All posts by Alex Lopez

paid sabbatical

Paid Sabbaticals: Are they worth it for employee retention?

Today’s employers are looking to increase employee retention at all costs. Some even go as far as offering paid sabbaticals–an extended leave to work on personal and professional development. Many are seeing considerable success, but are paid sabbaticals viable for your company?

 

Current Retention Statistics

Retention rates across most industries are quite dismal. Gallup’s State of the American Workforce study found, “51 percent of workers are looking to leave their current jobs.” When it comes to higher education employees earning top salaries, it’s even worse. Another study from meQuilibrium reports, “42 percent of employees earning $75,000 or more intend to quit in the next 6 months.”

Statistics like these prove that employers need to be proactive about reducing turnover and remain diligent about retaining top talent. Paid sabbaticals are one of the more alluring options.

 

The Concept

Here’s how the sabbatical process works. Eligible employees who have worked for a company for a designated amount of time (usually at least three years) receive paid leave for a pre-determined duration. In most cases, this ranges anywhere from one to six months. During this time, the employee engages in enriching activities such as travel or volunteering that contributes to their personal/professional development.

Employees on sabbatical still receive either full or partial compensation. The main purpose is to provide employees with a chance to recharge and grow. In turn, it should result in more loyal, educated and enlightened employees.

 

Does it Work?

You may be wondering about the practicality of paid sabbaticals. Is it really viable for SMBs?

If you look at the employers listed on Fortune’s 100 Best Companies to Work For in 2012, roughly 25 percent of them offered paid sabbaticals. This is unlikely to be a fluke and shows that there is, in fact, a correlation between this type of program and company success. For the most part, employees respond quite favorably to this type of perk. It can be especially popular among millennials who tend to value flexibility and self-development.

However, it’s important to note that most companies have at least 1,000 employees and many have 2,000 plus. Employee absences are not always feasible for really small businesses with tight budgets and 100 or fewer employees.

The employees who typically participate are those who are highly skilled, talented and sought after. Some of the most common industries taking advantage of sabbaticals are finance and high-tech. In other words, you don’t usually see low-wage workers taking paid sabbaticals.

 

Making the Call

This is definitely a program worth considering. It encourages loyalty and retention because only employees who have been part of your company for an extended period of time are eligible. However, you’ll want to examine all of the angles before deciding whether or not it makes sense for your business.

 

 

Setting Career Expectations: How to balance employees desire vs actual opportunity

Career development is a common objective among most of today’s employees. Millennials, in particular, tend to place an emphasis on consistent progression and may be inclined to look elsewhere if a company can’t offer advancement opportunities. Unfortunately, there are often limitations to employee development, and an individual’s desires can’t always be met. It’s important to take the right approach when setting career expectations.

 

Assessing Employees

There are typically two factors that prevent employees from ascending their way up the company ladder – lack of talent, skills, and knowledge and/or inadequate budget.

It’s important to be completely honest about an employee’s aptitude and overall abilities. Maybe someone would love to be promoted to a position in senior management, but they simply don’t possess the skills for that to become a reality.

When setting career expectations, you need to be open and honest in terms of how much advancement a particular employee can expect based on their talent level. In some cases, you can work alongside an employee to fill the gaps. Other times, substantial career advancement isn’t in the equation.

Either way, you should be upfront about what the likelihood of progression is within your company. This ensures that you’re on the same page right out of the gate and prevents resentment when an employee doesn’t get the push they were anticipating.

 

Addressing Budgetary Restrictions

The second factor that often stands in the way is a lacking career development budget. While some companies actively invest in employees by paying for educational training or offering financial assistance to undergraduates seeking graduate degrees, it’s not in the cards for every organization.

Be honest about the situation. If it’s unlikely that a person will ever have the opportunity for advancement, you definitely don’t want to fill their head with false hopes. Explain your company’s circumstances and that career development may not be a reality.

However, companies can establish an employee development program even with a small budget. There are innumerable digital materials on the Internet that can be used to train and educate the right employees. You may also want to consider the idea of mentorship where senior staff members provide guidance to promising workers. Resources from ClearCompany and the SBA can provide further insight.

Employers obviously want to see employees grow and progress. Their personal success ultimately spills over and improves your business as a whole. It’s only natural that you’ll want to give your employees the opportunity for career advancement.

