Author: Todd Henneman

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Talkin’ About Their Generations: The Workforce of the ’50s and Today

In 1958, Mel Bloom started working for the CBS owned-and-operated television station in Chicago. The young journalist was eager to work in the fast-growing medium. After all, almost 90 percent of U.S. households owned a television by then, a tenfold increase since the decade’s dawn.

Bloom’s generation became known as the conformist “company men” portrayed most recently in the popular cable show Mad Men. Bloom’s peers have largely left the workforce by now. But their experience is a reminder of the way each American generation finds its way into the world of work—and in doing so presents challenges both to previous generations and to employers.

Dubbed the “Silent Generation” by Time magazine, those born between 1925 and 1942 had their entrance into careers eased by a thriving economy. Consumers were not only buying televisions but also cars and other big-ticket items unavailable during wartime shortages. Fueling spending, the postwar population was growing at a historic pace.” Builders raced to meet the demand for houses as new parents left cities for the plush parks and new schools of suburbs.

TV networks catered to their children—a generation later dubbed “the baby boomers” who, today, are at or nearing retirement age in unprecedented numbers—with a roster of series that would become part of the nation’s lexicon: The Howdy Doody Show on NBC, Disneyland and later The Mickey Mouse Club on ABC, and Captain Kangaroo on CBS.

Off the air, CBS’ WBBM-TV, which was then located a couple of blocks east of Chicago’s iconic Magnificent Mile, was like most offices of the 1950s: Bloom and his colleagues were expected to wear crisply ironed dress shirts with ties and to keep a suit coat within arm’s reach.

No one worried about ambience. WBBM’s workspace, a former ice-skating rink, felt like a “concrete fortress,” Bloom recalls, because of its cinder block walls. (The building was demolished in 2009.)

The newsroom’s workforce—like the majority of white-collar workers at the time—was 100 percent white, Bloom remembers. Women were secretaries, with the notable exception of one editor.

Only one person over age 65 worked at the station. He had been asked to stay on, Bloom says. Without such an invitation, retirement at 65 was compulsory.

Bloom joined WBBM as an intern and, upon completing his master’s degree from Northwestern University, became a full-time news writer. Despite being a self-described “kid,” he received little coaching. “Nobody would put their arm around you and mentor you,” Bloom says.

Some of the older workers grumbled about the new guys. After all, many of them weren’t old enough to remember the Great Depression and hadn’t fought in World War II.

“They talked about our generation not knowing what it was like to fight and struggle,” Bloom says. They were critical that “we never seemed to get excited or upset.”

In general, the workplaces of the 1950s enjoyed intergenerational harmony, labor historians say. Young workers of the 1950s gained a reputation for following rules and obeying authority. In fact, Fortune magazine lamented their “grey flannel mentality” and penchant for “taking no chances.”

Pragmatists, they wanted to fit in the system, not defy it.

“They were very fatalistic of what authority required of them,” says Neil Howe, president of the consulting firm LifeCourse Associates. “The idea was: Trust these big institutions built by all these people who sacrificed so much and try to get ahead by playing by the rules. And they did.”

Young professionals of the 1950s “wanted to hunker down and be the experts,” Howe says. They married young, started families quickly, and rarely—if ever—jumped ship to another company.

“It was a different world back then in many ways,” says Melvyn Dubofsky, distinguished professor emeritus of history and sociology at Binghamton University in New York. “There were a lot of incentives to remain with the company at which you started.”

Among them: job security, automatic cost-of-living raises, defined benefit pension plans and retiree health insurance, which was particularly important in this pre-Medicare era.

Although employers in the 1950s took a paternalistic view and valued workforce stability, many firms required employees to retire at age 65. Such policies reflected a commonly held assumption that performance decreased as age increased.

But with more Americans relatively healthy at 65, researchers began to question that belief.

In a May 1953 issue of The Personnel Journal, Workforce Management‘s predecessor, a researcher from Ohio State University argued in an article titled “Older Workers’ Efficiency in Jobs of Various Types” against “premature forced retirement.” Research fellow Mark Smith reached his conclusion after examining the performance evaluations of 903 men, ages 18 to 76, at a large company. He said he selected these personnel records because their “spontaneity and informal nature” made them “unbiased.”

Smith determined that speed and the ability to learn decreased with age but “steadiness”—which he did not define—and the ability to work without supervision improved with age.

Pointing out that the company had 16 workers in their 70s and 46 workers aged 65 to 69, Smith concluded that “an arbitrary retirement age of 65 would have cost this organization a very considerable number of valuable employees.” Simple changes such as better lighting or more comfortable chairs may be all older workers need to remain productive, he said.

Questions surrounding the aging of the workforce remain pressing today. And four generations can be found in the labor force—more than ever before.

Another large generation—this time, the millennials—is entering the labor market in a time vastly different than what their grandparents faced during the Eisenhower era.

Meanwhile, retirement has moved out of reach for their baby boomer parents. Boomers increasingly gauge when to retire not by age but by personal savings. And, collectively, they haven’t saved enough.

Almost 30 percent of Americans in their 60s have saved less than $25,000, according to the seventh annual Retirement Survey from Wells Fargo & Co. With defined benefit pension plans rare, one-quarter of middle-class Americans say that they will need to work until at least age 80, Wells Fargo’s survey found. For point of reference, the average life expectancy is 78, according to the U.S. Census Bureau.

With boomers postponing their retirements, the talent pipeline has become clogged. Boomers are staying put in senior leadership posts, and Generation X sees little chance of advancing, at least anytime soon.

“People in their 30s and 40s see that they’re reporting to someone who they don’t think is going anywhere,” says Colleen O’Neill, senior partner in talent management consulting at Mercer. “Those folks are sitting in what you thought was your feeder pool for your senior leaders. A lot of companies have just been hoping that those folks will wait.”

Generation X hasn’t switched employers yet, but its members feel discouraged, O’Neill says.

Forward-thinking companies are responding to the situation by exploring everything from special projects for Generation X to lateral moves for baby boomers. “Those companies have to make a decision: Are they going to move people out and create some opportunity for that next generation?” O’Neill says.

Stalled advancement combined with generational differences have fueled conflict. About one-quarter of HR professionals surveyed by the Society for Human Resource Management last year reported substantial levels of intergenerational conflict within their organization. At half of the organizations, managers complain about younger workers’ poor work ethic.

Companies that laid off expensive veteran employees during the recession and later replaced them with less-expensive entrants stoked conflicts, says the University of California’s Lichtenstein.

“Today, there is more generational conflict when you have two-tiered wage structures,” says Lichtenstein, author of State of the Union: A Century of American Labor.

It’s not just older workers who are upset, based on SHRM’s findings. Younger workers complain that older managers are resistant to change (47 percent) and don’t give enough recognition (45 percent).

