One ponders and one points at a gargantuan book

Is Your Employee Handbook Compliant?

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Your company’s employee handbook is one of the most important tools in your business bandolier. An effective employee handbook is the last word on company policies, employee code of conduct, and even new-hire onboarding; it constantly lays out the most updated legal guidelines put forth by the federal and your state and local governments.  

Considering its importance, staying on top of your employee handbook should always be a top priority. When was the last time you checked to ensure your handbook is up to date — does it reflect current laws and guidelines? Is it articulating all process and policy changes that you have implemented in the world of COVID-19? 

If it’s been a while since your last review, take some time to go through your handbook and use this guide to ensure that you’ve got everything covered.

 

The Compliance Baseline

There are several items an employer must inform their employees of in one way or another. These essential concepts are the basics of compliance. Adding these items to your employee handbook is the first step to becoming fully compliant with federal, state, and local laws.

  1.  You must affirm your compliance with the Equal Employment Opportunity Commission (EEOC). This means that your company is an equal opportunity employer. By being compliant with the EEOC, you affirm to not discriminate against a job applicant or employee, according to the EEOC website, “because of the person’s race, color, religion, sex (including pregnancy, transgender status, and sexual orientation), national origin, age (40 or older), disability or genetic information.”
  2. You must outline your company’s breast-feeding policy. Lactation accommodation laws vary widely between states, so be certain to refer to your local laws when drafting your own company policy.
  3. You must inform employees about your Family and Medical Leave Act policy. The Family and Medical Leave Act affirms that employers must give at least 12 weeks of unpaid maternal or paternal leave; leave spurred by a debilitating health condition; and leave based on several other serious reasons. Employees who take maternal or paternal leave are in a job-protected state during their leave, meaning they cannot be replaced during or due to the leave. This, however, is the federal baseline; almost every state has their own rules regarding leave from work, so make sure those rules are also displayed clearly.

 

Is Your Employee Onboarding Compliant?

Beyond getting employees acquainted with their new jobs, onboarding is an essential moment for informing employees of their rights at your company. Onboarding in your employee handbook is a great time to remind new hires of their tax and healthcare requirements.  Here are a few things to consider including in your onboarding process and in your handbook:

  1. Begin every onboarding with the almighty I-9. All new employees at every company in the United States, D.C. and Puerto Rico must fill out and submit an I-9 tax form before they begin working. 
  2. If you plan to run a credit check on your new hires, you must collect a written consent, or signature, before you do.
  3. Healthcare is confusing enough, so save your employees some headaches and be upfront and deadly serious when explaining your company’s healthcare options. Many employers require that new hires choose a plan within 90 days of their hire, so be certain to lay out your company’s policy in your handbook.
  4. During the onboarding process, you’re collecting a lot of personal information. In your employee handbook, assert your company’s seriousness about data protection and privacy. Several states have data protection laws which restrict how long and in what capacity employers may keep employee personal information on file, so be certain to inform employees of their rights to data security.

 

Is Your Harassment Policy Compliant?

Your employee handbook must have an unambiguous and detailed harassment policy. Harassment is any form of coercion, threat, or intimidation made against a person. Harassment can be verbal or nonverbal, direct, and indirect. Employees who are being harassed may naturally feel isolated and without recourse, so it is paramount that your employee handbook have a sound, effective harassment policy.

Your harassment policy should read like a tree of “if, then” statements with the goal of assuring employees that if they report harassment, it will be acted on seriously and quickly. Be certain to lay out key details of what happens when an employee files a harassment complaint.

Be certain to also explain that if harassment occurs on the basis of an EEOC protected quality, the harassment is also discrimination. The EEOC also requires employers to include a “no retaliation” statement which affirms that employees that report harassment are fully insulated from retaliation by their harasser or anyone from the company at large

 

Is Your At-Will Policy Compliant?

All 50 states, Washington D.C. and Puerto Rico are under at-will employment guidelines. This means that an employer can fire an employee for any reason as long as the firing is not discriminatory, i.e.: firing anyone for a reason connected to an EEOC protected quality. At-will, however, goes both ways. The same policy means that employees also can quit their jobs or start strikes for any reason and at any time.

When drafting your at-will statement, check your state guidelines to see if you live in an area with either public policy exceptions or implied contract exceptions, as these two changes can affect how at-will works.

The public policy exception affirms that an employer cannot fire an employee if the firing breaks a state or municipal-level law. The most common example of the public policy exception at work is firing an employee in retaliation for their following of a state law. The only states that do not have a public policy exception for at-will employment are Alabama, Florida, Georgia, Louisiana, Maine, Nebraska, New York, and Rhode Island.

The implied contract exception prohibits an employer from firing an employee after oral, written or otherwise assurances of continued employment. If an employer makes a statement regarding an employee’s job security and then counters those claims, the employer has broken an implied contract between them and the employee. By the nature of implied contracts, it can be difficult to enforce these rules in court, but most states have implied contract exceptions.  The only states that do not are Arizona, Delaware, Florida, Georgia, Indiana, Louisiana, Massachusetts, Missouri, Montana, North Carolina, Pennsylvania, Rhode Island, Texas, and Virginia.

 

COVID-19 & Americans with Disabilities Policy

As much as we all would have liked COVID-19 to stay in the “19,” the EEOC now has guidelines that employers ought to include in their handbooks.  Many of the EEOC’s guidelines, however, refer to existing discrimination restrictions as well as federal rules from the ADA (Americans with Disabilities Act). The EEOC requires that employers who see employees display visible COVID-19 symptoms may exclude those employees from the workplace. Employers may also ask employees entering a physical workplace if they have COVID-19 or any symptoms. These actions would traditionally count as discrimination under the ADA or discrimination guidelines but both are currently allowed.

 

The Compliancy Balance and the Ever-Expanding Employee Handbook

Remember that your employee handbook is meant to be used as a reference resource. If your handbook is written like a law school textbook, it will be treated like one and be used sparingly as possible. An employee handbook should have a personality that reflects your brand and company culture. Employees should close their handbooks after reading and feel closer and more connected to their company — whether they’re reading it on their first day or after several years of working with your company. Maintaining a handbook that is fully compliant requires a business owner or human resources specialists to vigilantly watch admittedly dry government bodies and their actions like the EEOC and ADA. As much as the work can be draining, the result is universally worth it: a staff informed of their rights and fully prepared to integrate into your company.

Female HR Professional at laptop choosing health insurance carrier for company

Best Health Insurance Carriers for Small Businesses

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American healthcare is famously obtuse and legendarily difficult to navigate.  It is no small feat to organize your personal healthcare in America, let alone healthcare for your small business and its employees. When selecting a group health insurance plan for your small business, the number of options are often staggering, and it can be incredibly difficult to know if you are getting the best quality for the price package.  As much as we would like there to be a quick and easy answer to health insurance, there isn’t. The best thing you can do as a small business owner is to educate yourself on the types of health plans on the market today and the most reputable providers.  Once you’ve armed yourself with the key details, it may be easier to make a choice to address the unique needs of your small business.

What Health Plans are out There?

There are six main types of health insurance plans, all of which are available for small business group coverage.  It is important to be well-versed in all plan types as even the most straightforward low-premium plan may end up costing more in the end if chosen for the wrong person.

