Now Common for Temps and Freelancers

Full-time employees are no longer the only workers being subjected to background checks, new research shows. A study from the background screening firm HireRight revealed a significant increase in the number of organizations conducting background checks on temporary, contract and freelance workers. Specifically, 86 percent of employers are now screening contingent workers before bringing them on for any assignments. This is up 45 percent from 2012. “Contingent workers typically have the same type of access to company facilities, data, other employees and customers as full-time employees,” the study’s authors wrote. “For this reason, it’s important to thoroughly screen every worker in the same way, regardless of work status.”

While the influx of temporary workers is changing the background screening process for many employers, the decriminalization of marijuana many states have enacted is not. The study found that, despite a number of states legalizing marijuana during last year’s election, nearly 80 percent of the employers surveyed have no plans to change their drug screening policy this year.

Along with the states that allow decriminalized marijuana for personal use, 28 states now allow medical use of marijuana. “Whether or not you support the use of medical or recreational marijuana, it’s best to have a policy that explicitly states your organization’s position,” the study’s authors wrote. Background checks are typically a one-time occurrence for employees. The research found that 48 percent of employers do not rescreen their workers post-hire. Those that do conduct follow-up background checks typically do so when an employee is promoted or changes roles. “Unlike candidates hoping to join an organization, current employees already have access to highly sensitive information, such as records, business transactions, and financial data,” the study’s authors wrote. “Without occasional or regularly scheduled follow-up background checks, problems may arise that could seriously affect a business.” Overall, criminal history and past employment is what employers are looking for most during background screenings. The study found that 84 percent of organizations conduct criminal and other public record searches, with 72 percent checking previous employment and references.

Employers are finding more resume lies now than they were five years ago. The research shows that 85 percent of employers have found a lie or misrepresentation on a resume or job application, up from 66 percent in 2012. The biggest problem organizations say they face with background checks is that they are slowing down the hiring process. The study’s authors said that, with more complex candidate backgrounds, organizations are struggling to find a balance between speed and accuracy. “Organizations are now competing for the most qualified candidates and therefore putting greater emphasis on creating a positive onboarding experience, which includes the background check process,” said Mary O’Loughlin, vice president of global customer experience and product management for HireRight, in a statement. “Despite pressures to hire quickly, organizations should not overlook the importance of instituting a thorough background check process that includes creating a global policy, rescreening current employees, and ensuring a rigorous screening process for senior executives.”

Really Do to Your Team

Getting your new hires started off on the right foot requires more than just offering them a quick tour of the office and sending them on their way. Giving employees the best chance at future success requires a successful and thorough onboarding program, according to new research from CareerBuilder. Unfortunately, a number of employers aren’t taking those steps. The study found that 36 percent of organizations do not have a structured onboarding process in place. Not having any process in place can cause a number of negative consequences for both the employee and employer. Specifically, 16 percent of HR managers said it lowers their company’s productivity, 14 percent said it brings on greater inefficiencies and 12 percent said it leads to higher employee turnover.

Lower employee morale, lower levels of employee engagement, lower confidence among employees, a lack of trust within the organization and missed revenue targets are among the other negative impacts of not having a thorough onboarding program. “While onboarding is a critical component of setting new employees up for success from day one, this study shows some companies are neglecting fundamentals in the onboarding process – and running into serious consequences that can impact the bottom line,” Rosemary Haefner, chief human resources officer at CareerBuilder, said in a statement. The study discovered employers use varying strategies when it comes to their onboarding process. Nearly half of those surveyed provide an overview of their process and how things work; 45 percent offer individual, ongoing training; 43 percent introduce new hires to key employees; and 42 percent provide an introduction to the company culture.

Additionally, more than 30 percent have a team welcome, ensure the new employee’s workspace and technology is ready before they arrive, and have goals and expectations for the employee’s role with defined milestones and success metrics. Some employers also provide detailed information on the company and growth opportunities and assign a mentor to the new hire. The research revealed that HR employees would benefit from including more automation and technology into their onboarding systems. More than 40 percent of the HR managers surveyed who don’t capture onboarding information electronically spend three hours or more per employee manually collecting and processing the data, while 16 percent spend five or more hours.  Those who collect all the information manually say they suffer from heavier workloads and higher stress levels. In addition, it leads to missing information, delayed start dates and candidates who end up walking away from the job because the process took too long. “Employers need to establish a comprehensive checklist for every new employee and incorporate more automation to provide a better, more efficient experiences for employees, their managers and HR,” Haefner said. Overall, one-quarter of employers have an onboarding process that lasts just a day, or less, with 26 percent having programs that last about a week. Twenty-one percent have an onboarding process that lasts one month, with 11 percent extending it over the course of at least three months. The study was based on surveys of 2,300 hiring managers and human resource professionals across a variety of industries and company sizes in the private sector. – See more at: http://www.businessnewsdaily.com/9936-consequences-poor-onboarding.html#sthash.f00H9rdS.dpuf