At the same time, it’s crucial to set career expectations the right way. Take a realistic approach by balancing employee desire with actual opportunities to keep everyone happy and your business on track.

 

 

Make Next Year Your Best: End of the Year Checklist for Businesses

2017 is nearly over, and the holidays are coming to a close. But things are just as hectic as ever for many small business owners. With a mountain of year-end tasks on your plate and tax season looming, it’s easy to get overwhelmed. Following an end of the year checklist should help you keep all your ducks in a row and get 2018 started out on the right foot.

 

Gather Tax Information

Begin by compiling all the necessary documents for handling taxes. This can include:

  • Income statements
  • List of operating expenses
  • List of assets bought or sold
  • Invoices and receipts
  • Deductions

Ideally, you will have this information already organized. If not, it’s smart to invest in some accounting software moving forward.

 

Double-Check Payroll Information

According to Fundera, “33 percent of small businesses get fined for doing payroll incorrectly, often because they’re trying to do it on their own and don’t know the nuances.” Claiming ignorance won’t work with the IRS, and you could get hit with some ugly penalties.

Always double-check everything payroll-related and make sure that you’re correctly classifying employees and independent contractors. For more on this, please consult RMI’s Payroll Guide.

 

Get a Snapshot of Your Cash Flow

It’s important to know how you’re positioned in terms of cash flow. There are three key areas to examine to determine this:

  1. Cash flow from operating activities (e.g. revenues and expenses)
  2. Cash flow from investing activities (e.g. assets purchased and assets sold)
  3. Cash flow from financial activities (e.g. loans and loan repayments)

Doing this unassisted can be a little tricky, so you may want to use a tool like the Pulse App. This will generate robust, visual-driven reports to fill you in on the details.

 

Perform an Inventory Count

If you have physical products, it’s a good idea to count inventory levels at the end of each year. You’ll want to ensure that you’ve got an accurate count for accounting purposes and to minimize revenue loss due to theft. This should also give you an idea of what type of growth your business is experiencing long-term.

 

Back Up Critical Data

We live in a very uncertain world. You never know when important documents could go missing and cause you unwanted headaches and financial loss. Do the smart thing and back up all critical data in a stable cloud environment.

Make sure to choose a cloud provider with an emphasis on security. Also be sure to carefully organize and classify information for easy retrieval later on.

 

Examine Your Needs for Next Year

Analyzing your situation at the end of the year should shed light on your needs for the following year. For instance, you may need to hire some additional staff members or downsize, invest in more equipment, adjust your budget and so on.

This end of the year checklist should serve as a basic template to close out the year with minimal setbacks. Hopefully, this will allow you to run your business with a greater degree of efficiency and help you make a smooth transition into the New Year.

 

Office Environment: What yours says about your company culture

Company culture is impacted by many different elements. Philosophy and values play a large role, but office environment is equally influential. Aesthetics and ergonomic factors like furniture, decor, layout and overall office design can all play a major role in your company’s culture.

 

What Research Says

Blue Kite Marketing performed a study where they asked companies whether or not they believed office environment affected their company culture. According to their research, “53 percent of companies said their physical space – including design, decor and layout – reflects their brand.” This is a clear indication that there is an overlap. Specifically, business owners should think about key elements in the environment.

 

Color

Darkly colored, dimly lit offices tends to signal a serious and formal environment that can come across as unfriendly to customers and clients. Employees may work independently where minimal interaction takes place. This emits a closed-off feel.

Conversely, a light colored office indicates a warmer atmosphere where a lot of collaboration goes on. Google’s offices are a great example.

 

Organization (or the Lack Thereof)

Office organization is another reflection of company culture. Are employees’ desks cluttered with piles of papers? Is it highly organized with a minimalist vibe? Or is it somewhere in between?

Generally speaking, a well-organized office indicates your company has its ducks in a row. You’re efficient, stay on top of projects and usually meet deadlines. An office with a lot of clutter that’s in general disarray tends to mean the opposite.

 

Layout

There are two primary types of layouts – open and closed. Open layouts include few, if any, barriers between desks. Employees work side-by-side within close proximity of each other. Cultures that value collaboration often opt for an open layout. They are catching on in many modern offices and are popular with millennials.

A closed layout was very common in the 80’s and 90’s, consisting of a standard cubicle-based office. It lends itself to less interaction and collaboration, which may indicate less chemistry and cohesion among your staff.

