Ramadan, Kwanzaa, Hanukkah, and Christmas occur at the end of the calendar year--not to mention Las Posadas, Three King’s Day and Winter Solstice!

Employers, HR professionals and managers struggle with how to celebrate these holidays, recognize the diversity of religious beliefs and practices, and consider the issues of non-religious employees who do not partake in these holidays. Should a Christmas tree be placed near the reception desk? A menorah? Both - or perhaps nothing at all?

A Gallup poll states that 90% of American adults say that religion is either very important or fairly important in their lives. And with that, arises workplace conflicts. Charges of religious discrimination in the workplace have risen 43% since 1990. This has led to a piece of pending legislation in Congress called “The Workplace Religious Freedom Act,” which will place an increased burden on employers to meet employee requests for religious accommodation.

Should employers take note of all of this? Most definitely. And why? It’s not just because of the legislation, or the legal implications. It’s also because it’ll make your workplace more productive. It’s because religion may be the most important element in your employees’ personal lives and it needs to be respected as such.

What can employers do to accommodate religious expression and observance by employees? Fortunately, such accommodations involve minimal costs. But they do require managerial planning.

Just a few site administration issues. As you may have noticed, we just revamped the blog template. (Thanks, Helen Jane at Maplevine!)

At the same time, we took the opportunity to build in a Feedburner account into our RSS feed.  So if you’d like to subscribe to TriNet’s HR Blog using the news reader of your choice, Feedburner makes it easy.

Go ahead...subscribe to TriNet’s HR Blog. We’ll do our best to make it worth your while.

The other month I gave a presentation on “Making the Move to a PEO,” discussing why HR outsourcing may be right for companies as they gear up for the challenges of 2008.  Presenting with me was Jennifer Panning, VP of Finance for Colorado-based Stratavia. 

It was actually a lot of fun.  I got to talk about the company and the value proposition that I love, and I got to do it alongside a fantastic TriNet customer.

Together, we presented an overview of TriNet’s services, explained how TriNet interacts with its customers, and talked about Stratavia’s experience during its multi-year partnership with TriNet.  We also talked about the nature of the Professional Employer Organization (PEO) relationship and dispelled many of its myths. (Here’s my favorite one: no, we don’t hire and fire your employees!  We can give you guidance on adding and reducing staff in compliance with the law, but our customers control their own destinies.)

We had over 100 people on the call, and we answered many of their questions at the end.  (We didn’t get to them all, though--there were a lot!)

You can watch the presentation here.

We’re pleased to announce a new addition to the TriNet benefits package: an executive supplemental disability plan offered through our partner, MetLife. The enhancement provides crucial support for high wage executives at TriNet’s customer companies, protecting their ability to work, earn a living, and provide for family and retirement in the event of a disabling injury or illness.

The plan will be available to employees with earnings of $200,000 and over. It supplements the extensive benefits package that we already offers to our customers, which includes a full suite of side-by-side PPO plans, life insurance, vision and dental plans, and value-added benefits such as retirement solutions, banking services, and pet insurance.

The fact is, the executives at our customer companies are particularly interested in new, innovative benefits offerings.  I believe the executive supplemental disability plan is one of those offerings that will actually surpass their expectations--and that’s no mean feat.  It’s a product that is simply unavailable to the smaller businesses in our vertical markets, and no other HR outsourcing provider is offering anything like it.

The executive supplemental disability program provides an income tax free benefit that offers advantages such as an extra income protection benefit of up to $10,000 a month, 25% off street rates, guaranteed issue, portable policies with discounts, and convenient payroll deduction for premium payments.

The bottom line? It’s an enhancement that continues our commitment to deliver HR outsourcing services that help high-performance companies compete with larger, more established firms for the same in-demand talent.  In the final analysis, that’s pretty much what we’re here for.

It’s always heartening to be an industry that’s just starting to show its best years. Despite having been around for decades, the idea of Professional Employer Organizations (PEOs) is still picking up steam and gaining momentum among small and medium-sized companies.  It’s hard to believe that the concept hasn’t found more penetration--but there are concrete signs that this has started to change.

Such, at least, is the viewpoint of IDC analyst Lisa Rowan and long-time industry observer Carrie Aaron.  They see that years of PEO data plotted on an S-curve and matched against Bureau of Labor Statistics (BLS) data provides insight about the current status of the PEO industry. They also make some predictions about when the industry might reach its tipping point and double in market share.

They point out that whether you’re speaking with investors or current providers, those people already engaged in the PEO industry are consistently upbeat about the prospects for growth being fueled by trends such as:

Every hiring manager knows some people fudge their résumés to get a job.

In fact, say almost a third of the small businesses in a recent survey, up to half the résumés they receive are inaccurate.

