FreshView
a publication of Cascade Employers Association
MAY 2011
Dollars & Sense Poll |
In This Issue:
- 390 Plus Participants!
- BOLI Recovers More Than $2.5 Million for Wage Theft Claims
- What Are the Characteristics of Job Title Inflation and Why Is It Risky?
- OFCCP Proposes Major Changes to Audit Requirements
- FreshView on Compliance
- Did You Know?
390 Plus Participants!
By Jerry Bumgarner, CCP, Director of Research & Compensation Services
Cascade Employers Association
jbumgarner@cascadeemployers.com
The Oregon Regional Pay Survey from SalaryTrends just hit a milestone of sorts when it exceeded 390 Oregon area participants in our "evergreen' survey data base! As a compensation consultant and user of many surveys, I know that no other pay survey in Oregon has ever had this many responses in a benchmark job pay survey ... and participation is everything when it comes to assuring the validity of pay survey data. Although small sample sizes can also yield valid results, as a rule of thumb, the larger the sample size is the greater the likelihood the results will be valid.
How Many Is Enough?
If you are using surveys to determine pay levels for your employees, be sure to pay attention to the sample size for each survey and for each job. While it is not necessary to ignore data when the sample is small, I believe other survey sources should be considered to validate the small data sample.
From experience, I can tell you that many national and regional survey sources are very good/valid at the national and regional levels, but do not have sufficient local participation to point you to valid local pay practices. This is especially true with non-exempt jobs for which the competitive market for talent tends to be local (e.g. within a 25 mile radius of the workplace). To avoid paying too little or too much, I recommend not using national and/or regional market pay data to price your non-exempt jobs. You may be surprised about how far off the market you end up.
Some market survey sources, especially those that are free on the internet, do not actually conduct surveys and should be avoided if possible. These sources often rely on data collected by others and simply project local area pay practices based on cost of living statistics for an area. Cost of living information is used by these sources even though it is common knowledge that pay levels are determined mostly by the supply and demand for talent in a geographic area. While this data is not necessarily useless, you should exercise caution when using it to establish equitable and competitive pay practices for your organization.
As a survey user, try to understand the differences between "good" market data sources and those that do not meet some or all survey quality tests. To help you determine if a survey you are using or considering meets standard survey validity tests, consider the following 7 survey best practices. All 7 are observed in each SalaryTrends pay survey:
- Pay data is collected randomly from a "sufficient" number of organizations which are representative of the mix of organizations in the geographic area.
- Pay data (base and variable) is collected from actual employers using job descriptions (responsibilities, education, experience, etc.) to assure appropriate job matching.
- All pertinent pay data elements are collected and reported in a confidential manner (salaries, salary ranges, incentives/bonuses, etc.) without identifying individual participants.
- The total number of organizations responding, the responses for each job, and the number of job incumbents reported by each organization, are all reported.
- All reported pay data is screened and "cleaned" through direct participant contacts to assure the accuracy and validity of the survey results.
- All pay data summaries are based on actual participant pay practices and report central tendency data (e.g., averages, medians), and data extremes (e.g., 10th, 25th, 50th, 75th, 90th).
- All pay data is aged based area pay trends (not cost of living) and Include data cuts based on industry, geographic area, size (based on employment and/or revenue), union status, etc.).
For more information about the Oregon Regional Pay Survey, or other surveys available through SalaryTrends, go to SalaryTrends.com.
BOLI Recovers More Than $2.5 Million for Wage Theft Claims
By Jenna Reed, Director of Human Resource Development Services
Cascade Employers Association
jreed@cascadeemployers.com
According to a report from the Oregon Center for Public Policy, the Bureau of Labor and Industries (BOLI) received 1,664 wage complaints in the last fiscal year, resulting in more than $2.5 million owing to employees.
Considered wage theft, these claims include but are not limited to situations "when employers pay workers less than the minimum wage, don't pay time and a half for overtime hours, cheat on the number of hours worked, steal tips or don't pay workers at all." Retail, service and construction industries had the highest rate of claims against employers.
It's important to keep in mind that this reflects only the amount of claims actually filed with BOLI and is likely only a small portion of overall employer wage violation.
What Are the Characteristics of Job Title Inflation and Why Is It Risky?
Provided By: CCH
(a benefit to Cascade's Members)
When economic times are tough, companies everywhere create innovative solutions to keep their loyal staff happy. When there isn't enough spare cash for generous raises, many employers turn to title promotions with slight raises as a way to show their appreciation. And while there's nothing wrong with advancing a competent person, employment law experts warn companies to maintain integrity when giving promotions and be aware of potential legal risks associated with "job title inflation."