Health Maintenance Organization (HMO)

Health Maintenance Organizations are plans that generally advise members to stay within networks to keep costs low. Even with network limitations, HMOs generally allow members to access more specialists and preventative care than with other plan types. Key things to know about HMOs:

  •       High out of network costs
  •       Generally lower premiums than most other plan types
  •       Primary Care Physician (PCP) almost always must recommend in order for members to see specialists

Preferred Provider Organization (PPO)

A preferred provider organization lets members go out-of-network much easier than HMOs but often in exchange for higher premiums. PPOs generally offer members more independence in picking their doctors and choosing what care they would like to receive. Key things to know about PPOs:

  •       Much larger provider network compared to HMOs
  •       Referrals not required to see specialists
  •       High premiums for group plans

High Deductible Health Plan (HDHP)

High Deductible Health Plans are a type of either HMO or PPO that often only begins to contribute after a high deductible is paid by the member. Unlike PPOs and HMOs copays do not apply; the insurance will only begin to pay in once a given deductible is reached. Key things to know about HDHPs

  •       Lowest HDHPs requires members to pay at least $1,300 before any level of contribution from insurance
  •       Can function either as HMO or PPO, so network size will vary depending on carrier
  •       After deductible is paid, insurance usually pays similarly to an HMO

Point of Service Plan (POS)

Point of service plans generally offer less choices to members in exchange for lower costs even compared to HMOs. Unlike HMOs, however, POS members can often still get out of network service. Key things to know about POS Plans:

  •       Very low deductible if service is in-network
  •       In-network procedures’ paperwork is handled by provider
  •       Sometimes requires referral from PCP in order to see specialists (varies by plan)

Flexible Spending Account (FSA)

Flexible Spending Accounts function differently from all above plans. FSAs are amounts of money set aside by an employee that is sometimes supplemented by the employer. The money in this account  is then set aside for healthcare spending throughout a calendar year. Employees choose how much money to set aside at the beginning of each year.

  •       Limited to $2,750 per year
  •       Money is FSAs may be used for deductibles, copays and even prescriptions but not premiums
  •   For the most part, there is a use it or lose it component to this plan; however,  $550 may be carried over each calendar year

Health Savings Account (HSA)

Health Savings Accounts are a type of HDHP that lets employees use untaxed money towards medical expenses. Since HSAs only apply to HDHPs, the money in employees’ accounts can be used for nearly every type of medical expense with the exception of  premiums. Key things to know about HSAs:

  •       Contribution limit of $3,600
  •       Does not reset like FSAs (there is no use it or lost it component)
  •       Employees can open HSAs independent of employers
  •       Funds used for non-medical expenses are both taxed and likely to compound a penalty

 

Best Healthcare Providers for Small Businesses

 

UnitedHealthcare (UHC)

UnitedHealthcare has the largest network of providers in the United States with individual plans for every state as well as Washington D.C. and Puerto Rico. UHC also has one of the most robust presences both in-person and online allowing plan-holders to select their PCP and specialists directly from their website. UHC offers several plans specifically for small businesses catering to companies with as low as 2 employees and as many as 5,000.

Most Popular Plans for Small Businesses

UnitedHealthcare Choice: UHC Choice is a classic HMO with competitive copays and great discounts for in-network care. Choice members, however, do not need a PCP to see a specialist, making the plan superior to most HMOs.

UnitedHealthcare Choice Plus: At a higher cost to employers, UHC Choice Plus allows employees to leave the already-massive UHC network at lower out-of-pocket costs and generally offers lower copays than standard UnitedHealthcare Choice.

Options PPO: UHC’s Options PPO allows members to use any doctor inside or out-of-network. When using out of network doctors, members often have to submit claims themselves in order to be reimbursed.

Bottom Line on UnitedHealthcare

As a business owner, UnitedHealthcare is likely the easiest provider to work with when it comes to organizing your group account as well as choosing a plan type. Because of UHC’s massive network size, your employees will have a great choice of provider as well. Compared to other providers on this list, however, UHC is likely to cost more for a group plan.

 

Blue Cross Blue Shield (BCBS)

Blue Cross Blue Shield is another massive health provider operating in all 50 states as well as D.C. and Puerto Rico. BCBS generally operates on a state-by-state basis meaning that the key points of health plans are likely to vary along those state lines. Within the BCBS network, however, are several effective group plans that are competitively priced and cater to all sizes of business.

Most Popular Plans for Small Businesses

Blue Select: Blue Select is a family of health plans that partner low-cost doctors and practitioners with equally low pay-in prices for employers. Blue Select functions like an HMO, rewarding in-network care with low copays and out-of-pocket expenses.

BlueCard PPO: The BlueCard PPO is available in the entire contiguous United States and allows members to access out-of-state care at no added charge. BCBS’s PPO plans allow members access to as many as 600,000 network doctors and 6,000 hospitals making the plan especially lucrative for small businesses with traveling employees who may seek out-of-state care.

Bottom Line on Blue Cross Blue Shield

Blue Cross Blue Shield generally costs less than other big-name providers like UnitedHealthcare while offering comparable care. Setting up a group plan, however, is notably more difficult because of BCBS’s lesser web presence. The varying quality of plans on a state-by-state basis means that business owners will often need to do quite a bit of research to see if BCBS is the right choice in their area.

 

Aetna

With a multi-century history of operation in the United States, Aetna is recognized as a reliable and high-value healthcare provider. Aetna is often cited as being the preferred choice of small businesses with less than 50 employees because of unique savings opportunities.

Most Popular Plans for Small Businesses

Aetna Funding Advantage (AFA): Aetna Funding Advantage functions like a Health Savings Account in that employers pay a maximum claim amount from which employees can then use for insurance. Once that claim amount is spent, stop-loss insurance begins. Also similar to an HSA, 50% of surplus money still in the account after a calendar year is returned to the business owner.

Aetna Open Access HMO: Unlike traditional HMOs, members do not need a PCP’s referral to see a specialist on Aetna’s Open Access HMO.

Bottom Line on Aetna

Aetna is a great lower-cost health insurance provider, but Aetha network of hospitals and providers tends to be spotty. Before signing up, be certain that your PCP and hospital of choice are still in-network. Compared to carriers above, Aetna has the granular information on their websites that small business owners are likely looking for, but you’ll likely have to get on the phone with a representative to find out if their plans work well in your area.

Humana

As their name implies, Humana puts an especially human spin on the sometimes-mechanical health insurance selection process. Humana is widely regarded to have one of the best customer service teams in the healthcare industry. Similar in scope to Aetna, research is likely necessary to see if Humana’s well-priced plans will apply in your state. Humana group plans for small businesses traditionally cap at 50 employees, but plan guidelines vary state-by-state.

Most Popular Plans for Small Businesses

Humana Canopy: Humana Canopy is a great option for employees who do little more than annual physical check-ups. Preventative care is also fully covered on Canopy, but out-of-network and especially out-of-state care is often not covered.

Humana Efficiency: Humana Efficiency has the lowest premiums compared to any other Humana plans and one of the lowest in the industry. Low premiums, however, equate to high out-of-network costs.

Bottom Line on Humana

If your small business has less than 50 employees, Humana is likely a great economic choice. Even Humana’s least comprehensive plans still cover preventative care, and their more inclusive plans are great for in-state care.