 

Technology

Are your employees using sleek, modern laptops they can easily unplug to seamlessly transition to a different workstation? Or are they using goliath, antiquated desktops that render them immobile?

The former is usually found at more innovative companies that are tech-savvy and value a collaborative environment. The latter is often found at more traditional companies where innovation and collaboration may be lacking.

Your office environment may impact your company culture more than you think. In many ways, it can shape your company’s value and collective mindset. It can also influence the direction your company takes and its overall success. If you’re not satisfied with your current office environment, you may want to revamp it so that it’s more in line with your company’s vision.

 

The Keys to the Virtual Interview

The concept of a virtual interview has gained a lot of momentum in a short period of time. Not only does it enable recruiters to streamline the interview process, it saves money because candidates don’t have to fly in. This means there’s opportunity for your company if you know how to fully harness the power of the virtual interview.

 

Choosing a Platform

The technology you use will heavily impact how successful you are. Many companies opt for basic platforms such as Skype, FaceTime, and Google Hangouts. These are free and should be sufficient if you’re interviewing on a small scale.

However, you may want to look into more comprehensive platforms that cost money but have more robust features. For instance, some platforms offer:

  • A pre-recorded interview system
  • Branding display for more of a professional feel
  • Real-time skill assessment
  • Interview analytics
  • Applicant organization features

If you plan on doing these types of interviews on an ongoing basis, it may be worth the investment. This resource from Capterra offers reviews on some of the top virtual interview software.

 

Set Up

Address a few factors before meeting with a candidate digitally. For starters, position your webcam at eye level so that your head and shoulders are included in the frame. Sit in a quiet environment that’s void of distractions. Be sure that the location is organized and that you’re dressed professionally. After all, it’s just as important that you make a positive impression on a candidate.

Gather materials such as a candidate’s resume, cover letter, portfolio, etc. and have them with you before the interview commences. If you need to access online resources, open the necessary tabs ahead of time.

 

Objectives

The vast majority of recruiters use a video interview to filter promising candidates and narrow it down to a few of the most impressive. Therefore, your main goal is to determine:

  • Whether or not they have the skills and knowledge needed for a position
  • If they’ve got the work ethic, soft skills and other intangibles you’re looking for
  • If they have a personality that will mesh with your company culture

Knowing your objectives will dictate the types of questions you ask and your overall approach to the process. Generally speaking, you don’t need to get highly detailed with your questions. Focus on the questions that will give you a good feel for a person’s professional qualifications.

You can always follow up with additional questions in the final round of hiring. Remember to veer away from anything that could be deemed discriminatory just like you would with a traditional face-to-face interview.

An OfficeTeam survey suggests that 63 percent of employment interviews are done via video. This is definitely a medium to consider. Achieving success with it boils down to finding the right platform and taking an organized, systematic approach to the process.

Should You Reimburse for Continuing Education?

Offering the right benefits can give your company a competitive advantage in terms of recruiting and retention. However, you need to be sure that the benefits you offer are financially feasible and have a favorable ROI. One trend that’s catching on is reimbursing employees for continuing education. Does it make sense for your business, and will it add to your bottom line?

 

The Pros

Develop Your Employees

As an employer, it’s only natural to be invested in your staff. Their personal success inevitably contributes to the success and growth of your company. Reimbursing employees for continuing education improves their knowledge and develops their skills, which they can then utilize to become better employees. This can translate into improved performance, increased output and more.

 

It Can Increase Loyalty and Morale

Offering this benefit shows your team members that you want to see them flourish. You don’t merely view them as cogs in the machine, but you genuinely want them to thrive. This can quickly breed loyalty and raise morale. In turn, employees are likely to put forth a greater effort and go the extra mile for you.

 

It’s Tax Deductible

You should also know that you can deduct this benefit as a business expense. According to BizFilings, “Educational assistance programs allow employers to provide employees with educational assistance of up to $5,250 annually excluded from an employee’s income. Employers can claim a business deduction for educational employee benefits paid and are not required to pay FICA or FUTA payroll taxes for benefits provided under the program.”

 

The Cons

Upfront Costs

Tuition costs can be expensive. According to the College Board, “The average cost of tuition and fees for the 2016–2017 school year was $33,480 at private colleges, $9,650 for state residents at public colleges, and $24,930 for out-of-state residents attending public universities.”

