Connie Shadley
President, Proflex HR Solutions
We've found ourselves in interesting times: the worst recession in nearly three decades, a virtual sea change in Washington and a host of other issues. How are employees reacting?
Employees, like all of us, are nervous about the economy. They're paying particular attention to the cost of benefits: what they need, what they can afford and what they can't. Employees who have 401(k) plans are asking more questions and seeking more information about fund choice options and [wanting to know] if and when they might be able to make changes. I'm sure there are some who are also nervous about employment stability with the increase of layoffs around the country. I expect employees will continue to be frustrated with pay adjustments since they have not been able to keep up with the increase of costs in every day life. I remind employees to look at the "total compensation" offered by the employer, which includes: pay, benefits, rewards/bonuses, time off and other perks.
How are employers responding?
You're seeing companies cut back on internal spending. When companies do cut back on expenses such as supplies, travel, events, etc., employees get frustrated, but they should understand that everyone, including company management, is tightening their belts right now. I know one company I work with is looking at ensuring they are getting the biggest bang for the buck when it comes to employee benefits, as well. Most employers are trying to keep costs down and keep the benefits they give to employees attractive. When it comes to pay raises for 2009, it will be interesting to see what employers do. Most have budgeted for them already, so employees can hope that companies continue to provide increases in pay during 2009. I'm working with a company right now that for the first time is tying specific performance factors and goal achievement of employees to merit increase eligibility versus giving a standard adjustment once a year. Most employees are used to a pay for performance pay (pay based on merit), but those who aren't may be in for a change.
What changes do you expect to influence the HR field this year?
I think HR will continue to focus on retaining top talent, but I think HR also will need to look at how it conducts business overall in all areas (selection, compensation, performance management, training, benefits, etc.) and to ensure that we function in a way that is efficient so we do not add unnecessary cost to the business. With layoffs, we might be asked to do more with less.
Are you seeing more companies outsourcing HR or less?
My experience is that I see smaller businesses outsourcing HR, because they do not need full time support, but want to ensure they are protecting their business from potential legal liability. They want to ensure they are in compliance, functioning efficiently and that employees are performing at the highest level of productivity.