Kaiser Permanente

If you are lucky enough to be in one of the eight states (Hawaii, Washington, Oregon, California, Colorado, Maryland, Virginia, Georgia and Washington D.C.) which offer Kaiser Permanente health plans, it is well-worth looking into their offerings for small business-oriented group plans. All Kaiser plans offer extremely competitive premiums for often identical or even superior care. Since Kaiser plans vary so much by state, our overview will focus on the general details of their most common plans.

Kaiser Traditional HMO Plans: No matter which state, Kaiser Traditional HMO plans offer competitive copays and $0 deductibles making them especially helpful for employees that may face chronic health issues or regular non-PCP visits. Almost all Kaiser HMO plans require members to get referrals from PCPs to see specialists.

Kaiser Deductible HMO Plans: Deductible HMO plans from Kaiser function in a way similar to most other carriers’ own traditional HMOs. This style of plan has lower premiums but requires members to pay into a deductible when not seeing a PCP or specialist.

Kaiser PPO Plans: Being that PPO plans are especially useful for out-of-network visits and Kaiser is a very localized provider, PPO plans from Kaiser are likely only helpful for small businesses with very specific needs. If you have a company in a Kaiser-supported state, it is very likely a majority of that state’s providers are within their HMO network. A good example of a Kaiser PPO plan being helpful is if you have employees who split time between Kaiser-supported and not Kaiser-supported states.

Kaiser Point of Service Plans: Kaiser’s POS plans are a great middle ground between HMO and PPO that allows more care options than HMO plans and a deductible often costing between Traditional and Deductible plans. Compared to Kaiser PPO plans, Kaiser POS plans often have lower premiums and offer similar service.

 

Untangling the Knot of Group Health Insurance

It would be fantastic if there was a “number one” choice for group health care that worked for every small business; but, like small businesses themselves, all plans and packages are different. Finding the best health care plan for your small business requires a business owner to consider three key factors: which state your company is based in, how many employees you have and most importantly, the overall costs. Depending on any of these factors, the answer of the “best provider” could be completely different for two companies. Knowing the key plan types as well as the most reputable providers, however, gives any business owner the tools to choose the best provider and plan type for their employees.

 

Joe Biden speaking at the conference about employment changes.

SMBs Should Expect and Prepare for Employment Changes Under Biden 

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The policy differences between the Trump and Biden administrations may be night and day, and if President Joseph Biden has his way – especially with Democrats holding a slim majority in Congress for roughly the next year – small businesses may have to make significant changes in the way they manage employees. 

As if running a small business wasn’t complicated enough – if you own and operate a small business, whether you also serve as the human resources manager or have an on-staff HR executive, you can expect legislative change in areas such as wages, diversity training, dealing with unionized employees and offering more paid time off. 

Tracking and implementing potential changes may seem like an overwhelming task as debate continues on the American Infrastructure and Jobs Act and the American Families Plan (AFP), which will usher in sweeping changes if passed. If you don’t have an internal HR executive, you may want to consider hiring an outside HR consultant or business attorney to make sure you are in compliance with upcoming potential changes.

Some HR issues to consider under the Biden administration are: 

An Expansion of the Family and Medical Leave Act (FMLA)

Under the current FMLA, employers must provide workers with up to 12 weeks of unpaid leave per year for illness or injury, or to care for a sick family member. Employees must be allowed to return to their same or an equivalent job at the end of their leave.

According to the fact sheet for the AFP, if Biden’s plan is enacted, you should expect to be required to give your employees paid time off for family matters and medical leave. The proposed changes would essentially create a sweeping increased paid family and medical leave program.

In short, the Biden administration is proposing that, over a 10-year period, employers guarantee 12 weeks of paid parental, family illness, personal illness or safety-related leave. Workers would receive three days of bereavement leave per year starting in year one. Congress is still debating the bill, but it is expected to be voted upon before the end of the year. 

Protecting the Right to Organize (PRO) Bill

The PRO bill narrowly passed the US House of Representatives on March 9 and is currently being debated in the Senate. If passed, the PRO Act would present a potentially significant disadvantage to small business owners in that it would expand workers’ rights to organize and form unions. 

The PRO Act, which would be enforced by the National Labor Relations Board, would also:

  • Prohibit mandatory arbitration agreements in employment contracts. An arbitration agreement is typically a clause in an employment contract which obligates employees to arbitrate all disputes with his/her employee and prevents an employee from organizing a class action suit against an employer. Historically, such a process has favored large corporations, but prohibiting such clauses could work against a small business in that it would make small businesses susceptible to frivolous lawsuits. 
  • The Act would reverse the US Supreme Court’s previous decision that mandatory arbitration agreements were enforceable.
  • It would also potentially change the ABC Test – a test used in some states to determine whether a person is an independent contractor or full-time employee – by imposing stricter requirements for an employer on how to classify a worker. This is important because, unlike a contractor, a full-time employee is entitled to overtime pay, collective bargaining power and health insurance benefits. The Senate is still hashing out what the line will be that separates an independent contractor from a full-time employee.
  • Create new civil penalties and make SMB owners vulnerable to personal legal liability.

An Increase to the Minimum Wage

As we continue to navigate the ups and downs of the COVID-19 pandemic. labor groups and unions have been adamant about raising the current $7.25/hour federal minimum wage, which Democratic Vermont Senator Bernie Sanders has repeatedly referred to as a “starvation wage.” 

 

A national increase to minimum wage is one of the sweeping labor proposals from the Biden Administration.

Biden has spoken about raising the wage a number of times since his 2020 campaign, and ordered the minimum for federal contractors to be raised to $15/hour in April. Various states and private corporations such as Amazon and Target have already raised hourly wages to $15 to $20/hour. 

While Congress has yet to hash out a plan to raise the wage, small businesses should already be considering a raise in pay to their hourly employees due to another concern: the current worker shortage. 

People who were furloughed or laid off during the pandemic and are now re-entering the workforce are demanding more than the minimum wage and better working conditions. Small businesses need to comply with that despite the hit to their bottom lines.

The Incorporation of a Diversity, Equity and Inclusion (DEI) Policies

One of Biden’s first acts as president was to reverse President Trump’s executive order 13950 forbidding diversity-inclusion training and education in federal agencies, the military, federally-contracted companies (a large percentage of which are small businesses), and for federal grant recipients. 

The revocation of the order affects small businesses – even ones that have 10 or less employees – in that it makes them more susceptible to legal action for discrimination, especially if they do not have a DEI training plan in place. The intent of the revocation was to encourage companies to put DEI training programs in place, but with such a policy in place, it may be possible for employees to prove unconscious bias or systemic racism in a lawsuit against an employer. 

“A company’s unilateral decision to enforce DEI policies regarding bias/systemic racism is an employee’s only protection while at work,” said Andrew Lacy, founding Attorney of The Lacy Employment Law Firm, a labor rights and employment firm, in an interview with HR consulting firm Zenefits. 

An Increase in Immigrants and Foreign Visa Workers

The US workforce, on average, relies on 1 million foreign temporary workers and 8 million undocumented immigrants. Under the Trump administration, most new temporary work visas were suspended under the decree that those temporary workers competed with Americans for jobs. 

Additionally, Trump rejected new applications for the President Obama-era program of Deferred Action for Childhood Arrivals (DACA), a program that provided a 2-year period of deferred action from deportation and granted a work permit, among other protections, and temporarily suspended a variety of work visas in his attempt to limit immigration. Trump’s attempts to limit immigration arguably disrupted the workforce in the US, since undocumented immigrants often fill low-paying jobs and are always in need by both big and small businesses alike.