Although you may not pay an employee’s entire tuition, this can still be a major expense, especially if you’re offering it to multiple employees. If you’re a new company or operating on a minimal budget, it may simply not be feasible.

 

Scheduling Conflicts

It’s not always easy to juggle higher education with a full-time or even part-time career. Combine this with raising children and other obligations and it can create issues with scheduling. Not to mention an employee’s performance can diminish if they’re fatigued with a full plate.

 

Employees May Look for Greener Pastures

There’s also the potential for this benefit to backfire. In some cases, employees will develop their skills, improve their education and ultimately leave for a higher paying job. In this scenario, all of the money you funneled into reimbursing their continuing education will be futile and you’re wasting resources.

It’s good to explore different benefits to offer your employees. Reimbursing employees for continuing education is becoming more and more popular and makes sense in certain situations. Carefully weighing the pros and cons should help you determine if it makes sense for your company so that you can make an informed decision.

 

Is Student Loan Forgiveness an Option to Lure New Employees?

Recruiting can be brutal. Not only must you acquire top industry talent, you need to retain your employees long-term. This can be difficult, especially when it comes to millennials who have a penchant for chronic job hopping. One benefit that’s gaining ground is student loan forgiveness.

 

An Enticing Proposition

A significant number of Americans are plagued with student loan debt. The College Investor points out, “Roughly 43 million people have student loans, and the U.S. workforce is roughly 144 million people, which means almost one in three workers have student loans.” In theory, a third of potential new hires have student debt they need to pay off.

You can bet that student loan forgiveness looks very appealing to many job seekers, especially millennials. A survey from Student Loan Hero found that nearly 46 percent of employees would prefer student loan payment assistance over a 401(k) retirement plan. This number is even higher among 18 – 24-year-olds where 54 percent would choose this option. If you’re specifically targeting younger employees in your recruiting efforts, this can give you an upper hand over competitors.

 

Companies Offering This Benefit

At the moment, only three percent of companies currently offer student loan forgiveness. Some notables include Chegg, Fidelity, and Kronos. However, it’s definitely a trend that’s catching on. More companies are realizing that there’s a genuine need for financial assistance, and it’s something that many job seekers respond to. Forbes even lists student loan forgiveness as the hottest benefit of 2017.

 

Lawmakers Take Notice

As of now, there is only tax-free tuition reimbursement but no tax-free student loan repayment. However, this may change in the near future as a bill was recently introduced in early January 2017 called The Student Loan Repayment Assistance Act of 2017.

The act enables employers to make tax-free repayments of their employees’ student loans as well as provide a business-related tax credit. With the cost of higher education being at an all-time high, lawmakers are working to provide relief in any way they can. This added incentive would make loan forgiveness even more popular among companies.

 

Is It Right for Your Company?

It’s safe to say that this could be a smart move if your company is looking for an edge in recruiting. It should be especially effective if you’re looking to recruit bright young talent. With such a small percentage of companies currently offering this benefit, it can make your company stand out from the pack.

The great thing about student loan forgiveness is that it can also be structured to improve retention. An example is Natixis Global Access Management, which pays a lump sum of $5,000 to employees who have been with the company for five years and $1,000 annually for up to five more years. Of course you can create your own terms, but this just shows how this benefits aids in both recruiting and retention.

It will be interesting to see how offering student loan forgiveness as a benefit will play out. Although it’s only currently offered by a small number of companies, it’s likely to catch on, especially if the Student Loan Repayment Assistance Act of 2017 is passed.

 

7 Tasks You Can Outsource to a Virtual Assistant

As a business owner, you probably have a lot on your plate. There may not always be enough hours in the day to get everything done. A never-ending to-do list can be frustrating and overwhelming. Fortunately, we live in a digital age where an abundance of virtual assistant services are available. If you’re feeling swamped, there are seven tasks you can outsource immediately.

 

1. Posting and Responding on Social Media

Networks like Facebook, Twitter and LinkedIn are gold mines for lead generation. However, they also require a lot of upkeep. A virtual assistant (VA) can handle the more time consuming aspects like posting content from your blog and curating content from relevant industry sites. You can also have employees promptly respond to comments so that you don’t leave leads hanging.

