Relocation can be a challenge, but careful planning can be the difference between a move that’s difficult and one that’s smooth.
“When managing an office move, a move consultant’s objective is to minimize disruption in the workplace and quickly return the office to a normal workflow,” says Patricia Meyers, marketing manager at SMC Consulting, LLC.
“No two moves are exactly the same. However, there are basic activities that need to take place to ensure an effortless transition,” she says.
Smart Business spoke with Meyers about how to effectively manage a move from one office to another.
What does a move management consultant do?
Whether you are moving an entire office, co-locating a cross-functional group or just reorganizing an office, a move management consultant can provide the appropriate plan and execution. An effective move management consultant will streamline the move process to ensure a successful relocation with minimal organizational disruptions, relieving the burden of coordination and implementation of the move while saving the customer time and money.
Move consultants simply enjoy the challenge of putting puzzles together. A move, like a puzzle, requires a process in order to execute the plan. You look at the whole picture — or in the case of a move, the old and new floor plans — then look at each small piece to find out where and how each needs placed to complete the picture.
What unique services can a move management consultant provide?
Experienced move consultants prioritize and manage a move by creating detailed plans and timelines for each of its phases, then communicate that plan to the customer and all associated vendors. Coordination, communication and scheduling all pre- and post-move activities will ensure a successful move.
Move management consultants might also be known as change managers. Change is not always viewed in a positive manner. Making the transition from an old, secure office space to a new, unfamiliar one is sometimes difficult and stressful for employees. The move management consultants will communicate on a regular basis to keep everyone informed as to progress and expectations. Employees who feel they are informed tend to embrace change, making the move less agonizing.
What do companies need to plan for when relocating?
There are many components to consider when relocating. Expect to have a solid and well thought-out plan of attack, and a move consultant who can execute that plan. Coordination and planning of movers, furniture, computers, phones, employee communication, office supplies and even the vending is critical to success.
As companies decide how they’ll execute a move, they should also consider:
- Consultant’s time vs. employees’ time — Put the move in the consultant’s hands leaving time for your employees to handle the day-to-day business.
- Experience — Productive processes and no loss of time.
- Programming — Collaborating with all involved to assemble the puzzle.
- Strategic planning — Making sure all parts fit together and knowing how to execute.
- Execution — Implementing the strategic plan and managing every detail to ensure a successful move.
- Attention to detail — Taking inventory of existing equipment, disposing of old and unused equipment, satisfying lease close out requirements.
A move consultant will help your company achieve cost savings by providing you with one point of contact who can reduce risk, time, cost and employee downtime. Ultimately, you want your employees to leave their old office on Friday and enter their new office on Monday ready to begin work with minimal disruption. ●
Insights Facilities is brought to you by SMC Consulting, LLC
The Patient Protection and Affordable Care Act (PPACA) made sweeping changes to the insurance industry landscape.
“Business owners and HR professionals will need to be in compliance with the rules and regulations set forth by PPACA. And, individuals will have increased questions about the health insurance marketplaces, individual mandate and underwriting,” says Michael Galardini, sales executive at JRG Advisors, the management arm of ChamberChoice. “As a result, employee benefits professionals will be asked to help guide both businesses and individuals through the changing marketplace.”
Smart Business spoke with Galardini about employee benefits trends small and large employers can expect to see in 2014.
What changes will small employers face?
Small employers, categorized as any employer with fewer than 50 full-time employees, will see a drastic change in 2014 in the way health insurance rates are developed for each group. Before PPACA, insurance companies could develop rates based on gender, industry, group size, health status and medical history. Post PPACA, small group rates are no longer rated, and small group insurers will only be able to vary premiums by family size, geography, tobacco use and age.
With the changes in underwriting, there also will be changes to the plan designs being offered to small employers. The establishment of Health Insurance Marketplaces and their product offerings has created a change in product design. The plan designs being offered are 90 percent, 80 percent, 70 percent and 60 percent coinsurance plans, which share the financial responsibility with the employees. These plans create larger out-of-pocket costs that most individuals are not accustomed to paying. Particularly in Western Pennsylvania, the population as a whole is most familiar with rich plan designs with no coinsurance, low deductibles and copays.
Explaining these product differences with a one-on-one approach is important to help each individual understand how his or her plan works. The business owner and/or HR professional as well as an outside advisor need to engage each employee to ensure everyone properly understands the available solutions.
