May 2016 issue

Volume 6 : Issue 5 TM

www.HRProfessionalsMagazine.com

2016 MSSHRM Conference

Workplace

Investigations and

Confidentiality

Highlights

from the 30th Anniversary

ARSHRM Conference DOL Issues

Gag Order to Businesses

Across the Country Under the Revised

Persuader Rule

Lindsay Carter MSSHRM

Diversity Chair

Highlights

from the 26th Annual

SHRM-Atlanta HR Conference

Why Employee

Stock Ownership Programs Matter to Private Companies

JUST PUT IT ON THE COMPANY CARD…NOBODY WILL NOTICE.

YOU’RE REALLY SHOWING OFF YOUR BEST ASSETS TODAY.

THEY’RE WORRIED ABOUT OVERTIME. I’M JUST WORKING OFF THE CLOCK.

I NEVER WEAR THE SAFETY GOGGLES. THEY LEAVE A MARK.

What you don’t hear can still hurt you.

The things employees say when you’re not around can cause legal troubles for you. Fisher & Phillips provides practical solutions to workplace legal problems. This includes helping you find and fix these kinds of employee issues before they make their way from the water cooler to the courthouse.

1715 Aaron Brenner Drive • Suite 312 • Memphis, TN 38120 • 901.526.0431 www.laborlawyers.com

ATLANTA BALTIMORE BOSTON CHARLOTTE CHICAGO CLEVELAND COLUMBIA

COLUMBUS DALLAS DENVER FORT LAUDERDALE GULFPORT HOUSTON IRVINE

KANSAS CITY LAS VEGAS LOS ANGELES LOUISVILLE MEMPHIS NEW JERSEY NEW ORLEANS

ORLANDO PHILADELPHIA PHOENIX PORTLAND SACRAMENTO SAN ANTONIO SAN DIEGO

SAN FRANCISCO SEATTLE TAMPA WASHINGTON, D.C.

Bringing Human Resources & Management Expertise to You

Millennials visited the ER 9% more than their older colleagues from July 1, 2014 to June 30, 2015 www.HRProfessionalsMagazine.com Editor

Cynthia Y. Thompson, MBA, SHRM-SCP, SPHR Publisher

The Thompson HR Firm, LLC HR Consulting and Employee Development Art Direction

Park Avenue Design Contributing Writers

Theresa J. Allen William Carmichael J. Bruce Cross Harvey Deutschendorf David Estel Murray L. Harber Mary Moffatt Helms Thomas L. Henderson James W. Hollis Jennifer S. Kiesewetter Gabriel P. McGaha Abtin Mehdizadegan Clifford Stephan Board of Advisors

Austin Baker Jonathan C. Hancock Ross Harris Diane M. Heyman, SPHR John E. Megley III, PhD Terri Murphy Susan Nieman Robert Pipkin Ed Rains Michael R. Ryan, PhD Contact HR Professionals Magazine: To submit a letter to the editor, suggest an idea for an article, notify us of a special event, promotion, announcement, new product or service, or obtain information on becoming a contributor, visit our website at www.hrprofessionalsmagazine. com. We do not accept unsolicited manuscripts or articles.

All manuscripts and photos must be submitted by email to Cynthia@hrprosmagazine.com. Editorial content does not necessarily reflect the opinions of the publisher, nor can the publisher be held responsible for errors.

HR Professionals Magazine is published every month, 12 times a year by the Thompson HR Firm, LLC. Reproduction of any photographs, articles, artwork or copy prepared by the magazine or the contributors is strictly prohibited without prior written permission of the Publisher. All information is deemed to be reliable, but not guaranteed to be accurate, and subject to change without notice. HR Professionals Magazine, its contributors or advertisers within are not responsible for misinformation, misprints, omissions or typographical errors. ©2016 The Thompson HR Firm, LLC | This publication is pledged to the spirit and letter of Equal Opportunity Law. The following is general educational information only. It is not legal advice. You need to consult with legal counsel regarding all employment law matters. This information is subject to change without notice.

Features 4 note from the editor

5 Profile: Lindsay Carter, MSSHRM Diversity Chair

WEB EXCLUSIVES

20 The Company Intraaaaaanet . . . The Good News!

22 Thank You 2016 30th Anniversary ARSHRM Conference Exhibitors!

HTTP://HRProfessionalsMagazine.com /Exclusive

32 Gaining the C-Suite’s Attention: 5 Ways Background Screening Adds to the Bottom Line 33 Book Look: Napolean Hill’s Keys to Personal Achievement

38 7 Ways to Deal with Workplace Conflict

Employee Benefits

Next Issue

14 Why the Nation’s Largest Generation Isn’t Hip About Health Insurance and What We can Do About it

Special Issue Profiles of Super Lawyers - Deadline to submit articles and ads is May 10

18 Why ESOPs Matter for Private Companies

26 The Release of the Final DOL Fiduciary Rule: What are the Key Differences Between the Final Rule and the Proposed Rule?

34 A Proactive Approach to Managing Health Costs

Employment Law 10 Business as Usual? The Verdict on Whether the Roberts Court is Indeed Pro-Business and What This Means for the Future 12 Workplace Investigations and Confidentiality

16 NLRB Holds Employer Policies Against Employee Videos/Recordings Unlawful 28 DOL Issues Gag Order to Businesses Across the Country Under the Revised Persuader Rule Regulations

36 Guidance for Employers on 24-Month F-1 STEM OPT Regulation

Industry News 6 Highlights of the 2016 30th Anniversary ARSHRM Conference & Expo April 6-8 in Rogers 8 Preview of 2016 MSSHRM State Conference & Expo May 16-18 in Biloxi

25 Preview TNSHRM State Conference September 14-16 in Memphis

30 Highlights from the 26th Annual SHRM-Atlanta HR Conference March 29-30 35 Preview of 2016 SHRMGA State Conference September 18-20 in Augusta

37 Fisher & Phillips LLP One Day, Many Solutions Seminar May 13 in Memphis www.HRProfessionalsMagazine.com

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a note from the Editor

TNSHRM members who register for the 2016 Tennessee SHRM State Conference by May 31 will have a chance to win an Apple watch! Early bird rates are good until August Cynthia was a keynote speaker at the Paylocity Partner Summit in Las Vegas in March. She also presented at the Tennessee Association of Health Underwriters Symposium at the University of Memphis in April.

Hello

31.The deadline to register for the Room Block at The Sheraton Memphis Downtown Hotel is August 14 by 5:00 PM. See Page 25 for more details. The Conference will be September 14-16.

The 2016 SHRMGA State Conference will be at the

MSSHRM friends! We look forward to seeing you in Biloxi for the 21st Annual Human Resource Conference and

Expo at the beautiful Beau Rivage in Biloxi May 16-18. We will have highlights in our June issue. I am honored to be presenting “Mitigating 2016 HR Trends That Impact Your Bottom Line,” approved for 1.00 HRCI Business Credit and 1.00 SHRM PDC. Please join me Wednesday morning for this informative session.

We will bring you highlights from the WTSHRM Spring 2016 HR and Employment Law Conference on May 4 at Union University in Jackson in our June issue also. This seminar is presented in coordi-

Augusta Marriott at the Convention Center in Augusta.

Early registration rates are available through August 30.

We are looking forward to seeing Mike Aitken, SHRM VP of Government Affairs, along with many other excellent keynote speakers at the Conference. See Page 35 for more details about the speakers. Mark your calendars to attend September 18-20.

If you are unable to attend the WTSHRM Conference and the MSSHRM Conference, please follow me on Twitter @ cythomps as I will be tweeting from the conferences about the exciting events and speakers. We will also provide daily updates on Facebook and LinkedIn.

nation with the Law Firm of Rainey, Kizer, Reviere & Bell, P.L.C. Attention SHRM-Memphis! We are excited to be co-sponsoring a seminar on May 13 at the Crescent Club from 8:00 AM to 4:30 PM with Fisher & Phillips LLP. The seminar is One Day, Many Solutions, and is approved for both SHRM and HRCI recertification credits. I will be speaking on, “Reinventing the Performance Evaluation.”

To register, please email Nikki Hunter at nhunter@laborlawyers.com.

Cynthia@hrprosmagazine.com www.hrprofessionalsmagazine.com

Sign up for our RSS News Feed to receive up to the minute HR Alerts on changing legislation affecting our workforce. www.HRProfessionalsMagazine.com.

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www.HRProfessionalsMagazine.com

Lindsay on the cover

CARTER

LINDSAY CARTER, MSSHRM DIVERSITY CHAIR Lindsay has served as president of the Capital Area Human Resource Association; and president of the Mississippi State Council of SHRM; a board member of SHRM’s Southeast Regional Council; vice president and a founding member of the Mississippi Association of Colleges and Employers; chairperson of the 2000 Mississippi SHRM state conference, and vice president of the Mississippi Black Human Resource Network chapter.

Lindsay is a thirty-five year veteran of the Human Resources field. For fourteen years, Lindsay served as the Director-

Lindsay was recognized as the 2002 Mississippi HR professional of the year, won a Gannett President’s ring for HR excellence in 2003, holds the Advanced Safety Certification from the National Safety Council, holds the lifetime Senior Professional in Human Resources certification from HRCI, the SHRM Senior Certified Professional and was the 2006 United Way of the Capital Area’s President’s Award honoree. Academically, Lindsay holds a B.S. degree in mathematics (go figure) from Ohio University and an M.B.A. from Washington University in St. Louis.

Human Resources for Gannett Riverstates Publishing Co. This was preceded by 21 years at BellSouth, 17 years of that time in various Human Resource functions including management employment, safety, E.E.O. and labor relations. Lindsay currently serves as an adjunct professor at Belhaven University teaching graduate level H.R. courses.

Despite retiring in 2011, Lindsay is in his 18th year of service on the board and has taken of the mantel of advancing Diversity and Inclusion in the state of Mississippi. He has developed and delivered six unique diversity presentations that center on getting people to talk about the areas that are often taboo to discuss in the workplace. These include race, sexual orientation, and religion. The presentations have been delivered to all nine professional chapters in the state and two student chapters as well as other professional organizations, universities and sororities.

Those who have been a part of those presentations, will quickly admit that they were drawn into discussing and thinking about diversity issues in new ways. He doesn’t just deliver the material but makes you think about the topic in ways that had never occurred to you.

Jokingly referred to as the “godfather” of HR, he leaves audiences laughing and wanting more as he starts by discussing how he avoided affirmative action for years as a black man who was assumed to be a beneficiary of EEO laws to the detriment of his peers. Now, he is a beacon trying to push organizations and individuals to include differences in making organizations more profitable and better service providers. 

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5

TS H G LI H IG H

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1 ARSHRM Past Conference Chairs gathered for a breakfast on Wednesday to celebrate the 30th Anniversary of the Arkansas SHRM HR Conference & Expo. First Row: Left to Right, Kathleen McComber, Holly Little, Tara Authur, Danielle Wood, Michele Burns. Second Row: Left to Right, Allen Dobson, Don Marr, Donna Davis, Kim Finne, Jim Corter, Steve Schulte, Donna Merriweather, Tim Orellano. Back Row Left to Right, Bruce Johanson, Ben Traylor, Ed Wheeler, Beth Graves, Eric Garvin, Jim Harris, Aaron Lubin, Hal Wyatt. Not pictured: Helen Moore, Russell Gunter, Linda Cote, JC Cote, Sam Carr, Irene DeHuff, Lin Blair, Cathleen Hoffman, Allison Ramsey, Jim Madden and Cliff Sandsmark. 2 (L-R) Tim Orellano, PHR, SHRM-CP; Kathleen McComber, SPHR, SHRM-SCP; and Bruce Johanson chaired the 30th Anniversary Breakfast at the Egg and I in Rogers.

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3 (L-R) ARSHRM Conference Co-Chairs, Cliff Sandsmark, SHRM-SCP, SPHR, CCP, CSCP; Jim Madden, SHRM-SCP, SPHR. 4 Michele Burns, SHRM-SCP, ARSHRM State Director; and Martha Rameriz, SHRM Field Services Director, present a letter from SHRM President and CEO Hank Jackson congratulating ARSHRM on their 30th Anniversary. 5 Cammie Scott, SHRM-SCP, SPHR, was Programs Chair.