 

2. Online Research

Sales and marketing research as well as researching industry trends are extremely important. This is what enables you to create valuable content and identify potential opportunities. A manual approach can be a time drainer. A VA can do the heavy lifting and provide you with actionable intel.

 

3. File Management

Do you save and store files digitally on platforms like Google Drive and Dropbox? Things get out of control in a hurry without ongoing file management. A VA can stay on top of this at all times so that your files are labeled, categorized and organized for easy retrieval.

 

4. Invoicing Clients

In terms of the financial/accounting side of things, a VA will be able to handle basic invoicing as well. They will ensure that all invoices are created correctly and go out on time without having to handle it yourself.

 

5. Proofreading/Editing Blog Posts

It’s really important that your blog posts are flawless from a spelling and grammatical standpoint. Glaring errors make you look unprofessional and can be a deal breaker for would-be customers. There are numerous VA services that will proofread and edit your blog posts to ensure they’re error free. You can even have freelance writers handle content creation entirely.

 

6. Creating Analytics Reports

Whether you’re monitoring the effectiveness of your SEO campaign, social media or PPC, you’ll need access to accurate reporting. A VA will take care of the more arduous elements of this process so that you have continually fresh reports at your fingertips.

 

7. Sending Email Blasts

According to research from Statista, “86 percent of consumers would like to receive promotional emails from companies they do business with at least monthly, and 15 percent would like to get them daily.” Why not have a VA take care of engaging and maintaining your email subscriptions? They can write emails, feature relevant promotions, respond to inquiries and so on.

 

If you’re pressed for time, hiring a VA makes all the sense in the world. These are just a few of the tasks you can outsource, and there are many other possibilities depending upon your specific needs. For more information on how the process works and advice for getting started, listen to this podcast from outsourcing expert Chris Ducker.

 

 

Excessive Workload: Has Overwork Become the New Norm?

Americans are working more hours than ever, and many are paying the price for it. We’ve arguably never seen a higher level of collective stress, exhaustion, and burnout than we’re seeing today — all stemming from an excessive workload. Has overwork become the new norm?

 

America vs. Other Major Economies

A study from CNN Money examined how many hours people worked each week in several different countries with major economies. According to their findings, America was at the top of the list with the average American working 34.4 hours per week.

To put things into perspective, here are the average hours worked per week in other countries:

  • Australia – 32.4 hours
  • Sweden – 31.2 hours
  • Switzerland – 31.1 hours
  • Austria – 30.3 hours
  • Ireland – 29.4 hours
  • Luxembourg – 29 hours

Keep in mind that this study takes both full-time and part-time workers into account. A separate study from Gallup reported, ” Adults employed full-time report working an average of 47 hours per week, which equates to nearly six days a week.” That’s a lot of work.

 

The Consequences

Chronic overwork can have a host of unsavory side-effects. Obvious symptoms include an increase in stress levels and fatigue. There can also be a plethora of long-term health complications including sleep loss, depression, diabetes and heart disease. Researchers have even found a correlation between an excessive workload and heavy drinking, especially among low-income workers.

You might expect an increased workload to result in higher productivity and output. This isn’t the case. Although you may see a temporary increase in productivity if employees raise their workweek from 40 hours to 60, pushing your employees like this has virtually no long-term impact on productivity. A study by Boston University’s Questrom School of Business found, “Managers could not tell the difference between employees who actually worked 80 hours a week and those who just pretended to.”

In a sense, an excessive workload is simply creating discord without any tangible long-term benefits. You can also bet that it’s not going to do your business any favors in terms of recruiting and employee retention.

 

Addressing the Issue

If an excessive workload is pervasive at your company, it’s something you’ll definitely want to address. Left unchecked, it could hurt morale, drive valued employees away, hurt your company culture and diminish your overall brand equity.

Here are a few ways you can prevent overwork and give your employees a healthier work/life balance:

  • Offer flexible scheduling
  • Allow employees to telecommute whenever possible
  • Mandate that employees must use their vacation days
  • Allow employees to completely disconnect from work during vacation time (contact them only for absolute emergencies)
  • Offer unpaid time off for major life events

 

Pushing employees to work longer hours can be tempting because of the perceived upswing in productivity. However, experts seem to agree that this usually does more harm than good. There’s no denying that overwork has become the norm in America, but there are several things you can do to ensure that this isn’t an issue for your company.