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Men Dominate MBA Enrollment in Chicago

Chicago’s business schools looking to boost female enrollment in their MBA programs need only to look to their East Coast rivals.


The University of Pennsylvania’s Wharton School and Harvard Business School are enrolling record percentages of women in the upcoming academic year. Women represent nearly 45 percent of the incoming MBA class at Wharton and 39 percent at Harvard, according to analysis by Poets & Quants, a website dedicated to graduate business schools.


Schools in the Chicago area generally can’t match these gains. In fact, female enrollment has been flat with the exception of DePaul University’s Kellstadt School, where women accounted for 40 percent of last year’s first-year students vs. 35 percent the year before. (Fall 2011 figures are not yet available.)


Rob Ryan, Kellstadt’s assistant dean, says the increase could be attributed to the growing number of women who have advanced to a point in their careers where an MBA has benefits.


At University of Chicago’s Booth School, women have represented 35 percent of its incoming MBA class for the past four years. Like many Chicago schools, Booth will not have figures for the 2011-12 class until later this summer. Female enrollment at University of Illinois at Chicago’s Liautaud School dropped to 33 percent in 2010 from 37 percent in 2009. Northwestern University’s Kellogg School has held steady in the 32 percent-to-33 percent range for the three years starting in 2008.


Female enrollment at Loyola University Chicago’s business school fell to 41 percent this summer from a high of 48 percent in the fall of 2008. Illinois Institute of Technology’s Stuart School saw the number of women slip to 38 percent last fall from 39 percent the previous year.


Michael Alexander, assistant director of academic programs at Loyola’s graduate school of business, was hard-pressed to explain why the school has the highest female enrollment among its Chicago peers. “To my knowledge, nothing has been done specifically to recruit women,” he said.


Lake Forest Graduate School of Management didn’t respond to requests for enrollment data.


It’s no accident that women are making up a greater share of enrollment at Wharton and Harvard, said John Byrne, editor of Poets & Quants and a former executive editor of BusinessWeek. Women made up nearly 40 percent of Wharton’s incoming class last year and 36 percent of Harvard’s class.


“They worked very hard on it. It was a very conscious goal to get a higher percentage of women,” Byrne said. “In general, full-time business school enrollment for women remains” fairly stable.


Comparatively, more women are applying to other graduate programs such as medical and law school. Women represented 47.3 percent of applicants for the 2010-11 academic year, according to the Assn. of American Medical Colleges. At law schools, 45.7 percent of applicants admitted in 2010 were women, according to the Law School Admission Council Inc.


At the undergraduate level, women have been in the majority for years, and the U.S. Education Department projects they will account for 57 percent of four-year college students nationally by 2013.


DePaul University’s Kellstadt School is seeing more women enrolling in its master’s of science program, particularly in accounting, marketing and real estate analysis, Ryan said. “There is a younger profile in the MS programs. They are right out of (undergraduate) school.”


Filed by Lorene Yue of Crain’s Chicago Business, a sister publication of Workforce Management. To comment, email editors@workforce.com.

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Facts on U.S. Pet Owners

The American Pet Products Manufacturers Association 2011-12 National Pet Owners Survey relates these facts about U.S. pet owners:


• In 2010, U.S. pet owners spent $48.35 billion on their pets; the estimate for 2011 is $50.84 billion.
The cost of veterinary care in the United States for 2011 is estimated at $14.1 billion.


• 62 percent of American households own a pet, which equates to 72.9 million homes.


•  38.2 million households have a cat, and the total number of owned cats is 93.6 million.


•  46.3 million households have a dog, and the total number of owned dogs is 78.6 million.


•  On average, dog owners spend $225 and cat owners spend $203 annually on routine veterinary visits.


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Third-Party Carriers to Employee Benefits Plans Can Be Sued Under ERISA

A panel of 11 judges on the 9th U.S. Circuit Court of Appeals in San Francisco ruled that ERISA does not specifically limit which parties can be sued to recover benefits due under the terms of an employee benefits plan. Previously, the court had held that only a plan or plan administrator could be held liable under the statute.