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6 Lt. Col. Scott Mann who is a Green Beret serving in Columbia and Afghanistan was the closing keynote speaker on Friday. He spoke on “Lead Strong When Trust is Weak.” 7 Steve Donahue was a keynote speaker on Thursday. His topic was, “Use Your Narrative Intelligence to Drive Change and Build Teams.” 8 ARSHRM Chapter Awards 6

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9 Michele Burns, ARSHRM State Director, presented Holley Little the 2016 Arkansas Outstanding HR Professional Award. 10 Michele Burns, ARSHRM State Director, and Rick Roderick with Cross, Gunter, Witherspoon & Galchus; presented the 2016 Russell Gunter Legislative Advocacy Award to Dan Woods, SPHR. (Dan was unable to attend.) 11 Michele Burns, ARSHRM State Director, presented the 2016 Arkansas HR Best Practice Award to the Bill and Hillary Clinton National Airport.

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12 Susan Chambers, retired EVP and CHRO for Wal-Mart Stores, Inc. was a keynote speaker on Wednesday. She presented, “Out of the Shadows and In Control.” 13 “Calming Fears or Creating Them – Ask an Attorney Panel Discussion.“ (L-R) Tim Hutchinson, Partner with Reece Moore Pendergraft’s Litigation Section; Wayne Young, Partner at the Friday Law Firm in Little Rock; Cindy Kolb, Director with Cross, Gunter, Witherspoon & Galchus; William Stuart Jackson, Partner with Wright Lindsey Jennings. 14 Shelley Simpson was a keynote speaker on Thursday. She is the Chief Marketing Officer of J.B. Hunt Transport Services, Inc., President of J.B. Hunt Integrated Capacity Solutions (ICS) and Truck, and is an Executive Vice President of the parent company. Simpson discussed “The Pain of Change.”

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15 Mary Oleksiuk is the Executive Vice President and Chief Human Resource Officer for Tyson Foods. She was the keynote speaker on Friday morning. Her topic was “Fowl Play – A Heroic Business Story.” 16 The 2016 ARSHRM State Conference Committee

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In Biloxi Meet Shonda M. Kines, MBA, SHRM-CP, PHR, CCP, CBP, FLMI Secretary | Treasurer MSSHRM State Council Shonda M. Kines, MBA, SHRM-CP, PHR, CCP, CBP, FLMI is the Manager of Human Resources for Southern Farm Bureau Life Insurance Company headquartered in Jackson, Mississippi. With over 15 years of human resources experience, her areas of responsibility include the corporate compensation, benefits, recruiting, payroll and EEOC compliance functions.

Shonda has held various volunteer positions with her local SHRM chapter, the Capital Area Human Resource Association, beginning as the College Relations Chairperson. In 2010, she was elected to the Board of Directors and has served in every role from Treasurer to her current role as Past President. She also currently serves as the Secretary Treasurer for the MSSHRM State Council.

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www.HRProfessionalsMagazine.com

She has a Bachelor of Business Administration from Mississippi State University and a Master of Business Administration from Mississippi College. Her professional certifications include the SHRM-CP from SHRM, Professional in Human Resources (PHR) certification from HRCI, the Certified Compensation Professional (CCP) and Certified Benefits Professional CBP from WorldatWork. She also has the Fellow Life Management Institute (FLMI) designation through the Life Office Management Association.

Shonda is a member of Executive Women’s International (EWI), Mississippi Association of Colleges and Employers (MACE) and Toastmasters International. She was named 2010 Outstanding Employee Professional of the Year by MACE and was selected as a member of the 2012 Leadership Greater Jackson class.

Keynote Speakers

Andy Masters, MA, CSP Andy is an award-winning author and international speaker who has written 5 books, earned 4 degrees, and presented hundreds of informative and entertaining programs on business, HR, and personal improvement topics. He has been featured on many national media outlets, including Life Time Television, Investor's Business Daily, and Leadership Excellence Magazine. Andy achieved Distinguished Graduate honors at Webster University, earning an M.A.-Human Resources Development, and another M.A.-Marketing. Andy has earned the prestigious "CSP" award/designation of the National Speakers Association (NSA), the highest earned international recognition for professional speakers, in which less than 10% of over 5,000+ speakers worldwide have achieved.

msshrm.org

Greg Gilbert

Speaker - Author - Leadership Coach - Home of the “Leader - Owner Mindset” If it pertains to Human Resources, leadership, management, supervision or life; Greg Gilbert has been there, done that, journaled it, heard the grievance and is now teaching and writing about it.

Early in his leadership career, the “if it’s not written, it didn’t occur” chip was implanted in his mind. In 1978, he began journaling successes, failures and what led to each. This continued through different positions and levels of leadership.

These journal entries became Keynotes, Seminars and the leadership book, “Leading Like You Own It – Why We Never Wax A Rental” in 2015.

Prior to retiring from a Fortune 100 company, Greg served his last 12 years as the primary Human Resources contact to over 2200 team members. Additional journals were required. In the past decade, thousands have joined Greg on the “Journey Through His Journals” and have learned the value of Leading and Living Like You Own It!

Kathryn (Kathy) Davanzo, M.Ed. – Principal Partner, CODA Partners, Inc.

Kathy Davanzo is a nationally known speaker and trainer with thirty years of professional speaking, training, and human resources leadership experience.

Kathy’s speeches and workshop are designed to increase leadership capacity through development of a strong Leader P.O.V.® (Point of View) and in developing competencies to become a more connected leader.

Before transitioning to full-time consulting, speaking and training Kathy served as a human resources leader at a Fortune 200 multi-location manufacturer of commercial foodservice equipment and as the chief HR leader for a $60M, multi-state nonprofit provider of services to youth and their families.

Kathy holds a bachelor’s degree in English and Communications Education from Miami University and a master’s degree in Education from the University of Miami. Kathy is a member of the Society for Human Resource Management (SHRM and Association for Talent Development (ATD).

Kathy is an avid sailor. When not sailing, she resides in Gulfport, Florida with her husband, Charlie.

www.HRProfessionalsMagazine.com

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Business as Usual?

The Verdict on Whether the Roberts Court is Indeed Pro-Business and What this Means for the Future.

BY GABRIEL P. MCGAHA

Opening Statement Following the unexpected death of United States Supreme Court stalwart, Justice Antonin Scalia, in February, corporations throughout the country have been reeling to determine how a Scalia-less Supreme Court may affect the way they do business for the next generation. Most studious observers are well-aware that over the last fifteen years, more Americans have begun to embrace a more-populist approach when balancing the interests of businesses with the interests of consumers and employees.

Recent measures to increase the minimum wage in a growing number of cities and states, the growing support for the Affordable Care Act, and the unprecedented support for what were once-considered “fringe” presidential candidates are just a few examples of the country’s shift towards economic populism. Notwithstanding this populist trend, however, the nation’s highest Court appears less inclined to shift from the status quo.

And with respect to cases involving corporate interests, the Court’s decisions have been largely “business as usual.”

The Evidence In a 2013 article published by the University of Minnesota Law Review, Lee Epstein, William M. Landes, and Judge Richard Posner opine that the Supreme Court under Chief Justice John Roberts is one of the most business-friendly courts in recent history and “much friendlier to business” than the Courts headed by former Chief Justices Warren Burger and William Rehnquist. The scholars further determined that of all 35 justices who have served on the Court since 1946, the nine most business-friendly justices include Chief Justice Roberts and Justices Alito, Thomas, and Kennedy (and Justice Scalia before this death).

In fact, they ranked Justice Alito and Chief Justice Roberts as the most business-friendly justices, respectively, since 1946.

Equally telling is that, other than Justice Kagan (who had not yet been confirmed at 10

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the time of the study), only Justice Sotomayor ranks among the 10 least business-friendly Justices on the current Court, with Justices Breyer and Ginsburg falling near the median. As Erwin Chemerinsky, the dean of the University of California, Irvine School of Law, succinctly put it, “The Roberts court is the most pro-business court since the mid-1930s.”

There are several factors that provide insight into why the Supreme Court has remained a relatively reliable forum for advocates seeking to protect their business interests despite the nation’s bent towards economic populism. First, the influence of consolidated business organizations, such as the U.S. Chamber of Commerce, has grown in recent decades.

According to data compiled by the Constitutional Accountability Center (CAC), the Chamber of Commerce won 11 of the 16 cases in which it filed briefs in 2014, and boasts a 70 percent overall win rate before the Court since Chief Justice Roberts’ confirmation. Also telling is the percentage of petitions for certiorari the Court has granted for groups supported by the Chamber of Commerce, which, according to a study published by Justice Department attorney, Adam D. Chandler, has been approximately 32 percent. This is an enviable success rate considering that the Court grants an average of only one out of every petition submitted.

Another factor that helps explain why the Roberts Court has been a reliable protector of business interests is the growing number of conservative members of Congress over the last two decades. This phenomenon has forced Democratic presidents to select more moderate nominees in an effort to win Republican support, even sometimes to no avail, as evidenced by the Senate’s decision not to vote on President Obama’s most recent nominee, Judge Merrick Garland.

A third factor that helps explain the business-friendly leanings of the Roberts Court may be rooted in the deregulation decisions of its predecessors. As Noam Scheiber

argues in his New York Times article, “As Americans Take Up Populism, the Supreme Court Embraces Business,” the early 20th-century Supreme Court largely viewed “big business” with skepticism, which led to increased corporate regulation through the 1970s. This set the stage for the conservative assault on regulation and a growing sentiment among economic and legal scholars that safety and environmental regulations did more harm than good and that free markets were better at promoting growth. This shift in legal thinking has had a significant impact on federal courts.

Under Chief Justice Roberts, the Supreme Court has held that corporations can be exempt from antitrust legislation if they are already regulated by a government agency, even if that agency does not regulate collusive conduct.

The Court has also been fairly consistent in issuing unfavorable rulings for plaintiffs seeking class-action certification in cases against businesses, which has resulted in less class-action litigation. This has been welcome news to corporations in that once a class is certified, the damages sought are often so enormous that not settling the case prior to trial becomes cost-prohibitive (even if the chances of losing at trial are small). In addition, the Court has enforced arbitration provisions in consumer contracts, making it more difficult for consumers to litigate disputes in court.

Although liberal justices have generally dissented on the most sweeping pro-business decisions in areas like class actions and arbitrations, many of the antitrust and other pro-business decisions have been uncontroversial, with liberal justices signing on. In 2007, for example, Justice Stephen G. Breyer wrote the majority opinion in a 7-1 ruling effectively granting antitrust immunity. Similarly, in 2011, Justice Sotomayor joined the conservative majority in finding that a law that denied companies access to pharmacy records violated the companies’ First Amendment rights. And, in 2012, Justices Breyer, Kagan, and Sotomayor voted with the conservative justices in an arbitration decision.

The Verdict Despite the Court’s general bent towards protecting business interests, the death of Justice Scalia has left some companies unwilling to take their chances before the Court. This sentiment was evident most recently in Dow Chemical Company’s decision to pay $835 million to settle a case that was scheduled to be heard before the Court shortly after Justice Scalia’s death.

The selection of a new Supreme Court justice is shaping up to be a protracted struggle, and it appears, so far, that the current vacancy will be left unfilled this year. Although companies like Dow have good reason to be concerned that Justice Scalia is no longer on the Court, the growing influence of the pro-business lobby and the conservative majority in Congress make it unlikely that he will be replaced by a justice whose decisions in business-related cases will bring about sweeping reform.

Furthermore, while the country’s growing embrace of economic populism is undeniable, most Americans are far more interested in the Supreme Court’s decisions on controversial social issues than they are on its business-related rulings. As a result, Americans’ support or opposition to a Supreme Court nominee is likely to bear more on the nominee’s social rather than his or her business ideology. Therefore, for the foreseeable future, the Court’s businessrelated cases are likely to be “business as usual.”

