Montgomery & Graham February Newsletter

Why Worry about October in February?

2010-02-10T09:23:00.000-08:00

Because it Might Make your Workers’ Compensation Insurance Premiums Much more Affordable.

By Jeff DeHaan, CPCU

You might not know that Unit Statistical Card Data is filed six months ahead of the time your company’s premiums are calculated for the coming year for Workers’ Compensation Insurance. If you’re not even really sure what Unit Statistical Data is, it’s important to note that mistakes and reserves for claims that have not yet been paid can make a big impact on what you pay for coverage.

What is ‘Unit Statistical Data’?
Unit Statistical Data is audited exposure, premium, and loss information for a policy. Each year the National Council on Compensation Insurance (NCCI) collects the following:
• Data from about 2.6 million policies
• More than 4 million unit statistical reports
• Detailed claim information on more than 248,000 claims

The Unit Statistical Data for every policy year needs to be reported based on a valuation 18 months after the inception of the policy. This means that if your policy renews on October 1, the data impacting what you will pay for your insurance is valued as of March 30.

What difference does that make to what I pay?
In Oregon, your actual workers compensation insurance premiums are linked to your actual loss experience (claims) through the Experience Rating. The rating increases or decreases your company’s premium for the current policy period based on your actual losses during previous policy periods.

The Experience Rating uses a formula that compares your company’s actual losses with the losses expected for an average company of your size and type. Your future workers compensation insurance rates are then adjusted up or down based on how well you do against the average.

How do I know if My Company Can Save Money on WC Insurance?

If you want to learn more about the Montgomery & Graham Property & Casualty Workers’ Compensation FREE Audit Program and how it can help your business please email me at jdehaan@mg-pc.com

Democratic leaders said to be still unsure on how to proceed with health reform.

2010-02-10T09:22:00.000-08:00

NAHU Newswire

CQ Today (2/3, Armstrong, Wayne) reports that Democratic leaders "have told rank-and-file lawmakers that they have no solution yet" to passing healthcare reform, but they "are working with the White House to salvage" the legislation. "House and Senate leaders appear to be struggling to reach agreement on which side would move first with a package of changes to the Senate bill (HR 3590) that would be passed through the budget reconciliation process. Neither side appears to want to be the one initiating that process, though [Senate Majority Leader Harry] Reid (D-NV) and his aides have argued that it is up to the House to act first."

On Tuesday, Roll Call (2/3, Dennis) reports, House Majority Leader Steny Hoyer (D-MD) was asked about a statement he made last week that "Democrats would like to decide on a path forward sometime this week." He admitted, "Did I say that. ... I was in error." He added, "I anticipate making a decision just as soon as the way forward is clear."

Fox News (2/3, Pergram) adds that "Hoyer indicated the Democratic brain trust was considering a number of options, ranging from a conference committee to resolve differences in the health bill, to using special budget rules that would allow Democrats to bypass the supermajority requirement to quash Senate debate. He also said it was possible that Democrats could break the broader bill into smaller pieces of legislation."

First Lady urges Congress to pass healthcare reform. NBC Nightly News (2/2, story 7, 0:40, Williams) noted that "in an interview to air on 'The Today Show,' Matt Lauer talked to the First Lady about...the overall effort to get healthcare reform passed." The First Lady was shown saying, "This is the right thing for the country. It's hard. It's scary. It's confusing. But I hope for our country's sake we can do it now and not wait until things get worse. I mean, I agree with the President when he said we don't have the option to do nothing. He's right."

Rangel says work has begun on compromise bill. The AP (2/3, Fram) reports that Rep. Charles Rangel (D-NY) indicated that "leading lawmakers hoping to revive President Barack Obama's stalled health care overhaul have started writing a compromise bill, but it's unclear when the legislation will be ready for votes." He expects that "the measure would change the massive Senate-approved health bill to what bargainers from the White House, Senate and House agreed to last month." The AP calls Rangel's comments "the first concrete sign that Democrats will try enacting major health legislation in the wake of the Republican upset in a Massachusetts special election that cost them their crucial 60th Senate seat."

Understanding your Responsibilities under FMLA

2010-02-10T09:20:00.000-08:00

As a small business owner, you've probably realized success depends on anticipating and managing the various risks and opportunities that confront your venture. You've envisioned a number of these scenarios and your responses to them in your business plan. You've given extensive thought to your marketing and sales, manufacturing, and purchasing strategies - but what about your employee strategy? The Family and Medical Leave Act (FMLA) of 1993 is one of many regulations that makes it imperative for small business owners to consider human resources in a different light to avoid losing expensive lawsuits, alienating your workforce and distracting your attention.