What can large employers expect to see?
Large employers or those with 50 or more full-time employees also will notice significant changes in the future.
Beginning in 2015, large employers will be required to offer coverage to employees working 30 hours or more a week. There also are requirements to the type of plan that must be offered to these individuals as well as a contribution limit. The plan design must be at least a 60 percent coinsurance plan, and the employee’s contribution cannot be more than 9.5 percent of his or her household income. There are two fines an employer could receive:
- Penalty A: Employers that do not offer coverage to full-time employees (working 30 hours or more a week) will be subject to a penalty equal to $2,000 per full-time employee minus the first 30.
- Penalty B: Employers that offer coverage that is not of minimum value or not affordable (or both) will be subject to a penalty equal to $3,000 for every employee who receives subsidized coverage through the marketplace.
Large employers should be talking to their advisor in 2014 to determine if they will meet these guidelines.
Are there any other upcoming changes?
Lastly, and probably most significantly, is the individual mandate. Individuals are required by March 31, 2014, to have a qualified health insurance plan or pay a fine. The fine for 2014 is the greater of $95 or 1 percent of income. Individuals can purchase insurance through the marketplace or directly from an insurance company. The marketplace could offer a subsidy based on an individual’s income to help pay for premiums.
A qualified advisor will be well versed on the products available to individuals and business owners. The changes due to PPACA provide more options to purchase health insurance products, but the marketplace for health insurance is ever changing. Business owners and HR professionals need to be aware of when these changes occur and how they can impact their business. ●
Insights Employee Benefits is brought to you by ChamberChoice
Not long ago my heart sank when I read that the Pittsburgh metropolitan area ranked 48th among the 50 top cities in Entrepreneur magazine’s list of the best cities for entrepreneurs.
Entrepreneurship is a Pittsburgh tradition and the life-blood of our future growth. So how can we move up the entrepreneurial ladder?
Water the acorns
Because venture capital firms can only invest in companies with addressable markets exceeding $500 million, they usually don’t make bets on small startups.
Seed money for these companies must come from high net-worth individuals in the private sector, sometimes called “angels.” Places like Palo Alto, Calif., Boston, Mass., Raleigh, N.C. and Austin, Texas, have become technology hotbeds.
Why? Because young tech-company founders, whose companies have grown into mighty financial oaks, showered startup capital on acorns that had fallen nearby — folks with good ideas.
In Pittsburgh, we need to create an environment where there are incentives for successful local entrepreneurs to reinvest their personal wealth in local startups. A nice complement to our state’s venture capital program would be tax breaks for angel investors who deploy capital intrastate for startups or invest in venture capital firms based within state lines.
Teach your children well
Entrepreneurial education on a high school, collegiate and executive seminar basis is a must. Every major university in our region has entrepreneurial education programs. Many are taught on a graduate and undergraduate level. Organizations such as the Network for Teaching Entrepreneurship help high schools, often in low-income districts, to provide classes in business, finance and technology.
Why couldn’t the Commonwealth of Pennsylvania create a program such as the Job Training Partnership Act to provide tuition dollars for this type of education for adult entrepreneurs? Why can’t an introduction to entrepreneurship be part of a life skills curriculum that is mandated for high schools across the state?
Our gang of several
The Group of Eight (G8) is an international association that represents 65 percent of the world’s economy and includes the United States, Canada, France, Germany, Italy, Japan, Russia and the United Kingdom. The leaders of these countries get together every year to find ways that they can work together to better our global economy.
Could we bring together the leaders of local economic development agencies to form a group that functions in a regional way, much the same as the international version?
What if the state gave this local group of leaders a chunk of its venture capital program dollars, with the proviso that the group hires a staff of experienced venture capitalists to administer the fund? After all, members do have day jobs running their own organizations. The profits of this venture fund would then be redeployed regionally in the form of economic development grants.
Green cards with diplomas
You know how we beat China and India in the world economy, technology and talent? We should take the advice of a highly successful local venture capitalist. The diploma any foreign student receives from a local college should have a green card stapled to it.
How about we create a local bureau of immigration lawyers that provides free legal service to foreign kids coming out of local schools? If we get them a green card, they must commit to living in the region for another five years.