Legal Challenges are Coming at HR Professionals from Every Direction

That’s Why Rainey Kizer Makes Your Business Our Concern As the issues facing HR executives become more frequent, challenging, and complex each year, you need a law firm that provides advice individualized for your specific needs. This is why you should know the employment-law attorneys at Rainey, Kizer, Reviere & Bell PLC. For over 30 years, our AV-rated firm has advised businesses, nonprofit organizations, and government agencies on all aspects of employment law. To learn more, please call.

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Memphis Jackson Nashville Memphis Jackson 901-333-8101 731-423-2414 901-333-8101 731-423-2414 615-651-7420 Gabriel P. McGaha, Attorney Fisher & Phillips LLP gmcgaha@laborlawyers.com www.laborlawyers.com

T e n n e s s e e d o e s n o t c e r t i f y s p e c i a l i s t s i n t h e a r e a o f e m p l o y m e n t l a w .

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Workplace Investigations and Confidentiality

in protected concerted activity, i.e. to discuss the terms and conditions of employment, including talking about discipline with co-workers, employers may not enforce blanket policies requiring employees to maintain confidentiality about internal workplace investigations. In the Banner Health case, a hospital employee contacted human resources because of a concern he had about a supervisor’s instruction believed to be outside of the established hospital procedure. The employee was told to keep the complaint confidential and not to discuss the investigation, which was the hospital’s usual practice.

As a result of the Banner Health decision, any blanket employer policy banning employees from discussing the investigation with co-workers is illegal. In fact, the mere existence of such a policy now violates the National Labor Relations Act, even if not applied. Because of the Banner Health decision, employers must now demonstrate a legitimate business justification for requiring confidentiality on a case-by case basis.

The four justifications articulated by the NLRB for requiring confidentiality are: 1) protection from witness harassment or intimidation; 2) danger of evidence being destroyed;

By THOMAS L. HENDERSON

or many years the National Labor Relations Board (“NLRB”) has primarily focused on matters involving collective bargaining, unfair labor practices, and union/management issues. Over the last few years, however, the NLRB has issued a number of decisions that have expanded the scope of the National Labor Relations Act (“NLRA”) in ways that impact both union and non-union employees. One of the most dramatic effects of these decisions has been the limitations placed on an employer’s ability to require confidentiality of employees participating in workplace investigations.

Section 7 of the NLRA gives employees the right to engage in various protected activities referred to as “concerted” or “protected” activities.

According to the NLRB these rights include the right of an employee to discuss discipline or disciplinary investigations involving fellow employees.

Historically, HR Professionals routinely requested or required confidentiality from employees participating in disciplinary investigations.

They have done so primarily to protect the integrity of their investigations. By preventing employees from discussing the subject matter of the investigation or the process itself, employers hope to collect more accurate and reliable evidence. Without some control over the investigative process there is a risk of witness tampering, evidence destruction, and contamination of necessary information. While it is imperative for every investigation to be methodical, impartial, and comprehensive; it may be equally important to the integrity of the investigation to maintain some level of privacy for employees, depending on the circumstances surrounding the investigation.

The NLRB has held, however, that before requiring an employee to maintain confidentiality relating to a work place investigation, an employer must first determine, on a case by case basis, whether such a restriction is necessary under the circumstances. As a result, a “generalized concern” of an employer is no longer sufficient to justify prohibiting employees from discussing on-going investigations.

In the NLRB’s Banner Health System decision, the Board specifically held that because the NLRA provides employees with the right to engage 12

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3) danger of testimony being fabricated; or 4) prevention of cover-up.

Employers now clearly have the burden of showing, in each particular situation, why confidentiality is necessary. Accordingly, for each new investigation, employers with and without unionized workforces, need to assess certain factors before determining whether confidentiality is necessary and if so, the scope and temporal requirements of such restrictions. In addition, employers should consider developing a “check-list” or form to document whether confidentiality is required for a particular investigation, the justification for the requirement, the scope and length of any confidentiality requirement, and the explanation provided to the employee as to why confidentiality is needed.

In conjunction with the specific justifications outlined by the NLRB, employers should consider the potential for cover-up, collusion, or fabrication of information/testimony; theft or misappropriation of trade secrets, company proprietary data, formulas, insider trading, or misuse of other sensitive data; copycat testimony or evidence; retaliation against the accused, accuser, or witness; damage to the reputation of any employee, witness, accused, the company, or accuser; destruction of evidence; and criminal charges. Where one or more of these factors are or might be present, appropriate parameters regarding confidentiality should be developed and documented.

One effective way to document the reasons why the employer is asking employees not to discuss an internal investigation, is by giving employees an acknowledgment form explaining the purpose of the investigation, promising that the employee will not be retaliated against for complying, and the reason for keeping the investigation confidential. Preferably the employee should sign the acknowledgment form, or the acknowledgment should be incorporated into any written statement you ask the employee to sign.

Employers should also revise all company policies and practices requiring confidentiality in internal investigations, to show that the confidentiality requirement will be applied on an individual case basis. Taking a practical approach to handling investigatory confidentiality in light of Banner Health will greatly reduce the risk of charges and complaints issued on such policies and practices.

Thomas L. Henderson, Managing Shareholder Ogletree Deakins Memphis Office thomas.henderson@ogletreedeakins.com www.ogletreedeakins.com

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Why the Nation’s Largest Generation Isn’t Hip About Health Insurance . . . and What We Can Do About It LOCKTON® COMPANIES

HERE’S WHAT WE KNOW: Baby boomers are retiring at alarming rates—a whopping 10,000 a day until 2030, according to the Pew Research Center.

As boomers exit the workforce, the largest generation in the country, 76.6 million to be exact, is waiting in the wings.

WHY THE RESISTANCE? A FEW POSSIBILITIES COME TO MIND:

Under the Affordable Care Act (ACA), young adults are allowed to stay on their parents’ health insurance plans until they turn 26. And they seem to be taking advantage of the opportunity.

Less than half of all eligible employees under age 26 enrolled in their employer-provided health plan in 2015 according to a new report from the ADP Research Institute. Most often, Mom and Dad picked up the bill instead.

And, for those millennials signing up for insurance for the first time, the entire process can be confusing, overwhelming, and downright daunting.

Millennials (those born between 1980 and 1996) have $1.68 trillion in purchasing power, are highly educated, and can tweet faster than you can say “Bugs Bunny.”

According to a study in the Journal of Adolescent Health, young adults ages 19 to 30 struggled when it came to enrolling in health insurance on HealthCare.gov. In the study, college-educated young adults from Philadelphia signed up for health insurance, but half couldn’t define “deductible,” and three quarters couldn’t explain “coinsurance.”

But unfortunately, many millennials don’t seem to “get it” when it comes to health insurance.

Plus, most of the young adults in the study were unaware of subsidies for insurance, and they didn’t have an idea of how much insurance plans generally cost. Most thought an affordable plan cost less than $100 a month.

A recent GuideSpark survey shows that more than 50 percent of millennial employees don’t understand their employee benefits options, and 56 percent wish their employers would communicate better about benefits. More than half of those employees surveyed want to leverage their benefits but also want to spend as little time as possible learning about them.

In fact, 45 percent of millennials would rather clean out their email than research their health benefits, and 26 percent would prefer to clean their toilets, according to a survey by Aflac.

“45 percent of millennials would rather clean out their email than research their health benefits.”

—Aflac 14

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Think again. Young adults actually end up in the emergency more than any age group other than the elderly, says Young Invincibles, a nonprofit that works to give young adults a stronger voice on economic issues like healthcare.

This statistic rings true for Lockton clients. According to Lockton’s proprietary InfoLock® data, between July 1, 2014, and June 30, 2015, millennials visited the ER 9 percent more than their older colleagues and had 5 percent more hospital admissions. What’s more, 10.6 percent of those ER visits were documented as potentially nonemergent, meaning a doctor visit may have sufficed.

Despite these figures, millennials don’t seem to grasp the need for preventive care. A recent survey conducted by the National Business Group on Health and The Futures Company found only 39 percent of millennials believe preventive care is important to staying healthy.

In another survey, ZocDoc found millennials are the most likely to forego checkups, wellness visits, and screenings. According to a study by The Children’s Hospital of Philadelphia, as many as 40 percent of millennials do not have a primary care doctor. This lack of a relationship creates a fragmented approach, further leading to lower quality care and increased costs.

As the first generation to be true “digital natives,” millennials have grown up with cell phones, tablets, social media, and video.

It’s no wonder the Pew Research Center reports 15 percent of young adults ages 18 to 29 are “smartphone dependent,” meaning they don’t have home Internet service.

If we’re still relying on printed enrollment guides alone to communicate employee benefits, we may very well be missing the mark.

One final reason millennials may not be so keen on health insurance: they can’t afford it.

According to the Pew Research Center, millennials are the first in the modern era to have higher levels of student loan debt, poverty, and unemployment and lower levels of wealth and personal income than their two immediate preceding generations had at the same stage of their life cycles.

Two-thirds of recent bachelor’s degree recipients have outstanding student loans, with an average debt of about $27,000, according to the Urban Institute and the National Center for Education Statistics. Two decades ago, only half of recent graduates had college debt, and the average was $15,000.

Besides student loan debt, millennials are also still reeling from the Great Recession (2007–2009) and, in part, the longer-term effects of globalization and rapid technological change on the American workforce, the Pew Research Center reports.

WITH SO MANY OBSTACLES, HOW DO WE HELP MILLENNIALS?

And many HR technology vendors have developed apps allowing employees to access their benefits summaries and insurance cards, enroll in benefits, view paychecks, etc.—right from their phone or tablet.

Technology also provides a unique ability to offer higher- quality care at lower costs. Telemedicine and e-visit solutions simplify making appointments and coordination of care. Additionally, these new options reduce ER visits and costs, with visits as low as $40. Increased preventive and coordinated care directly factor into an employer’s population health, which helps to save the employer, employee, and the healthcare delivery model time and money.

Yet, despite its many benefits (and all the bells and whistles), technology isn’t a stand-alone solution.

While millennials may send upward of 100 texts a day, they still value faceto-face communications, especially when making important decisions.

Start with ditching the acronyms (HDHP, HSA, etc.) and defining basic insurance terms like:

Employers would be wise to offer in-person meetings for millennials (and others too) who need more information about their benefits and help selecting the right plans.

• Deductible.

• Coinsurance.

• Premium.

• Out-of-network.

• High-deductible health plan.

• Health savings account.

• Health maintenance organization.

When it’s not possible to meet in person, a phone call or video chat is your next-best bet.

Employers may also want to consider who delivers the message. Who better to educate millennials about health insurance than their peers or At least someone to whom they can relate?

And make sure your definitions themselves are clear, concise, and jargonfree. For example, what if: • “Ancillary provider” became “dentist,” “lab,” or “pharmacy.”

• “Formulary” became “prescription drug list.”

• “Member liability” became “the amount you will pay.”

• “Telephonically” became “by phone.”

• “Utilize” became “use.”

Source: The 2014 Cisco Connected World Technology Report

Educating millennials and other employees about their benefits isn’t a one-and-done effort. To truly engage this generation, communicate year-round, in several different ways, and make benefit information easy to access, all the time.

Source: CEB Iconoculture Consumer Insights Fast Facts and the US Census Bureau

And remember: While choice is nice, too many choices may be overwhelming. A 2015 study by the National Bureau of Economic Research shows too many health plan options result in less rational choices by consumers. In fact, the study found that 85 percent of employees would be better off if their employer only offered one plan.

Clearly, employers and HR professionals need to embrace technology and meet millennials where they are—online, on their phones, all the time.

That means sending open enrollment and benefits information via text, hosting video chat information sessions, utilizing interactive decision-support tools, posting to social media channels, and more.

Young Invincibles is even using Twitter chats and its own app to help guide people through the enrollment process.

Also, ask millennials for their feedback; they’ll be happy to give it. Short surveys throughout the year are a great way to solicit feedback and show employees of all ages you value their opinions (as long as you do and are open to change). Remember the rule: Don’t ask if you don’t want to know and aren’t prepared to do something about it.