Under Biden’s proposed U.S. Citizenship Act of 2021, roughly 11 million undocumented immigrants will have extended legal rights as well as an eight-year pathway to citizenship. Additionally, the act will limit workplace raids by the Immigration and Customs Enforcement (ICE), thus presenting less disruption to small businesses. 

Anyway You Slice it, Change is Likely Coming

Whether you call yourself liberal or conservative, the fact is that now is the first time Democrats have controlled the executive and legislative branches of the federal government since 2015, and this will be the case until after the midterm elections in January 2023. 

With a little more than a year to go, you can bet Democrats will push for as much of the Biden Administration’s agenda as possible, so if you’re an SMB owner or an HR executive at an SMB, you can most definitely expect change between now and 2022, and now is the time to start preparing for it.

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How (and Why) to Choose an LLC Attorney

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Forming a limited liability company (LLC) can bring you a host of benefits – it will establish a legal identity for your small business, separate you from your business’ legal and financial liabilities and simplify your taxes at year’s end. 

Whether you are creating a new LLC or converting to an LLC from a sole proprietorship, the process requires knowledge of your state’s rules on how to form and operate an LLC, a lot of paperwork and legal agreements between you and the members of your LLC, if you do not intend to be the sole member. 

Your best bet in forming an LLC is to consult with an attorney who has experience in forming LLCs in your particular state and municipality. Of course, you can try forming an LLC yourself, but mistakes on any of the required paperwork can leave you prone to significant delays in or, worse yet, legal liability and fines. 

Your LLC attorney can help you:

  • Determine if an LLC status is right for your business as opposed to sole proprietorship or an L or C corporation structure;
  • Draft and file your articles of incorporation, and make sure that they comply with your state’s regulations;
  • Negotiate funding agreements with your investors, if you have any other than yourself;
  • Draft and file the most important document of all – your LLC operating agreement, which specifies how you will operate your business, which includes how to invite or replace members of your LLC and bind the company to business loans. Without an attorney representing the interests of all of the LLC members, you are vulnerable to drafting an operating agreement that could present future conflicts and financial risks for your business, as well as potential future legal disputes between you and your partners, and 
  • Ensure that your LLC is compliant with business laws specific to your state and municipality. 

How to Choose an LLC Lawyer

Of course, attorneys can be expensive, and if you’re just starting a business, you may not have the budget for one. If that’s the case, you may consider using one of the various online legal services out there such as LegalZoom and Rocket Lawyer. These types of services offer you legal advice as well as an on-call attorney for a low monthly fee. 

However, if you are using one of these services, chances are you’re setting up an LLC yourself, which can still make you prone to errors in your paperwork. Additionally, you don’t know the experience level of the attorney you will be in contact with when using one of these services. 

If you choose to hire an attorney and have the budget to do so but don’t know where to begin, you can always look in your local Yellow Pages, put out a request for local referrals to the community via social media platforms, or you may wish to use online services such as LegalMatch and UpCounsel – both of which can match you with a qualified local attorney after you answer an online questionnaire.

Another inexpensive way to go could be to consult with a law school near you. Most law schools such as Columbia University in New York and Northwestern University near Chicago have programs in which law students assist entrepreneurs with starting their businesses, and the services these students render typically are free. Note however, you will be getting advice from law students who are seeking experience, and not licensed attorneys. 

Questions You Should Ask

If you have a list of attorneys that you are considering but don’t wish to end up inadvertently hiring the slick-talking title character from “Better Call Saul,” here are some questions you should ask:

  • How many years of experience do you have in helping to form an LLC?
  • Are you familiar with business law in my state and the state in which my LLC will conduct the most business?
  • How much experience do you have with my specific industry?
  • How much do you charge and what is your fee structure?
  • How long will it take to finish setting up my LLC (this affects how much you’re going to pay)?
  • Will paralegals or legal assistants handle part of my case? (This will also affect how much you pay)?
  • Do you have experience with funding agreements for an LLC?
  • Are you knowledgeable about tax options for LLCs?
  • How much experience do you have in drafting articles of incorporation and operating agreements?

While all entrepreneurs have dreams and are determined to operate for themselves, if you’re forming an LLC, you would be well-advised not to go it alone. While state agencies can provide you with the necessary templates and forms to fill out to create an LLC, the law prevents them from giving you any sort of legal advice. Mistakes in drafting complex documents such as operating agreements, articles of incorporation and funding agreements can cost you in the long run, so you should at least use an online legal service, depending on your budget.

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Preparing Your Small Business for Retirement

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Thinking about an exit strategy may be the last item on your priority list as you work hard to successfully run your small business. But no matter how young you are or how new your business is, life moves fast. It’s never too early to think about retirement, because being old and broke is the last place you want to be in a few decades (or a few years) from now. 

To prepare for retirement, the first item on your agenda should be to determine what you want to do with your business when it’s your turn to ride off into the sunset. Do you want to sell your business and use the proceeds to fund part of your retirement, or do you dream of passing along your business to your children or other close relatives? 

Planning For Retirement

No matter what you plan to do with your business once you’re ready to retire, saving money for retirement throughout your career is still your best bet. To do this, you’ll need to ask yourself some important retirement lifestyle questions, including:

  • What will your source of retirement income be?
  • How much money will you need to retire? 
  • What age do you want to retire, and how much will you need to save each month to make it happen?

Easily determine how much you need to save for retirement with the help of free online retirement calculators.

Online retirement calculators, such as this one from Bankrate, can be used for free online. If there is a place where you dream of spending your golden years, try to get an idea of what the cost of living is there. Also factor into the equation that as you get older, medical bills may pile up. If necessary, speak to a financial advisor about these factors. You can find a financial advisor online for free on various personal financial websites, such as SmartAsset.com. 

If You’re Starting Late

If you’re a bit late in the game when it comes to saving for retirement, not to worry. According to a great article from the American Association of Retired People (AARP), there are steps you can take, such as refining your personal budget to eliminate any excesses; setting up automatic savings deposits; maxing out contributions to any individual retirement account (IRA) you may have, and working as long as you can. The fact is, even if you’re starting to save in your 40s or 50s, you can still save enough to retire. 

Saving vs. Selling For Retirement

Selling your business to fund your retirement is an extremely risky proposition because small business owners tend to overestimate the value of their business and often mistakenly believe that selling it will bring in enough income to comfortably retire. Don’t count on it. A business is only worth what a buyer is willing to pay for it, and if you own a mom-and-pop shop with relatively low profit margins, chances are that selling your business will not pull in enough funds for you to retire.

The answer is to save early and often for retirement by setting up a retirement plan for yourself and your employees. Whether you have two or 20 employees, there is a retirement investment plan out there for your business. 

Retirement Investments

You can open a simple IRA which allows employees to contribute money to the plan. Another option is a SEP IRA, in which only the owners can make contributions. You can also fund a solo 401(k), which covers a business owner with no employees, or a 401(k) plan for small businesses.

You may want to seek help from a financial advisor to choose your investment options. The advisor can help you build a diversified investment portfolio that will automatically adjust the financial risk of your portfolio accordingly as you get older, and keep your retirement assets safe and allow them to grow.