As a result of the ruling, the 9th Circuit will overrule four employee benefits cases: Ford v. MCI Communications Corp. Health and Welfare Plan, Everhart v. Allmerica Financial Life Insurance Co., Spain v. Aetna Life Insurance Co. and Gelardi v. Pertec Computer Corp.


The case before the court goes back to 2001, when Laura Cyr was terminated from her job as a vice president at Channel Technologies Inc. She immediately filed a claim for a back injury under the company’s long-term disability plan, administered by Reliance Life Insurance Co.


Reliance granted her benefits based on her final salary. The following year, Cyr filed a civil lawsuit against CTI for gender discrimination based on unequal pay for similar responsibilities, according to court documents. Her disability payments were based on her salary of $85,000.


Cyr reached a settlement with CTI, retroactively bumping her salary up to $155,000. However, when she sought to have her disability benefits adjusted to reflect the higher salary, Reliance declined and then said Cyr’s claim file was lost, according to court documents.


As a result, she sued Reliance, claiming breach of fiduciary duty, but the district court initially found that only the plan or the plan administrator could be liable under ERISA—not a third-party insurer such as Reliance. Afterward, the court changed its mind and decided in Cyr’s favor, setting off the appeal by the carrier. Cyr petitioned for a hearing before the full panel of judges at the 9th Circuit.


“A plan administrator under ERISA has certain defined responsibilities involving reporting, disclosure, filing and notice,” wrote judge Richard Clifton. “But the plan administrator can be an entity that has no authority to resolve benefit claims or any responsibility to pay them.”


In this case, Clifton wrote, Channel had nothing to do with Reliance’s denial of Cyr’s request.


“Reliance is, therefore, a logical defendant for an action by Cyr to recover benefits due to her under the terms of the plan,” he wrote.


“The 9th Circuit recognizes that there’s nothing in the statute that exonerates insurers,” said Joseph Creitz, a lawyer who represents Cyr. “Nobody else has addressed it as clearly as the 9th Circuit has.”


He noted that most third-party insurers don’t try to evade their responsibility on the claim that they’re not subject to ERISA. Still, the case could shape the outcomes of similar lawsuits in other jurisdictions: For instance, the 7th U.S. Circuit Court of Appeals in Chicago has cases that have limited the liability to the plan and its administrator, as well as cases in which other parties have been sued under ERISA, Creitz said.


From here, the case goes to a panel of three judges for further consideration.


A call to Reliance for comment was referred to one of its lawyers, and a call to Reliance’s lawyer in the Cyr case, Michael Bernacchi, was not immediately returned.  


Filed by Darla Mercado of InvestmentNews, a sister publication of Workforce Management. To comment, email editors@workforce.com.


 


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SHRM Agrees to Meet With Protest Group Regarding Differences

After months of frustration over ignored invitations to meet about their concerns, a splinter group of former leaders of the Society for Human Resource Management announced at a news conference on June 26 that SHRM’s board of directors has voted to accept the group’s invitation.


Kathryn McKee, a former SHRM board chair and a spokeswoman for the SHRM Members for Transparency, reading from an email sent by Henry Hart, the HR association’s general counsel, said that SHRM hopes to “re-establish a relationship of understanding and respect between the two groups.” She called the surprise development “a miracle.”


“It doesn’t exactly take the wind out of our sails, but it takes us in a new direction,” she said.


The announcement was made across the street from the Las Vegas Convention Center where the world’s largest HR professional association is holding its 63rd annual conference from June 26 to 29.


The transparency group, which formed last year, has a detailed list of grievances against association leaders that includes the SHRM board’s 2005 decision to pay board members an annual honorarium to allow reimbursement for business-class travel for board members. Another key issue is the number of board members without credentials from the HR Certification Institute, which is affiliated with SHRM. Currently, only four of 11 board members have this certification, which is viewed as the industry standard for evaluating human resources practitioners’ expertise.


