Author: Site Staff

Aon is the latest company to phase out its defined benefit pension plan. It’s also adding a second defined contribution plan.

According to Business Insurance, Aon already has a 401(k) plan, but this new plan will be based on employees’ length of service. Employees will receive an annual employer contribution of 3 to 7 percent of their pay, depending on how long they’ve been with the company.

U.S. Aon employees hired since January 1, 2004 will be enrolled in the new plan. The company will keep its defined benefit plan for people hired before then.

During the 2000 and 2002 elections, some companies tried to help their employees register to vote, and also mounted get-out-the-vote efforts. According to the Washington Post, a lot more companies are getting in the act.

The Post reports that of the 150 companies that belong to the Business Roundtable, 99 are participating in its voter-registration program this year, compared to 27 two years ago. Political action committees as well as lobbying groups–such as the U.S. Chamber of Commerce–are also ramping up their voter-registration programs for employees of private companies.

One PAC conducted focus groups which showed “that 60 to 70 percent of employees who used company-provided information voted for the pro-business candidates,” according to the Post. When employees were contacted several times by companies, the employees were more likely to vote than those who weren’t contacted by their employers.

Exxon Mobil, DaimlerChrysler, Caterpillar and other companies will use their intranets and mass e-mails to encourage employees to vote, and gently encourage them to vote “pro-business.” Meanwhile, the association of beer wholesalers will distribute posters that read, “Be Sure to Vote Pro-Beer.”

After a contentious debate, non-union city employees in Las Cruces will soon receive merit pay increases instead of longevity pay increases, according to the Las Cruces Sun-News.

Employees can get a raise of between 1 percent and 6 percent every year. Some city employees said “such a system would be rife with favoritism and good ol’ boy cronyism, with favored employees getting substantial increases while less popular employees get little,” the Sun-News reports.

One council member said he supports the controversial move, but that “human resources failed to sell it to city employees.”

China’s “frequent violations of workers’ rights” give it an unfair trade advantage that has cost more than 727,000 U.S. jobs, according to a 103-page petition filed with the U.S. Trade Representative by the AFL-CIO and the Industrial Union Council.

The unions say that “China prevents workers from joining unions and bargaining collectively, denies its citizens safe working conditions, provides no minimum wage and uses forced labor.” The end result, according to the filing, is that Chinese workers’ wages are 47 percent to 86 percent lower than they should be, which reduces the price of Chinese goods.

Wei Jinsheng, a Chinese worker advocate and dissident, says, “The lives of the workers are miserable.”

At least 12 employees of Southern California Edison apparently rigged a customer-service poll done by the firm, according to the Los Angeles Times.

The surveys, according to the Times, “helped persuade state regulators to grant the utility $28 million in special service awards between 1997 and 2000.” Edison is investigating whether the employees unfairly got bonuses as well. Edison is also planning on giving customers back any money the company unfairly received.

Employees may have given the phone numbers of their family and friends to a polling firm, rather than customer numbers. Employees may also have entered invalid phone numbers when customers were unhappy, rather than having the polling firm find out about the problems.

Enrollment in consumer-directed health plans will grow from 169,000 in 2003 to 478,000 in 2004, according to a study by the National Business Group on Health and Watson Wyatt Worldwide.

Nearly one-third of large companies expect to offer a consumer-directed health plan to employees this year. Right now, 21 percent offer one. Most employers will offer other health care options as well.

The survey also asked companies without consumer-directed health plans why they haven’t taken the plunge. Twenty-nine percent said the effectiveness of the plans hasn’t fully been tested, while 20 percent said they’re not convinced that the consumer-directed plans would bring costs down.

Nearly 40 percent of the 18,146 people at NASA are age 50 or older, according to Florida Today, leaving the agency “ill prepared for a bold future in space exploration.” Another 22 percent of NASA’s workers are age 55 or older, and employees over 60 outnumber those under 30 by a ratio of about 3 to 1.

In the 1960s–during the moon-landing work–going to work at NASA had the lure of a job in Silicon Valley. Now, private-sector jobs are seen as offering better wages, and interest in federal service is declining.

Dear Keep Them:



A study sponsored jointly by Sibson Consulting and WorldatWork notes five types of rewards that employees value, and that contribute to employee retention: 1) compensation; 2) benefits; 3) career opportunities; 4) work content, and 5) a feeling of affiliation with the company and its values.

When it comes to compensation, there are several options. The most common and useful approach is a retention bonus that’s offered to top performers but preserves the overall base pay structure. The U.S. military is an interesting case in point. How does it retain personnel with “hot” skills, such as aircraft pilots, mechanics, and IT specialists, who can earn far higher salaries in the private sector? The armed forces uses highly flexible retention bonuses that can actually exceed annual salary. This preserves a flat, highly egalitarian overall salary structure while maintaining some relationship to market value in total compensation delivered.

Other compensation options include increasing the differentiation between top performers and others in the delivery of annual cash incentives and stock options or stock grants as a way to retain the best employees, or through special one-time grants of options or stock.

Other types of rewards used to retain key employees:

• Career opportunities are especially motivating to high performers. It’s important to make sure that key employees know that they’re highly valued, in order to increase their sense of job security and perception of future advancement opportunities. Similarly, special training opportunities or developmental assignments can be provided selectively even when training and development budgets are tight.
  
• As far as work content goes, you can give special, prominent assignments to key employees or permit them unusual autonomy in their work.
  
• In the area of benefits, special perks for key employees–such as additional paid vacation days–can be useful. (Though consider whether you really want them out of the office).
  
• Foster a sense of affiliation with the company and its values. Make sure you have a specific, important, compelling mission. Make sure executives not only say that that the company believes in rewarding top performers, but that they back it up with action.
  

SOURCE: Gerald E. Ledford, Jr., senior vice president and national practice leader, employee effectiveness, Sibson Consulting, Los Angeles, California, April 4, 2003.

LEARN MORE: Please readFour Ways to Lose Your Best People.

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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Dear Workforce Newsletter

With profits dropping, the German carmaker will cut about 5,000 jobs by not replacing people who quit or retire, according to the Associated Press. The company has been lauded recently for creating an “age-friendly workforce” and in the 1990s for handling workforce reductions.