Most retirement investment vehicles – be it a 401(k) plan or an IRA – allow you to contribute pre-tax dollars and will not charge you capital gains taxes until you retire or if you take an early withdrawal from it. Even saving just $100 pre-tax dollars per paycheck can add up over the years, so start saving early.

Always Know How Much Your Business is Worth

If you plan to sell your business to fund at least part of your retirement, you should always have a rough idea of what your business is worth. Finding out is a bit of a complicated process, so you may want to work with your accountant or an M&A advisor that specializes in small- to medium-size businesses (SMBs). 

  • The first step is to determine your cash flow by calculating your assets and deducting your liabilities from them. Your assets include current and outstanding invoices, equipment and inventory. If you own the land that your business resides on, that’s an asset as well. Then, subtract any outstanding debt and expenses you have from that figure. This is your cash flow and will at least give you a good starting point in determining the value of your business. 
  • Second, determine how much gross annual earnings your business makes through sales. This is often referred to by large corporations as earnings before interest, taxes, depreciation and amortization (EBIDTA). A company’s rough value is often calculated by a multiple of gross annual sales or cash flow. 
  • Third, consult with an M&A advisor or accountant on what multiples are used in your specific industry and location. For example, if you own a small tool manufacturing and supply shop in a wealthy location such as New York City, the average multiple of earnings that your business may sell for in the area could be five. Therefore, if your business’ gross annual sales are $500,000, it could sell for $2.5 million. 
  • Fourth, consider your client base. If you’re an accounting or law firm or an independent medical practice and have a base of long-time clients or patients, that should be a negotiating point when you go to sell your business. Typically, companies with long-time clients fetch higher multiples than smaller businesses such a retail store or restaurant. 

Now that you have a rough idea of the value of your business, you should factor that into the amount you are saving and investing for retirement, especially if you are planning to sell your business to fund your retirement.

Passing Your Business to Your Heirs

If you’ve saved enough for retirement and want your child or another close relative to inherit your business, there are several logistical and financial considerations you need to examine:

  • First, make sure your child is properly educated, trained and willing to run your business. It is probably best to introduce your child to the business as early as possible.
  • Second, if you have more than one child and they all want to inherit a piece of your business, make sure you speak with your accountant and your kids about how they will divvy up your business and what tax consequences, if any, each of them will face once you decide to retire.
  • Work with your accountant to avoid paying the gift tax. The gift tax taxes the transfer of property from one person to another. The property does include a business, and this tax applies while you are still alive (this is not to be confused with the inheritance tax, which is what your heirs will owe to the IRS on whatever property you leave to them after you are deceased). 
  • Keep in mind that there is a $15,000 annual exclusion from the gift tax in 2020 and 2021, and a $11.7  million lifetime exclusion. If the amount you are giving to your heirs stays below those amounts, you can avoid having to pay the gift tax altogether..

When it comes to planning your retirement, do not listen to the old Rolling Stones song, “Time is on my Side” (notice that Mick Jagger and Keith Richards haven’t retired yet!). Start saving early, because you do not want to be financially struggling in your golden years, and you certainly want your children to be fully prepared for the day when they take over your business. The earlier you start, the better off you will be.

Health insurance forms

Tips on Lowering the Cost of Healthcare For Your Business

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It’s no secret that healthcare plans represent a dilemma for many small businesses: on one hand, offering comprehensive, all-inclusive health insurance is often crucial to attracting and retaining talented employees, but on the other, setting up and maintaining a healthcare plan is expensive, confusing and time consuming. 

According to a recent survey of 827 small businesses from Small Business for America’s Future, more businesses (55%) are worried about the costs of providing health insurance to their employees than they are about the dangers of COVID-19 (37%). The study also found that 76% of small business owners do not provide coverage because the cost is too high, while 53% of small business owners said they do offer insurance but are considering dropping it because of rising costs. 

Roughly 90% of small business owners said their health insurance costs increased over the past four years, with 40% responding that costs have risen by 10% or more a year. 

What to Do?

There are several ways to reduce the cost of health insurance while at the same time providing your full-time employees with the health coverage that they need for both themselves and their family members. 

#1 Shop Around for a New Plan

If your insurance provider keeps increasing costs at an unreasonable rate, then simply shop around with a health insurance broker, such as eHealth, for a new plan that offers modest increases in prices. If you have a preferred provider organization (PPO) plan, keep in mind that with the rise of value-based health care – new types of medical care systems that are meant to drive the cost of care down – those types of plans are a thing of the past. You may consider switching to types of plans that are generally cheaper, such as:

  • Exclusive provider organization (EPO) plan, which have a curated number of doctors but don’t require referrals;
  • Health Maintenance Organizations (HMOs), which restrict patients to a particular set of doctors, but often charge higher co-pays if the patient sees an out-of-network physician, and
  • A tiered plan – a plan that offers multiple tiers of physicians under the in-network umbrella. The first tier of doctors already have arrangements with the insurance carrier to offer financial discounts for services, and those savings are passed on to you and your employees.

#2 Offer a Plan With an FSA Option

Flexible spending accounts (FSAs) allow employees to set aside pre-tax dollars to spend on major medical events, such as surgery, teeth replacement, high-cost prescription drugs, or any other future medical need. Insurance plans that offer FSAs typically will offer you, the business owner, high annual deductibles but also a discount on premium contributions while still providing health insurance to your employees. 

#3 Look for Insurance Plans That Emphasize Value-Based Care

Value-based health care is the new trend in medicine today, and there are several ways insurance companies can offer it and pass the savings along to your business in the form of lower monthly costs. Look for plans that include:

  • Wellness plans rewards;
  • Telemedicine;
  • Free annual physicals and flu (and COVID-19) vaccination shots, and 
  • Prescription drug coverage that requires pharmacy benefit managers (PBMs) to automatically offer cheaper, generic versions of prescription drugs before selling patients the more expensive brand name ones, and
  • Dedicated service experts.

#4 Shifting Healthcare Costs to Employees When Applicable

While not ideal, you may want to choose a cheaper insurance plan that places a greater burden of healthcare costs on employees. Some plans can save you money by raising the deductibles and copayments for medical services, and raising the costs of using out-of-network doctors. Be warned, however, that employers must balance this approach with affordability requirements under the ACA.

As a benchmark: A 2020 Kaiser Family Foundation health benefits survey found that full-time employees paid on average 17% of the premiums for single coverage, and 27% of the cost for family coverage. The survey also showed that employers are shifting costs to employees through increased deductibles and out-of-network copays.

You also may want to add “working-spouse” provision to your health coverage plan. These provisions limit an employee’s spouse’s access to a plan when the spouse works for another employer that offers health insurance, thus saving you time and administrative costs.

#5 Educate Yourself and Your Employees

If you and your employees don’t have a solid grasp of the ins and outs of medical insurance, know that you’re not alone. The more your employees are educated on their health benefits, the better and lower-costing choices they will make. You may want to consult with a health insurance brokerage firm such as eHealth or your current insurance carrier to:

 

  • Provide training on open enrollment;
  • Give a simplified summary of benefits from your insurer, as well as explanations on deductibles and in-network doctors, and 
  • Provide access to a health insurance expert, either through your own HR manager (if you have one) or an agent from your insurance carrier.

Which Insurance Companies Are the Most Popular?