"If you're inflating job titles, you're breaking down traditional boundaries in the duties category. While employers may have good intentions, if you start inflating titles, the titles themselves don't reflect the duties of the position and required expertise," explained John K. Skousen, a partner in the Irvine, California office of Fisher & Phillips LLP. "It also can become confusing, disorganizing and difficult when striving to maintain job classifications and proper salaries when the economy bounces back—including dealing with inaccurate job descriptions with misleading duties requirements, which can converge to cause difficulty separating exempt and non-exempt employees."
Skousen offers the following tips for employers looking to implement title changes:
Steer clear of negligently promoting. To give someone a responsibility he/she is not capable of doing—or a title that suggests something he/she is not really doing—is very risky. This may occur inadvertently when "promoting" by consolidating two or more positions into one job, leaving an employee unable to perform certain new functions in the glorified job. Employers are largely liable for their employees' actions and if they haven't trained them properly, or are negligently promoted, the company is responsible for that action. Employers should avoid the temptation to change titles if it misstates what the person actually does.
Don't give overworked staff title changes. When an organization struggles financially, employees often get more responsibility and jobs are combined. Instead of two employees working 40 hours per week, companies may have one person in that role working 60-hour weeks. Risks include increased turnover due to injuries or job turnover. Employers should be smart and evaluate the risks of spreading out more work and responsibility to fewer employees just to "save money."
Don't play the name game. Many companies started calling staff "associates" several years ago, and it's lost much of its value today. Similarly, "consultants" are no longer sophisticated business consultants making $200,000 per year giving sound advice to companies. Now everyone's a "consultant" instead of a "salesman" or other appropriate title. Ensure the reputation of your team's qualifications are maintained, and that management titles remain respected.
Ensure exempt and non-exempt accuracy. Employers giving supervisory title changes may also assume they can shift a non-exempt employee to exempt status. However, if the actual job duties or responsibilities do not change much, there may be legal ramifications for misclassification and a potential lawsuit against the employer for unpaid overtime.
Remember past lessons learned. Inflating job titles is nothing new. In fact, similar practices took place in the '80s during that recession as employers attempted to compensate overworked and loyal employees during a tough economy. In addition, Skousen compares job title inflation to grade inflation in education, "If everyone has an 'A,' how do you discern between the best and the average?"
OFCCP Proposes Major Changes to Audit Requirements
By Jenna Reed, Director of Human Resource Development Services
Cascade Employers Association
jreed@cascadeemployers.com
Earlier this month, the Office of Federal Contract and Compliance Programs (OFCCP) published another proposed rulemaking regarding its Scheduling Letter and Itemized Listing.
The Scheduling Letter is used to notify covered contractors that they've been selected for an audit and the Itemized Listing requires employers to submit a variety of information including its Affirmative Action Plan, personnel flow (applicant flow, hires, terminations and promotions) and compensation data. The OFCCP's proposed rules greatly expand the amount and detail of information covered contractors will need to provide.
Highlights of the proposed rules include new requests for: policies on various types of protected leave and accommodations, personnel flow data provided by job group, job title and broken down by race and ethnicity, compensation data as it is on February 1 (no exceptions), separate breakdown of compensation data including all items included in compensation (base pay, commissions, bonuses, etc.), all variables that affect pay (education, length of service, performance, etc.) and any documentation or policies that affect pay.
The net result of the proposed changes means a much greater burden on employers in developing and maintaining their affirmative action programs. If you need assistance with your program, please contact Cascade.
FreshView on Compliance
By Cascade Staff
Question: Are Oregon employees who work in agriculture exempt from overtime?
Answer:It depends. There is an exemption from overtime for employees who spend all of the hours in the workweek on agricultural duties. This exemption can include office staff whose work is directly involved with the agricultural operations.
This exemption only applies to employees whose work involves performing agricultural work for their own employer. For example, if an employee packages products from another local plant nursery, the work would fall outside of the agricultural exemption and the employee must be paid overtime for any work performed over 40 hours in the workweek.
Did You Know?
60% of non-union organizations with fewer than 100 employees report that their compensation strategy seeks to stay even with the labor market in their area. Many employers are looking for the data to update their salary structures as the economy improves.
Do you need updated and current salary information in your organization? SalaryTrends has it!
Look here each month for a specific policy or benefit practice and see how your practices compare to other employers just like you.
©2011 Cascade Employers Association. All rights reserved.
SalaryTrends® is a trademark of Cascade Employers Association.
4068 Hudson Avenue, N.E. Salem, OR 97301
Salem 503.585.4320 Portland 503.224.5219 Toll-Free 800.835.5518
cascadeemployers.com
Send a message to: Cascade