Millennials give those of us in employee benefits, human resources, and communications a chance to be playful in our messaging, test new technologies, and truly reinvent the way we talk about health insurance.

Enjoy the opportunity!

Youth definitely has its perks.

Brad Owens

Lockton’s Memphis Office 901 757 6901 bowens@lockton.com

www.HRProfessionalsMagazine.com

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NLRB Holds Employer Policies Against Employee Videos/Recordings Unlawful

By MARY MOFFATT HELMS

Like many employers, your employee handbook may contain some version of the following rule:

Without prior management approval or consent, recording conversations, phone calls and company meetings with any audio or video recording device is prohibited.

If it does, you should consider revising such rules in light of the latest pronouncement from the National Labor Relations Board (NLRB, or “the Board”). If you are thinking this article is not applicable to your business because “we don't have a union” - think again. The National Labor Relations Act (NLRA) applies to most employers and protects most employees (with limited exceptions) with or without a union.

Section 7 of the NLRA grants employees the right to organize for purposes of collective bargaining, to engage in concerted activities for mutual aid and protection regarding their wages, hours and working conditions and to refrain from such activities. These rights are generally referred to as "Section 7 rights." In recent years, the Board has increasingly scrutinized many commonly-accepted employer policies and activities to find that a variety of employer policies either violated Section 7, or had an undue "chilling effect" on employees' exercise of those rights, issuing a number of employee-friendly decisions concerning a variety of workplace rules and practices.

Last year was no different with the Board closing out 2015 with its decision in Whole Foods Market, Inc., 363 NLRB No. 87, (December 24, 2015) in which the Board held that the employer's rule against unauthorized recording of conversations or taking of photographs without prior management approval violated Section 8(a)(1) of the National Labor Relations Act. The Whole Foods decision is yet another example of the Board's aggressive stance regarding employee's Section 7 rights after a line of recent decisions from the Board regarding other common employer personnel policies, such as Purple Communications, 361 NLRB No. 126 (September 24, 2014) (employer may not ban employees' use of Company email systems during nonworking time absent special business justifications) and Flex Frac Logistics, 358 NLRB No 54 (2012), upheld, 2014 WL 1178698 (5th Cir. 2014) (confidentiality clause violated Section 8 rights even though it did not specifically mention "wages" because it was broad enough that employees could reasonably construe it to restrict Section 7 rights).

When determining whether a workplace rule violates Section 8(a)(1) of the NLRA, the Board and Courts are first to consider whether the rule explicitly restricts activities protected under Section 7, but even absent such specificity, the rule may still violate the NLRA if: (1) employees would reasonably construe the language to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7 rights.

Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004).

The two workplace rules at issue in the Whole Foods decision were contained in the Company's General Information Guide (GIG), which was distributed to employees.

THE FIRST RULE AT ISSUE PROVIDED AS FOLLOWS:

The NLRB is the administrative agency that enforces and interprets the NLRA and protects the rights of employees engaged in "concerted activity," which occurs when two or more employees take action for their mutual aid or protection regarding the terms and conditions of their employment.

In addition, one employee may be engaged in protected activity when engaging in protected activities with the authority of other employees, such as bringing group complaints to the employer or otherwise seeking group action with respect to terms and conditions of employment. Such activities might include, for example, a group of employees inquiring about wage increases, or seeking to improve workplace conditions, such as expressing safety concerns.

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In order to encourage open communication, free exchange of ideas, spontaneous and honest dialogue and an atmosphere of trust, Whole Foods Market has adopted the following policy concerning the audio and/or video recording of company meetings: it is a violation of Whole Foods Market policy to record conversations, phone calls, images or company meetings with any recording device (including but not limited to the cellular telephone, PDA, digital recording device, digital camera, etc.) unless prior approval is received from (management) or unless all parties to the conversation give their consent. Violation of this policy will result in corrective action, up to and including discharge. Please note that while many Whole Foods Market locations may have security or surveillance cameras operating in areas where company meetings or conversations are taking place, their purposes are to protect our customers and team members and to discourage theft and robbery.

THE SECOND RULE AT ISSUE IN THE DECISION PROVIDED: It is a violation of Whole Foods Market policy to record conversations with a tape recorder or other recording device (including a cell phone or any electronic device) unless prior approval is received from your store or facility leadership.

The purpose of this policy is to eliminate a chilling effect on the expression of views that may exist when one person is concerned that his or her conversation with another is being secretly recorded. This concern can inhibit spontaneous and honest dialogue especially when sensitive or confidential matters are being discussed.

In addition to these two rules, the GIG contained a list of "major infractions" that could result in discharge, which included the following:

“ recording conversations, phone calls or company meetings with any audio or video recording device without prior approval or consent.”

In its analysis, the Board considered "photography and audio or video recording in the workplace, as well as the posting of photographs and recordings on social media," to be protected by Section 7 if employees are acting in concert for their mutual aid and protection and no overriding employer interest is present.

In fact, the Board held that such protected conduct "may include … recording images of protected picketing, documenting unsafe workplace equipment or hazardous working conditions, documenting and publicizing discussions about terms and conditions of employment, documenting inconsistent application of employer rules, or recording evidence to preserve it for later use in administrative or judicial forums in employment-related actions." In summary, the Board considered photography or recording, even when covert, to be "an essential element in vindicating the underlying Section 7 right."

While the Board recognized several potential legitimate restrictions on employees' ability to record in the workplace, such as certain state laws which prohibit nonconsensual recording, and/or industry-specific privacy laws such as the Health Insurance Portability and Accountability Act (HIPAA), the Board found the Whole Foods rules were not limited to stores geographically based on relevant state law, but were applied companywide and found that no overriding privacy interests applied.

Whole Foods argued the rules were in place "to promote open communication and dialogue" in the workplace and to "preserve privacy interests, including personal and medical information about team members, comments about their performance, details about discipline, criticism of store leadership and confidential business strategy and trade secrets." Whole Foods further argued that the rules contained an "embedded rationale - the encouragement of open communication - that would lead a reasonable employee to understand their lawful purpose." The Board found however, that Whole Food's attempted business justifications, while "not without merit," were based on relatively narrow circumstances, and thus failed to justify the unqualified restrictions placed on Section 7 activity by the rules at issue.

The Board noted that its decision does not mean that "employers are forbidden from maintaining narrowly drawn restrictions on recording" but the Board went on to find that the rules at issue were unlawful because they would reasonably be read to prohibit all recording.

Where an employer has a business justification with respect to a no-recording rule, the business justification should be set forth in the policy as specifically as possible. For example, medical providers and business associates subject to HIPAA may benefit from specifically referencing such rules to applicable industry-specific privacy concerns and regulations. Many employers include a "savings clause" or "disclaimer" provisions such as "this rule is not intended to prohibit employees from engaging in protected concerted activity under the National Labor Relations Act or other applicable laws." However, the Board has observed such disclaimer language may not be sufficient because most employees are not knowledgeable of their rights guaranteed under the NLRA and thus such disclaimers are unlikely to satisfy Board scrutiny.

The Board's decision reversed the prior ruling of an Administrative Law Judge, and in turn, Whole Foods has appealed the NLRB's decision to the U.S. Court of Appeals for the Second Circuit. At the time this article goes to press, the case is still pending in the Court of Appeals. However, given the Board's aggressive stance with respect to the no-recording rule and other commonly-accepted employment policies, employers should consult with legal counsel to ensure employment policies are drafted to prohibit conduct outside the scope of Section 7 rights and are specific enough with respect to the conduct prohibited so as not to interfere with or "chill" an employee's exercise of his or her Section 7 rights, or any other legal rights.

Mary Moffatt Helms, Attorney Wimberley Lawson mhelms@wimberlylawson.com www.wimberlylawson.com

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Why ESOPs Matter for Private Companies

By CLIFFORD STEPHAN

Ever heard of an ESOP? I’m not surprised if this is a new concept for you. Employee Stock Ownership Plans (ESOPs) are a little-known secret when it comes to benefits and incentives for driving performance in a private company.

I’m a compensation consultant in Silicon Valley, and I am really familiar with stock programs and incentives for publically traded companies—but I only knew a few details about ESOPs, which functions like a stock program for private companies. That changed when I had the opportunity to work with one of the best ESOP attorneys in the country, Kevin Long of Chang, Ruthenberg & Long.

In short, I learned how ESOPs are basically a Swiss Army knife. When done right, it can handle a lot of different challenges and offer some great benefits for a private company. For example, a sharp ESOP program can roll succession planning, great incentives, and major employee engagement all into one compensation vehicle. While I still have a lot to learn, I’ve discovered that ESOPs are a great program that can handle employee engagement and leadership succession issues. If you’re a newbie to ESOPs, here are my Cliff’s Notes (pun intended) if you want to get up to speed: WHAT’S AN ESOP? An ESOP is a way for private companies to create ownership, alignment, loyalty, and engagement. By divvying out shares within a private company, it can act as a great incentive for employees. In my experience, it is also a fantastic way to create long-term incentives for key and critical talent and executives.

Basically, an ESOP functions as a long-term incentive by pulling some very specific compensation levers. By creating stock like a public company—but only making it available to employees—a private company can use an ESOP to increase long-term commitment and engagement. As a compensation expert, I really came to appreciate how powerful ESOPs can be for motivating employees and retaining them over the long-haul. Especially with private companies, it can really hurt when top talent leaves. With an ESOP in place, it can help align good behavior and long-term engagement to some great perks and rewards.

Substantial research on ESOPs and employees backs this up—for example, one article

by Steven Freeman (University of Pennsylvania) looked at thirty years’ worth of data on employee engagement and ESOPs. Sure enough, profitability, stability, engagement, and employee satisfaction were all positively correlated with ESOP companies. In short, ESOPs that are successfully implemented make good on a promise: if the company does well, then the employees will be well compensated. Especially in an age where more and more employees feel like their accomplishments are not recognized, ESOPs are an incredibly effective vehicle for rewarding the behaviors that move the company in the right direction.

Another great use for an ESOP is for succession planning. Let’s face it—companies sell, merge, or fail. That’s about it. But with that in mind, ESOPs can help to ensure a huge measure of stability through succession planning. If you’re going to spend the time picking out and nurturing your future leadership, why not do it in a way that offers significant tax incentives? Without it, I’ve seen businesses sell and owners face significant tax consequences. ESOPs can help soften the blow and create a win-win for legacy owners and the new executive leadership.

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SO WHAT CAN AN ESOP DO FOR A BUSINESS? What a company can achieve with an ESOP really depends on what a company is after. ESOPs are such flexible tools, and there are lots of different ways to design an ESOP in a way that aligns with both shortand long-term company goals.

Designing an ESOP means that a company has to think through a three-, five-, and ten-year plan. Because ESOPs are designed to work over years, a company has to do some serious soul-searching and commit to long-term goals. Think about it—what if something happens to the CEO? What if leadership leaves? When bad stuff does happen, having an ESOP in place means that there’s a plan to handle tough succession situations. A good ESOP program requires plans for a lot of different situations and contingencies, something both growing and established companies can never have enough of.

ESOPs are also a great vehicle for creating higher employee engagement and retention. By having a stock buy-in, it helps to modify behaviors and align employees with bigger business objectives. It’s a lot more robust than the garden variety 401k. Plus, it comes with great tax advantages that other compensation perks don’t offer.

Without getting too deep in the weeds, the tax benefits that come with ESOPs are really exceptional. Since the 1970s, income tax rules have been literally rewritten to incentivize ESOPs for companies and individuals. Tax exemptions, tax deferrals, deferred capital gains…there are some incredible benefits that make ESOPs a huge boon for private companies and their employees.

COMPLICATED? YES. BUT WORTH THE EFFORT Sure, it will take some time to unpack how an ESOP might help your company achieve its long-term goals.

It takes a lot more than a single article to fill you in on all the perks and features that come with ESOPs. There are lots of rules—tax and otherwise—that come into play with ESOPs. But don’t let the details scare you off! The benefits, opportunities, and tools an ESOP can offer your company far outweighs the time it takes to understand what a good ESOP is all about.