The transparency group had wanted to force a meeting with the board by launching a push to enlist the support of 10 percent of the SHRM membership, according to the organization’s bylaws, said Gerry Crispin, a transparency group member. He said that he is “almost positive” that the board was unaware of the group’s plans, but added that “it’s nice encouragement for them [the board] to come to our meeting in good faith knowing the alternative.”


SHRM officials were unavailable for comment.


—Rita Pyrillis

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CMS Says More Than Half of Early Retiree Health Reimbursement Fund Paid Out

The Centers for Medicare & Medicaid Services says it has paid out well over half of a $5 billion fund created by the health care reform law that partially reimburses employers and other organizations that have early retiree health care plans.


As of May 27—the latest date reimbursement information for the Early Retiree Reinsurance Program, or ERRP, is available—just over $2.7 billion had been paid out, up from $2.4 billion as of May 3, and $1.7 billion as of March 17, according to the CMS.


Because of the rapid disbursement of funds, the CMS announced in April that it would not accept new applications after May 5. It is widely expected that the $5 billion fund will be exhausted by the end of 2011.


Under the ERRP, the federal government reimburses plan sponsors for a portion of claims incurred starting June 1, 2010, by retirees who are at least age 55 but not eligible for Medicare, as well as covered dependents, regardless of age.


After a participant incurs $15,000 in health care claims in a plan year, the government will reimburse 80 percent of claims up to $90,000.


Of the $2.7 billion distributed, $220.7 million—unchanged from May 3—was distributed to the United Auto Workers Retiree Medical Benefits Trust. The trust is a voluntary employees’ beneficiary association set up by the UAW under a 2007 collective bargaining agreement between General Motors Corp., Ford Motor Co. and Chrysler and the UAW.


Under that agreement, the automakers agreed to contribute more than $50 billion to the VEBA. In return, the automakers no longer have to provide health care benefits to UAW-represented retirees and their dependents. The UAW is responsible for managing the VEBA and paying retiree health care claims.


Other big recipients as of May 27, and increases, if any, from May 3, of ERRP funds, include:
• AT&T Inc., $141.5 million, unchanged.
• California Public Employees’ Retirement System, $98.7 million, unchanged.
• Verizon Communications Inc., $91.7 million, unchanged.
• State of New York, $88.4 million, up from $47.9 million.
• State of New Jersey Treasury Department, Pension Accounting Services Department, $77.6 million, up from $38.6 million.
• Teacher Retirement System of Texas, $70.6 million, up from $68.1 million.
• Public Employees Retirement System of Ohio, $70.6 million, unchanged.
• Commonwealth of Kentucky, $63.4 million, unchanged.
• Georgia Department of Community Health, $57.9 million, unchanged.  


Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, email editors@workforce.com.


 


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Report: Working Women ‘Markedly Less Confident’ About Retirement than Men

Working women not only earn less on average than their male counterparts. They also set aside less money for retirement, raising the prospect of financial difficulties later in life, according to a report released June 14.

“Gender Gap in Financial Literacy,” by El Segundo, California-based Financial Finesse, found that men and women are virtually equal when it comes to participating in company-sponsored 401k and other retirement plans. Ninety-two percent of women participate vs. 91 percent of men. That’s up from 83 percent and 88 percent, respectively, in 2010.

According to the survey of 2,244 U.S. workers taken in the first quarter of 2011, women are “markedly less confident” than men about investing. Only 25 percent of female workers express confidence in how their retirement investments are allocated, in comparison to 42 percent of men.

Uncertainty among women stems largely from a lack of knowledge about financial products and services, resulting in investments that may be too conservative to outpace inflation, says Liz Davidson, CEO of Financial Finesse, which provides financial-education programs to about 400 U.S. employers, including many of Fortune 500 companies.

The Financial Finesse research confirms findings of earlier reports, including one in February by Windsor, Connecticut-based LIMRA, a consulting firm to the financial services and insurance industries. Its survey of 2,500 private-sector employees concludes that women save 40 percent less for retirement than men.