Looking at just two of the four generations in today’s workplace—Generation X and the millennials—shows some of the differences that could give way to these sentiments.

Generation Xers didn’t receive a lot of grooming and mentoring, says David Stillman, co-founder of generational consultancy BridgeWorks. “It was sink or swim,” he says. “Now they’re managing millennials who want endless collaboration, lots of group activities and tons of feedback. They’re clashing.”

To move interactions from clashing to constructive, work groups should look for ways to use their differences to their advantage rather than argue about which way is right, Stillman says.

He also suggests that Generation X managers improve their acumen at running teams, and millennial workers become more comfortable working alone and prove their independence.

The younger generation also seeks a different type of employer, argues Howe, who is credited with naming the millennial generation. They’re looking for “the perfect employer who will be their ally and take care of them.” That reflects a marked change from the nomadic generation they follow, which ushered in terms like “value added” and gravitated toward entrepreneurism.

“We’re seeing the return of the in locus parentus employer,” Howe says.

It’s a complex but not hopeless situation.

Generations tend to value many of the same benefits but want them for different reasons, says Karen Sumberg, senior vice president at the Center for Talent Innovation, known as the Center for Work-Life Policy until this year.

For example, all the generations value flexibility: the Silent Generation and boomers to phase into retirement and Generation X to balance work with child-care obligations. Millennials arrive in the workplace expecting flexibility and seeing it as the natural way to work.

“Generational differences are interesting and certainly they’re important, but certainly they don’t override what the general employee population needs,” Sumberg says.

Looking ahead, Sumberg anticipates that companies will offer creative arrangements for boomers so the organizations don’t lose boomers’ knowledge base

Now 72, Bloom is one such executive. He left WBBM in the mid-1960s and went into not-for-profit management. After 27 years as chief executive of the American Technion Society, an independent organization that raises funds for the Technion-Israel Institute of Technology, he plans to retire by year’s end.

He and his board have agreed upon a plan in which he’ll serve as an emeritus officer at a 75 percent pay status for two to four years with a varying time commitment. The transition will allow him to train and mentor his successor.

Todd Henneman is a freelance writer based in Los Angeles. To comment, email editors@workforce.com.

Take the Pew Research Center‘s “How Millennial Are You?” Quiz.

Pew also has more generational information here:

“What Makes Your Generation Unique?”

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Pet Projects

Visitors to the Jim Henson Co. may not be surprised to see Rowlf the Dog from The Muppet Show or Apollo the puppy from its new puppet TV show Pajanimals. But they might be surprised to see real-life dogs Billy, Jasper and Barley romping on the Hollywood lot.

“At any given time, there are probably 12 dogs on the lot somewhere,” says Nicole Goldman, senior vice president of marketing and publicity for the Jim Henson Co. Trouvé, Goldman’s terrier mix, sits in her office on days when she doesn’t have off-site meetings. “Everybody knows everybody else’s dog and their story. It feels like a community where we’re all involved with having the animals on the property.”

The Jim Henson Co. is one of a growing number of employers that let employees bring pets to work. Almost 1 in 5 U.S. companies allow pets in the workplace, according to the American Pet Products Association. The most common pet permitted: man’s best friend.

Allowing pets in the workplace reduces stress and increases loyalty, says Jerry Osteryoung, professor emeritus of entrepreneurship at Florida State University.

“I would argue that the costs are negligible, and it adds so much,” Osteryoung says.

Research backs him up. A study published in the Journal of Occupational Health Psychology found that pets in the workplace reduce stress, absenteeism and turnover and improve morale.

Clif Bar & Co. allows dogs at its headquarters in the San Francisco suburb of Emeryville, California, as part of its effort to help employees maintain a healthy work-life balance.

“Combined with our other unique benefits, it helps create a fun and supportive working environment for our people,” human resources manager Jennifer Freitas says.

Lauren Kanouse agrees. A lot of her colleagues bring their children to Clif Bar’s on-site child care and eat lunch with them in the company cafe. She brings her 9-year-old golden retriever, Buzz, who stays leashed to her desk and snoozes on his bed.

“As they have lunch in the cafe with their kids, I get to take Buzz for a short walk and have our fun time,” Kanouse says.

Pet-friendly policies tend to be found in smaller organizations or in high-tech firms, Florida State University’s Osteryoung says. About 5 percent of software company Autodesk Inc.’s 7,000 employees have brought dogs to work, spokeswoman Alexandra Constantine says. Google Inc. spokesman Jordan Newman credits dogs with making the Internet giant “a happier and more fun place.”

Lauren Yurko, a developer at online shipping marketplace uShip Inc., keeps a red plastic bowl by her desk for the days her Shar-Pei-Labrador mix, Wrigley, spends at the office .

“He was totally raised by all of my co-workers,” Yurko says, “He’s totally at home in the office. He’ll roam and pretty much check in with everybody. He’ll come back to my desk every once in a while just to make sure that I’m there.”

Other employers offer benefits that make any pet owner sit at attention.

Home Depot Inc. offers veterinary pet insurance. It was one of 2,500 companies with such a benefit in 2011, up 4 percent from a year earlier, according to California-based Veterinary Pet Insurance Co.

At the State University of New York in Delhi, pets of staff and faculty members receive free medical care and grooming as part of the hands-on learning of veterinary students, says Bonnie Martin, vice president for operations.

One satisfied client: Martin’s one-year-old mutt, Bilbo. He wags his tail in approval of his bath, nail trimming and ear cleaning.

Todd Henneman is a freelance writer based in Los Angeles. To comment, email editors@workforce.com.

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Tips for Two at the Top

Few companies have co-chief executive officers. Human resources consultant Mercer found only 10 examples in its database of more than 300 companies. Before championing this management model, you may want to heed what’s helped others.

Have distinct, complementary skills. Think the abrasive and practical Gen. Leslie Richard Groves Jr. and the sensitive and philosophical physicist J. Robert Oppenheimer of the Manhattan Project, says J. Richard Hackman, a professor of social and organizational psychology at Harvard University. Otherwise, the arrangement could deteriorate into a struggle for dominance.

Don’t upstage your counterpart. At Farmer Bros., only one of its two chief executives could sit on the board. Patrick Criteser agreed that the seat should go to Jeffrey Wahba. “It’s incumbent on me to treat him like we’re sharing the board seat and to make him feel like he’s got half that vote,” Wahba says.