Chris Allison is the former CEO of Tollgrade Communications Inc. where he spent 16 years taking the telecomm venture from tech startup to publicly-traded company with a market capitalization of $2 billion. Allison now devotes his time to shaping future business leaders as Entrepreneur-in-Residence at Allegheny College, where he teaches entrepreneurship and managerial economics. He is the author of “You’ll Manage: Lessons Learned from a Former CEO.” For more information, visit chrisallison.biz.
When unwanted attrition happens, the usual reaction is, “Why? Where are they going?” Most organizations use the exit interview to answer these questions. An HR professional meets with the departing person and attempts to learn the good, bad and ugly about why they are leaving. Unfulfilled promises and hopes are revealed as the interviewer shrinks in chagrin, wishing this critical information had been discovered sooner.
If the departing talent is senior in the firm, or in a key role, the departure interview will be shared with the company’s top executives and board of directors. Here the “why” questions intensify. The board will pepper the CEO and chief human resource officer with questions such as, “What were the warning signs? Why weren’t they heeded? What have we learned from this terrible loss? Are we at risk with others? How do we prevent this from happening again?”
These are precisely the right questions to ask. But why wait for the loss to happen, or even the threat of loss to appear, to know the answers?
We know that the millennial generation will be employed by an average of six different companies during their working lives. We also know that they are extremely connected. LinkedIn and Facebook constantly push information on new/available opportunities to subscribers, so one doesn’t even have to seek new opportunities or wait for a recruiter’s call. These vehicles also enable departing employees to stay in touch with their former colleagues, independent of communication vehicles that touch the employer. Alumni networks of former employers, colleges and professional associations are powerful magnets pulling on the brightest and best talent, all the time.
So how do company leaders stay in tune with what’s really happening with their brightest and best? How can they really know what their star talent is feeling or what might cause them to leave?
It’s easier than you think. Engagement surveys are not the answer, although they can be barometers of company culture and leadership. The best way to know how your employees are feeling is to simply ask them in a one-on-one conversation. Ask the same questions you’d use in an exit interview — but don’t wait until they leave to do so!
One of the many gifts of the millennial generation is their comfort level with directness and transparency. They are straight shooters with one another and value when they receive it from others. Just ask them the questions you want to know. And tell them directly how much you and the company value them.
And don’t assume they know what growth potential exists for them in your organization. For most millennials, advancement within companies happens too slowly, in contrast to their expectations.
This is all the more reason why executives and senior HR leaders need to budget time by having direct, crucial conversations that yield immediate understanding of what matters most to these key employees — and that conveys clearly how much they are valued/appreciated, and what their future can be within the current company.
What are the most effective tools for preventing the unwanted loss of our brightest and best talent? They lie in our leadership behaviors. Don’t wait for an exit interview to know why your top talent is leaving.
Instead, have those crucial conversations early enough to discover how to prevent the departures from ever happening.
Leslie W. Braksick, Ph.D., MPH is co-founder of CLG Inc., co-author of “Preparing CEOs for Success: What I Wish I Knew” and author of “Unlock Behavior, Unleash Profits.” Braksick and her colleagues help executives motivate and inspire sustained levels of high performance from their people. You can reach her at (412) 269-7240 or firstname.lastname@example.org.
For more information, visit www.clg.com.
Ken Kobus is proud to be a third-generation steelworker, saying, “The mill was always in my life, even as a baby.”
He began working at the Jones & Laughlin Steel Corp. in 1965, spending most of his time at the Hazelwood Coke Works. He worked there from December 1966 until the plant closed in 1998. His father had worked at the Jones & Laughlin Pittsburgh Works for 37 years and his grandfather started work at J&L in 1906.
Through this life-long connection with J&L, Kobus has amassed a vast knowledge of its history and steel-making techniques, along with personal stories and photographs. Many of Kobus’ photographs and other items, such as his hard hat, are now on display as part of the Rivers of Steel exhibit entitled “J&L: A Pittsburgh Icon.”
An industrial giant
For more than 125 years, Jones & Laughlin Steel was the symbol of industrialized Pittsburgh — dominating the landscape of the city, physically and emotionally. Its history spans from the development and expansion of ironmaking in the 1850s, through the boom of the 20th century and finally to the decline of the industry in the 1980s.
The mill resided at the head of the region’s blue-collar persona: strong, determined, persistent in presence and willing to adapt to survive. Using photographs, archival documents, artifacts and personal stories, the exhibit tells the story of an incredible and resilient company and the region that it helped to create.