Angst regarding retirement is not confined to women. Despite the increasing participation in retirement plans, only 12 percent of women and 19 percent of men expect to have enough money when they reach retirement age, according to Financial Finesse. Worries about record federal debt, inflation, and potentially higher taxes are eroding worker confidence, Davidson says. “I also believe it is due to the fact that as employees focus more on retirement, they are realizing just how far behind they are.”

Although concern cuts across gender, women face more obstacles to retirement than men, Davidson says. Among them: they live an average of five years longer than men, have higher health care costs throughout their lives and tend to earn less money.

Other findings:
• 64 percent of women say they have a “general knowledge” about stocks, bonds and mutual funds, vs. 84 percent of men.
• 61 percent of men say they have an “emergency fund” to pay bills in case they lose their job, compared to 46 percent of women.
• 63 percent of women say they “spend less than I make each month,” in contrast to 8 in 10 of men.

If there is good news, it may be that employers are realizing the need to help their employees by providing more targeted advice, online benefits-planning tools, and one-on-one consultations with financial planners.

“What we’re seeing is a new mindset,” Davidson says. “Employers are bringing this up when we talk with them.”

—Garry Kranz

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Dear Workforce How Do We Help a New Manager Manage?

Dear Flustered and Fed Up:

New managers often inherit a set of expectations that were established by their predecessors, which can make the transition difficult for everyone. You mentioned written expectations, which are effective only if people truly understand how to meet them and, equally important, why they should meet them.

Solving this problem requires three steps.

First, if she has not done so already, the new manager should begin with one-to-one performance discussions with employees about the written job expectations. Are they clear and do they make sense to the employee? This conversation is likely to reveal opportunities for clarification and set the stage for step two.

Next, determine whether the employee has the tools necessary to meet the new manager’s expectations. Is more training required? Are there roadblocks that only the manager can remove? Which behaviors are the responsibilities of the employees to change?

Finally, the new manager must make a very important connection for her employees: that meeting expectations will help them to achieve their personal goals. To some degree we all want to know: ‘What’s in it for me?’ If the new manager can demonstrate to her employees that meeting expectations will lead them closer to achieving their personal goals, she will be much more likely to get the results she needs.

By following this process, the new manager has:

1. Made sure that her employees fully understand her expectations

2. Have the necessary tools, skills and knowledge to meet those expectations

3. Helped employees make the connection why this is personally important.

Should some employees still fail to meet expectations, however, then your manager needs to move quickly to address this lingering issue. Many new managers struggle with giving performance feedback. By using the previous three-step conversation as a backdrop, she should address it through ongoing coaching. It will be necessary for her to explain how poor job performance is having a negative effect on the department—and therefore is just as likely to prevent the employee from reaching his professional goals.

Most employers have a progressive discipline process, which is set up to let poor performers know the consequences of their actions (in carefully measured and legally defensible steps). No manager ever wants a situation to deteriorate to this point, but if it happens, let your new manager know she is doing the right thing: striving to create an environment that enables employees to succeed. Ultimately, though, whether they succeed is entirely up to them.

SOURCE: Alan Preston, Preston Leadership Inc., Phoenixville, Pennsylvania

LEARN MORE: Supervisory jobs have very different requirements for success than individual contributors’ jobs.

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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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Protest Group Calls News Conference on Opening Day of SHRM Confab

Frustration is growing among a handful of past presidents and board chairs of the Society for Human Resource Management who have been calling for a meeting with the industry association’s leaders to discuss recent board decisions and concerns about the future of the organization.

The splinter group, called SHRM Members for Transparency, recently announced a June 26 press conference to air its grievances.

UPDATE: SHRM agrees to meet with protest group.

The event will take place across the street from Las Vegas Convention Center on the opening day of SHRM’s 63rd annual conference, which is set for June 26 to 29. Kathryn McKee, a former SHRM board chair and transparency group member, will be speaking, says Mike Losey, former SHRM CEO and the transparency group’s leader.

