Most Popular Articles

Advantages and Disadvantages—Team Goals vs. Individual Incentives?

"In yesterday’s Advisor , consultant Katie M. Busch offered tips on incentives for nonexempts. Today, her take on team vs. individual awards, plus an introduction to the wage and hour guide that solves your problems before the feds do."

Busch, whose remarks came at a recent BLR-sponsored webinar, is owner of HR Compensation Consultants, LLC. Here are her suggestions about team and individual incentives.

What Are Team-Driven Incentives?

Team-driven incentive are intended to foster a collaborative environment in which team members are focused on helping one another. They are:

What Does it Mean to be Competitive with Employee Pay?

Many jobs today – and perhaps some your company has posted – list the pay as "competitive." But what does that mean?

The Dirty Dozen Myths of Non-Exempt Pay

"Overtime after 8 hours? Double time for holidays? There are many myths of wage and hour and they are widely believed by the rank and file. In today’s Advisor, we’ll dispel a dozen of them."

Myth #1—Employees get extra pay for working nights and weekends.

The Facts: The FLSA does not require extra pay for weekend or night work. This policy is a matter of agreement between the employer and the employee (or the employee’s representative).

The only FLSA extra pay requirement is that covered, nonexempt workers be paid not less than time and one-half the employee’s regular rate for time worked over 40 hours in a workweek.

Can You Pay at Different Hourly Rates? (Sure, but …)

"Employees who do two different types of tasks may be paid different hourly rates during the workweek. Or, an employee may work in two or more different positions during the same workweek at different rates of pay. But how do you calculate the overtime?"

The general rule is that all hours worked in all positions and at all rates are counted toward the weekly total for the purpose of determining whether the employee is owed overtime.

When an employee receives different hourly rates of pay throughout the week, generally, you determine the regular rate by dividing the total compensation received during the workweek by the total number of hours worked. This will product a “weighted average” or “blended rate.”

Overtime and Part-Time Pay Myths Debunked

"Yesterday’s Advisor debunked eight myths of pay for non-exempts; today, four more plus an introduction to the best way to ferret out pay practice errors before the feds do."

Myth #8—Employees must be paid overtime for more than 8 hours a day or for weekend work or holiday work.

[Go here for Myths 1 to 8.]

The Facts: For covered, nonexempt employees, the FLSA requires overtime pay at a rate of not less than one and one-half times an employee’s regular rate of pay after 40 hours of work in a workweek.

Incentive Comp Threatening Your Organization? Think AIG

"The recent economic meltdown has ushered in a new sobriety, says expert Jack Dolmat-Connell, designed to prevent (or at least mitigate) what many view as one of the primary sources of the collapse—excessive compensation."

In spite of the old saying that a salesperson cannot be overpaid, it seems that one indeed can be. And they were, says Dolmat-Connell, president and CEO of compensation consultants DolmatConnell & Partners. He points to AIG as a prime example of where things went wrong. 

“They had traders whose pay was $100,000 a year, but had the potential of earning $20 or $30 million bonuses,” he says. “That caused excessive risk for the organization. When faced with that kind of potential for financial gain, people sometimes do unnatural things.” 

Discretionary Versus Non-Discretionary Incentive Pay and Bonuses

"Bonuses and incentives have most of the same components: [they're] variable, tied to performance, [and can be] any form of payment. But [bonuses are] not predetermined or forward-thinking. With a bonus plan, employees will generally know that good work will get them a bonus at year-end, but they don't know exactly how good that work needs to be."

As we all know, the FLSA requires us to pay overtime pay when it is due, and the base pay rate must include all payments for that time period in question—including incentive pay and bonuses paid during that time. But is that always the case? Actually, the answer is no.

It’s true that most incentive payments and bonuses must be included when calculating overtime. This is because most bonus payments that are based on criteria related to attendance, production, efficiency, quality or quantity of work, or any other work performance standard must be included. However, there are some exceptions. Those include payments made for gratuitous reasons, or those made as gifts on special occasions that aren’t determined by hours worked, production, or efficiency. These are considered to be purely discretionary bonuses. That becomes the key decision factor: whether the bonus or incentive payment is discretionary or non-discretionary.