Founded in Brownstown, now part of Pittsburgh’s Southside neighborhood, in 1850 by two German immigrant ironmasters, Bernard and John Lauth, J&L had its beginnings in puddling and heating furnaces.
In 1853, Benjamin Franklin (B.F.) Jones joined the Lauth brothers to help them begin a rolling mill. Banker James Laughlin came on in 1856 to assist with financing for the mill. The Lauth brothers sold their interest in the business to Jones and Laughlin in 1861.
When the company was first established, the Lauth brothers processed pig iron into wrought iron through a laborious process known as “puddling” — literally cooking and working the iron. It required a lot of skill and time to puddle iron since only small batches of wrought iron could be produced at a time. The iron would later be rolled into desired shapes.
At the time of the Civil War, J&L was the largest producer of iron railroad rails and provided iron for ships, firearms, munitions and other military material. After the war, railroads switched from iron to steel, which would last years rather than months.
By 1895, J&L had largely stopped puddling iron due to its expanding steel business. The Bessemer process, a faster way of producing large amounts of steel, was first introduced into the United States in the late 1860s. J&L built a small Bessemer plant in the early 1870s, but abandoned it due to poor production. The company later built a second, improved Bessemer converter in 1886.
Cold rolled iron
During the mid-1850s, J&L, with fewer than 25 employees, was producing seven tons of iron per day. The most notable of its achievements was the development of the process of cold rolling.
Kobus says the beginning of cold rolled iron came about accidentally.
“To make a roll at that time you would have to mold the iron hot,” he says. “One of the men on the rolling train dropped his tongs into the rolls and when the tongs came back out they had a shine and a polish to them.”
The Lauth brothers began to experiment with the process and eventually perfected a method of rolling a stronger, and for many purposes, better product.
“Cold rolled products kept very accurate dimensions,” Kobus says, which was important for shafting and machinery.
George H. Thurston in his book “Pittsburgh and Allegheny in the Centennial Year” (1876), claims that cold rolled iron had “75 percent more effective strength than the same size of turned iron, and is made nowhere else in the world but by this firm at Pittsburgh.”
Steel in the 20th century
By the early 1900s, management realized it needed to expand to remain competitive. Constrained by topography and faced with limited opportunities to enlarge the Pittsburgh site, the company purchased a defunct amusement park at Woodlawn, Pa., some 20 miles downstream from Pittsburgh on the Ohio River.
There, they established the town of Aliquippa and began building their new works. Eventually the Pittsburgh plant would employ 10,000 workers, while the Aliquippa site employed three times as many.
As the years went by, J&L gradually found it more difficult to compete in a global marketplace. Ling-Temco Vought Inc. (LTV) acquired controlling interest of J&L in 1968. In 1974 it became a wholly owned subsidiary of LTV.
In the 1970s, the steel industry began to have problems due to a variety of factors including foreign competition, environmental controls, labor costs and lack of reinvestment. Both the Pittsburgh and Aliquippa Works of LTV were closed in the 1980s.
In 1984, Republic Steel merged with the J&L Steel subsidiary of the LTV Corp., with the new entity being known as LTV Steel. In December 2001, LTV filed for Chapter 11 bankruptcy, and a few months later International Steel Group purchased LTV. It was acquired by Mittal Steel in 2005 which merged with Arcelor to become the world’s largest steel company, ArcelorMittal, in 2006.
How to reach: Rivers of Steel Heritage Corp., (412) 464-4020 or www.riversofsteel.com
Rivers of Steel: Connecting past to present
The Rivers of Steel Heritage Corp. conserves, interprets and develops historical, cultural and recreational resources throughout Western Pennsylvania. Rivers of Steel seeks to link the colonial and industrial heritage to the present and future economic and cultural life of the region and the communities it serves.
The museum and archives division collects and preserves the history of the Rivers of Steel National Heritage Area through artifacts, documents, photographs and audiovisual materials that show many aspects of southwestern Pennsylvania’s industrial, cultural and ethnic traditions. The corporation is located in the historic Bost Building in the Homestead neighborhood.
The Bost Building, built in 1892 as a hotel, served as the temporary headquarters for the Amalgamated Association of Iron and Steel Workers during the Homestead Lockout and Strike.