“There’s so much misunderstanding and confusion after so much effort on our part,” says Losey, whose group formed last year shortly after the SHRM board voted to nearly double the annual honoraria paid to board members and to allow reimbursement for business-class travel. “Why do they say we’ve met when they haven’t met with us and why won’t they meet with us? It’s extremely frustrating. This is an opportunity for us to address some of these issues.”

The press conference is being triggered in part by the SHRM board’s failure to respond to repeated invitations for a meeting with the transparency group, Losey says. At the heart of the group’s concerns is the board’s 2005 decision to pay board members an annual honorarium.

Other issues include the number of SHRM board members without credentials from the HR Certification Institute, or HRCI.

While the group lists 46 official members only a few will attend the conference, Losey says, pointing to the board’s decision to repeal a provision offering free conference registration to past presidents and board chairs. He says some plan to skip the conference in protest and others can’t afford to go.

It’s unclear whether the press conference will pave the way for a meeting with SHRM leaders. SHRM interim president and CEO Henry Jackson declined to comment.

For more on the growing dissent between SHRM Members for Transparency and SHRM, click here.

—Rita Pyrillis

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Survey Says 30 Percent of Employers May Drop Health Care Coverage After 2014

Thirty percent of employers say they may stop offering health care plans after 2014, when key provisions of the health care reform law go into effect, according to a survey released June 7.


Consultant McKinsey & Co., which surveyed more than 1,300 employers of varying sizes, found that 30 percent of employers “definitely” or “probably” will stop offering coverage after 2014.


That is when changes such as federal health insurance premium subsidies for lower-income uninsured employees begin for individuals to purchase coverage from health insurance exchanges that are to be set up then.


“The shift away from employer-provided health insurance will be vastly greater than expected and will make sense for many companies and lower-income workers alike,” said the study, published in the June issue of McKinsey Quarterly.


Employers that drop coverage would pay an annual penalty of $2,000 for each full-time employee, a fraction of the typical cost of group plans. Group plan costs averaged more than $9,500 per employee last year, according to a Mercer survey.


The McKinsey findings vary from other surveys on the issue.


For example, Mercer last year found that 6 percent of employers with at least 500 employees and 20 percent of employers with 10 to 499 employees said it was likely they would drop coverage in 2014.


“Employers are reluctant to lose control over a key benefit. But beyond that, once you consider the penalty, the loss of tax savings, and grossing up employee income so they can purchase comparable coverage through an exchange, for many employers dropping coverage may not equate to savings,” Tracy Watts, a partner in Mercer’s Washington office said at the time.


However, about half of the 200 employers with workforces ranging from 50 to 150 employees said at a Lockton Benefit Group conference earlier this year that they intend to exit the group market in 2014.


At the moment, the “majority of our clients will wait and see,” Lockton Benefit Group president J. Michael Brewer told a congressional committee in March. What employers ultimately decide to do will depend on insurance costs in 2014 and the perceived need to offer a health care plan to gain a competitive advantage, he told lawmakers.  


Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, email editors@workforce.com.


 


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EEOC Proposes Records Rule on Genetic Information Nondiscrimination Act

The Equal Employment Opportunity Commission has issued a proposed rule under which employers would be required to maintain all relevant employment and personnel records until any charge filed under the Genetic Information Nondiscrimination Act is resolved.


The 2008 law prohibits employment discrimination based on genetic information.
The EEOC said that employers already have this record-keeping requirement with respect to Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act.


The proposed regulation would extend those same requirements to records relevant to any GINA charge. The EEOC said there would be no increased burden due to the proposal because firms’ “systems for retaining employment records under Title VII and ADA records are already in place.”


The proposed regulation was published June 2 in the Federal Register. Comments, which are due by Aug. 1 can be submitted online at regulations.gov.


Separately, the EEOC said it plans to hold a public hearing at its headquarters June 8 at which panelists will discuss the appropriate use of disability leave as a reasonable accommodation, and complying with relevant regulations.


Additional information about the hearing, when available, will be posted at eeoc.gov/eeoc/meetings/index.cfm.  


Filed by Judy Greenwald of Business Insurance, a sister publication of Workforce Management. To comment, email editors@workforce.com.


 


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