In just a few short months, I went from knowing only the basics about ESOPs to being a major fan— in fact, I’m really excited to be going to the Employee Ownership Conference in Minneapolis this April!

Fortunately, you don’t have to go to a conference if you want to learn more. For starters, I would definitely recommend that you check out Kevin Long’s excellent post: https://www.linkedin.com/pulse/esops-benefitboth-buyers-sellers-whys-kevin-g-long. He does a great job of highlighting some of the finer points of an ESOP and what it can do for a company.

Clifford Stephan, Principal One Compensation Clifford@onecompensation.com OneCompensation.com

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The Good News Company Intraaaaanet...

By THERESA J. ALLEN

Quite often I find myself scratching my head in disbelief over the notion that a large percentage of small and medium-sized companies do not offer an intranet site despite the internal communication idea being introduced more than 20 years ago. What is even more baffling is that most companies aren’t familiar with the term “intranet.”

I frequently witness this disbelief first hand. Since Regions Insurance offers its clients a complimentary intranet tool, my work as a resource coordinator presents opportunities for me to communicate with my clients about their intranet site, or the lack thereof. Upon initially asking my client contact, which routinely is someone from Human Resources or the Benefits Department, if their company hosts an intranet site, there’s a bit of confusion. I get a quick, confident “Oh, sure,” yet upon further conversation, I find what they are actually referring to is the company Internet site. This, of course, prompts a quick tutorial from me defining the difference between “er”…

Interrrrnet and “ra”…intraaaaanet.

I certainly do not consider myself a technology expert….far from it.

But I know enough to recognize that when a business struggles with issues ranging from internal communications, company-wide inconsistencies, employee morale and retention, they need help. An intranet site can offer solutions and, with a bit of research, the company will find that seeking the assistance of an intranet site does not need to be elaborate or expensive.

Basically described as a smaller version of the Internet, the idea of the intranet was introduced somewhere around the mid-90s. It was designed to work as an internal communication tool for disseminating and sharing information throughout the organization faster and better. Through the years, the intranet concept has seen tremendous advancement.

(Good news reference #1) If designed appropriately, a company can use their site for addressing numerous pain points. A perfect example could be high employee turnover which may be caused by low morale, possibly the result of employees feeling disengaged. For an employee, having a networking resource like the intranet site at their desktop makes them feel part of a team. They can stay connected not only within their department and know what is going on there, but also on a broader organizational level – engaged and more aware of company activities and news. An employer can go even further with the idea of employee engagement by giving their workforce an opportunity to contribute to surveys, polls, forums or blogs, which management has created and posted on the site.

Another business problem an intranet site can influence is the rolling and cumulative costs associated with printing, distributing, maintaining and storing hardcopy documents. Because the company has complete managerial control over their site, the administration can post virtually anything relating to their company for their employees to view; from policies and manuals, forms and directories, to fun and entertaining sections such as discussion forums, newsletters and photos from the company Christmas party.

Beyond improving the company bottom line, there’s more good news (good news #2) when overcoming the pesky paperwork problem. Think of the time savings. Moving paper-based processes into an electronic environment cuts down on the time employees spend on routine tasks. Also, consider the environmental savings – reduced printing. All of us want to save a tree.

If the initial site set-up is properly designed, well-organized and used correctly, employers can 20

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control their business easier, manage their employees more successfully and improve productivity, which ultimately puts the company in a position of saving money and increasing profits. In the early stages of planning, the site’s development team should take into consideration the different requirements of the various areas of the organization. Preliminary discussions with your key people will generate feedback that will be crucial in developing a successful site.

Discuss the concerns from the leaders of Human Resources, Customer Service, Sales and Marketing, the Management and Executive teams, and by all means, the IT department.

Human Resources personnel, especially those who are experienced, jump – maybe leap – at the chance to find yet another way to communicate with employees.

The techie world of intranet delivers the good news of cross-communications to Human Resources directors who face the daily challenge of coordinating communications and, well, everything else between several office locations. (Can you spell good news?)

Whoever is chosen to spearhead the project of development should pay careful attention to details and liven up the site by giving it character and making it interesting, appealing and user friendly to the employees. People like to see their name in lights, so highlight their accomplishments and post photos with their smiling faces. You will make it so enticing they can’t help but visit the site and become engaged.

Consider giving it a nickname. Popular site names include “Hub”, “Grid” or “C-Net.” The name should be relevant to the site’s purpose within the organization, should not be overly serious or boring and needs to roll off the tongue easily.

I have only marginally touched on the advantages, usefulness and “good news” of a company intranet site. I could easily write a ten page dissertation. Just remember or make a “note to self ”: the intranet idea is growing rapidly. Eventually it will become commonplace and employers will be savvy enough to create a successful site and fully maximize its potential. This, in turn, will win praise from the workforce and ultimately save the company valuable time and money.

I ran across a quote recently from an anonymous intranet developer that captures the essence of the internal communications concept which has developed into the term intranet: “People view it as a utility now, like the lights, telephone and email. No awareness of the team behind or work involved.” Or, I could leave you with a more simplistic quote from one of my clients. Her quote, “It’s like an electronic HR Department” is probably better suited for this article.

Either way, it’s all good news.

Theresa J. Allen Client Resource Team Coordinator Certified PPACA Professional Regions Insurance Ridgeland, MS Theresa.Allen@regions.com

Have questions? Let’s talk.

When it comes to securing the right answers to comply with the Affordable Care Act, who you ask can be every bit as important as what you ask. Let the ACA-trained professionals of the Regions Insurance Client Resource Team provide the guidance you need to steer your organization in the right direction.

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Employee Benefits Practice Leader tom.hayes@regions.com 479-684-5259

Sales & Marketing Coordinator katrina.mckinney@regions.com 205-264-7177

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University of Arkansas System eVersity Human resources professionals know better than anyone how critical it is to hire qualified employees while also finding ways to enhance the skills of their existing workforce. Meeting the needs of employers is one of the foundational goals of the University of Arkansas System eVersity. We recognize that if our graduates are not prepared to make important contributions to their employers then we are not doing our job. Working together, we can help create a more educated workforce for Arkansas, improve the lives of your employees, and create a more productive atmosphere at your workplace. We want to work with you and hope you and your employees will “Rethink College” with us.

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Click on the Event tab and scroll to the bottom where you will see registration information for the conference.

A fun social event will be held at the World’s Largest Bass Pro Shop located in historic Downtown Memphis with opportunities to explore many of the attractions that the bluff city has to offer.

All interested exhibitors & sponsors, Please contact us at

art.smith@agsmithassoc.com

LEGAL ONLY Pre Early Bird Special: Early Bird: After 8/31/2016:

THURSDAY & FRIDAY ONLY $350 by 4/30/2016 Pre Early Bird Special: $375 5/1/2016 - 8/31/2016 Early Bird Special: $425 After 8/31/2016: 8/31/2016 FULL CONFERENCE

Pre Early Bird Special: Early Bird Special: The Host Hotel: The Sheraton Memphis Downtown Hotel Group: Society for Human Resource Management, Memphis SHRM After 8/31/2016: Event Dates: 14 Sept - 16 Sept Room Block: $142/night The cut-off-date to register under the ROOM BLOCK is August 14, 2016 by 5:00pm.

The Hotel Booking Number is 800-325-3535

$300 before 4/30/2016 $325 5/1/2016 - 8/31/2016 $375

$425 by 12/31/2015 $475 5/1/2016 - 8/31/2016 $575

**Event Ticket - $95 for each additional guest (Exhibitor Reception or Thursday Night Event)

The Release of the Final DOL Fiduciary Rule: What Are the Key Differences Between the Final Rule and the Proposed Rule?

By JENNIFER S. KIESEWETTER

On

April 6, 2016, the Department of Labor (DOL) issued the final fiduciary rule, six (6) years after the rule was first proposed.

In 2010, the DOL proposed an initial rule changing the definition of “fiduciary” under

the Employee Retirement Income Security Act of 1974, as amended, (ERISA) which was the first amendment to the definition of “fiduciary” since the inception of ERISA. However, the 2010 fiduciary rule proposal met with significant push-back from the industry, Congress, and other interested parties. As such, the DOL withdrew its 2010 attempt to expand the fiduciary definition. On April 14, 2015, the DOL announced its “re-proposal” of its fiduciary rule, which received 3,530 substantive comments on the proposed rule during its comment period. Additionally, two hundred eighty-one (281) members of Congress raised issues with respect to the DOL’s proposed fiduciary rule. Then, after review of all of the comments, as stated above, on April 6, 2016, the DOL issued the final fiduciary rule.

WHO IS A FIDUCIARY UNDER THE FINAL RULE? The DOL has made substantial changes to the final rule from the 2015 proposed rule (“proposed rule”). Overall, the final rule clarifies who falls under the definition of a “fiduciary”, including individuals who provide investment advice for a fee to an ERISAcovered plan, a plan fiduciary, a plan participant or beneficiary, or an IRA holder when making an investment decision. Current law does not address providing investment advice for a fee to IRA holders. Thus, this final rule, as did the proposed rule, pulls those who advise IRA holders for a fee under the fiduciary umbrella.

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BEST INTEREST VS. SUITABILITY The final rule requires that investment advisors act in the “best interest” of their clients as opposed to the previous “suitability” standard. Essentially, all investment transactions involving plans, whether ERISA or non-ERISA, participants and beneficiaries, and IRA holders are now considered fiduciary acts under the final rule. As such, these investment transactions and any investment advice for a fee must be made or given prudently and in the best interest of the plan and/or investor.

CONFLICTS OF INTEREST / BEST INTEREST CONTRACT EXEMPTION Advisors must disclose any potential or existing conflicts of interest. If an advisor is paid by commissions or his or her advisory compensation is affected by his or her recommendation, then the advisor must satisfy the Best Interest Contract Exemption under the final rule. Commenters on the proposed rule stated that the disclosure requirements associated with the Best Interest Contract Exemption were overly cumbersome and compliance would be difficult, if not impossible. The DOL significantly streamlined these disclosure requirements in the final rule. For example, the requirements to include projections as well as the annual disclosure requirement have been entirely eliminated. Even though the requirements have been lightened in the final rule, the Best Interest Contract Exemption will still require effort and expense.

Additionally, commenters on the proposed rule stated that the Best Interest Contract Exemption contract requirement was unwieldy, called for the signature of too many parties, and must be executed too early in the process. The final rule clarifies that the contract requirement only applies to IRAs and other non-ERISA plans. Although not applicable to ERISA plans, advisors to ERISA plans must acknowledge their fiduciary status to the plan as well as the plan’s participants and beneficiaries although no contract is required. The DOL adjusted the contract requirement so that it can be incorporated into other account opening documents and can be entered into before or at the same time the recommended transaction is executed. Any advice given prior to entering the contract must be covered by the contract itself. Firms can send out a notification to clients informing them of any proposed contract amendments. If clients do not terminate the amended contract within a thirty (30) day time frame, then the amended contract is effective.

COMMISSIONS OR FEE-BASED ACCOUNTS Commenters on the proposed rule stated that conversions to fee-based accounts would effectively prohibit commission-based compensation. The DOL addressed these concerns in the final rule by stating that if moving a customer into a fee-based model is not in the customer’s best interest, the firm or advisor would have engaged in a non-exempt prohibited transaction. Thus, advisors and/or firms could continue engaging in commission-based compensation and revenue-sharing payments, if such compensation or payments are in their client’s best interests. Firms and advisors must adopt policies and procedures designed to ensure that they are, in fact, providing “best interest” advice to their clients. Additionally, advisors and firms must prohibit any financial incentives for advisors that may not serve their client’s best interest.

BIAS TOWARDS LOW FEE PRODUCTS Commenters on the proposed rule stated that it favored low-fee and low-cost products over all else, ignoring returns, quality, and other factors that could benefit plans and investors. In the final rule, the DOL did not adopt the low-fee streamlined option considered in the proposal, and clarified in the preamble that the advisor is not required to recommend the lowest fee option if another product is in the best interest of the client.