In addition to the main exhibition room currently featuring “J&L: A Pittsburgh Icon,” there are two rooms that have been restored to the way they looked in 1892, with original floorboards and period reproduction wallpaper. One room tells the story of the Homestead Strike; the other contains photographs that chronicle the restoration of the building from dilapidation through its opening as the Rivers of Steel Visitors Center.
The Bost Building also includes the Homestead Room — a permanent exhibit displaying artifacts and artwork specifically related to the Homestead Works.
For more information about Rivers of Steel Heritage Corp. and to plan a visit to the “J&L: A Pittsburgh Icon” exhibit, visit www.riversofsteel.com.
Over the course of the 120-plus years that Irwin Car and Equipment has been in operation, the company has undergone several ownership and identity changes — but it wasn’t until William Baker took over the company in 1993 that Irwin Car and Equipment started to reach its full potential.
Founded in 1891, Irwin Car started as a manufacturer of cast iron wheels and mine cars. The company evolved into making steel mine cars, but by 1981 and 1982 the industry was changing. Miners were moving away from mine cars and using belts and conveyors. Irwin at that point got left behind.
The company’s president at the time approached Baker about his interest in buying the company. Baker wanted to do a lot more than the current president had wanted or was willing to do. He had been happy running the company with six or seven people and doing less than $1 million a year in business.
“I had known that company for a long time because I was a supplier to it, and I thought it was a niche business that had a lot of potential to grow,” says Baker, who is now the company’s president and CEO. “My goal was to buy the business and take it from six people and grow it to $20 million.”
The few people in the business at the time thought Baker was unwise, but he embarked on a program to build up the company anyway.
“Twenty years later here we are at $50 million in sales with seven business units,” Baker says. “We don’t do anything today that they did back then.”
Here’s how Baker helped Irwin Car and Equipment realize its true potential.
Get with the times
When Baker bought Irwin in 1993 the company was still doing business in industries that were either not growing or dying. Today, the company has grown from six employees to 125.
“We’ve grown dramatically, and we’ve introduced a whole host of new products,” Baker says.
“My background has been in growing and building businesses, and this one isn’t the first that I built.”
Out of college, Baker went to work for Midland Ross, a global diversified manufacturer with $1.2 billion in sales in the 1970s. He was put on a fast track and given experience in a number of different areas of the business.
“I learned how to do things first class with a lot of money, and then first class with no money and a lot of risk,” he says. “Having worked for a big corporation you learn how to do things the right way. I was able to sort the wheat from the chaff and evaluate what I needed to do and what I didn’t need to do and what made sense and didn’t make sense.”
That’s why he wanted to get involved with Irwin and had the vision to take the company beyond what it was doing.
“We have replaced all the equipment and we’re a totally different company,” he says. “We’re a custom engineering and design manufacturer of material handling equipment. We have formed seven business units, and we principally have a lot of niche markets.
“We have a business unit that makes wheels and wheel assemblies for all types of applications. We make wheels from 4 to 65 inches in diameter. We make wheels for the NASA launch pad, the Hubble Telescope Observatory, the Seattle Mariners baseball dome and the Arizona Cardinals turf field that they roll in and out.”
The company has two other business units, one that makes industrial transfer cars with an 800-ton capacity and the another that makes steerable trailers, automatic-guided vehicles and big transporters up to 400-ton capacity.
Irwin still has a business unit that makes specialty cars for the mining industry and tunneling, and one that makes locomotives and mantrips for tunneling and mining. The company also makes the signaling and switch equipment for all the streetcars and light rail systems in North America.
“The company was not in a niche market when I bought it,” Baker says. “It had a wheel business when I bought it, but they only made wheels that were 12, 14 and 16 inches in diameter. My thought was if you could do that you could make bigger wheels, smaller wheels and other circular products.
“It was a situation where we said, ‘If we can make the wheels, we can sell the bearings and mount motors and drives and represent a company that sells roller chain and conveyor chain and sprockets. That led us to moving into industrial cars and beefing up our engineering department. It was a complete building process.”
Focus on growth
Over the past 20 years Baker has managed to grow the company from a
$1 million business into a $50 million one. But he still sees further potential and has his sights set on hitting $100 million.
“That’s not a magic number or anything, but I believe we could get there,” Baker says. “We’re still looking to grow strategically and synergistically. We’re also looking at new product development.
“My philosophy has been that companies don’t just stay the same. If you don’t grow, you actually regress because the market is ever changing, the customer base is ever changing and nothing stays the same.”