The 6 Most Common Wage/Hour Violations—and How to Avoid Them

"What are the most common violations found by DOL’s Wage and Hour Division (WHD)? Time clocks, rounding, training time, and break time are among the top six."

By law, employees must be paid for all “hours worked.” In general, “hours worked” includes all time an employee must be on duty, on the employer premises, or at any other prescribed place of work. Also included is any additional time the employee is “suffered or permitted” to work.

Note: There is no federal requirement for payment of holidays, vacation, sick or personal time.

Can You Forbid Discussions of Salary and Pay?

"Much as most employers would like to impose a ban on discussion of pay (not to suggest that there are embarrassing inequities in your pay structure), it’s not legal because the NLRB (National Labor Relations Board) says it interferes with Section 7 rights."

It’s all part of NLRB’s new expansive view of its role.

For insights about the overly aggressive NLRB and the recent court decision concerning the legitimacy of President Obama’s recess appointments, we spoke with Patricia Trainor, BLR’s senior managing editor, HR.

“There’s a very interesting situation at the NLRB now: A court has ruled that Obama’s interim appointments were invalid, so any actions the board has taken may be invalid as well,” says Trainor.

Key Factors in Determining Salary Increases

"Yesterday’s Advisor told how to deal with red circles; today, determining salary increases plus an introduction to the all-things-compensation-in-one-place website,®."

Once you’ve got a salary increase matrix (see below), determining increases should be simple—but it’s not.

Several approaches are commonly used for determining salary increases.

  • Performance/merit systems are the most common.
  • Across-the-board or general increases are often tied to increases in the cost-of-living index.
  • For unionized employees, the collective bargaining agreement will include a negotiated provision for wage increases that usually includes a fixed general annual increase that may be combined in some instances with merit provisions and cost-of-living escalators that add to the across-the-board increase when the cost-of-living index goes up more than a predetermined amount.
  • Many employers utilize a grid system with low, middle, and high ranges to determine what an employee’s wage should be based on job performance and current salary.

Number One Stay-Out-of-Court Training Topic? Wage/Hour

"We’ve identified the six key manager/supervisor training topics for staying out of court, and—no surprise—wage/hour is number one."

1. Wage/Hour/FLSA

Why it’s a challenge: Supervisors and managers think they know the rules, but the rules are more complex than they think they are.

Typical manager/supervisor blunders:

  • “I won’t pay for unauthorized overtime.” In most cases you must pay for all hours worked even if you forbid workers to work. You can discipline them for disobeying, but you have to pay them.
  • “Yeah, they grab the phone now and again when they’re home.”If non-exempt workers are spending more than a de minimus amount of time answering business phone calls after work hours, they probably need to be paid.
  • “I’m not recalculating overtime just because I gave a little bonus at the end of the month.” Overtime must be paid on the “regular rate” which includes many bonuses and other payments. If the bonuses are awarded after pay for the period has been made, you must recalculate and pay the additional amount.

Job Evaluation—Three Common (and Good) Methods

"There are three commonly-used job evaluation methods, says consultant Michael Strand, and you have to pick the one that’s best for your organization."

Strand, owner of consultancy HR Dynamics Inc., offered his comments on the three methods at a recent webinar hosted by BLR/HRhero.

Ranking Method

This is non-quantifiable and subjective, but is a basic simple approach, says Strand. You arrange all jobs in rank order of their relative duties, responsibilities, qualification requirements, that is, their “importance” to the organization, he says. The method is best used for smaller organizations with fewer jobs (under 30‐40); it may be awkward and unwieldy for larger companies with a large number of different jobs.

Who’s Using HRIS? Whose Are They Using? Survey Says …

"Are HRISs taking over for HR and compensation manages? Who’s using such systems, whose systems are being used, and what are they being used for? BLR’s recent HRIS survey provides the answers."