Maintain a united front. At Primerica Inc., the senior leadership team reports jointly to the co-CEOs. “People know that to deal with an issue, particularly a big issue, they have to deal with the John aspect of it and they have to deal with the Rick aspect of it,” says co-CEO John Addison, who focuses on marketing while Rick Williams focuses on operations and finances. “They can’t come to either of us and say, ‘The other guy is being a twit.’ “

Build a relationship before sharing leadership. Entrepreneurs Russell D’Souza and Jack Groetzinger were friends at Dartmouth College before starting SeatGeek, a New York City-based company that forecasts ticket prices for sports and music events. “It’s really important that when you pick someone to work together, you know a lot about them,” D’Souza says. “You make the decision consciously, weighing the strengths and weaknesses of the person in mind.”

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Patagonia Fills Payroll With People Who Are Passionate

Patagonia Inc. CEO Casey Sheahan, still dressed in a cycling jersey and shorts from a lunchtime ride, chats with the human resources director in the lobby of the outdoor clothing and equipment company’s headquarters in Ventura, California. The space, with its Douglas fir staircase and portrait of Yosemite’s El Capitan, feels more reminiscent of a national park lodge than the gateway to a $400 million retailer. At the foot of the stairs stands a door that leads to the company cafe, which serves organic food and drinks. Today’s special: free-range organic barbecue chicken. One of the cafe’s windows looks into the infant and toddler child-care room, whose walls are adorned with art made by employees’ children.

More than 3,000 miles from headquarters, Betsy Pantazelos wraps up a day at the Patagonia store on Newbury Street in Boston. The interior, with its schoolhouse lights and wooden mezzanine, echoes the headquarters’ lodgelike feel. That environment, along with the corporate philosophy and culture behind it, explains why Pantazelos started working there four years ago while in graduate school and has stayed, rising from floor leader to store manager.

“This is a group of people who not only work together, but they play together, too,” she says. “As a result, people stay around longer because they feel supported and understood. The company offers every individual employee a lot of empowerment, and that’s very unusual in retail.”

Perennially recognized as a good workplace for mothers, Patagonia also has earned a reputation for employee loyalty at a time when other apparel retailers commonly see turnover of more than 100 percent annually, according to independent management consultant Robert Bartlett, who has worked in the retailing industry for 35 years. Patagonia had 25 percent combined voluntary and involuntary turnover in its U.S. brick-and-mortar stores as of the 12 months ended in July. Turnover was 7 percent at its headquarters and 6 percent at its distribution center in Reno, Nevada. Those numbers have remained stable during the past 12 years, despite the U.S. economy’s crests and falls.

The industry average in 2010 for all retail was 43.8 percent, according to the U.S. Bureau of Labor Statistics and the National Retail Federation.

Lifestyle retailers—whether they sell bikes or surfboards—tend to attract employees who love that lifestyle and often stay longer. Still, Harry Friedman, CEO of retail consulting firm the Friedman Group, characterizes Patagonia’s turnover as an unusually good number. “We’d love it at 25 percent,” he says.

Billy Smith, an avid surfer, joined the company four years ago. On days with good swells, he’ll awake at 5 a.m. to test products. “Landing this job was probably the best thing that ever happened to me,” says Smith, 26, a product developer for wet suits and surfing gear. “I feel like I represent the brand as much as it represents me.”

Sheahan, who became CEO in 2006, credits the low turnover to the corporate culture, camaraderie and the company’s “ambitious, authentic mission statement, which is very meaningful to our employees.” That statement: “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”

“They know what they do each day is contributing towards a higher purpose—protecting and preserving the areas that most of them love spending time in,” Sheahan says.

Patagonia grew out of Chouinard Equipment, a supplier of climbing tools. In the 1970s, founder Yvon Chouinard began selling rugby shirts and shorts made of lawn-furniture fabric. The durable clothes proved popular, and he and wife, Malinda, spun off Patagonia in 1973.

The 1980s brought compound annual growth of as much as 50 percent. But amid the recession of the early 1990s came what employees called “Black Wednesday”: the only large-scale layoffs in company history. Since then, the company has followed a strategy of slow growth. Still privately owned by the Chouinards, Patagonia does not need to please Wall Street and shareholders and can therefore create a culture and mission that aren’t so tightly bound to the bottom line.

Long before much of corporate America embraced “green business,” Patagonia was creating clothes from recycled soda bottles and installing solar panels at its corporate campus. One percent of sales goes to support environmental not-for-profits. Every Patagonia store has an environmental grants budget, and local employees take pride in deciding who gets what.

You can track the environmental impact of more than 150 products on The Footprint Chronicles, an interactive microsite. Select “down sweater” and you’ll read “the good,” “the bad” and the company’s spin through “what we think,” which says Patagonia needs to find a consistent supply of goose down from birds that the company can verify have been treated humanely.

“I really never thought that I’d be in retail,” says Maureen Kent, manager of the outlet store in Salt Lake City, who says she was a ski bum until she turned 38. “But I love the environmental stance Patagonia takes. And I love the fact that we get to give money back to our local organizations.”

The company also lends its talent to green groups. After one year of service, employees can apply for two-month internships with environmental not-for-profits during which time they’re still paid by Patagonia.

Bartlett says Patagonia employees may feel more connected to the company because of their “higher calling.” “Count me a skeptic,” he says, “but they think they’re saving the world.”

At the headquarters, an easy one-block walk from the Pacific Ocean, employees lean their surfboards against a wall near the cafe and break from work to catch waves. Restrooms include showers to freshen up after jogging, biking or even playing volleyball.

No one has private offices. Employees wear headphones to signal that they can’t be disturbed. Guests are obvious because they’re the only ones in traditional business attire.

Val Franco, one of the first employees hired, left in 1976 and then returned in 1985. “What’s cool about this place is the culture,” Franco says. “We have this amazing day care and there are parents who are like-minded helping you raise your children, so it’s sort of a village.”

To help sustain the retailer’s culture, every new hire receives a copy of Chouinard’s book Let My People Go Surfing, which charts Patagonia’s history and philosophies. New workers also are introduced at quarterly meetings, open to all employees, where executives review the financials. After all, employees may receive bonuses linked to their performance, responsibility and salary if the company meets or exceeds goals, financial or otherwise.

“We know what we’re doing by generating revenue for this enterprise is helping preserve the environment, and that’s really important to a lot of us,” says Lu Setnicka, director of human resources. “But we don’t want to go out of business doing the right thing. We still have to remain profitable.”

Indeed, Bartlett, the consultant, says, “Being fond of the outdoors and being next to the bears and so on is not a qualification to be a successful sales associate in the stores. The two things may be in opposition.”

To boost employee morale, which often can lead to success, the company encourages celebrations. In Reno, a group known as the Fun Patrol organizes parties throughout the year. And the outlet store in Salt Lake City closed for an entire Wednesday in August. Instead of selling merchandise, the staff brought paddle boards, kayaks and bocce ball sets to the nearby Jordanelle Reservoir for what they called a “field day,” a company tradition.