Irwin operates in a very tough market, but Baker says this will be the company’s best year ever, not because the economy is good, but because it sells to 22 markets in nine foreign countries and 42 states.
“We’ve been able to increase penetration with our existing customers and increasing penetration with new customers while adding new products,” he says. “We think we can continue to grow. We’re biting off market share from competitors, and there has been a lot of rationalization in the industries we serve, and the strong will survive.”
Baker’s keys to growth success start with him. He views his role in the company as needing to be out in the marketplace so he knows what is happening firsthand.
“I’m out there with our salespeople getting to know our customers and our markets, and based upon that, I have a good feel for what’s happening in the marketplace,” he says. “No. 2 is to have good people to rely on and trust who can assess what’s happening in the marketplace.
“No. 3 is to have a vision of where each market is going and what products may be up and coming and also looking at competitor’s products to see how you could enhance them by working with your customers.”
His other key to growth has been his willingness to take some calculated risks.
“We spent $3.8 million in our manufacturing facilities in the last three or four years when the economy was tanking,” Baker says. “We believed this was the time to do it because the markets would come back some day.”
While those markets are indeed bouncing back, they still aren’t as great as Baker had hoped they would be at this time.
“We basically haven’t seen growth for the last six years and that’s been the biggest challenge,” he says. “We sell to companies like Boeing and Caterpillar, and people aren’t spending any money because they don’t have any confidence. It’s gotten to the point where people have cannibalized and cannibalized to the point where they can’t do it anymore and they have to buy some equipment in terms of modernization, expansion and job creation.”
Looking for a catalyst to get the economy moving again, Baker put his focus on new markets and products for the company.
“We’ve continued to develop new markets and new products,” he says. “One product in particular was a low-emission diesel mantrip and locomotive for the mining and tunneling market. We received a very significant order that has carried us the last 2½ years. It was a great new risk for us and a great new product line.”
That was a high-risk, high-reward proposal for the company, because it was historically making battery and trolley electric locomotives. The jump into diesel was a big stretch.
“You have to look to the future of where that market is going or what kind of products you can produce and what kind of markets you can enter that appear to be high growth and sustainable for the long term,” Baker says.
“I drive my business from a sales and marketing standpoint. From our perspective the customer is No. 1, because if you don’t have a customer you don’t have a business. We’re very customer-oriented, and we’ve continued to work with our customers to develop new products and look for areas where they have needs.” •
- Make sure you see the full potential of your business.
- Focus on growing new markets and products.
- Continue to listen to what your markets and customers are looking for.
The Baker File:
Name: William Baker
Title: President and CEO
Company: Irwin Car and Equipment
Education: He received a degree in management and economics from Westminster College. He also earned a master’s degree in business administration from the University of Toledo.
What was your first job and what did you learn from it? When I was about 12 years old I had a grass cutting business. I also worked for White Swan Amusement Parks for two summers when I was 14. Those jobs taught me to work hard, be focused and that at times I had to make sacrifices. When my friends were out having a good time, I had to work.
What was the best business advice you ever received? You have to treat people like you want to be treated.
In all your experience growing and building businesses, what has been one of the biggest keys to success? The ability to stay focused and be determined are the two critical ingredients.
If you could speak with anyone from the past or present, with whom would you want to speak with? I always admired Vince Lombardi.
How to reach: Irwin Car and Equipment, (724) 864-8900 or www.irwincar.com
The Patient Protection and Affordable Care Act (ACA) will have a profound effect on most employers that offer health plans in 2014.
“Passing the law was the easy part. The process of issuing regulations and guidance between three separate federal agencies — Health and Human Services, Department of Labor and the IRS — is the difficult part. Add to the mix an occasional court ruling and you have the perfect recipe for confusion and the risk of misinformation,” says Chuck Whitford, client advisor at JRG Advisors, the management arm of ChamberChoice.
Smart Business spoke with Whitford about points to consider in the coming year with the ACA.
What’s the first step going into 2014?
Going back to basics, determine if your plan is ‘grandfathered.’ A plan that essentially hasn’t changed since March 23, 2010, is most likely grandfathered. However, if you changed insurance companies before Nov. 1, 2010, or passed along the majority of the rate increases to employees, the plan you thought was grandfathered may not be.