Business Automation Impact Workers in the Gig Economy

Two trends remaking the American economy are the growth of freelancers and independent contractors – the so-called gig economy – and an expansion of automated processes. But how do the two intersect? What impact will the breakneck pace of automation have on temporary workers in the gig economy? Morag Brand, a freelancer and certified automation expert, said automation and short-term contract work are a natural pair, and that the gig economy can expect a boost in activity as a result of more businesses employing automation-focused technologies. “Automation has to start somewhere, and that’s right at the initial concept stage … but it has to be set up by someone, and this is where freelancers enter the scene,” Brand told Business News Daily. “So, yes, freelancers and contract workers should expect more work as automation expands, but it will be short bursts of ‘set up and move on,’ rather than the traditional retainer model of old. This is also cost-effective for the business owner too.”

Cristina Escalante, COO of the web and app development company The SilverLogic, said the gig economy has grown exponentially with automation technology, which paved the way for the Ubers and Airbnbs of the world.

“The gig economy was created by the combination of automation and the birth of Web 2.0,” Escalante said. “[Many of these jobs] would have been completely unimaginable without both automation and web-based platforms.”

But the intersection of the gig economy and automation goes well beyond the common references. Freelancers are taking to platforms like Fiverr and Upwork to get their services out to the public at affordable rates. Writers and data analysts share these platforms to connect with potential clients all over the world, enabling them to spread their services to a wider audience.

“An Upwork data researcher or proofreader can build a reputation, maintain connections with clients, and use a gig platform as a launch pad for his or her own business,” Escalante said. “Although it’s conceivable that humanity will automate itself into unemployment, for the near future at least, gig workers capable of retooling and pivoting can expect more work.”

However, there remains a great deal of progress to be made when it comes to connecting freelancers and clients. Kristen McAlister, president and co-owner of Cerius Executives, which provides companies with temporary executives, said locating temporary workers is still a heavy lifting process for the would-be client. She anticipates further automation of this space in the future, which she predicts would lead to much quicker mass adoption.

“The overwhelming trend to finding contract workers on platforms is a ‘post’ rather than a ‘search’ process,” McAlister said. “This makes the connection process far more manual and flawed than most realize.”

A major complaint of clients searching for freelancers is that oftentimes the posts advertising their services are vague and ambiguous, McAlister added. She sees further automation as an obvious solution to this problem.

“Increased automation and AI to help improve the need identification and matching process will provide significant advances in this space,” she said. “It needs to get to the point of an Uber or Amazon AI model to remove much of the current friction and increasing mainstream adoption for businesses.”

 

Legal issues surrounding the gig economy

There are a few legal issues any company interested in hiring gig workers needs to be aware of. Jon Yarbrough, a labor and employment attorney for Constangy, Brooks, Smith & Prophete, said businesses commonly misclassify their employees, which can lead to severe penalties from government regulators.

 

How to Retain Increasingly Mobile Workers

As the economy improves and more job opportunities appear, workers are growing increasingly restless. According to research conducted by ADP, more than 1 in 4 people change jobs annually – an unprecedented frequency of job switching. Moreover, ADP found that 63 percent of the average employer’s workforce is open to leaving for a new job at any time, and 46 percent would leave for a job that paid the same or less than their current position. So, how can employers find and retain top talent? Sreeni Kutam, division vice president of major account services at ADP, said the findings boil down to two philosophies in conflict with one another: “me vs. we.” Employees, he said, often take the “me” perspective, asking themselves how much they can make, how they can advance and whether they’re satisfied. Employers, on the other hand, naturally take a bird’s-eye view of the organization, concerning themselves more with financial performance and overall organizational health.

“The question becomes due to the external factors – economic improvement, unemployment going down – would that tension be elevated to unprecedented levels?” Kutam said. “And we are seeing that in the marketplace.” That’s certainly alarming news for any employer who wants to hang on to their best employees. Luckily, there are significant steps employers can take to keep their employees happy in their current roles, rather than searching for greener pastures. Invest in managers’ skills Managers need to be more than just employees who once did a good job; they need to understand how to get the best out of people, while minimizing their weaknesses. When employees feel they are contributing and clearly understand their value in an organization, they are engaged in their work and more likely to stick around. “A lot of companies promote managers based on how good they were at their previous job,” Kutam said. “But actually, the people management aspect of leadership is the X-factor.