Setnicka coaches managers to define expectations, communicate deadlines and then trust their staffs with freedom to figure out when and how to meet those deadlines. “That doesn’t mean you leave them floundering,” she says. “You have a responsibility to check in and see how they’re doing.”

Providing benefits such as two months of fully paid leave to new parents and flexible hours enhances employee engagement, which leads to more satisfied employees, Setnicka says.

“When you walk through the front door here, you don’t have to shed part of who you are,” says Setnicka, whose son also works for the company. “For some organizations, that’s unfortunately what you have to do. You have to leave behind your role as an activist or your role as an athlete or your role as a parent. At Patagonia, when you come through that front door, every aspect of you is celebrated.” However, Setnicka acknowledges that this flexibility varies by project and role. “Someone who works in a retail store can’t say, ‘I think we’ll open the store at noon today,’ ” she says. “There are certain hours of operation.”

But retail employees such as Bruce Livingstone, who works at the company’s flagship store in Ventura, says the company has provided flexibility when they needed it most. When a family member fell ill, Livingstone wanted to return to the East Coast. It was a stark difference from his experience working for other retailers. “The company was very flexible and said, ‘Take whatever time you need,’ ” Livingstone recalls. “They do what’s right and worry about the bottom line after the fact. It just reinforced the reason why I’m here.”

Workforce Management, November 2011, pgs. 6, 8 — Subscribe Now!

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Best Practices for Diversity Training

Here are five of the best practices based on research and companies’ experiences.

• Communicate an individual business case. During the past decade, developing a business case for diversity has become a standard practice within companies. However, organizations also should communicate what Villanova University management professor Quinetta Roberson calls an individual business case. “People want to know, ‘What’s in it for me?’ ” says Roberson, who studies strategic diversity management. “Is this going to increase my skill set where I’m more likely to be identified as a high-potential or future leader? They need to be given some kind of motivation to learn.” That way, they’re more engaged when they attend training.

• Use experiential training focused on behaviors. “Generic and theoretical learning doesn’t have the same stickiness as experiential learning,” says Michael Hyter, president of diversity consultant Global Novations. Leading-edge practices incorporate experiential learning that develops skills rather than simulates discrimination. “We don’t teach people how to manage black people,” Hyter says. “We teach people how to teach people who are different than them.”

• Adopt clear metrics. Determine the goals of diversity training and evaluate its effectiveness, says Shilpa Pherwani, a managing partner with diversity consultant Ibis Consulting Group. Pherwani‘s firm tracks effectiveness by creating action plans for participants, tying the actions to organizational competencies. Steps may include setting specific recruiting and hiring goals for people of color and providing equitable opportunities to members of underrepresented groups.

• Encourage employees to practice what they learned. Managers need to provide opportunities for subordinates to apply their diversity training, Roberson says. “We saw examples where employees would go back to their job excited about what they learned, but their managers would say, ‘I don’t care about all that diversity stuff. You’ve been gone for a day or two. I need you to do X, Y and Z.’ ” But when managers share the newly trained subordinate’s enthusiasm, they’re reinforcing the message that the company values diversity and inclusion programs.

• Don’t expect training to be a panacea. “Diversity training just in and of itself doesn’t change the culture,” Pherwani says. It should be part of a comprehensive strategy that includes recruitment, mentoring and talent management. The diversity training helps explain the business rationale and provide skills to engage in difficult diversity conversations. Combining that training with a systemic approach provides a road map to organizations that want to build an inclusive culture, she says.

Workforce Management, August 2011, p. 14 — Subscribe Now!

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Solving the Diversity Puzzle

Lecturing employees about diversity is one thing, but some companies are taking training a step further. Strategies include engaging employees in teamwork exercises and having workers simulate disabilities.

In July, Jennifer Vena decided to talk with colleagues about Tourette’s syndrome after watching video clips of American Idol contestant James Durbin and public speaker Marc Elliot, both of whom have the neurological disorder known for causing motor and vocal tics.

It’s the latest in a string of topics advanced by Vena since she decided a year ago to add one item about diversity to her team’s monthly meeting agenda. “It is really each individual making a commitment to demonstrate inclusiveness in his or her daily actions that will make a difference,” says Vena, a senior consultant at Bright Horizons Family Solutions, a private company that manages employer-provided child care centers.

Vena’s self-imposed monthly commitment is part of an initiative known as One Thing introduced last year by Bright Horizons. The brainchild of the company’s diversity council, One Thing challenges employees to take one action that fosters workplace diversity and inclusion. More than 600 employees have submitted One Thing commitments. Other employees have vowed to take new co-workers to lunch so they feel welcomed or to read books to learn about other dimensions of diversity.

“It’s an evolution of the way we’re doing the work,” says Dan Henry, Bright Horizons’ chief human resources officer and co-chair of the diversity council. “There is only so much training you can do in this space. At some point, it has to come down to what people do.”



Bright Horizons isn’t the only company whose diversity practices are evolving. Increasingly, companies are supplementing lectures with activities ranging from simulating deafness to using case studies that hone skills for navigating complex situations. The goal: to create better managers, not simply more sensitive ones.

“Companies are offering courses on how to be an effective team member, conflict resolution, cultural agility,” says Quinetta Roberson, a management professor at Villanova University’s School of Business who has researched diversity trends. “They’re giving people an openness to experience where people can deal in various contexts with various people, where people have the tools to navigate in any context.”



Beyond guilt trips
The National Training Laboratories of Bethel, Maine, which is now called the NTL Institute, determined more than a decade ago that “practice by doing” is second only to “teaching others” as the most effective way of learning. But only in recent years has diversity training transitioned away from side shows and guilt trips to skill-building, such as resolving conflict and providing developmental feedback to subordinates with whom managers have little in common.

“People learn more by doing,” says Ondra Berry, co-founder of training firm Guardian Quest. “We can recite experiences from our lives blow-by-blow because we remember more when we’re actively involved, especially when it has made an impact on us.” NV Energy Inc., which provides electricity to 2.4 million customers throughout Nevada, hired Guardian Quest for three days of training four times per year.

The sessions are about teamwork as much as they are about diversity. In one, a line of people must navigate under chairs and around other obstacles, communicating only through taps and touches. In another, the group must figure out how to pass everyone through a spider web of ropes.



Carolyne Sharp attended the training after changing jobs involuntarily as part of a reorganization at NV Energy. She was unhappy because she had been transferred from a power plant, where she liked her co-workers, to the corporate office, where she would be working in purchasing and contracts.

“After I took the training, I was fired up,” Sharp says. “I found my voice. I wasn’t afraid to say something anymore. The true me came out again.”

Since, she has won five awards for her efforts to expand the number of minority suppliers, holds regular reunions for her training cohorts and organizes an annual companywide event to honor veterans.