What FMLA Requires

FMLA, a workplace law in the domain of the United States Department of Labor, requires companies that employ a workforce of 50 or more or that are public agencies to make unpaid leave of up to 12 weeks available to employees facing personal medical problems, the birth or adoption of a child or the need to care for a family member. FMLA applies specifically to employees who have worked for your company for at least 12 months and 1,250 hours and who intend to return to work at the conclusion of their leave. You must continue to pay the benefits of these employees and save their jobs for them.

The costs of compliance are high. The Small Business Administration estimates that "small businesses spend $6.3 billion a year on the Family and Medical Leave Act compliance," averaging $31,500 per eligible small business. Fortunately, it is possible to minimize or even eliminate this cost by understanding what FMLA requires you to do.

Bringing a weekend mindset to work

2010-02-10T09:10:00.000-08:00

By Lydell C. Bridgeford January 20, 2010

New research by the University of Rochester suggests that employers can improve their work-life balance initiatives by studying the moods of their workers during the weekend.

In the study, which focused on workers’ physical and mental well-being during Friday evenings to Sunday afternoons, researchers found that employed adults experience better moods, greater vitality and fewer aches and pains during the weekend.

“Workers, even those with interesting, high status jobs, really are happier on the weekend,” says Richard Ryan, a professor of psychology at the University of Rochester. “Our findings highlight just how important free time is to an individual's well-being," Ryan adds. “Far from frivolous, the relatively unfettered time on weekends provides critical opportunities for bonding with others, exploring interests and relaxing -- basic psychological needs that people should be careful not to crowd out with overwork.”

Participants in the study were paged three times a day, the morning, the afternoon and the evening, to complete a brief questionnaire. They had to rank, using a seven-point scale, positive and negative feelings and physical symptoms associated with weekend activities.

The survey involved 74 adults, aged 18 to 62, who worked at least 30 hours per week. The research also reveals that workers felt more competent during the weekend than during the work week.

This analysis “offers one of the first substantive and theory-based explanations for why well-being tends to be more favorable on the weekends: People experience greater autonomy and relatedness, which are, in turn, related to higher wellness,” the researchers write. By contrast, the work week “is replete with activities involving external controls, time pressures, and demands on behavior related to work, child care and other constraints.”

The findings also prompt a broader discussion on how the workplace can support workers’ psychological needs. “To the extent that daily life, including work, affords a sense of autonomy, relatedness, and competence, well-being may be higher and more stable, rather than regularly rising and falling,” the researchers observe.

What is the best way to hire the right employee?

2010-02-10T09:01:00.000-08:00

SOURCE: Patsy Svare, managing director, the Chatfield Group, Northbrook, Illinois, December 7, 2009

Dear Workforce:

I've heard a lot about finding the right “organizational fit” when hiring new employees. My question is a little different. Specifically, how do we develop good interview questions/hiring criteria to ensure a good match as we search for a prospective new HR director?

—Criteria-Challenged, HR assistant, telecommunications, Seattle

Dear Criteria-Challenged:

Hiring a new HR director is one of the most important decisions your company will make. In addition to being a strong “culture fit,” your HR director must bring the technical know-how and specific leadership competencies that will be needed in the future.

Your top HR exec plays a critical role in coaching employees at all levels, driving organizational change, shaping performance expectations and building people programs, as well as leading by example. Does your CEO know what changes will be needed from employees in the future? Your HR director must be able to demonstrate these new expectations while also coaching and influencing others to adopt them.
In addition to up-to-date technical competencies—such as knowledge and experience with best-practice recruiting strategies, compensation and benefit plan design, employee relations programs, leadership, and technical training and development—the HR exec needs to be a good manager of budgets and of the people who work as internal consultants to the organizations.

The ability to help organizations find their way through change is an advanced competency, and may not be as easy to find in a candidate as a good cultural fit or technical know-how.

As you prepare for candidate interviews, aim to get double value from interview questions such as these:

• What have you done to address your organization’s need for change in its employment practices?

• How did you go about installing new workforce health and safety measures? Where did you find the most helpful ideas for new programs?

• When you developed the company’s new pay-for-performance programs, what resistance did you face, and how did you handle it?

You can modify any of these questions for other areas of HR where the candidate installed or updated programs, e.g., training curriculum, compensation plans, etc. The idea is to get a sense of technical knowledge and skills, as well as the leadership competencies that were required to match programs to business strategy, and to coach and influence others to accept the new programs and practices.
Structure the HR director interview to be sure the candidate has a good handle on the three key building blocks for success that are specific to the HR director role: technical know-how/best practices, culture fit and leadership competencies.
Finally, here’s a short list of leadership abilities you might want to consider as you build your HR leadership competency model:

• Strategic thinking ability
• Change management ability
• Coaching ability
• Creativity
• Diplomacy
• Emotional intelligence
• Managerial courage
• Negotiation skills
• Decision-making skills, good judgment
• Resourcefulness
• Strategic ability
• Tolerance of ambiguity