In June 2012, BLR’s HRIS expert, Holly Jones, surveyed BLR customers on their HRIS use. An audio conference download was offered as premium for survey completion. Just under 600 HR Daily Advisor and HR Hero Line readers responded. According to Jones, important findings included:

  1. About half of respondents use an HRIS system and about half of those use systems that are cloud-based or SAAS.
  2. Almost 80% of HRIS users have 100 or more employees.
  3. Of survey respondents who use an HRIS, 28% are logged in for more than half of the day.
  4. Reporting data, payroll management, PTO/leave tracking, and benefits management were the most common uses among respondents
  5. ADP was the most popular system used by respondents, with 21 percent of respondents

Job Sharing—The Advantages and Disadvantages

Job sharing is a special type of part-time employment in which two or more employees share the duties of a single, full-time position. Job sharers may each work part of a day or work alternate days or weeks. Here’s how it may benefit the employer:

  • Improve recruiting by attracting qualified employees who don’t want to work full-time.
  • Improve retention by offering an alternative that may appeal to many workers.
  • Reduce absenteeism and tardiness because of the flexibility offered.
  • Give workers time to deal with family and other personal responsibilities.
  • Give the employer a pool of workers who can be asked to return to full-time work temporarily during high demand periods or to fill in for other employees who must be away from their jobs unexpectedly.
  • Increase productivity as each partner makes sure to do his or her full share.
  • Enhance output because of collaboration and exchange of ideas between partners.
  • Increase engagement especially when a partner goes from full time to part time—instead of stress from missing deadlines, there is pride at getting the job done.

Job Description Alert—Disparate Impact Lawsuit Lurking

"Job descriptions don’t seem as though they would be lawsuit generators, but poorly written or out-of-date job descriptions can set you up for a nasty disparate impact lawsuit, says attorney Susan Fahey Desmond."

For a more detailed explanation, we turned to BLR/HRhero’s HR Guide to Employment Law, written in part by Desmond, who is a Partner in the New Orleans, Louisiana office of Jackson Lewis LLP.

You could set yourself up for a disparate impact suit, Desmond says, if :

  • Your listed requirements on the job description are not necessary for the job, and
  • They disqualify those in a protected class at a disproportionate rate.

Regression Analysis: Setting Pay Levels with Precision

"Regression analysis is commonly used in compensation to match, verify, or predict salary levels. In today’s Advisor, Consultant David Wudyka clarifies how to use the technique."

What Is Regression Analysis?

Regression analysis is a statistical technique that predicts the level of one variable (the “dependent” variable) based on the level of another variable (the “independent” variable).

In a compensation setting, for example, that might be the relationship of executive pay to company size or company revenue.

15 Ideas in 15 Minutes—Attract, Engage, Retain

"A much-appreciated session at BLR’s recent Advanced Employment Issues Symposium was a panel presentation during which panelists offered quick, real-world-tested ideas for attracting, engaging and retaining employees."

The original talk was called “30 Ideas in 30 Minutes,” but we’ve culled the best fifteen ideas for our readers. The panelists were:

  • Andrew Botwin, head of Human Resources for accounting firm Rothstein Kass
  • Kathy Brooks, VP of Employee Experience, Green Mountain Coffee Roasters
  • Michael Burchell, Vice President, Global Business Development, The Great Place to Work Institute
  • Rob McElory, General Manager, Daphne Utilities
  • Liz Wilson McKee, Internal Communications Manager at law firm Baker, Donelson PC

Implementing Pay Grades and Ranges: Common Pay Structure Issues

"Do you utilize pay grades? If you’re just starting to implement such a system, you may be confused about where to even begin."

You also may find yourself facing employees who don’t fit into the standard pay grades for one reason or another or who have maxed out at their existing pay grade. You may even have an employee who is pointing to online salary information and claiming she’s not getting paid enough, which is a position HR professionals are finding themselves in quite often, especially as the economy improves and employees are starting to look around to see what else is out there. How do you implement a fair pay structure without complicating your payroll process?