Whether you have two employees or 200, there are insurance companies that have a reputation for offering generally lower costs and specialize in providing coverage for small businesses. The most popular seven companies are:

  1. UnitedHealthcare, which has a reputation for providing one of the most extensive network of physicians and emphasizes the use of modern technology for virtual healthcare;
  2. Blue Cross Blue Shield, which operates through 36 local, independent doctor networks and is known for affordable tiered plans;
  3. Anthem, which has the largest network of doctors and takes an integrated approach to medical care through combined health plans, which connect patient data in order to more effectively manage care;
  4. Humana, which offers a diverse array of tiered plans and emphasizes preventative care, and wellness programs;
  5. Kaiser Permanente, the largest managed care organization in the U.S. and offers one of the widest array of plans specialized for small businesses;
  6. Health Care Services Corp., the largest customer-owned health insurance company in the nation that emphasizes affordable plans for small businesses through value-based care, and
  7. Oscar Health, a company that emphasizes cheaper insurance plans for small businesses by utilizing healthcare technology such as telehealth, electronic appointments and automatic wellness checks.  

While setting up a health insurance plan is time consuming and often painfully expensive, we all want to see everyone have access to the healthcare that they need, especially our employees. The good news is that employer health care costs have not risen as sharply as it has in recent years. There is an affordable, well-priced plan out there that is right for your business and employees, it just may take some time to find the right one, but in the end, it will be time well spent.  

Several people sitting at their desks in the office.

Overcoming The Challenges of Hiring Office Workers

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The process of finding and hiring qualified, full-time employees has always created headaches for small businesses that operate out of an office, but as we near the end of the COVID-19 pandemic, those challenges have become amplified. 

As businesses try to recoup their staff to pre-pandemic levels, it’s no secret that there is a plethora of openings for office workers, yet the number of applicants available to fill those roles is far smaller. According to recent data from the Bureau of Labor Statistics, the seasonally adjusted number of job openings in the U.S. far outpaced the number of new hires and voluntary quit rate at the end of April 2021.

You Need Them More Than They Need You

To put it bluntly, the reality of the hiring landscape right now is that as a small business owner, you need employees more than they need you. No matter what type of small business you are, be it a small law, medical or accounting practice; a public relations/advertising agency or a marketing or an IT or web design firm, hiring the right candidates for an office has become more difficult than ever. 

Here are some tips on how to hire the right candidate:

Don’t Fight the New Normal

Frontline hourly wage workers obviously must show up to their place of employment, but for office workers, the pandemic has shown us the future: it is remote/hybrid work. Nobody, especially millennials, wants to shave off hours of their lives everyday by commuting to and from work on a packed train or through rush hour traffic anymore, only then to be confined to a cubicle for eight hours a day. The pandemic has taught us that most office jobs can be successfully performed from the comfort of one’s home. 

If you’re a small business owner and believe that people should be working in the office full time, then you need to seriously reconsider that view if you expect to attract and retain good talent. Even financial services giants such as UBS and Synchrony Financial recently announced that they are offering hybrid work situations. Plus, survey after survey has revealed that large swaths of workers would rather quit their jobs than return to the office. 

The times are-a-changin’, and you need to as well by offering a remote or hybrid work situation. 

Be Concise in Your Job Ads

If you placed a job ad and you find yourself having to sift through hundreds of resumes from candidates who aren’t quite qualified, then you probably were not exact enough in wording your ad. Whether you place the ad on Indeed, Glassdoor, ZipRecruiter or LinkedIn Jobs, be succinct in what you’re looking for, and try using “knock-out” statements or questions to narrow down the list of qualified candidates. Some easy knockout questions include:

  • Did you graduate college?
  • What are your salary expectations?
  • We are seeking someone with at least X years of relevant experience.
  • Are you willing to undergo a background and credit check?
  • Do you have experience using X software or apps?
  • Can you provide samples of your work that are relevant to this position?

Questions such as these in the job ads can significantly narrow down the list of qualified candidates.

Also, try to avoid asking classic-yet-pointless abstract interview questions such as “where do you see yourself in five years from now” or “why do you want to work here?” Obviously, the applicant is seeking a job to make a living. These questions contribute little to the process and will only waste your valuable time having to read the answers. 

Take Advantage of ATS

An applicant tracking system, or ATS, is software that allows you to manage the applicant hiring process and keep track of strong candidates. It can help you organize the interview process and send automated alerts to you on the statuses of candidates. They are not expensive, and are offered by companies such as HRCornerstone and Jobvite.

You can store data and export helpful reports using systems like an ATS, Google Analytics or recruitment marketing software. You don’t need to track every recruiting metric there is. 

Communicate With Candidates

Good candidates will carefully note how you treat them during the interview process when evaluating whether to accept your offer. In this regard, it is important to give them a timeline of when you’re going to get back to them and where they are in the process. When you do interview a good candidate via Zoom or in-person, give them a general idea of where they are in the process. For example, tell them that “I really enjoyed our conversation” or “I have some other candidates I have to interview, but you seem very well-suited for the job.”

Also, act fast with an offer when you do get a good candidate. Remember, if a candidate impresses you during an interview, then he/she is probably impressing other recruiters as well. 

Loosen the Purse Strings

Always keep in mind that you have very strong competition for employees, especially from larger companies. No matter how nice of a person you were during the interview, nothing talks like money. Research what the going rate is for the position you are offering (this can easily be done on Glassdoor or Indeed) and offer them more. Remember that the millennial generation values work/life balance above all else, so offer candidates flexible hours and additional paid time off days as a way of getting an edge on your competition.

Respond to Negative Reviews

You may not know it, but your small business may have bad employee reviews on Indeed, Glassdoor and other web-based job sites, which have become something like the Rotten Tomatoes of workplace reviews. 

You want your brand to come across as strong and your work environment appealing, so it’s important to find any bad reviews of your company (perhaps left by disgruntled former employees) and adequately respond to them. 

This may mean the difference between an acceptance or rejection of your offer. If you’re not reading your company’s employee reviews, you can bet that strong candidates are. 

Drawn hands in different colors

The New Age of Social Responsibility and Accountability

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The modern era has cemented businesses and companies as one of the most powerful bodies with the ability to shape social change. When companies make a statement, people often notice. It is critical then that companies and businesses know how to harness good attention and meaningfully address bad attention. The COVID-19 pandemic further proved that businesses have a social responsibility to stay in tune with their local community. Navigating the new age of social responsibility can be daunting for small businesses and international corporations alike; it can sometimes feel like the rules are always changing. It is essential that modern businesses and companies not only strive to grow but to also make the world a better place. Companies that transcend that us-versus-them mentality between consumers and businesses are those who hold themselves accountable and are genuinely engaged with promoting social good.

Businesses who are outwardly socially responsible and active in their community have the most to gain, as Porter Novelli’s 2021 Business & Social Justice Study found that 62% of Americans believe that companies can help normalize social justice conversations through marketing and communications. The same study also found that six-in-ten Americans say it is no longer acceptable for companies to be silent on social justice issues, further, 49% take companies’ silence on social issues to mean they do not care. Not every business, however, has the budget or scope to hire consultants to manage a company’s social image. But, the good news is: there are several low-cost strategies business owners can take to better their community involvement, paint their brand in a better light, and show consumers that they take social responsibility seriously.