ANNUITIES Prior to the final rule, variable and fixed indexed annuities enjoyed protection under Prohibited Transaction Exemption 84-24, whereby these products could be sold in retirement accounts even if the advisor received commission-based compensation. Under the final rule, variable and fixed indexed annuities lost their protection under Prohibited Transaction Exemption 84-24, and are now swept right into the path of the fiduciary rule. The final rule states that both variable and fixed indexed annuities now fall under the Best Interest Contract Exemption. Fixed rate annuities, on the other hand, retain their 84-24 exemption.

EDUCATION Commenters on the proposed rule stated that the DOL should establish a clear line between education and investment advice, so as not to trigger fiduciary status when providing educational investment information to participants and investors. The final rule describes the types of information and activities that constitute non-fiduciary investment education, including general plan information and general financial, investment, and retirement information. The DOL also revised the final rule to allow asset allocation models and interactive investment materials which identify specific investment alternatives under ERISA-covered and other plans, if certain conditions are met, to fall under the education provision of the final rule. However, notwithstanding the above, in the IRA context, no independent plan fiduciary reviews and selects investment options. Thus, references to investment alternatives with respect to IRAs are not treated as education under the education provision of the final rule.

IMPLEMENTATION The final rule goes into effect in April 2017. However, with respect to the Best Interest Contract Exemption, only part of the exemption goes into effect next April. Next April, advisors and firms will be required to comply with acknowledging their fiduciary status, adhering to the best interest standard, and making basic disclosure of conflicts and interests.

The remainder of the rule will go into full effect on January 1, 2018.

SISKIND SUSSER PC Tennessee’s Largest Business & Employment Immigration Practice

IMMIGRATION LAWYERS 1028 Oakhaven Road Memphis 38119 901.682.6455 3200 West End Ave. Suite 500 Nashville, TN 37203 615.647.6006

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ONE AREA OF PRACTICE. ONE FOCUS. The Kullman Firm has engaged in the practice of labor and employment law on behalf of management since 1946. ! Employment Discrimination Litigation ! OSHA ! Wrongful Discharge Litigation ! Collective Bargaining Negotiations ! Labor and ADR Arbitrations ! Union Representation Cases

! Wage and Hour Law ! OFCCP/Affirmative Action ! ERISA/Employee Benefits ! FMLA Compliance

Offices in Louisiana, Mississippi, Florida and Alabama.

Jennifer S. Kiesewetter, Esq. Kiesewetter Law Firm, PLLC jkiesewetter@kiesewetterfirm.com www.kiesewetterlawfirm.com

www.kullmanlaw.com

Attorney responsible for content of this ad: Martin J. Regimbal www.HRProfessionalsMagazine.com

27

Talk Isn’t Cheap:

GAG ORDER

DEPARTMENT OF LABOR ISSUES GAG ORDER TO BUSINESSES ACROSS THE COUNTRY UNDER THE REVISED PERSUADER RULE REGULATIONS

By J. BRUCE CROSS and ABTIN MEHDIZADEGAN

There is no shortage of compelling work for Human Resources practitioners in the modern workplace. With near-constant change in the regulatory atmosphere of labor and employment law, HR professionals and their labor attorneys have become agile in navigating the maze of red-tape and regulation to achieve compliance. In charting a proper course, it is more critical now than ever for employers and their attorneys to speak candidly about the myriad of day-today concerns that arise in the course of operating a business. Their ability to do so, however, is now placed in dire jeopardy because, under the U.S. Department of Labor (DOL) new “Persuader Rule” regulations—promulgated under the Labor-Management Reporting and Disclosure Act (LMRDA) of 1959—employers, HR professionals, and their attorneys, will be subject to unprecedented disclosure requirements that, among other things, interfere with the attorney-client relationship. This article will review the revised Persuader Rule and discuss the legal challenge seeking to protect employers from DOL’s dangerous regulatory agenda.

BACKGROUND OF THE PERSUADER RULE The somewhat esoteric “Persuader Rule” is one of the disclosure requirements imposed by Congress in 1959 under the LMRDA. It was designed to require employers to disclose their hiring of “middlemen” to speak with employees and influence their opinions about unions. Often, these middlemen—persuaders—would pose as workers so that employees would not know that their employer was the source of the anti-union message. Under the LMRDA, employers and their “middlemen,” who speak directly with employees to persuade their opinions about unions in the workplace, have been subject to certain reporting and disclosure requirements.

For the last fifty years, outside legal and labor relations experts who advise employers on how to lawfully communicate with employees—but who do not actually speak directly with employees—have never been subject to these reporting requirements. This activity is considered “exempt” from the LMRDA’s reporting requirements under the “advice” exemption, because the employer, not a third party or “middleman,” is communicating with the employees. This distinction is logical because there is no chance of confusion as to the source of the communication when the employer is the speaker.

DOL’S NEW PERSUADER RULE REGULATIONS On April 25, 2016, DOL’s revised Persuader Rule would require employers, HR professionals, and their attorneys to file reports—not just for direct persuader activity (e.g., middlemen directly talking to workers)—but also for so-called indirect persuader activities that, for over fifty years, have been exempt from disclosure. Specifically, under the new Rule, HR professionals and their attorneys and consultants must file burdensome reports—or otherwise face criminal penalties— whenever they engage in the following activities: • Drafting, revising, or selecting persuader materials for the employer to disseminate or distribute to their employees; • Attending seminars where the attorney or consultant develops or assists the attending employers in developing anti-union, pro-business tactics and strategies; • Developing or implementing personnel policies or actions that have the object of persuading employees about how to exercise their rights to support or not support union representation; • Planning or directing a course of conduct that is recommended to an employer where the plan can indirectly persuade employees about unionization; and • Counselling employer representatives on what they should say to employees where the statements are indirectly persuasive and are not limited only to what the employer may lawfully say to employees.

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Even trade associations will be required to submit disclosure forms in certain instances—particularly where the association’s staff presents at a union avoidance seminar or undertakes indirect persuader activities for particular members.

In overturning fifty years of precedent, the revised Persuader Rule replaces clear-cut legal definitions with vague and complicated language that will drastically harm all U.S. businesses and make it difficult for employers to access legal counsel. Importantly, if they fail to make the broad and sweeping disclosures now required under the Persuader Rule, they face criminal penalties, including up to one year in prison and $10,000.00 in fines.

LEGAL CHALLENGE TO PERSUADER RULE Just as it would be unfair to require the St. Louis Cardinals to file its playbook with Major League Baseball before it takes on the Chicago Cubs, or to require a journalist to disclose a list of sources before reporting on a major political scandal, it is unprecedented and unfair to ask any U.S. business to tell DOL when it seeks legal or other counsel with respect to dealing fairly with their employees.

In addition to placing unnecessary, unfair, and unprecedented barriers between attorneys and their clients, the reporting requirements under the revised Persuader Rule have a dangerous chilling effect on the First Amendment speech and association rights of every employer. Similarly, because DOL replaced the bright-line test regarding direct persuasive activity and indirect persuasive advice with the vague and unclear distinctions discussed above, the Rule violates HR professionals’ rights under the Due Process Clause of the Fifth Amendment, which provides that every person should have fair notice of the types of activity that constitute criminal behavior. Moreover, DOL drastically overstepped its regulatory authority, because nothing in the text of the LMRDA, or its legislative history, supports or otherwise suggests that Congress ever intended employers to have to report basic HR activities as potential “persuasion” activity.

On the same token, although the LMRDA expressly exempts attorney-client privileged information from disclosure, under the new Rule, an attorney and his or her client must disclose a significant quantum of information that, in essence, renders the attorneyclient privilege meaningless. This is true even if 99% of the services provided by an attorney are exempt from disclosure, because if he or she engages in even the slightest “persuader” activity as that term is redefined, the entirety of the attorney’s services—exempt or otherwise—must be disclosed. The attorney-client privilege, embedded in the Rules of Professional Conduct’s confidentiality requirement, is intended to establish trust between the attorney and client so they can speak freely without unreasonable government intrusion. Under the revised Rule, attorneys will be forced to make a Hobson’s choice: either violate their clients’ confidences or face criminal liability. The revised Rule interferes with the attorney-client relationship and operates to prevent attorneys from being able to render candid professional advice that is so desperately needed to comply with the ever-growing federal bureaucracy.

For these reasons, on March 30, 2016, Associated Builders and Contractors of Arkansas, Associated Builders and Contractors, Inc., the Arkansas State Chamber of Commerce/Associated Industries of Arkansas, the Coalition for a Democratic Workplace, the National Association of Manufacturers, and Cross, Gunter, Witherspoon & Galchus, P.C., filed the first lawsuit in the nation to prevent DOL from implementing these dangerous regulations. The federal lawsuit, filed in Little Rock, Arkansas as ABC of Arkansas et al. v. Perez et al., 4:16-CV-169 (E.D. Ark.), is currently pending before Judge Kristine Baker.

POLITICAL PAYBACK? The revised Persuader Rule, if allowed to proceed, will require new, complex, and unprecedented levels of disclosure for attorneys, consultants, associations, and other professionals who provide advice to employers about how to legally communicate with their employees. DOL justifies the time, expense, and burden associated of the revised Rule in the name of transparency. DOL believes that workers will be more informed about the employer’s message in a union organizing campaign if these mandatory reports are filed with a little-known office of the agency. This tired “transparency” refrain assumes that filing burdensome forms will have some type of trickle-down effect on workers and enlighten their perspective about unionizing. Of course, DOL has no evidence that employees ever see, or otherwise are about, the content of such reports.

Rather, DOL drew sharp criticism during the rulemaking process because the Rule is so blatantly one-sided. If “transparency” was the real impetus for the new Rule, DOL should have applied a similar reporting obligation on labor unions, which regularly hire high-paid public relations consultants, front groups, and salts (e.g., individuals who work for unions to infiltrate a business with the intent of union organizing) to influence employees’ views regarding their employers and unionization. Strikingly absent from the revised Persuader Rule is any similar transparency obligation on labor unions, and several critics specifically argued that DOL’s revised Persuader Rule amounts to nothing more than “political payback” to the current administration’s labor allies, or otherwise to ensure future political support from organized labor. DOL denies that the revised Rule, despite its one-sided nature, is a form of political payback. Common sense should serve as a reliable indication on this issue.

Your Resource for Legal Innovation and Inspiration Customized Management Training Compliance Audits Policy and Strategy Analysis Litigation Defense Global Mobility Labor Negotiation www.bakerdonelson.com THIS IS AN ADVERTISEMENT. Ben Adams is Chairman and CEO of Baker Donelson and is located in our Memphis office, 165 Madison Avenue, Suite 2000, Memphis, TN 38103. Phone 901.526.2000. ©2016 Baker, Donelson, Bearman, Caldwell & Berkowitz, PC

CONCLUSION Whatever reason supports DOL’s misguided regulatory agenda in the waning months of Secretary of Labor Thomas Perez’s reign, it is beyond question that the revised Persuader Rule presents a serious, imminent threat to businesses across the country. HR professionals—particularly in light of the expanding bureaucracy of labor and employment regulation— must be able to speak candidly about their lawful business objectives with counsel without fear of disclosure. Instead, under the revised Rule, businesses are forced to navigate the complex aspects of labor law in the dark, or else face criminal liability, if they rightfully refuse to waive the attorney-client privilege.

So while the Cardinals and Cubs, reporters and their sources, and organized labor all continue to enjoy privacy in their affairs, small businesses are again left behind to pay the high costs of the U.S. Department of Labor’s backroom deals with big labor.

PERFECT ALIGNMENT. Relationship. Reliability. Respect.

At the center of our Employee Benefits and Labor & Employment practices.

J. Bruce Cross, Director Cross, Gunter, Witherspoon & Galchus, P.C. bcross@cgwg.com www.cgwg.com

Abtin Mehdizadegan, Associate Cross, Gunter, Witherspoon & Galchus, P.C. abtin@cgwg.com www.cgwg.com

N A S H V I L L E K N O X V I L L E M E M P H I S W A S H I N G T O N D C bassberry.com Blog: bassberrylabortalk.com

@BassBerryLabor

www.HRProfessionalsMagazine.com

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TS H G LI H IG H

26TH ANNUAL SHRM-ATLANTA HR CONFERENCE

March 29-30, Cobb Galleria Centre

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1 Joe Gerstandt was the Tuesday keynote speaker. His topic was “The Authenticity Advantage: The What, When, and How of Flying Your Freak Flag.”