Great team leaders leverage the strengths of individual team members to get to the broader perspective.” Boost wages As the economy improves, productivity is reaching new levels. Generally, sales and earnings are going up, but wages are lagging. Everybody feels more appreciated after a raise, especially when so many Americans are working two or three jobs just to make ends meet. Making sure your staff is compensated well and happy with their paychecks is essential to keeping them on board. However, while good pay is an important puzzle piece, don’t expect compensation alone to keep top talent content in an otherwise disconcerting environment. Use performance management tools Performance management software is a great way for employers to keep an eye on the individuals in their organizations. Although employers are often susceptible to the “we” view, performance management tools help them drill down into the strengths, weaknesses and aspirations of individual team members. The good software even helps identify those who might be flight risks, helping you to address their concerns and keep them within the organization. [See our picks for the best performance management tools.] Offer career development opportunities A stagnant employee is an unhappy employee. While a good manager leverages an employee’s strengths, most employees want to feel like they are progressing not just professionally, but also personally. For those ambitions, internal career development programs and opportunities are key. In the end, your organization will also benefit from more content, well-rounded employees.

Business Owners Are Not Following Suit in the Gig Economy

The gig economy might be growing by leaps and bounds in the U.S., but small business owners are slow to embrace freelancers and independent contractors. A new survey released by small business marketing firm Manta found that most entrepreneurs prefer to employ traditional salaried employees rather than opt for more temporary or fluid work arrangements. Moreover, the minority of small business owners that do use gig economy labor don’t offer benefits to those workers, the survey results demonstrate. “With all the press the growth of the gig economy has gotten … we were expecting to see higher numbers,” Dario Ambrosini, chief operating officer at Manta, said. “These results are more in line with what we’ve seen from small businesses in the past. They mainly hire contract workers for seasonal businesses or short term projects.” According to Manta’s survey, two-thirds of small business owners do not currently employ any contractors or freelancers, and 85 percent have no plans on hiring those types of workers within the next year. Further, 73 percent said they do not utilize online labor marketplaces, such as Upwork, to find and hire freelancers.

“Small businesses tend to buck the trend and do their own thing,” Ambrosini said. “Large companies are definitely moving toward the contract worker, but this poll and everything else we’ve done shows SMBs won’t embrace the gig economy –  and I wouldn’t predict that they will until those numbers start to move.” Manta’s survey is based on responses from more than 2,200 small business owners between March 28 and March 31. The margin of error on all numbers is +/- 2.08 percentage points.

Pace Yourself to Avoid Workplace Fatigue

Similar to athletes in the pool or on the track, employees need to pace themselves in the office in order to avoid burning out, new research suggests. The study from researchers at the University of Virginia and Chinese Academy of Sciences developed a model for how employees should best distribute their efforts during the day to prevent fatigue. Previous research has found that fatigue not only makes work more unpleasant, but it results in decreased productivity. When developing the model, the researchers found that employees are best served by following one of two patterns, depending on the type of job they have.

This pattern is similar to the strategy that Olympic swimmers and runners often use. The study’s authors said these athletes typically try to lower their burn rate after getting off to a strong start so they have some energy left in their tank for a strong finish. Some jobs, however, require employees to always perform at maximum intensity. This may include workers who operate machinery or provide customer service. In this “all-or-none” scenario, the researchers say the best pattern for employees to follow is to begin and end the day with “on” periods, but take breaks during the day. Employers who insist on employees keeping a high pace all the time are harming their organization in the long run, according to the study. The researchers said fatigued employees leads to high turnover, low morale and low productivity. Since fatigue often goes unnoticed until it is already causing problems, the study’s authors said employers are best served by taking preemptive measures to ensure workers don’t get burned out. Manel Baucells, one of the study’s authors and a professor at the University of Virginia, suggests that managers can help avoid fatigue by giving employees greater control over when they take breaks. The researchers said their study isn’t meant to say that employees should be working long hours. Working lengthy days is fine, as long as employees are given breaks during the day to recharge. “Google seems to have learned this lesson and makes the work environment pleasant, promoting fun distractions, while at the same time encouraging long work hours,” Baucells wrote in an article on the University of Virginia Darden School of Business’s website. For employees who work from home, it is important that they self-manage their time and effort.

The study’s authors said they need to avoid the temptation to push hard all day long. “At-home workers should draw clear home/work boundaries in their schedules (and workspaces) to better facilitate a high-low-high effort, rather than putting in long hours that wind up yielding equivalent (or lower) outputs,” Baucells wrote. “They may even consider starting work immediately upon rising in the morning to take advantage of showering and breakfast as times to rest and reduce accumulated fatigue.” In the end, the researchers believe employers will see the dividends in ensuring their employees don’t become overfatigued from pushing themselves too hard.