 

Familiarize Yourself with the Concept of “Stakeholders”

To meaningfully represent social responsibility, a business ought to work for the benefit of not just shareholders, but all stakeholders in a company. Stakeholders are all people who interact or are affected by a business. Customers, suppliers, employees, and surrounding community members are all considered stakeholders because the business, in some way, affects their lives. Recognizing the interconnected relationship between a business and its community is the basis of stakeholder theory and being aware of the several ways your business can affect the people around you is one of the most tangible ways to increase your social responsibility.

Companies that think in terms of stakeholders instead of “shareholders” tend to make decisions based on ethics and morals rather than investments and returns. Instead of creating value for stockholders or focusing solely on monetary returns, create value for your community. Even if a business doesn’t actually have shareholders, it is still possible to have your business geared toward a shareholder mentality. 

So, how do you determine the difference between a stakeholder and shareholder perspective? An example of stakeholder mindfulness could be establishing more expensive recycling measures knowing they will benefit the community while shareholder mindfulness could be choosing the least expensive waste removal system knowing it will increase immediate returns. Working for stakeholders means planning for long-term success beyond cash returns instead of short-term profits. Whether that means taking direct input from employees and customers, or actively making decisions to those peoples’ benefit, stakeholder theory is the basis of a socially responsible company.

Actively Engage in Local Events

Associate your brand with initiatives, events, and collectives that promote social good. Be present at local events. Being a sponsor for local events promoting modern social awareness is one of the most effective ways to associate your brand with those very concepts. Beyond sticking your brand’s logo on banners and T-shirts, be sure to have a physical presence at events either through enthusiastic team members or product displays. Event sponsorship is also one of the most effective ways to promote organic cross-pollination associating your brand with social good. Through either television and news media coverage or individuals on social media, people are likely to take notice of your brand in a way that does not feel manufactured.

One of the best forums for connecting event organizers to sponsors is Sponsor My Event which regularly features events across the United States ripe for associating your brand with modern social responsibility.

Become a Forerunner for Modern Ethical Labor Practices

No matter if a company is strictly domestic or deals internationally, those who adopt modern ethical labor practices show solidarity with their employees and community at large. As company labor practices become increasingly public, it is much less acceptable to remain silent. Like stakeholder theory, consider the wellbeing of your employees and even the origin of your supplies before your bottom line. 

Strategies to consider include restructuring your hiring process to avoid bias; there are a number of simple things you can do to reduce hiring bias, including tapping new sources for talent – this can mean posting job ads on job boards like Diversity.com and Career Contessa, or using skills assessments which can create fairer evaluation criteria. 

Another strategy is researching and being transparent about your suppliers and the origin of your materials. Especially in textiles and electronics, there are several international suppliers that use unethical practices like child labor or low wages. Ethically sourced products are often more expensive than their counterparts, but by investing in an ethical supply chain a business can quickly turn their intentional supplier choices into a selling point.

If your company is one of the few in your local area to offer intentionally diverse hiring or commits to sourcing ethical supplies, both potential employees and likely local leaders will take notice. With limited publication and fanfare, businesses that employ ethical labor practices are likely to be considered socially responsible. 

 

Meet Your Local Leaders

One of the best ways to learn how to serve your community is to listen to your local leaders. Either through research or social media, find out who in your local area represents business ideals you want to align your company with. Find out who is leading pride month organizations for your city. Find out who represents local unions. No matter which angle best suits your business, there is likely a local leader who would be happy to sit down and talk about how to run your business for the betterment of your community.

Proper Social Media Outreach

Basic social media outreach is no longer acceptable. Either in addressing social change or simply responding to customers, businesses with stale or basic social media presences are missing out on a massive opportunity for growth and refining your brand’s association with social responsibility awareness. The first step toward being socially responsible is being unambiguously honest with your customers. Social media puts companies on equal footing with every consumer; that means holding businesses accountable is often much easier. Avoid obtuse legalese and give your customers transparency and honesty.

The type of writing that works in a professional email or an employment ad falls flat on social media; clear, targeted statements are often the most effective. A timely example is the various ways businesses chose to address June 2021 Pride Month. Companies that simply posted a message with a rainbow banner are missing out on a key element of harnessing social media: intentional and engaging content.. Those companies that published reviews on how their company succeeded and can grow to better support the LGBTQ+ as well as others that meaningfully engaged either with videos or comments from executives will be seen as leaders instead of falling into the fold among thousands of cookie-cutter posts.

 

The Importance of Social Responsibility

Social Responsibility is a bizarre balancing act for businesses in the modern world. Actions benefiting the social good often are counter to direct monetary returns but have the potential to make your brand more appealing in the long run. Companies that over-publicize their social outreach also run the risk of appearing insincere and only driven by the potential for cash returns. A truly socially responsible business must genuinely make choices and changes to the betterment of the community with positive PR as a byproduct instead of the sole purpose.

In learning what steps toward social responsibility best suit your company, the first stage is collaboration. Talk to your staff and engage with your community not out of obligation, but genuine interest on how to do better.

People and a giant mouse statue in front of the building

The Challenges of Hiring Union Workers

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Small businesses need to prepare for the challenges of hiring and managing union workers in the coming years, as union membership is expected to increase under the Biden Administration.

While union worker employment did not decrease that much during the pandemic as much as non-union workers, according to a study by the Economic Policy Institute, union membership is still at historic lows, thanks to union barriers created by previous presidential administrations and more states embracing ‘Right to Work’ laws over the past decades.

The Biden Administration, however, as part of its Build Back Better initiative, has already outlined plans to increase union membership across all sectors by promising punitive action against companies that violate labor laws, and denying funding to companies that engage in union-busting activities, among other things.

What Does This Mean For You?

So what does this mean for your small business? Whether you operate out of an office, are a small construction company, an independent restaurant or a small medical practice, you are most likely going to have to deal with tougher salary and benefits negotiations with union applicants. You also risk a protest and a giant, inflatable rat being placed in front of your office if you choose not to hire union workers. 

Alina Clark, marketing director at CoCoDoc, calls hiring union workers ‘more challenging than ever’ in post-pandemic world.

“Pro-union workers feel that syndicates are a fundamental building component of a powerful working class,” said Alina Clark, co-founder and marketing director at software development firm, CoCoDoc. “Opponents believe that unions are excessively restrictive and damage workers. Especially after the pandemic, the task of hiring union workers has become more challenging than ever.”

Challenges of Hiring and Employing Union Workers

As a hiring manager, there are challenges you will face when hiring union workers. Some of them include:

Bargaining and organizing.

Small business owners or their human resources managers cannot interfere with employees’ rights to organize, according to the National Labor Relations Board (NRLB). Small business owners, managers and HR executives are not allowed to fire, demote or strip an employee of his or her benefits if they join a union without some sort of negotiation.

Dealing with employee grievances.

When a union employee has a grievance with a company, the company’s actions must be consistent with any collective bargaining agreement that has been reached. Union employees can also be represented by a union official when meeting with a company’s management over a grievance. 

Meeting workers’ salary and benefits demands.

This issue is especially important as safety concerns still linger due to the COVID-19 pandemic. Businesses both big and small must negotiate with unions on wages, hours, and workplace safety conditions. 

Managing union dues. Some union employees may demand that their union dues be automatically withdrawn from their paychecks, so this is an issue that your accountant or payroll department may have to deal with.

Innovation May be Stifled

Some hiring managers said one of the biggest concerns of hiring unionized workers is that being in a union may stifle their creativity.