You must tell employees if you have a grandfathered plan. A grandfathered plan can be exempt from some of the ACA rules, such as covering preventive care at 100 percent, continuing coverage for ‘adult dependents’ to age 26 and nondiscrimination rules for fully-insured plans.
How will the exchanges affect employers?
You will most likely be asked questions about the new health insurance benefits exchanges, also known as marketplaces. They are primarily online marketplaces for purchasing health insurance, run either by a state or the federal government. The federal government has a hand in, at least, running exchanges in 33 states. There are two types — one for individuals and one for small employers, generally up to 50 employees.
There have been glitches in these online systems. Once problems are fixed, it should be easier for individuals to review available plans and see if they qualify for subsidies to reduce premiums or, in some cases, reduce the cost sharing of deductibles and coinsurance.
What’s important to know about full-time equivalent (FTE) employees?
For the purpose of the ACA, a full-time employee works 30 or more hours per week, or 130 hours per month. The law requires employers to track the number of full-time employees and add up the hours worked by their part-time employees each month (up to 120 hours per month) and divide by 120 to determine the number of fractional ‘equivalent’ employees.
Employers with 49.99 or fewer FTEs don’t have any requirements to offer coverage and won’t be assessed penalties. The ACA still will impact their health plan’s rates, and they must comply with the 90-day waiting period limit and other ACA provisions.
Employers with 50 or more FTEs must offer coverage, deemed affordable and of minimum value, to all full-time employees and dependents to age 26. If any full-time employee receives subsidized coverage in an exchange, it triggers employer penalties. The ACA defines affordability as the employee’s cost for single coverage not exceeding 9.5 percent of income. A plan covering at least 60 percent of costs on average is considered minimum value.
In July, the Obama administration announced a one-year delay in the penalties and employer reporting. This can create a different set of issues for an employer that offers coverage to employees that work, say, 40 hours per week and has employees who work between 30 and 39 hours per week. These employers may want to hold off extending coverage to their 30- to 39-hour employees until 2015. However, with the individual mandate, employees not offered employer-sponsored coverage might go to the exchange. Some will qualify for a subsidy and also may qualify for cost-sharing reductions. Fast forward to 2015, employers wishing to avoid the nondeductible excise taxes (penalties) may extend eligibility of an affordable plan that meets minimum value to these employees, removing exchange subsidies and increasing the employees’ cost.
Because of the complex nature of the ACA, employers are encouraged to review their employee benefits strategy and communications for 2014 and beyond with a qualified advisor. ●
Insights Employee Benefits is brought to you by ChamberChoice
The modern employee assistance program (EAP) is an employer-sponsored benefit designed to support the achievement of employer health and productivity goals. EAPs also have evolved to become a strategic partner to maximize the human capital of an organization.
“An EAP’s main goal is to resolve problems before they interfere with work attendance or productivity. And, in performing that task, EAPs have a positive impact on a company’s bottom line,” says Sandra Caffo, a senior director at LifeSolutions, an affiliated company of UPMC WorkPartners.
Smart Business spoke with Caffo about how EAPs work and their ROI.
What is the potential payoff of using an EAP?
A study found that for every dollar spent in a typical EAP, there was a return of $5.17 to $6.47 in increased work productivity. The study also showed that 80 percent of costs from lost productivity were associated with presenteeism, which is when an employee is at work, but is not productive, largely because of personal problems.
EAPs employ behavioral health experts who can provide short-term coaching and counseling that focuses on problem resolution. The goal with all EAP services is to resolve problems before they interfere with work attendance or productivity. Because of that, EAPs can help supervisors understand how to manage those valued workers whose productivity suddenly and mysteriously plummets.
How do EAPs enhance value?
Supervisors may be able to spot a troubled employee and express concern, but typically they are not equipped to work out a plan of action to address the problem. Many supervisors would argue — correctly — that this isn’t part of their job description. That’s where an EAP can help. It can provide consultation to both the manager and the employee to develop a plan of action.
EAP consultants are able to guide leaders at all levels to shift their focus to management strategies that will make a difference in an employee’s job performance. With an EAP management consultant, leaders learn how to coach employees toward improved performance while holding them accountable for negative patterns of behavior.
Because EAPs are able to provide services that consider all of the occupational and non-occupational factors that affect job performance, they are able to increase the value of an organization’s investment in its workforce. They achieve this in several ways:
- By increasing employee engagement and improving productivity, morale and workplace harmony.