Encourage Employees to Volunteer

Creating a culture of volunteerism within your company doesn’t just help others, it also helps your organization, new research finds. A study from Deloitte revealed that employers who encourage and promote volunteering boost morale, workplace atmosphere and brand perception. The research found that an overwhelming majority – 89 percent – of employees think organizations that sponsor volunteer activities offer a better overall working environment. In addition, 70 percent believe volunteer activities are more likely to boost staff morale than company-sponsored happy hours, with more than three-quarters saying volunteering is essential to employee well-being.

Nearly 70 percent of employees are not volunteering as much as they would like to, with nearly two-thirds of those saying part of the reason is because they aren’t able to dedicate any time during the day to volunteer. “Employers have an opportunity to build on their volunteerism programs by creating a culture that celebrates volunteering and empowers volunteers to be more active,” said Doug Marshall, managing director of corporate citizenship for Deloitte LLP, said in a statement. In addition to providing more opportunities to volunteer, employers can do a better job of making sure employees, especially younger ones, know the benefits of doing so.

Three-quarters of the millennials surveyed said they would volunteer more if they had a better understanding of the impact they were making, compared to 61 percent of those of all ages. Besides explaining the benefits to the community that come from volunteering, employers could do a better job of informing employees how helping others in need can have a positive impact on themselves. Although 80 percent of those who make hiring decisions believe active volunteers move into leadership roles more easily, only 18 percent of employees think volunteering can enhance their career opportunities. Additionally, just 36 percent think volunteering can help develop new skills. “As businesses continue to find new ways to retain and attract new talent, and establish a more purpose-driven and engaged workforce, they should consider how they can better incorporate volunteerism into their culture,” Marshall said. “It’s a potential solution from which businesses, professionals and communities can benefit, while supporting employees’ personal and career development, and boosting their sense of well-being.”

Social Media Screenings Gain in Popularity

If you think that your Facebook and Twitter profiles won’t be looked at when you’re applying for a job, think again. The vast majority of employers are now searching through candidates’ social media accounts as part of the hiring process, new research finds. A study from CareerBuilder revealed that 70 percent of employers now use social media to screen job candidates before hiring them, up from 60 percent a year ago and 11 percent in 2006. Many employers are also moving beyond social networks when checking out potential employees online. Nearly 70 percent are using online search engines such as Google, Yahoo and Bing to research candidates as well, compared to just 59 percent last year.

While the fear of having something embarrassing or negative discovered might tempt some job candidates to try and completely erase their online persona, employers say that strategy can backfire for many job seekers. One-quarter of hiring managers expect candidates to have some sort of online presence, and nearly 60 percent are less likely to call someone in for interview if they can’t find them online.

According to the report, job seekers frequently research details about on-the-job lifestyle factors, including benefits and schedule flexibility as well as the type of work that will be expected of them if hired. The most important criteria, however, is compensation. Currently, 44 percent of candidates know compensation details about a position before applying, and this level of transparency is only increasing. “Easy access to information has changed the way individuals find jobs and jobs find individuals,” said Jim McCoy, vice president and global practice leader at ManpowerGroup Solutions. “As organizations across the globe continue to report difficulties filling roles, understanding candidate preferences is critical.” ManpowerGroup Solutions offers the following advice for employers and hiring managers to help with recruiting efforts.

Reach the right talent where they are Understand that candidates are gleaning much of their information from your company’s website, so it’s important to prioritize the creation of content that is both brand relevant and high quality. Be open to new conversations and new ways of having them You must be willing to be fully transparent with today’s information-hungry candidates – especially related to compensation. Monitor the buzz Monitor conversations about your company on social media and career sites like Glassdoor, and be ready to jump in and respond to questions or provide additional information when necessary. “Organizations should be thinking about candidates as consumers,” McCoy added. “Managing the message to the market is key to building a successful employer brand and attracting the best talent.”

