The tiered system usually breaks down into these categories:  Employee only (individual), employee plus spouse (or increasingly plus one, either spouse, partner or child), Employee plus children (without spouse/partner), or Employee plus spouse/partner and children (family).  Each level may require a different level of cost sharing with employee.  In some cases the plans may limit the number of children eligible for coverage.

There is another interesting factor that companies are using to mitigate their healthcare insurance expenses – focusing on the employee’s eligibility for coverage under a spouse’s plan.  Some companies deny coverage to spouses that have insurance through another source.  In some cases the employee may be charged a “surcharge” if they are eligible for coverage from another source. 

Pricing of coverage is very important in the overall picture.  If the company’s policy is inexpensive relative to the employee’s spouse’s plan, then the employer may end up covering more dependants than other companies in the area.  If the pricing is too restrictive, then employees may not get the coverage they need for their families,   The end result may be a  hardship for that employee in the event of a health issue, or the employee may search for other employment due to this dissatisfier.

Now let’s throw another factor into the mix.  In a blog in the New York Times online recently, the blogger posted the idea that American insurance companies may go away altogether.  There are a couple of reasons given:  first , over 60% of working Americans are now covered by a company self-insurance plan.  Second, the new healthcare reform act, focusing on accountable care organizations, may significantly affect the reimbursement process for care.  The outcome may be that providers are reimbursed by patient, with bonuses for quality achievements.  Theoretically the providers will be focused on keeping the patient healthy to keep treatment costs down. Also there’s no need for an insurance “gatekeeper”, as the company or group of individuals will contract directly with the provider group for care. (Sounds a lot like the original HMO plan goals, without the insurer.  We’ll see!). 
So, best of luck to employer and employee alike!

When the employees in a company are unprepared for their retirement years, they may work beyond the time they should retire.  This is a psychological blow for the employee, and has an effect on the org staffing plan as well.  Because the recent financial crisis has taken a bite out of peoples’ savings and retirement accounts, as many as 24% of workers are planning to work until after age 70.  There is also a significant increase in the number that feel they won’t be living comfortably in retirement.

For the company, there is a significant financial impact when employees work beyond their normal retirement age.  First, health care expenses for folks over 65 can be more than double the cost of insuring people age 45 -55.  In the case of work-related accidents, severity and time away from work can increase dramatically in the older employee.  Salaries and compensation tend to be higher in the more mature worker compared to younger employees with a similar skill set.  Some sources say that productivity drops…but there is an issue with the new grads and young employees on the same topic.  There is a problem, however when an employee is there because they have to be because they can’t retire.  There tends to be a drop off in energy and productivity for these folks.

There are things the organization can do to promote a culture of retirement readiness.  The first step is obviously to look at the level of participation in retirement plans by those nearing retirement age.  Then look at how many employees at all stages of their working life are utilizing the retirement benefits of the organization to the fullest advantage. 

As the company reviews the retirement culture in their organization, they need to evaluate the plan design to assure that employees have access to options that fit their needs, and that the company makes it easy for employees to contribute or participate.  Then – communicate.  The information needs to be geared to the various ages or work life stages of the employees.  Younger workers will have very different needs and views of retirement than a 55-year-old.  Provide easy response mechanisms such as “take action” cards that encourage them to respond.  Employees should also be offered financial consulting support from an outside source to provide them information for informed choices regarding their plans. 

If the company makes matching contributions, they should try to structure the matches to encourage savings.  As is to be expected, if the company matches up to 3% of the employee’s deferred salary, that is what they will contribute.  If the plan matches at 50% for the first 3% deferred salary, changing to a 25% match for the first 6% might change the participation rates and encourage more savings without adding costs to the company.

Obviously there needs to be continued evaluation of the entire retirement picture, with specific measures such as participation rates and average salary deferrals to track how well the plan is succeeding.  Success of the plan is greater success for the organization, and a better prepared workforce.

You are invited to attend the 2011 New Mexico Employer Summit on Thursday, November 17, 2011 at Hotel Albuquerque from 7:30 a.m. to 12:30 p.m. Panels and discussions during this half-day event will include:
-  “How to Align Business Practices with Unemployment Insurance Policy”
-  “Readily Available Business Resources and Services”
-  “How Employment & Labor Laws Apply to Your Business”
Advanced registration is required and seating is limited. Registration is $25 per person. To register, please call Rosanna at the Albuquerque Hispano Chamber of Commerce, (505) 842-9003, ext. 110 by November 3, 2011. For more information, please call (505) 841-8690 or visit the 2011 New Mexico Employer Summit website at
www.dws.state.nm.us/employersummit.

Smart Phones are also coming to the attention of mobile security experts as more and more business is conducted on these devices.  Hackers are developing malware  to exploit security issues that may include a less-than-optimal browser, user authentication, and data encryption technologies.  According to an item in SHRM News, in 2010 more than 1 million smart-phone users in China were infected with a “zombie” virus hidden in bogus anti-virus programs.  Another case involved a worm connecting infected iPhone devices to a server in Lithuania, enabling criminals to control the phones.  Adding to the problem, according to the January 2011 article, is the bring-your-own-computer movement allowing employees to use their own mobile devices in the workplace, which can infect company servers.  It is up to companies to either disallow the use of those devices as is done in the national laboratories, or to restrict important data so it cannot be accessed through these devices.  If a document has to be emailed the sender needs to strip any identifier info such as social security numbers from the mail.  Hopefully soon the security systems will be upgraded to deal with these issues, as the world is certainly addicted to the Smart Phone!

There are speculations as to why this bill is necessary.  One reaon may be that a misclassified contract worker is prevented from accessing wage and hour protections and benefits they may be entitled to. 

Among the bill’s many provisions targeting misclassification:

* Requiring that employers keep records reflecting the correct status of each worker as an employee or nonemployee and stating expressly that employers violate the FLSA when they misclassify workers.
* Increasing penalties on employers who misclassify their employees and are found to have violated employees’ overtime or minimum wage rights. Civil penalties would be imposed, up to $1,100 per employee for first-time violators, and up to $5,000 per employee for repeat or willful violators.
* Allowing double liquidated damages for employers that fail to accurately classify an individual as an employee and violate the minimum wage or maximum hour provisions of FLSA.
* Requiring employers to notify workers in writing of their classification as an employee or nonemployee.
* Creating an official Department of Labor (DOL) “employee rights web site,” explaining that employees may have additional or greater rights under state or local laws and how employees may obtain additional information about their rights under state or local laws (the web site may provide a link to permit individuals to file complaints online with the Wage and Hour Division).
* Providing protections to workers who are discriminated against because they have sought to be accurately classified.
* Mandating that states report quarterly to the DOL the results of state auditing and investigative procedures with respect to identifying employers that may have excluded employees from unemployment compensation coverage.
* Directing states to strengthen their own penalties for worker misclassification.
* Permitting the Wage and Hour Division, other administrations of DOL, and the Internal Revenue Service to refer incidents of misclassification to one another.
* Directing the DOL to perform targeted audits focusing on employers in industries that frequently misclassify employees.