- By focusing on building the capacity of employees and their dependents to successfully respond to life’s personal and work-related challenges.
- Through EAP coaching and consultation, which helps leadership, managers and supervisors increase their skills to effectively address difficult employee situations. It can tailor programs and initiatives for key workforce groups to meet specific needs.
How does an EAP mitigate business risks?
Supervisor consultation helps to build action plans and handle new or complicated employee situations, from incompatible employees to workforce reductions.
On-site trainings focus on staff development and skill building in areas such as stress management, customer service and multi-generational teams.
EAP intervention also can help when an organization has a traumatic incident like an accident or death to support those managing the situation and those affected by it.
A federal occupational health study of more than 60,000 workers using EAP services over a three-year period found statistically significant improvement from pre- to post-EAP intervention for six measures related to work productivity. These include: employees’ emotional problems, employees’ physical health, the interference of physical or emotional issues on work and social relationships, perceived health status, job attendance and/or tardiness, and global assessment of functioning. In short, the benefits of EAPs are measurable, and they can be used to select an effective EAP, gauge its performance and determine the ROI. ●
UPMC WorkPartners is part of the UPMC Insurance Services Division, which also includes: UPMC Health Plan, UPMC for Life, UPMC for You, UPMC for You Advantage, UPMC for Kids, Community Care Behavioral Health, EBenefit Solutions and Askesis Development Group.
Insights Health Care is brought to you by UPMC Health Plan
If you were to assemble some of the world’s outstanding business leaders in one place and ask them their secret to sleeping well at night amid the pressures of running a successful business, you might think you’d collect the best tips to handling anxiety in the business world.
The truth is that top business leaders often don’t have a secret to reveal — they rely on the strength and confidence they’ve developed over the years.
At the EY World Entrepreneur Of The Year conference, held earlier this year in Monaco, EY Entrepreneur Of The Year country winners assembled to compete for the World Entrepreneur Of The Year title.
We took the opportunity to collect the thoughts of the world’s most accomplished entrepreneurs — innovators, futurists, turnaround specialists and problem solvers — about dealing with worries. ●
“There’s nothing that keeps me up at night. I sleep very well. The challenge we have as a company is to keep delivering the culture we have created and expand it, keep evolving at the speed our customers expect us to evolve and keep creating value for them as we have for the past 10 years.”
Entrepreneur Of The Year 2012 Argentina
“The main thing is to make sure that we are always looking for new, creative ideas that keep our business updated with new technology and creativity. The other thing is making sure we are working faster than before.”
Lorenzo Barrera Segovia
founder and CEO
Entrepreneur Of The Year 2012 Mexico
“Business has its highs and lows, because let’s face it, it’s not easy. It has its challenges. They asked Steve Jobs what was the most important thing in business and he said, ‘Passion.’ If you don’t have passion you would give up when things get difficult. We have so much passion and love for what we do that it becomes a part of our life.”
founder, president and CEO
Entrepreneur Of The Year 2012 United States
2013 World Entrepreneur Of The Year
“What if the stock market crashes? What if there is some unknown thing that happens? What if there’s another 9/11 type of situation? Companies need to carry on, but maybe they don’t need to do events. Maybe they cut back on entertainment and speakers. The worry is what happens if something happens that I can’t control.”
President and founder
SME Entertainment Group
“We are in recovering times. I feel very positive about the economy in general, but I’m still very worried about Europe. And while we are recovering, it’s still choppy and choppy times are times when there are more needs out there.”
Retired global chairman and CEO
"I guess there is a point in my life where I thought it is all about me, and I am going to be the guy that guides everything and controls everything. What I have learned is that the best thing that I have done for our business is learn to let go and learn to get people who are better equipped to manage specific areas, do their thing and not get in the way."
Dr. Alan Ulsifer
CEO, president and chair
Entrepreneur Of The Year 2012 Canada
“Nothing keeps me awake at night becase my work is solid.
My father married at 60 and my mother was 23. They had four children. Then he died, and we quickly had to start thinking about what to do. There was no money — nothing. We had to leave the little town we lived in because of violence there. Thanks to that, I am where I am right now because I still could be on the streets of my village selling tobacco. There is no wrong that can do good. That's what I have to teach people.”
founder and president
Entrepreneur Of The Year 2012 Colombia