Checking the résumé is only the first step in what should be a rigorous look at each candidate’s background. No matter how much you want or need to hire someone, you must carefully check their credentials and background. There’s too much at stake.

Screening candidates is a booming business these days. Traditionally only large companies with security needs, such as defense contractors or banks, used rigorous background checks. Now smaller businesses are doing it, too, as much to make sure the candidate is suitable for the job as for security reasons.

Replacing a worker who didn’t fit and who left or had to be fired can cost more than the employee’s yearly salary, say experts. Especially for small businesses, with fewer resources and thinner benches, hiring an unsuitable employee is a costly mistake.

TriNet is one of the many PEOs that suggests requiring applicants to complete a detailed job application that asks about legal and disciplinary actions. Also: Always ask for references and make sure to check them. Recruiters with PEOs said they have even seen fairly elaborate ruses, such as reference letters faked by the job applicant.

The National Association of Professional Employer Organizations, TriNet’s trade association, surveyed 352 small and medium-sized businesses across the nation earlier this month on how they recruit and retain workers. Among its other findings: Almost a quarter said more than half contain misspellings or grammatical errors.

Turnover is a big problem for these companies. Forty percent said their turnover exceeded 10 percent in the last year, indicating there may be a problem with their hiring process.

The below article was written by Jay Pimentel, Esq., TriNet’s Associate General Counsel, for a technology/entrepreneur newsletter.

Small and medium-sized companies spend so much time on growing the business and developing product that they often overlook one of their most potentially serious and costly issues—human resource compliance.  Unlike their large-company counterparts, they lack the time and resources to build infrastructure and processes that don’t relate directly to these objectives.

But if a business owner is focused on growth and product, how do they know what issues to look for in order to protect the company? Let’s look at the Top 5 Compliance Issues that they may face.

1. Exposure to Workplace Litigation Not Being Addressed

According to the EEOC, race and sexual discrimination are the first and second most prevalent forms of workplace discrimination. But less than 25 percent of businesses provide training regarding racial and sexual harassment.  At the same time, more than half of new hires leave their jobs within the first six months—opening the door to wrongful termination lawsuits.

Yet despite the possibility of being sued, small business owners are not addressing the problem head on.  For example, only 23 percent of small businesses provide employment discrimination and/or sexual harassment training (based on a random survey of 300 privately held businesses conducted by Chubb Group of Insurance Companies).

Employee turnover contributes to employer liability by creating potential wrongful-termination cases.  Studies show that a company’s legal costs in a wrongful termination lawsuit can run up to $85,000, and that winning plaintiffs receive judgments averaging $500,000.

2. Current Benefit Regulations and Laws Not Being Followed

The cost of compliance with benefits regulations is often a bigger burden for small companies, primarily because the associated overhead expense is spread over a smaller workforce.  According to a U.S. Small Business Administration survey, small companies spend up to 80 percent more per employee on federal regulatory compliance than large companies.  Poor management of personnel-related tasks can make compliance even more costly.

For the small business owner who offers retirement and health and welfare benefits, keeping up with all the regulations and laws can be daunting.  The required tests must be conducted, plan provisions must be properly applied, required notices and documents must be provided to employees, and all required government filings must be completed.  Plus there’s the alphabet soup of HIPAA, COBRA, FMLA, and the rest.

3. Multiple HR Policies and Procedures to Follow with no Qualified Guidance

For a small to medium-sized business, the human resource “department” is usually one person who wears many hats.  This HR generalist may be responsible for compensation and benefits, HR management, labor relations, legal issues, staffing, HRIS, training and much more. Besides, keeping up with all of these tasks, thorough independent research often falls into the “nights and weekends” environment, which can become both costly and time consuming. 


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TriNet has a lot to celebrate lately.  Among the many items is our most recent acquisition.  The full press release is below. We welcome all of the employees and customers of John Parry & Associates into our family!

TriNet Acquires John Parry & Associates

SAN LEANDRO, Calif. (July 10, 2007) – TriNet Group, Inc, a nationwide provider of human resource (HR) outsourcing services for small and medium-sized companies, today announced the next stage of its growth and expansion strategy through the acquisition of the business of John Parry & Alexander (JPA), an HR outsourcing and consulting services company based in Walnut Creek, California. All executives and employees from JPA have become full-time team members of TriNet. Specific terms of the transaction are not being disclosed.

“Since its inception, JPA has focused its unique blend of HR consulting and outsourcing services on non-profits and community banking markets,” said Dennis Wootten. “Although we’re proud of what JPA has accomplished in its thirteen years in business, we believe that TriNet can offer our customers an enhanced set of services, a broad set of benefit plans, increased access to enterprise-level technology, and specialized human capital consulting tailored for their specific business challenges. We see this integration as a major opportunity to raise the level of our services to our clients, and we believe it is a ‘win/win’ for all concerned.”