2 Dr. Paul White was the keynote speaker on Wednesday. He presented “The 5 Languages of Appreciation in the Workplace.” He has co-authored three books including The 5 Languages of Appreciation in the Workplace.” 3 Cynthia caught a photo op with Jack W. Bruce, SHRM-SCP, SPHR, 2016 President of SHRM-Atlanta.

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4 Dorothy Knapp, SHRM-SCP, and Scott Ferrin, SHRM-SCP, Field Services Representatives for SHRM; with Sally Roberts, Director of SHRM Georgia State Council at the SHRM booth. 5 Greg Hare with Ogletree Deakins discussed hot topics in employment law during Tuesday’s concurrent sessions.

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6 Randy Patterson, CHRO for Bluelinx in Atlanta, presented, “The Keys to Managing a Successful Career in Human Resources.” 7 Martha Jean McHaney, VP of Human Resources for Morris Communications, spoke at a concurrent session on Tuesday. Her topic was “Human Resources: We’re SO Entertaining.” 8 Colonel Chuck Hodges, Senior Director for Events and Programs, U.S. Chamber of Commerce, presented “An Employer Guide to Hiring and Retaining Military Talent.” 9 One of the hostesses at the SHRM-Atlanta Conference who helped guide us to the Exhibit Hall.

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10 “Classifying Employees and Independent Contractors,” was Todd Wozniak’s topic. He is a Shareholder with Greenberg Traurig, LLP. 11 Maureen Whatley, VP Global Talent Management and Acquisition with Alere, Inc., spoke on “Transforming Performance – Abandoning Performance Reviews and Ratings and Focusing on What Really Matters to Employees.” 12 Cameron Pierce and Dionysia Johnson-Massie discussed “Best Practices for Effective Workplace Investigations.” They are Shareholders with Littler Mendelson.

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13 Michele Sarkisian, President P3 Advisors LLC, spoke on “Businesses Doing Well While Doing Good.” 14 Theo Gilbert-Jamison, CEO Performance Solutions By Design, presented “The Role of HR in Creating & Sustaining a Culture of Service Excellence.” 15 Yvette Montero Salvatico, Managing Director, Kedge, LLC discussed “Breakthrough HR: How Disney Launched the Workforce of the Future.” 16 Ed Hurley-Wales’ topic was “Business Resource Groups Can Transform Diversity and Engagement.” He is VP, Market Diversity, ADP.

www.HRProfessionalsMagazine.com

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Gaining the C-Suite’s Attention:

Five Ways

Background Screening Adds to the Bottom Line

By DAVID ESTEL

S

avvy HR professionals understand that, in business, every road eventually leads back to the all-important bottom line. While there are other tasks and initiatives that require attention, each and every employee should ultimately focus on holding and increasing company revenue and profit. Operating with any other goal will take you off course quickly, wasting company time and money.

While there are obvious efforts that directly tie back to increased revenue, saving on materials and landing new clients, for example, there are just as many indirect actions and decisions that have a big impact. Background screening may seem like just another task you must check off the list to fill that open position, but it's much more. Background screening processes and the resulting information can end up weighing heavily on the company's bottom line.

The C-Suite pays attention to positive and negative fluctuations in the company’s revenue and profits, and HR professionals can strive to move the needle by effectively hiring quality employees.

Sounds easy when we put it like that, right? We all know recruiting, interviewing, and selecting the right person for the job is anything but easy. However, there are a variety of tools to help make the best decision, and background screening is one of them.

Here are five ways a thorough background screening increases your bottom line, and garners positive attention from the C-Suite:

#1:

Reduces time wasted on hiring tasks.

When a position opens up, HR and hiring managers must spend a significant amount of time selecting, interviewing, and choosing a candidate to fill the role. A thoughtful background screening process can 'weed out' unqualified or unsafe applicants. For example, if the position requires operating a motorized vehicle, a Motor Vehicle Registry Search will guide you to interview the applicants with safe driving records and active licenses. This 32

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way, hiring managers aren’t spending time and resources interviewing those applicants who cannot operate a vehicle. These specific screening reports assist HR professionals in paring down the applicant pool to only the most attractive candidates, saving time and money.

#2:

Lessens the chance of hiring mistakes.

Hiring the wrong person can end up costing companies roughly 25% of that person's annual salary. There are direct expenses such as the time to train, benefits, and the cost to fill the position yet again. Indirect costs sometimes add up to be even more costly, such as lost productivity, decreased industry reputation, and high performing employees becoming frustrated and leaving. Conducting a pre-employment screening background check before a person is hired can circumvent these losses, and protect the business's bottom line.

#3:

Mitigates the risk of losing clients.

The last problem managers want to deal with is an inept employee who mishandles customer accounts. Losing just one customer because of a bad hire can take years to recover from. A thorough background check can uncover issues in an applicant's history that can warn you up front that they may not be a good choice. For example, criminal convictions may show an applicant’s impulse control issues and violent tendencies. An employment verification could uncover his or her inability to get along with customers, or other problems with performance that could end up diminishing client confidence. The bit of time and money it takes to perform a simple background check is covered several times over by retaining just one good client.

processes. These instances fall back on the employer, opening them up to lengthy, expensive litigation by the injured party and their families. Performing a full background check on job candidates safeguards your company from falling victim to negligent hiring lawsuits by providing documented evidence as to the company’s due diligence.

Being able to defend your hiring decisions goes a long way toward thwarting the impact of negligent hiring lawsuits.

#5:

Increases the hiring process's productivity.

Checking an applicant's criminal history along with previous employment verification and education history is a quick way to gain lots of valuable insight into that person. Background checks paint a clearer picture of the candidate than a resume, as almost half of resumes contain some type of mistruth or exaggeration.

The same goes for interviews, as any candidate, no matter how unqualified or dishonest, can buy a new suit and charmingly offer the “correct” answers. Background screening provides definitive information that allows HR professionals the ability to forge ahead faster and with greater confidence.

Conclusion: Little else demands the C-Suite’s attention like the bottom line, making protecting it a top priority for HR professionals. A thorough and complete background screening process will build a solid foundation toward minimizing the risk of a bad hire for the safety and productivity of your workplace, and achieving a high-performing, qualified workforce. Commit to a thorough hiring process that includes a thoughtful background screening plan to make this happen. Your C-Suite will thank you for it!

#4:

Decreases the chances of a negligent hiring lawsuit.

Unfortunately, today’s news is full of people who have been injured or killed because of an employer's shoddy background check

David Estel National Account Executive Background Screening Data Facts, Inc. david@datafacts.com www.datasfacts.com

Structure, Layout, and Readability

NAPOLEAN HILL’S KEYS TO

PERSONAL ACHIEVEMENT

By WILLIAM CARMICHAEL

My review this month must begin with a confession: the author’s name, Napoleon Hill, was not one I was familiar with. Upon researching this gentleman, however, a realization of his import quickly dawned. For those of you likewise unfamiliar with this giant of corporate success, allow me to provide a bit of his background and his relevance to us today. Napoleon Hill’s Keys to Personal Achievement by Napoleon Hill and Judith Williamson revives fifty-two essays from Hill’s early collection of works during his remarkable career as one of the most prolific success coaches of the early twenty-first century.

Born into poverty during the late 1880s and exposed to every conceivable disadvantage one can imagine, Hill’s story is one of boot-strap inspiration. He began his writing career at age thirteen as a “mountain reporter” for small town newpapers, then went on to become one of America’s most beloved and respected motivational authors at a time when Americans had very little to be motivated about. He devoted nearly thirty years of his life to discovering what determines an individual’s successes or failures. Most significantly, the philanthropist Andrew Carnegie commissioned Hill to personally interview over 500 millionaires-- including Thomas Edison, Alexander Graham Bell, Henry Ford, Theodore Roosevelt, William Jennings, Woodrow Wilson, and John Rockefeller—to unearth a success formula that could be used by the average person. From his interviews and experiences, Hill wrote Think and Grow Rich (1937), an immediate best-seller, followed by Law of Success (1937), and then his most controversial work, Outwitting the Devil (1938), wherein Hill imaginatively converses with the Devil to prove the principles of success.

An Overview of Napoleon Hill’s Keys to Personal Achievement In her foreword to Napoleon Hill’s Keys to Personal Achievement, Judith Williamson, Director of the Napoleon Hill World Learning Center, proclaims that “To be accustomed to the process of using Dr. Hill’s Science of Success System, we must condition our minds to be ready to accept the possible within the impossible.” This lead-in carefully weaves the auto-suggestion most of us easily recognize: “If it is to be, it’s up to me,” one of Hill’s many contributions that has certainly withstood the test of time. He also brilliantly declares, “All the breaks you need in life wait within your imagination . . . Imagination is the workshop of your mind, capable of turning mind energy into accomplishment and wealth.” And one of my favorites: “You must get involved to have an impact. No one is impressed with the won-lost record of the referee.” Regardless of these analogies’ date of publication, they still very much apply today.

Why This Is A Must-Read Essentially, this book is about reaching our goals. It is about growth. It is about careful selfreflection in our fast-paced world and the importance of rethinking what our dreams and aspirations are really all about. It reminds us that we must use our time wisely and efficiently, for we are only given so much. It teaches us to rely upon our own inner strengths. It tells us that hope is never completely out of reach. And for those of us in the hectic corporate environment, change is the only constant. And perhaps most significant of all, it provides timeless truisms with which we can identify. For anyone who struggles with uncertainty about how to reach goals successfully, Dr. Hill addresses this all too common dilemma with common-sense and a remarkable dose of reality.

Readers will immediately connect to his advice as well as the specific situations he describes.

Napoleon Hill’s Keys to Personal Achievement can be approached in one of two ways: a quick perusal in one sitting, or by taking each of its fifty-two chapters as a point for each week of the year. Either will accomplish its intent of facilitating a reconsideration of our particular goals. For example, Chapter One deals with the importance of effective time management, while Chapter Two offers a reflection upon the world around us, including the people who are important to us and why we choose to make them important. Chapter Three involves the importance of paying attention to those in need, while Chapter Four explores self-discipline.

Chapter Five gives thought-provoking commentary regarding personal initiative, while Chapter Six helps us think about the significance of our mental attitude. Perhaps one of the most powerful chapters was the one about The Power of Thought, wherein Hill notes that “Man is the only creature on earth with the power of self-determination, the right to choose what his thoughts and actions will be. Man possesses one thing over which he has the inherent, absolute right of control, and that is his mental attitude.” Each of the remaining chapters contains the same simple concepts and relative issues we each deal with today, personally and professionally.

Ultimately, Hill is the consummate motivator as his passage about having peace of mind from Chapter 32 indicates:

“ Since what you achieve in life depends on what you firstconceive, and this depends first of all upon your deep, inner, subconsciously founded belief- - you see that your life depends upon your power to believe!”

Though Hill’s principles are often overlooked in the modern hustle and bustle, these simple values written eighty years ago still remain true today, and they offer a refreshing perspective that is ultimately valuable to our organizations.

Who Will Benefit Most From This Book?

Anyone who needs “a shot of motivation with a dose of reality!”

William Carmichael, Ed.D Strayer University william.carmichael@strayer.edu www.strayer.edu www.HRProfessionalsMagazine.com

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A Proactive Approach to Managing Employer

Health Cost

by engaging patients with quality care and assists in navigating patients to high performing providers who show they can improve outcomes and reduce costs.

These strategies have helped to reduce costs in the middle cost group by another 18% in the past year.

be overwhelming. It’s hard enough for many plans to ascertain if it’s complete or even right, much less understand its true meaning and then how to apply it to change the behavior of members and their providers. It all starts with understanding the individual and collective stories the data is telling in terms that are accessible and useful to all constituents. With understanding comes the ability to apply and change.