The earliest forms of diversity education arose soon after President John F. Kennedy signed an executive order in 1961 that required federal contractors to “take affirmative action” to avert discrimination based on race or national origin. By 1963, government contractors such as Western Electric provided two days of lectures and discussions about prejudice to leaders of all their locations.



During the 1970s when the U.S. Equal Employment Opportunity Commission gained the power to bring lawsuits against private companies, training sessions proliferated to help employers avoid litigation. These compliance sessions evolved in the 1990s into training that used broader definitions of diversity, including factors such as sexual orientation, religion, communication styles and tenure.

Now, companies are increasingly looking for quantifiable returns on their investment. They’re tracking employee engagement to see whether the training translates into higher scores and looking at 360-degree evaluations to see whether managers gained skills.

“The expectation is more than a good experience,” says Michael Hyter, president of diversity consultant Global Novations. “It’s real, measurable learning. It’s a measurable outcome. There is a specific skill that ought to be obvious for the investment that we’re making in this person’s development experience.”

Hyter says that he holds his firm to a different standard than he did a decade ago, emphasizing to clients how his firm’s training builds competencies and enhances employee engagement.

In one instance, a client had become alarmed about turnover among women of color. Hyter’s firm conducted a cultural audit, which suggested managers were weak at providing developmental feedback across the board, not only to women of color. The firm identified competencies, trained managers and embedded behavior into 360-degree evaluations every 90 days. Within 18 months, turnover decreased and more women and minorities had risen within the organization.

“If we talked 10 years ago, I would have said we gave 5,000 people diversity training and left, and they loved it,” Hyter says. “But nothing much would have changed. There was no real measurable change in behavior or skills.” Nowadays, he asks specifically what outcome clients seek and looks at what skills drive those results.

In 2010, 68 percent of the member organizations surveyed by the Society for Human Resource Management indicated that they have practices in place to address workplace diversity compared with 76 percent of organizations surveyed in 2005. But of companies with diversity practices, 71 percent say they provide training compared with 67 percent in 2005.

“The organizations that were really invested in diversity and inclusion work before the recession hit remain so,” says Eric Peterson, SHRM’s manager of diversity and inclusion. “Those who were getting started, it was an easy cut to make when they needed to cut back.”

Making an investment
Sodexo Inc. is among the companies that have invested years of time and money into diversity strategy. The food and facilities-management services company offers multiple diversity workshops available to everyone from cashiers to members of the C-suite, invites outside speakers to lead sessions at its annual diversity conference and offers webinars available anytime from any location.

“We use every opportunity we can to spark people’s interest and seed a desire to learn more,” says Betsy Silva Hernandez, Sodexo’s senior director of diversity, learning and consulting.

Managers attend a full-day diversity workshop, facilitated by a cohort of external trainers, within six month of joining the company. There, managers learn about their role in building an inclusive workplace, reflect on their own views of diversity and explore situations that they may encounter. One scenario presents a white male voicing resentment based on his perception of reverse discrimination.

“It gives them an opportunity to talk about the issues in a safe place—what they feel are going to be their challenges—and an opportunity to talk about what they can better do to lead in this space,” Hernandez says.

Managers can opt to attend 15 Diversity Learning Labs, follow-up sessions that range from 90 minutes to three hours offered throughout the year. Topics include gender, sexual orientation, cross-cultural communication and disabilities. A recent lab simulated working with disabilities. For one hour, participants lived with a disability. One employee wore special earplugs that blocked all sound, another temporarily lost vision, while someone else spent time in a wheelchair.

“We want it to be interactive,” Hernandez says. “We look at 90 percent interaction and 10 percent sharing information and raising awareness.”

John Friedman, director of public relations for Sodexo, gave up his sense of hearing during the lab. He went with a colleague to a place that was “100 percent familiar, where we’d been to 100 times in our own building,” he says. “It was a markedly different experience and profoundly humbling.”

Eight years ago, Sodexo also began conducting an annual diversity and business summit, a place where it tests new learning labs on such topics as generational differences. Each year, the full-day event is held in a different region, with area managers invited to attend with North American president and CEO George Chavel and his executive team.

As diversity has become ingrained into business strategies, Chavel and other chief executives are immersing themselves in their companies’ initiatives. Their involvement underscores the organizational commitment to diversity.

Consider, for example, Mark Wagar, president and CEO of Empire Blue Cross and Blue Shield, the New York City-based subsidiary of WellPoint Inc. In 2008, the company introduced the Empire Diversity Council to serve as an advisory body to its senior-management team. Wagar then launched a “community ambassador program” in which members of employee resource groups help identify ways of better serving their own demographic.

When Asian employees formed a resource group last year, they asked Wagar to serve as executive sponsor because, he says, “of my activism.” A self-described “giant Dutchman,” Wagar agreed and is working with members on a business plan detailing employee education and customer research goals.

“If it’s a business reality that there’s lots of old white men running companies, if you don’t have old white men who are willing to speak out about this and about how it [diversity] makes richer lives and better business,” Wagar says, “it’s not going to go as fast as it otherwise would.”

Some companies also are linking diversity education to performance evaluations. Bright Horizons evaluates employees against the company’s values, known as the Heart Principles. Employees learn about this connection in diversity training they attend during their first 90 days. Among those principles: “We strengthen our organization by embracing diversity and never allowing acts of nonacceptance.”

Sodexo goes further. It ties managers’ bonuses to training, recruitment and other diversity goals. This connection provides an incentive for managers to attend additional training sessions and to encourage subordinates to do so, as well. The strategy appears to be working: In fiscal 2009, 2,900 employees participated in 85 learning labs, and the next year 6,900 attended 243 labs. Through June, Sodexo already had exceeded its 2010 attendance.

Discussions about business cases for diversity—reducing turnover-related expenses, tapping new market niches, better understanding customers—still dominate conferences.

But Caesars Entertainment Corp. is taking a novel approach. Fred Keeton, chief diversity officer of the casino operator based in Las Vegas, has developed a concept that he calls “Diverse by Design.” Many organizations assume that having a diverse workforce naturally creates better teams, but Keeton handpicks team members to ensure that the teams have what he considers to be the relevant mix.

He applies the hospitality industry’s concept of yield management to diversity, creating teams with what he considers the best mix of cognitive styles and experiences to solve thorny business problems or drive revenue.

“Every dimension is not always important to what you want to do,” says Keeton who is also vice president of finance for external affairs. “You’ve got to manage your diversity like you manage so many other things.”

He mines employee data, picking the most relevant attributes using a matrix that considers everything from thinking styles to job function, geography, cultural style and the traits traditionally thought of as diversity: race, gender or ethnicity.

Insight into cognitive styles, for example, comes from the Herrmann Brain Dominance Instrument survey, collected and shared with employees in diversity training conducted during their first 90 days.