Brack Nelson, HR manager at Incrementors, a web design and internet marketing firm, said “Laborers are connected by the opinions of the union…working in groups promotes ‘group think’ positions, which troubles individual creativity.”

Clark added, “Union workers mainly work in groups which promotes conditions of ‘group thought’ that, in turn, deter individual innovation. The Unions are greatly focused on seniority. This typically means that fresh and high-performing [union] employees are not progressing. Likewise, personnel that do not perform at high levels are tough to demote. That, in turn, makes the process of hiring good and innovative [union] workers very difficult.”

Tips on Hiring, Managing Union Workers

Some tips on hiring and managing union workers:

  • Let union applicants know right away that your company is neutral on whether employees join unions or not, and that you are willing to negotiate fair wages and benefits.
  • Make sure you and your managers are following the guidelines set forth by the NRLB in not discouraging employees’ right to organize and form a union.
  • Just because an applicant is a member of a union, it does not mean that they can’t be creative, innovative or worthy of promotion. Encourage that. 
  • When negotiating with a union, negotiate job performance standards for unionized employees, and terms of termination or demotion if those standards are not met. 
  • Educate employees on the fact that your company is union-neutral, and strictly warn them that no one is to be pressured into joining or pulling out of a union.  

Remember, despite the potential inconveniences unions may represent, they are not your enemies. Unions are there to ensure safe work environments, fair wages and, lest we forget, we can even thank them for weekends and 40-hour work weeks! The point is, we all want workers to be treated fairly, and if you already do that, you should have minimal problems with hiring union employees. 

Father with a daughter in his lap looking at his laptop, working remotely.

Setting Up a Remote Work Environment – the Challenges and Benefits

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“All of humanity’s problems stem from man’s inability to sit quietly in a room alone,” wrote French philosopher Blaise Pascal. While that statement was written in the 17th century, we’re about to find out if it’s true in 2021, as tens of millions of Americans will continue to work quietly alone in their homes. 

If your small business operates out of an office and has decided to permanently move to a remote work environment, you are going to experience both benefits and headaches from that decision. Of course, most of your employees will be happy with the arrangement, but you’re also going to have to deal with new tax classifications and employee productivity issues, among other things. 

Savings Benefits With Remote Working

One benefit to remote working is a potential savings on office space. The average rent-to-revenue ratio in some business sectors in the U.S. is as high as 15%, so with fewer or no workers coming into the office, you may think about moving your company’s headquarters to a smaller, cheaper and more tax-friendly location anywhere in the country, especially if your headquarters is in an expensive urban area such as New York City or San Francisco.

Don’t Lose Valuable Employees

Moving to a remote working environment could very well allow you to retain valuable employees. This is particularly important since the number of job openings right now far outpace the number of new hires and the volume of people quitting their jobs, according to the Bureau of Labor Statistics. Roughly 40% of Americans prefer to work from home full-time, compared with 35% who seek a home-office hybrid and 25% who want to go back to the office full-time, according to The Harris Poll survey of 1,224 working adults.

Put simply, there are more job openings right now than available employees, so the competition for new employees is fierce right now. By not setting up a remote work environment, you risk losing much of your staff.

A recent poll of American workers from Flexjobs revealed that 60% of women and 52% of men who have been working from home during the pandemic would rather quit their jobs than return to their respective offices full time. 

You are also no longer limited to just hiring employees who live in the area surrounding your headquarters. You are free to hire talent from anywhere across the country, or even overseas. Bear in mind that every state does have different employment laws that could be costly. 

Challenges With a Remote Work Environment

While a remote work environment may be great for some of your employees, it will create challenges for you from a human resources and accounting standpoint. Some of the potential downsides of moving to a remote working environment include:

  • The ability for employees to collaborate and communicate may suffer;
  • Remote communications technology may need to be added or upgraded;
  • Payroll taxes and deductions may be confusing;
  • Workers may become less productive and motivated, and
  • The mental health of some workers may suffer due to the isolation of working at home alone.

Talk to Your Accountant

The first thing you need to do if you move to remote work is to speak to your accountant about managing your payroll. If your employees are out of state, you may have to deduct state and local taxes (SALT) from both the location of your company’s headquarters and the state in which your employee lives. 

Some employers will choose to make the employee responsible for his or her own SALT taxes, and some employers may even opt to make some out of state employees independent contractors in order to avoid the confusion. While some states such as New York and New Jersey and Washington, D.C. and Maryland do have reciprocity agreements in place that allow employers to pay only one set of SALT taxes, you still need to speak to your accountant about your options. 

If you do classify some of your employees as independent contractors, be aware that the PRO Act was reintroduced in Congress in January 2021, which will require employers to engage in the ABC test to determine if an employee can be labeled as an independent contractor to keep in compliance with the National Labor Relations Board. 

Use the Latest Communication Apps and Technology

To make remote working work, you’ll need to use the latest remote communications software that will allow for you and your employees to meet regularly. 

Video conferencing apps such as Zoom, 247Meeting, and Teamviewer will enable you to do that. Additionally, it’s crucial that you implement apps such as Google Docs, G Suite or Think Free that allow you and your employees to freely share and edit documents. 

Additionally, it is important for your IT or HR teams to set up a system to send laptops (with cameras) and other office equipment out to your employees so that they can stay connected.  Your HR team (which may be you, depending on your business) will also have to adjust payroll to allow employees to receive direct deposit and to have access to their paycheck stubs online. Services offered by ADP, Paychex or Onpay can help you with that. 

Hold Employees Accountable

According to a recent survey of small business leaders by The Harris Poll and Trinet, 55% of them said that employees were less productive when asked what the biggest challenges of a remote working environment is. The distractions of working from home, taking care of children or doing household chores can be a major deterrent. 

As a result, you may want to set up regular video conferences during the work week with your employees to go over what assignments they are working on. Set definitive performance goals and deadlines for them, and do not be afraid to set up one-on-one calls with employees whose productivity may be slipping since working from home. 

Keep Mental Health Issues in Mind

While working from home is considered a blessing by most, the lack of office friendships, the inability to pop your head over your cubicle wall and confide in your co-worker, and the general absence of employee camaraderie can lead to a feeling of isolation and depression in others, especially for those who live alone. According to the most recent Census data, single occupancy households are now the second-most prevalent in the country. 

Amber Broughton, managing director of The Harris Poll, said in a statement, “Small and medium size businesses continue to step up as they adapt to the new realities of this pandemic, investing in the wellbeing of their workforce through enabling remote work, staying in close contact, and offering increased flexibility to balance daily work and life.”

According to human resources association SHRM, some tips to avoid employee loneliness in remote work situations may include:

Encouraging regular, non-work related video chats between employees.

  • Creating a private Facebook group for your employees to share personal photos and thoughts.
  • Creating  a video conference  happy hour once a week where employees can grab a beverage of their choice and socialize.
  • If you can afford to, offer employee discounts at gyms, restaurants and other places where they can get out of the house.
  • As mask-wearing mandates loosen, try having company outings if most of your employees live within a close vicinity to the office. Also, the isolation factor could heighten the importance of holding an annual office holiday party and other events so employees can meet at least once a year.

Morgan Stanley’s CEO James Gorman was recently quoted as saying, “If you can go into a restaurant in New York City, you can come into the office.” While that may be a hard-line view, employers should carefully weigh the many pros and cons before moving to a fully remote work environment.

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