The Age of Well Informed Job Candidates

According to the report, job seekers frequently research details about on-the-job lifestyle factors, including benefits and schedule flexibility as well as the type of work that will be expected of them if hired. The most important criteria, however, is compensation. Currently, 44 percent of candidates know compensation details about a position before applying, and this level of transparency is only increasing. “Easy access to information has changed the way individuals find jobs and jobs find individuals,” said Jim McCoy, vice president and global practice leader at ManpowerGroup Solutions. “As organizations across the globe continue to report difficulties filling roles, understanding candidate preferences is critical.” ManpowerGroup Solutions offers the following advice for employers and hiring managers to help with recruiting efforts. Reach the right talent where they are Understand that candidates are gleaning much of their information from your company’s website, so it’s important to prioritize the creation of content that is both brand relevant and high quality. Be open to new conversations and new ways of having them You must be willing to be fully transparent with today’s information-hungry candidates – especially related to compensation. Monitor the buzz Monitor conversations about your company on social media and career sites like Glassdoor, and be ready to jump in and respond to questions or provide additional information when necessary. “Organizations should be thinking about candidates as consumers,” McCoy added. “Managing the message to the market is key to building a successful employer brand and attracting the best talent.”

While job seekers have previously been at the mercy of employers who cherry pick the candidates that best fit their needs, ManpowerGroup Solutions, a recruitment outsourcing services provider, notes that the new era of well-informed job seekers has shifted the balance of power from employer to candidate. To help businesses navigate the current landscape and continue to attract top talent, ManpowerGroup Solutions recently surveyed 14,000 job seekers – many of whom gather extensive details on a prospective employer well before they ever apply for an open position.

The Department of Labor’s Overtime Rule Change

A U.S. Department of Labor (DOL) rule change that would extend overtime protections to an estimated 4.2 million workers was temporarily halted by an injunction after 21 states sued in District Court. The DOL subsequently appealed the decision and is awaiting a decision in the Fifth Circuit Court of Appeals. Below is an overview of the previous rule, which the DOL is expected to revisit and significantly revise after abdicating its defense of the Obama-era rule in court. The DOL has, however, maintained that it has the authority to set such a rule governing salary thresholds under the law.

The amendment to minimum wage and overtime regulations under the Fair Labor Standards Act was set to go into effect Dec. 1, and would have lifted long-standing exemptions and raised the pay threshold from $23,660 annually to $47,476. Positions once considered executive, administrative or professional would be subject to overtime pay as well, and the pay threshold would be indexed to wage growth and updated once every three years.

“This [rule change] definitely will take merchants by surprise if they’re not careful and don’t pay attention,” Mark Schulze, co-founder of smart point-of-sale system Clover, told Business News Daily. “It’s a big change, so many people are affected by it.”

In short, employees who do not make at least the threshold salary and classify as exempt — now a narrower classification than before — are entitled to time-and-a-half pay after they’ve worked 40 hours in a week. The U.S. DOL maintains a list of valid exemptions for executive, administrative and professional positions for quick reference. [See Related Story: What You Need to Know About the New Federal Overtime Rules]

Much like with any other major change, business owners will need to ensure they’re prepared to handle the transition. Here’s everything you need to consider to make sure you’re in compliance with federal regulations by the deadline.

 

What is required of employers?

First and foremost, it’s important to track and record employees’ hours properly. Failing to do so could lead to errors and potentially even costly lawsuits. For small businesses using pen and paper or Microsoft Excel to track hours manually, the change means more time spent in administrative tasks and a higher likelihood of mistakes. It might be worth your while to consider investing in a time-and-attendance system that could automate much of the task of tracking hours.

“If you are tracking time on paper, switch to an automated system,” said John Waldmann, founder of employee scheduling company Homebase. “Tracking hours is complex, and the last thing you want is to be unprepared come Dec. 1 and have this catch up to you in 2017. This next month and a half is really the time to put the technological change in place.”

Business owners will also encounter new difficulties when managing their labor budgets. It’s necessary to revisit your operational practices as a whole, as well as the way you schedule and classify employees. Finding efficiencies wherever possible can help cut down on the total hours you spend on this task and reduce your likelihood of scheduling overtime for employees, Waldmann said.

“You can’t adjust how much overtime is being accrued and how much people are working without rethinking how you run your business,” Waldmann said.

 

What are the consequences for failing to plan accordingly?

Failure to comply with the new regulations can be disastrous for your bottom line, even to the point of ruining the business. At worst, an employee could file a wage-and-hour lawsuit against you, which will take considerable time and money just to settle.

“The exposure can be extremely large — magnified, of course, by how large your workforce happens to be,” said M. Reid Estes, labor and employment practice department manager at law firm Dickinson Wright. “You see multimillion-dollar verdicts and settlements almost weekly.”

Even if a lawsuit doesn’t arise, you could end up spending a lot of extra hours correcting errors, and lost time is irreplaceable. Moreover, in an attempt to keep employees exempt, many employers might mistakenly raise salaries, only to find out a worker’s job duties classify them as non-exempt; this essentially amounts to an added expense, Estes said.

“A lot of employers are taking the opportunity to do an audit,” he said. “Look at your workforce, and make sure they meet the duties test [for exempt status].”