Caesars uses Diverse by Design teams for only its toughest tasks. “If you have a problem that’s a really easy problem, having a lot of diversity doesn’t necessarily help you answer that problem,” Keeton says. “If you’ve got a really hairy, nasty, dirty problem that’s hard to solve, diversity becomes most potent. We call it creating the capacity to call the baby ugly because the people who created the baby aren’t going to call it ugly.”

The company piloted the first two teams in 2009 and has since formed eight other teams. One looked at ways of improving buffets. The team didn’t review the food itself, but rather proposed ways to increase the efficiency and effectiveness of buffet operations. A second team looked at the revenue-management systems of hotels, while another focused on whether to buy new or retain existing slot machines and what mix of games to offer.

Keeton says the results are proprietary information but the strategy is working.

Yet even after 50 years, diversity programs continue to spark debate. Sociologist Frederick Lynch, an associate professor of government at Claremont McKenna College in California, argues that diversity programs promote the notion of hiring people because of their skin color, gender or other demographic traits. He considers this tokenism.

“As I see it, we have gone from trying to make up for past discrimination to affirmative discriminations,” says Lynch, author of The Diversity Machine: The Drive to Change the “White Male Workplace.” Changing demographics may lead to a “natural affirmative action,” he says.

But other experts believe diversity won’t just happen without a lot of hard work. Patti Digh, a former vice president of international and diversity programs for SHRM and co-founder of the training firm the Circle Project, voices her frustration that companies insist on developing business cases before advancing diversity, saying this demand amounts to a stalling tactic. Diversity programs no longer need to be justified, Digh says.

They’re core business tools that should be integrated across product development, marketing and communication, not thought of as a separate silo.

“In the year 2011, continuing to say, ‘We have to build a business case for diversity’ is like saying, ‘We should really look into this new Internet fad,’ ” Digh says.

Workforce Management, August 2011, pgs. 12-14, 16, 18 — Subscribe Now!

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Disability Disclosure vs. Privacy

She has fragile skin. Bruises and scars, hidden by clothing, cover her legs. And she suffers from chronic joint pain. “To meet me, you’d have no idea that I have any physical challenge,” says the Ernst & Young human resources coordinator who suffers from a connective tissue disorder. “The truth is that every day I am in pain—every day—and I just live through it.”


She is one of the scores of Americans with “invisible disabilities,” chronic health conditions that are not immediately obvious, such as diabetes and cancer, sensory impairments such as reduced vision, mental illness such as bipolar disorder and depression, and learning disabilities. The accounting and consulting firm asked that her name not be used to avoid discrimination by insurance companies or others. Those concerns underscore the challenges that employees with non-visible disabilities face when balancing privacy with disclosure.


No study has identified how many Americans have non-visible disabilities, but more than 18 percent of Americans report some level of disability, U.S. Census data show.


Ernst & Young introduced a handbook in July to provide a basic level of understanding of non-visible disabilities among employees in hopes of fostering an environment “where everybody is limited only by talent, skills and energy,” says Lori Golden, who leads AccessAbilities, Ernst & Young’s initiative to build an inclusive work environment. “We really want others to get educated about this so we can all do it better.”


The 17-page handbook defines terms such as “disability,” “non-visible disability” and “reasonable accommodation”; explores the pros and cons of disclosure; and addresses questions that employees with disabilities and their managers might have about how much information to share, how to handle questions about accommodations from co-workers, and how to deal with resentment or backlash from colleagues who perceive an accommodation as special treatment. “One of the most difficult decisions an individual with a non-obvious disability has to make is whether to inform people or not,” Golden says.


Companies might not understand why employees choose not to disclose their disabilities. “Some employers feel like, ‘Why didn’t you tell me before?’ ” says Barry Taylor, legal advocacy director at Equip for Equality, which advocates for children and adults with disabilities in Illinois. “They don’t understand that you’re not required to disclose.”


Ernst & Young’s Golden sees risk in three areas—health, safety and performance—in not disclosing non-visible disabilities after being hired. “We feel that it’s really important that people with non-obvious disabilities understand that there are risks to not informing the organization about a disability,” Golden says. “If we don’t know that there is a disability at work and we haven’t had an opportunity to develop any accommodations and that person’s performance is not up to par, the disability does not afford protection.”


A recent study for the Kessler Foundation and the National Organization on Disability provides insight into why some workers choose to share information about their disabilities. The most common reasons: It was a visible disability (32 percent), it hurt job performance (33 percent) or the employee simply felt that others should know about it (49 percent), according to the survey conducted this year by Harris Interactive. Respondents could select more than one reason, so the total exceeds 100 percent.


Securing reasonable workplace accommodations, of course, requires open communication, says Kathleen Lee, project coordinator and business outreach specialist at Cornell University’s Employment and Disability Institute. “Reasonable accommodations are actually less about the law and more about just good common sense and about ensuring that employers enable employees to be productive in the workplace and maximize their potential.”


Ernst & Young’s handbook largely avoids traditional wording such as “disclosure” and “accommodation” in favor of “inform” and “adjustment.” Golden believes that “disclosure” implies purposeful concealment and that “accommodation” connotes a favor, whereas “adjustment” suggests a slight modification in how things are done. “We’re not trying to follow the dominant thinking but to shape it in ways that will work for our people and that will open up opportunities for people with disabilities in the wider marketplace,” she says.


Martha Artiles, global chief diversity officer for temporary staffing firm Manpower Inc., likes what she calls the forward-thinking terminology. She plans to adopt the handbook and share it with clients. “When you think about the fact that most people aren’t comfortable disclosing their disability unless they have to ask for an adjustment,” Artiles says, “they exist much more than we know.”


Workforce Management, September 2010, p. 3 — Subscribe Now!


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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Gay Couples Navigate Steep Retirement Challenges

When financial planner Patricia Pearsall-Ramey advises gay couples as they near retirement, she encourages them to think about “their unique planning needs.” Among the complications they face: government safety-net programs like Social Security that don’t recognize their relationships.


“If something were to happen to one of them, they could be at a significant financial disadvantage because they won’t be able to get a Social Security survivor benefit,” says Pearsall-Ramey, who works at the accounting firm Ernst & Young. “It really places the burden on the couple to make sure they’re saving sufficiently.”


A new study about lesbian, gay, bisexual and transgender baby boomers explores the challenges that the Stonewall generation, along with their employers, must cope with as retirement approaches.


The study, sponsored by the MetLife Mature Market Institute and the American Society on Aging, also hints that the generation which launched the modern gay rights movement with the Stonewall riots of 1969 could influence retirement policies as they age. “Still Out, Still Aging” compares 1,201 boomers age 45 to 64 who identify as LGBT with 1,206 heterosexual people of the same age.