Once the story is understood, the breadth of opportunity for meaningful action uncovered is often quite stunning.”

By MURRAY L. HARBER

Traditionally, Human Resources professionals, who are also responsible for employer benefits programs, work with a variety of vendors who offer insurance programs to support the employer’s needs. In today’s world of multiple generations in the workplace, the HR professional has to think differently about attracting and retaining top talent by spending more time crafting a benefits strategy that is more comprehensive, affordable, and has more value. Health-related costs continue to rise for many employers whether they are fully insured or self-insured. Several leading companies in the South are focusing on the root causes of this escalation in cost by being more proactive in managing their plan versus the traditional retrospective view they currently employ. Research is very clear that up to 50% of all health care costs are unnecessary.

As a result, there is a lot of room for savings in an employer’s investment in healthrelated programs and costs. It starts with the HR professional building an effective team approach to their benefits strategy.

We Can Do More Southern Farm Bureau Life Insurance Company’s executive team, led by its senior Human Resources Officer and its Medical Director, wanted to do more to manage the root causes of the rise in health claims. Even though they were recognized as Mississippi’s Healthiest Workplace in 2015 and they have flattened their cost curve, they knew they needed to squeeze more savings to be better stewards of company resources and continue to moderate any increase to their employees. They wanted to find out the key cost drivers for the high cost plan members along with the future cost drivers of the medium cost members. Knowing this information would give them insight so they could realign benefits and program elements to support health plan member’s needs.

We have a responsibility as an employer to effectively and efficiently “ manage our health benefits and associated costs. The investment of our premiums by both the employer and employee requires us to seek strong partners in managing our claims and the outcomes of medical care. Also our wellness program and on-site clinic aid our employees in being proactive in managing their health and costs.

The new model of managing health care and the costs associated with it requires all the parties involved to seek better outcomes and accountability for what they do.”

Billy Sims, VP of Human Resources, Southern Farm Bureau Life Insurance Company

Root Causes SFBLI has offered an industry leading health promotion program, along with providing an onsite clinic for the last 8-9 years and has seen great results. They contracted with Southern Health Network to analyze their claims and clinic data to identify areas of opportunity to continue to gain savings and reduce future trends. The analysis brought more attention to the lack of providers in the network delivering best-practice care, excessive use of the urgent services by some along with the need for more intensive disease management and promotion of preventive screenings and tests. Southern Health Network also manages the onsite clinic which has served the population well 34

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he volume of data and analysis “ Tavailable to a health plan nowadays can

Marshall Bouldin, Chief Medical Officer, Southern Health Network

The Path Forward As SFBLI continues to work with its team of consultants and vendors, they are integrating their efforts by starting with data and building systems which take a proactive approach to reducing unnecessary care, leveraging resources, and communicating effectively to employees and dependents alike. Knowing the real drivers of their health cost increases is giving them an opportunity to design more targeted communications and programs to give the members of the health plan the resources they need to be better consumers of health care, improve their self-management of their health conditions, and enhance their behavior changes for lifestyle improvement.

he main tenets of the program “ Tinvolve direct data extraction from the

plan’s carrier, analysis of individual characteristics of the population and installation of a nurse navigator to drive the directives. In the end, we have a pretty clear idea of what happened in the top 25 spends, as well as a good idea who will comprise future years’ highest expenditures.”

David Duddleston, Medical Director, Southern Farm Bureau Life Insurance Company

Murray L. Harber Executive Director Mississippi Business Group on Health murraylynnharber@gmail.com www.msbgh.org

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Guidance for Employers on 24-Month F-1 STEM OPT Regulation

By JAMES W. HOLLIS

Key Facts

• A new 24-month STEM OPT Extension rule goes into effect on May 10, 2016.

• The STEM OPT extension may be an effective tactic to respond to an employee not being selected in the FY-2017 H-1B Visa Lottery.

• Eligible employees working on 17-month STEM OPT extensions may apply for an additional seven months of employment authorization between May 10, 2016 to August 8, 2016 (the “transition period”).

• To qualify for a 7-month extension, employees must apply during the transition period, within 60 days of the Designated School Official (DSO) entering the employee’s eligibility for the extension into SEVIS and have at least 150 days of employment authorization remaining at the time the I-765 “Application for Employment Authorization” is filed with USCIS. • Employees on 17-month STEM OPT with EADs expiring between October 7, 2016 and January 5, 2017 could lose eligibility for the 7-month extension if the I-765 is not filed with at least 150 days of employment authorization remaining.

Background

On May 10, 2016, a new Department of Homeland Security regulation goes into effect creating a 24-month extension for F-1 STEM OPT to replace the 17-month extension that was previously available.

As of May 10, 2016, employees applying for a STEM OPT extension will have their applications adjudicated using the new 24-month STEM OPT standard. Employees or new hires whose STEM OPT extension request is pending on May 10, 2016 will be issued a Request for Evidence (or RFE) to provide the additional information required by the new 24-month STEM OPT standard. Employees who are currently working on a 17-month STEM OPT extension may be eligible for an additional seven months of STEM OPT. To be eligible, they must have the the training opportunity approved by their DSO (using Form I-983) and have at least 150 days of employment authorization remaining at the time their I-765 “Application for Employment Authorization” is filed with USCIS. They also must apply for the 7-month extension during the “transition period” between May 10, 2016 and August 8, 2016.

General Eligibility Requirements

In order to qualify for the 24-month STEM OPT extension, an employee must be currently working in a period of post-completion OPT and must hold a bachelor’s degree or higher degree in an eligible STEM (Science, Technology, Engineering, and Math) field from an accredited, SEVP-certified school. The employee must be seeking to engage in practical training for a minimum of 20 hours of work per week through an employer that participates in USCIS’s E-Verify program.

Also, the employee and the employer must create and submit a formal training plan on Form I-983 to the employee’s DSO for approval prior to applying for an F-1 STEM OPT extension with USCIS. The training plan must explain how the practical training opportunity is directly related to the employee’s qualifying STEM degree.

It must identify goals for the practical training opportunity, including specific knowledge, skills or techniques that will be imparted to the employee and explain how those goals will be achieved through the 36

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work-based learning opportunity with the employer. The training plan must also describe a performance evaluation process and the methods of oversight and supervision of the employee. Note that the training plan will be evaluated by the employee’s DSO for completeness, meaning that the DSO will ensure that the Form I-983 is signed and addresses the regulatory requirements of the training program. An ICE tutorial on drafting Form I-983 is available here.

Additional Requirements for Employers

The new 24-month STEM OPT regulation contains several notable requirements for employers: - Employers with employees on 24-month STEM OPT must be enrolled in E-Verify.

- The terms and conditions (including duties, hours, and compensation) of the STEM practical training opportunity be equal with the terms and conditions applicable to the employer’s similarly situated U.S. workers in the area of employment.

- Employers must have sufficient resources and personnel available and be prepared to provide appropriate training in connection with the opportunity at the location(s) specified on Form I-983.

- Employers must notify the employee’s DSO if there is a material change to the training opportunity, including the termination or resignation of the employee, within five business days - The employer must not use the F-1 STEM OPT employee to replace full or part time U.S. workers.

The regulation also indicates that DHS may perform site visits in order to determine if an employer is providing the training opportunity stated in the I-983 and to ensure that the employer is not abusing the program. It notes that employers will receive 48-hours notice of any site visits that do not result from a complaint or other evidence of noncompliance with the program. The number of employer site visits that ICE is planning is not clear at present but, as with other site visit programs, visits are not likely to be a widespread issue in the absence of complaints against an employer.

Action Steps for Employers

- Identify current employees holding 17-month STEM OPT work authorization who are eligible for the 7-month extension - Work with eligible employees to complete Form I-983 during the transition period - Develop a system to: • Identify F-1 initial OPT employees eligible for 24-month STEM OPT • Document and confirm that the wage they will receive is in line with similarly situated employees • Work with those employees to create and submit training plans to their DSO for approval • Determine when there are changes to the employee’s position that require notification of the DSO and comply with the STEM OPT employee evaluation requirements of the training plan

James W. Hollis, Associate Attorney Siskind Susser PC jhollis@visalaw.com www.visalaw.com

A TrA diTion of

Thinking Forward In order to be successful in today’s increasingly regulated workplace, employers must stay one step ahead. Let us put our history of thinking forward to work for you.

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Be sure to attend our FREE April 28 pre-seminar breakfast, where Courtney Leyes & Jeff Weintraub will present a “short course” on FLSA collective actions.

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37

By HARVEY DEUTSCHENDORF

e

e

7 Steps for Dealing with Workplace Conflict

We’ve all been in the place where we’ve had to have one of those…. difficult conversations. The ones that we dread having, the ones we would do anything to avoid. The problem is that we can’t get out of it. Possible situations of someone in your organization is not doing their job, missed deadlines, dishonesty and other issues always make for the need to have one of those dreaded talks. Oh sure, we can avoid them but the problems will only fester, become worse and we will end up regretting we didn’t get it together and have that conversation we’ve been putting off.

5. Repeat back what you heard and ask questions to clarify what you didn’t understand

While having such a conversation may never be pleasant or easy, there are a number of things we can do to keep them from going south.

6. Ask for what you need to happen and his/her opinion on what can be done to change the situation.

1. H ave a well thought out, clear outcome in mind Think about what you want to come out of the conversation. Is it better performance from a staff person, more accountability, a better relationship with that person? Visualize what the ideal outcome would be and work your way back from there. What do you need to do to move the conversation in that direction?

2. Wait until your emotions have settled down, you feel centered and in complete control of yourself.

If you need to practice, have a mock conversation with someone you trust, a family member, colleague or friend. Have them give you some negative feedback to determine if you are being triggered.

3. S tick to the data When speaking only talk about the facts of the situation. Talk about what actually happened, the effects of that and the situation it resulted from. For example, because of missing the deadline, the order was lost and the company is in danger of losing a customer.

Don’t make any judgements about why the person missed the deadline. Leave that part for them to tell you. If there is anything about the situation that you may be responsible for own up to it. If you are not sure if it is something that you did ask the other person.

Seeing that you are ready and willing to accept that you may have played a role in the problem will make it easier for the other party to accept some responsibility.

4. Actively listen when they tell their story This part is the most difficult as we all have preconceived notions and judgements about people and why they act as they do. Pretend that you will be tested on how well you can repeat what they said and fight the urge to jump in and contradict them. Pay close attention not only to the words, but the tone of voice and body language.

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For any positive progress to be made in coming to a solution, the person you are speaking to must feel heard. That doesn’t mean that you agree with him/her, or accept what they say. It only means that you actually listened to them and heard them. A clear statement would be, "What I heard you say was...... is that accurate?

Ask for the changes that you would like to see that would keep the situation from happening in the future. Then ask the other person what they think needs to change. There is no guarantee that the other person will be open, non-defensive, willing to share and be accountable. However, if the conversation has gone well, the chances of them becoming more open and honest will increase substantially.

7. D o some brainstorming and problem solving Do some brainstorming around solutions, not only for the problem you are dealing with, but for future scenarios that are likely to occur.

Try to come up with a means to resolve disputes that you both agree on. Look for sincere comments that the other said, or actions they committed to, in order to move the situation towards a resolution and let them know that you appreciate them for doing so.

WRAPPING IT ALL UP A successful outcome depends upon breaking through defensiveness and having an honest and open conversation. If the conversation starts to break down, if either of you start to become highly emotional, it is better to take a break and start over. Continuing on after emotions have boiled over will only make the situation worse, entrench positons and decrease the chances of having a desirable outcome. There is no guarantee of having the outcome that you are looking for. We cannot control the thinking of actions of another and if we have followed our plan and done our best we can at the very least walk away feeling that we gave the process our best chance of success.

Harvey Deutschendorf is an emotional intelligence expert, author and speaker. To take the EI Quiz go to theotherkindofsmart.com. His book THE OTHER KIND OF SMART, Simple Ways to Boost Your Emotional Intelligence for Greater Personal Effectiveness and Success has been translated into 4 languages including Chinese. You can follow him on Twitter @theeiguy.

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