees, it’s important that all other key stakeholders, such as a board of commissioners, are in alignment. The real hard work begins once your organization’s core values are selected, deﬁned and approved. Core values should be the foundational tenets of daily work as well as decisionmaking. Informing employees of core values goes beyond a memo, email or newsletter. To really bring awareness, the HR professional can launch a series of activities around the newly established core values. If you have an organizational picnic or quarterly update, make sure that the core values are featured in a fundamental way. Core values should also be visible. They should be listed on the website, in the employee handbook and on business cards. They should be hung visibly in every room where decisions

are being made. As established core values are purpose-oriented and goal-oriented, they should also have organizational weight behind them. They should be part of the hiring process as well as connected to performance appraisal. If the core values are aligned with the organizational mission, then evaluating employee performance based on the individual’s alignment with core values should be a commonsense initiative. Core values and their purpose in the organization are more effective when employees are expected to perform their work in manner that is in alignment with those values. For the human resources professional, the process of establishing core values in an organization is like a coach building momentum before a big game. When the organizational goal is established, employees just need the playbook and the encouragement they’re on the right track to take home the win.

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and management feedback to make adjustments and additions that heighten EX and demonstrate your leadership’s dedication to it.

3. Plan: Building a better experience is more than just an HR department task. Bring together stakeholders from all functional areas of your enterprise to chart people-centric objectives.

Hard words to say, harder words to hear. Whether you have to deliver the bad news or receive it, the experienced attorneys at McCarthy, Lebit, Crystal & Liffman will navigate you through the tricky matters of employment law in Ohio. Our accomplished attorneys have successfully represented both individuals and companies in hundreds of matters. Don’t wait, your best interest is a phone call away.

4. Install: Write your employee experience agenda into central aspects of corporate communication, from your mission statement and core values to your employee handbook. 5. Manage: Keep doors and lines of communication open between leaders and employees to encourage regular conversations that increase awareness, understanding and trust. 6. Measure: Evaluate individual and company performance according to people experience metrics, and routinely poll employees formally and informally about how they feel. 7. Improve: Use continuous employee

Harold Harrison is chief human resources officer at Cleveland Metroparks. Contact him at hgh@clevelandmetroparks.com.

Together with providing challenging and meaningful work, competitive compensation and beneﬁts, and worklife balance, employee experiencefocused workplaces are more likely to spark passion, help employees ﬁnd purpose and reap rewards. Beyond the cultural, physical and technological features of EX are the relational ones. Organizations that lead from the heart, with compassion, empathy and humanity, are winning big. Nothing turns a negative employee experience around quite like a leader asking, “How can I help?” Kelly Keefe is president at ERC. Contact her at 440-947-1284 or kkeefe@yourERC.com.

Contact Ann-Marie Ahern or Jack Moran at 216.696.1422

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