Few baby boomers—the estimated 78 million Americans born from 1946 to 1964— have saved enough to retire at 65, according to the report’s findings. Only 21 percent of the LGBT respondents and 25 percent of the general population have achieved their retirement-savings goals or are on track. Nearly half of the LGBT boomers surveyed plan to work until at least age 70.


Those findings show the importance of educating employees about retirement savings and expanding automatic enrollment in 401(k) plans and automatic escalation, which automatically increases the contributed percentage of earnings over time, says Barbara Howard, director of gerontology at MetLife Mature Market Institute. LGBT employees also should inquire about domestic-partner benefits and designating a domestic partner as a beneficiary for their pension plan, she says.


Some companies have taken steps to provide what they consider parity. At Ernst & Young, “everything that is available to our straight couples is also available to our LGBT couples,” says Chris Crespo, inclusiveness strategy director. “We have spousal equivalency in all of our benefits.” The professional services firm offers a defined-benefit plan, a 401(k) plan, long-term care insurance, medical insurance for retirees and their spouses or domestic partners and free financial planning.


Even when companies offer retirement benefits to LGBT boomer-age workers, they pay more taxes than their heterosexual counterparts, according to the Williams Institute at UCLA School of Law. That’s because the Defense of Marriage Act limits spousal tax exemptions to opposite-sex partners. Medical insurance provided to the same-sex partner of a retired employee is taxed as income, whereas the same insurance given to an opposite-sex spouse is not taxed.


To offset that built-in cost, Google Inc. in July began reimbursing its gay and lesbian employees the extra federal tax that those employees pay when their domestic partners receive health benefits. The reimbursement, to be noted as a line item on paychecks, is retroactive to January 1.


Kimpton Hotels and Restaurants, a boutique chain based in San Francisco, and Cisco Systems Inc. also pay the tax on imputed values of domestic partner benefits. In the nonprofit sector, The Bill and Melinda Gates Foundation “grosses up” salaries to pay the tax for domestic-partner health benefits.


Employers also aren’t required to provide the employees with the option of having their same-sex partners receive a qualified pre-retirement survivor annuity, paid to the surviving partner, if the employee is vested in a defined-benefit plan but dies before retiring.


But same-sex partners recently moved one step closer to equal treatment under inherited retirement plans, says Samir Luther, associate director of the Workplace Project for the Human Rights Campaign Foundation.


Since January 2010, employers must let a non-spouse beneficiary, such as a domestic partner, roll inherited retirement savings into an individual retirement account without paying taxes immediately, just as the tax code has allowed spouses to do.


Luther recommends that employers notify workers of the change through more than just their annual benefits update. He also hopes that the MetLife study will help him and his colleagues find more ways that employers could help LGBT boomers prepare for retirement. “There haven’t been a lot of people focused on best practices for LGBT retirees,” he says.


Todd Solomon, a partner in the employee benefits practice group of law firm McDermott Will & Emery, agrees that more employers are reviewing retirement plans.


“The first wave was everyone equalizing their health plans, and they left their retirement plans alone,” says Solomon, author of Domestic Partner Benefits—An Employer’s Guide. “Now they’re trying to equalize their retirement plans as well.”


Solomon cites two changes that he considers “cutting edge”:


• Writing 401(k) plans so a same-sex partner becomes the beneficiary if the employee forgot to designate one. Federal law already requires that an opposite-sex spouse be made the automatic beneficiary in such situations.


• Allowing hardship distribution from 401(k) plans to pay medical expenses of same-sex partners if they allow such withdrawals for opposite-sex spouses.


The benefits at Solomon’s law firm, for example, include a pre-retirement survivor annuity and leave for domestic partners equivalent to what’s provided to straight employees under the Family and Medical Leave Act.


FMLA-equivalent leave could be particularly important to LGBT boomers. The MetLife study found that more LGBT boomers provide care to a parent, domestic partner or friend than their straight counterparts. Gay, bisexual and transgender men provide the most care—41 hours a week, compared with 29 hours for other men.


“It’s pretty astounding the number of hours that males were putting in,” MetLife’s Howard says. “Employers need to respond to this issue.”


Those findings show the importance of flexible work arrangements and of employee assistance programs, she says. “Make sure that you constantly are getting the message out about the kinds of support that are available to your entire workforce population for elder care issues,” she says.


Employers also should revisit their preconceptions of family. Almost two-thirds of LGBT boomers say they have a group of friends whom they consider to be their families. And they aren’t the only boomer-age workers likely to have families who don’t conform to notions of a nuclear family.


“That traditional Ozzie & Harriet or Leave It to Beaver—that 1950s stereotype that people have—isn’t normal family anymore, whether that’s heterosexual or homosexual,” Howard says. “Think about heterosexuals who are not married. Think about siblings living together. Think about multigenerational households.


“If you think about friends forming this intimate family of choice, clearly it is a source of strength, support and networking for life,” she says.


For human resources professionals, one of the most troubling findings may be what all baby boomers—gay and straight—still have in common: They have based their long-term care plans on a fallacy. Fifty-seven percent of LGBT boomers and 49 percent of other boomers falsely expect Medicare to pay for their long-term care.


“It’s distressing,” Howard says.


In general, Medicare doesn’t pay for long-term care. The federal program covers the first 20 days of care in a skilled nursing facility following a hospital stay of at least three days. It also pays for home health care for those patients who meet certain requirements. But Medicare is not designed to pay for long-term care.


At least 70 percent of people 65 and older will require a period of long-term care in their lives, according to the U.S. Department of Health and Human Services.


“It is in many respects something that we can predict pretty well in the aggregate—the number of people who may need long-term care—but I’m not going to be able to predict whether you need it or I need it,” Howard says. “I think we’re all hoping it will be the other guy.”


Forty-nine percent of employers offer long-term care insurance as part of a group-purchasing program, Hewitt Associates Inc.’s 2009 Benefits SpecSelect database finds.


Without long-term care insurance, individuals pay for their own long-term care until they spend their assets to become poor enough to qualify for Medicaid, the government’s medical assistance program for low-income people. Medicaid remains the primary source of funding for long-term care, according to the U.S. Department of Health and Human Services.


But when it comes to Medicaid, LGBT seniors are more vulnerable. Opposite-sex partners of Medicaid patients are allowed to keep their home and a certain amount of income and assets so they aren’t forced to live in poverty.


“That [option] does not exist for LGBT people,” says Laurie Young, aging-policy analyst for the National Gay and Lesbian Task Force. “This is not just a retirement, but almost an end-of-life issue.”


Workforce Management Online, August 2010 — Register Now!

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Companies Making Friends With Social Media

Social networks ranging from employee-only applications such as Deloitte’s D Street to public sites including LinkedIn continue to gain ac- ceptance as the business benefits become clearer.