Lunches and Breaks—‘Little’ Violations, But Fines Add Up Quickly

"In yesterday's Advisor, we covered two of the most common wage/hour violations; today, more violations plus an introduction to a timely webinar covering one of comp's greatest bugaboos—non-exempt travel pay."

Wage/hours violations like lunch break payments seem like small potatoes, but multiply by 250 days a year and a thousand employees and add penalties—you’ve got a big-dollar fine.

Common Violation #3—Meal Breaks

Bona-fide meal periods (typically 30 minutes or more) are not work time, and an employer does not have to pay for them. However, the employees must be completely relieved from duty.

Can You Make Exempt Employees Punch a Time Clock?

"Physical time clocks are a relic of the past for many companies, but the question remains, can you track exempt employees’ hours without jeopardizing their exempt status?"

While employers are not required to track the time of an exempt employee, there is no prohibition against doing so. In other words, merely requiring an exempt, salaried employee to clock in and out will not destroy the employee’s exemption, as long as you don’t make any deductions from his or her salary based on the amount of time worked.

Everything I Need to Know About Managing … I Learned From My Mother

"In his keynote speech at BLR's Advanced Employment Issues Symposium, held recently in Nashville (AEIS Las Vegas is November 17-18), BLR CEO Dan Oswald told an appreciative crowd about the 10 critical management lessons he learned from his mom."

Lesson #1: Honesty is the best policy

Oswald told the story about getting in trouble in school and having to bring a note home for his mother to sign. He found the girl in his class with the best penmanship, and had her sign the note. The next morning, he couldn’t bring himself to go to school, so he told his mother he was sick. Eventually he admitted the truth.

The 6 Most Common Compensation Mistakes

"As companies grow, seat-of-the-pants payroll systems that did the job for a while suddenly start to look a little messy. That’s where consultant Bill Erdle of William J. Erdle Compensation Consulting ( enters the picture. "

He typically finds that some employees are paid too little (and likely to jump ship at the first opportunity) while others—whose specialties were desperately needed—make more than they should (and that’s robbing profits). To make matters worse, he says, no one knows which is which.

Here are six of the most common compensation mistakes Erdle sees:

Organizational Development? Start with the Janitor, says Al Gore

"In yesterday's Advisor we got Steve Forbes' and Al Gore's take on critical management issues. Today, Gore on OD, compensation, and short-term thinking plus an introduction to the "Compensation Bible.""

Challenge # 4: Organization Development

[Go here for challenges 1 to 3.]

Gore worked on the "reinventing government" program at the country’s largest employer, the US Government. He says the key to finding better ways of doing things is to start at the bottom.

Audit Turns Up Turnover Nightmare Sorry, One More Critical Task for Comp—Audit Time

Despite the fact that most comp managers are crazy busy, it’s time to add a task to the mix, says Dorf—a thorough compensation program audit. And, yes, in spite of what could be construed as a self-serving suggestion, he wants you to hire someone else to do it. Dorf is managing director of Compensation Resources, Inc. in Upper Saddle River, NJ.,

Retaining Your Best Employees—Five Key Tips

"In yesterday’s Advisor, we found the first of the “15 tips in 15 minutes” from expert panelists at BLR’s Advanced Employment Issues Symposium. Today, more tips plus an introduction to a special product just for smaller or even one-person HR departments."

The original talk was called “30 Ideas in 30 Minutes,” but we’ve culled the best fifteen ideas for readers. The panelists were:

  • Andrew Botwin, head of Human Resources for accounting firm Rothstein Kass
  • Kathy Brooks, VP of Employee Experience, Green Mountain Coffee Roasters
  • Michael Burchell, Vice President, Global Business Development, The Great Place to Work Institute
  • Rob McElory, General Manager, Daphne Utilities
  • Liz Wilson McKee, Internal Communications Manager at law firm Baker, Donelson PC