“TriNet looks forward to delivering the same unparalleled range of quality HR and benefits services to JPA’s customers that our other 1,500 customer companies enjoy,” said Martin Babinec, TriNet’s President and CEO. “We expect the transition to be smooth and seamless for JPA’s customers, especially now that JPA’s Co-Managing Directors, Dennis Wootten and Stephen Enna, have joined the TriNet team.”

TriNet welcomes the opportunity to work with JPA because the company’s customer base is aligned with TriNet’s target profile of high-performance organizations within the industries of technology, financial services, and professional services. TriNet tailors its human capital consulting, benefits packages, and online services to meet the high expectations of employees within these industry segments.

TriNet has continued to grow its customer base through a combination of a nationwide sales force and a series of acquisitions, which have included the Outsource Group in Walnut Creek and the E3 Group in Texas as well as books of business from ALTRES in Hawaii and HR Logic in Boston. TriNet currently serves over 1,500 companies throughout the United States and Canada.

High-perfoming small companies—and the entrepreneurs who lead them—are laser-focused on growth and innovation.  Market pressures demand the full focus and attention of the leadership. So its not uncommon for early-stage management teams to believe that sound human capital practices are a luxury—great in principle, but simply not practical given the pressures of the moment.

But the hard fact is that every company makes the most critical long-term decisions about people, culture and structure early in its history. Those choices can be made deliberately by management, or they may just happen as the business evolves—but the choices are always made.

The consulting firm McKinsey & Company continues to dominate its industry because of key human capital decisions made when the firm had fewer than ten employees. Marvin Bower’s advocacy of the partnership structure, strong “up or out” management, and a client-centered approach drawn from top law firms shaped McKinsey’s early choices about people and clients. Those choices can still be seen in the policies and practices of the firm. Bower did not wait “until we get bigger” to think about how McKinsey would manage its human capital.

Microsoft’s developer-centric, thrifty culture was shaped by Gates and Allen when the company’s small team was building BASIC interpreters for the Altair 8800. Those core practices have not changed; few would argue that Microsoft could change them now.

What are the key human capital choices that high-performing companies need to make?  McKinsey and Microsoft demonstrate that three elements—hiring practices, performance management, and compensation practices—need early, explicit attention.

Hiring shapes the identity of early stage companies. Leaders can “let it happen”, or, like Bower, can make the hard choices about the qualities and attributes that they believe will be essential to long-term growth and profitability.  Biotech companies often struggle with this challenge, as a “science-first” early stage gives way to the need to commercialize and manage manufacturing.  If the management team will not- or cannot—adapt hiring practices, then the company’s future is at risk.

Performance management, whether its the “up or out” variety or a more developmental approach, signals management priorities and shapes behavior.  We often encounter small companies with attentive financial management who have never actually reviewed the individual contributions of employees or executives. But the largest single investment these companies make is the compensation of their employees. Management needs to know—especially in the early stages—if goals are being met.  How can the leaders know, unless employee performance is being actively managed and measured?

Compensation practices are the counterpart of good performance management.  The right balance of base compensation, benefits, short and long-term incentives and work environment investments requires a disciplined look at the company’s long-term plans, as well as today’s pressing needs.  Management teams get what they pay for—and they need to decide what to pay for. 

When these human capital practices are established in the early stages—as they were at Microsoft and McKinsey—then the company is …

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Historically, the human resource function inside small and medium-sized companies has had an administrative focus.  Efforts are directed toward compliance, on boarding, benefit transactions and record keeping. We know that the concept of outsourcing these tasks to a single source expert can end up looking very inviting—let the HR outsourcer do the work as well as be held accountable for the result.

But lately the perception of HR impact has been evolving beyond the administrative focus.  A recent report (“Making HCM Strategic: Aligning the Workforce with Business Goals”) by AMR Research emphasizes that the new imperative for HR is to shift towards strategic human capital management.

The report reads: “Historically, human resource functions have been administrative and transactional in nature . . . professionals that have found ways to automate or outsource these transaction functions are now using their time to help drive corporate strategy, changing the HR function from the tactical to strategic.” Furthermore, “Managers are searching for the tools to align, measure, and motivate their workforce, identify top performers, attract and retain key employees, and optimize the deployment of their workforce.”

TriNet agrees with this assessment, and we’ve been making changes to our own service delivery to accommodate the increased demand for the human capital management tools that our customers have been requesting. Steve Carlson’s take on Business Intelligence dashboards, located a few posts down from this one, gives you a taste what we have in store.  And we will have more news to share in the near future.

In the meantime, it’s worth noting that the AMR Research report ends with the advice to “Outsource whenever possible,” and recommends replacing internal, HR administrative roles with “business strategy” positions more suited to a lean, efficient, high-performance organization.

Needless to say, we agree with that too.