Three recent surveys suggest how social networks contribute to the bottom line, but the studies also probe why some organizations struggle to tap their potential.


By 2014, social networking will replace e-mail as the primary form of communication for 20 percent of business users, according to Gartner Inc., a research and advisory firm.


Already, McKinsey & Co. has found that 69 percent of executives report that their companies have gained measurable business benefits, including better access to knowledge and higher revenue.


“Quite frankly, the companies that seem to have achieved the most are the ones that have been experimenting most deeply and for the longest amount of time,” says Michael Chui, a senior fellow of the McKinsey Global Institute.


A separate poll by the Human Capital Institute’s human resources membership found that, when counting both public sites such as LinkedIn and in-house applications, 49 percent of organizations use social networks somewhat. But getting employees to incorporate these sites into their routines remains a chief barrier to reaping the networks’ full potential.


“You have to ensure that people understand this is the place to go get answers,” says David Eisert, associate director of emerging technologies at Indiana University’s Kelley School of Business. “When you’ve got people in the network engaged, sharing information and openly communicating, that’s where the meat of knowledge transfer comes from.”


Companies that have invested in internal social networks have taken a variety of approaches to entice employees to create profiles and participate.


Deloitte pre-populated every profile in its D Street network with basic information drawn from its HR system.


“When we launched, we turned on profiles for all 46,000 employees,” says Patricia Romeo, D Street leader. D Street has been integrated into Deloitte’s internal portal, introducing mini-profiles of five colleagues each time an employee logs on. “It’s very much a Facebook-like experience,” Romeo says, “but all from the safety and security of behind the firewall.”


Sabre Holdings Corp., whose technology underpins travel reservations worldwide, created SabreTown, a social network accessed at least once a month by about 70 percent of its workforce. The company, based in Southlake, Texas, has 9,000 employees in 59 countries.


To encourage use, a team sat out in front of cafeterias and visited desks, taking and uploading profile pictures, says Erik Johnson, general manager of Sabre Holdings’ Cubeless, the software behind SabreTown. “It sounds like a silly little thing,” Johnson says. “But once that picture was attached to a profile, it’s amazing how much more likely users were to engage in the system and take ownership of that profile.”


Another challenge: demonstrating return on investment. In fact, not all of the early experiments with social networks have survived the recession. Dow Chemical Co. closed its My Dow Network, launched in 2007 to connect with retirees and former employees, because of “the global economic crisis,” spokesman David Winder says.


Allan Schweyer, principal at the Center for Human Capital Innovation and former executive director of the Human Capital Institute, says a vibrant social network could help with retention. But he concedes, “I don’t think there is going to be any great ROI measurement for corporate social networks anytime soon.”


Workforce Management, April 2010, p. 4 — Subscribe Now!

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Companies Open Up Once-Taboo Talk of Pay Scale

Before Pete Herrera received a job offer from Accenture, he went online to gauge what his peers in the field earn. Among other sites, he visited PayScale.com, a five-year-old compensation information company, where he bought a personalized report.


    As negotiations replaced interviews, Herrera was prepared to show his future employer printouts detailing the market value of the job. But in the end, he felt “very comfortable” with the offer because it fell within the range provided by Web sites, says Herrera, who recently retired after 23 years in the Air Force and who began working as an instructional design manager for Accenture in September. Still, he used the information to help negotiate an earlier performance review in hopes of earning a merit increase.


    For years, as far as many employees were concerned, pay scales were created with secret formulas. Some employers tried so hard to keep workers from comparing pay that handbooks forbade them from discussing it, a practice that landed several employers in court for violating the National Labor Relations Act.


    Now compensation information permeates the Internet, placing data a click away from Herrera or anyone else who has a few minutes for research. The result is that from small businesses to multinational firms, companies are tweaking workforce strategies so highly sought candidates understand their total rewards. They also are training supervisors to turn questions about pay into opportunities to re-recruit workers.


    “Information doesn’t ruin the business,” says Bill Coleman, senior vice president of compensation for Salary.com, which market-prices 3,500 jobs every month using employer-reported data. “It just levels the playing field and gives everyone an intelligent perspective from which to have a conversation.”


    Kettley Publishing, a 30-employee firm that offers software and Web-based products for professional financial advisors, embraces that idea. “When we’re recruiting employees, when we’ve drilled down to one or two candidates, we explain to them the process we use to arrive at compensation and the process we use in annual evaluations regarding compensation,” says CEO and CFO Ken Kerr, who uses Salary.com to guide his pay scales.


    “I want to be very open about how we make our decisions so they can determine for themselves that we’re treating this matter fairly and openly and objectively,” Kerr says.


    Motorola Inc., meanwhile, has prided itself on being open with its 950,000 employees, but the pay sites have prompted the No. 2 manufacturer of wireless handsets to adjust its practices. Motorola has taken deliberate steps to educate employees about the concept of market pay so they understand both what they find online and Motorola’s compensation philosophy, says Regina Hack, global compensation director.


    Green Mountain Coffee Roasters has gone even further. It sends its new hires through “financial literacy training,” which includes sessions on reading profit-and-loss statements and understanding “you and your pay.” All 940 employees of the Vermont-based company, whose coffee is sold under the Newman’s Own Organics brand and its own label, have attended the training since it began three years ago.


    “Clearly those sites are basing [pay scales] on some kind of survey,” says Kathy Brooks, vice president of human resources and organizational development for the coffee company. “They say it may be a typical benefit package, but what’s a typical benefit package? We’re trying to be careful about educating our employees about what the total compensation is really made of.”


    All employees at Green Mountain Coffee, for example, are eligible for a profit-sharing plan of up to 5 percent of their salaries. They receive up to $500 a year in “wellness reimbursement” for expenses such as joining a health club and are paid to volunteer up to 52 hours with the nonprofit of their choice. When someone cites numbers found online, Brooks wants to make sure they’re “comparing apples to apples.”


    Mike Hayes, vice president of business solutions for PayScale, which uses employee-reported data, says human resource professionals should probe the subject with job candidates or employees who make salary demands based on data found online.


    “The HR manager has to ask all of the questions that the employee will ask them: ‘Where did you get the data?’ ‘What makes up the data?’ ‘What in the data set tells you that you should be earning at this level?’ ” Hayes says.


    And employers should be ready to do something many organizations have never done before: Explain the strategy driving pay for a particular position, whether it’s paying above 50 percent of the market for mission-critical jobs or below 50 percent for less key spots.


    “There is a strategic decision companies have to make in terms of what their pay policy is going to be for various functions within an organization,” says Jim Stoeckmann, practice leader for WorldatWork. “And it is entirely appropriate to share with employees what that pay policy is.”