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Enter The Brave New World

Change has always been rampant, but the pace has never been more frantic than now, according to Robert Rosen, Patricia Digh, Marshall Singer, and Carl Phillips, authors of “Global Literacies: Lessons on Business Leadership and National Culture” (Simon & Schuster, 2000). Here are some events that will factor into this new stage of business evolution, as discussed in their book.


Globalizing Growth. The globalization of companies and brands makes it difficult, if not impossible, to determine the “home country” of many corporations.


International Megamergers. Global mergers create giant multinational corporations that are larger, richer and more powerful than many countries.


Regional Economic Power. Strong regional trade associations, such as the European Union, NAFTA, ASEAN, and Mercosur, will enhance geographic economic bases around the world.


Economic Interdependence. Strong global monetary and regulatory agencies will be required to handle severe volatility in the international financial system.


Privatizing Power. The privatization of state-run enterprises and the diminished economic decision-making power of nation-states will continue if there is no major worldwide depression.


Identity Problems. In an increasingly interconnected world, people will be torn between being global cosmopolitans, regional traders, national cheerleaders, ethnic personalities, and local citizens.


American Backlash. Defensiveness against ubiquitous American culture, democracy, military might, and free-market capitalism will counter the continuing strength of the United States as the primary world power.


European Integration. The economic integration of Europe and the euro, with the seemingly inevitable political integration to follow, will further solidify that continent’s influence over the world stage.


Asian Rebound. The hardworking nature of Asians and their social and family networks, combined with their commitment to education, form a strong foundation for their economies to rebound — and sooner rather than later.


China Inc. If China holds together as one nation and if its economic development continues, this will become the largest, most important market in the world.


Haves & Have-Nots. The gap between the haves and have-nots, both within and among countries, will continue to widen unless more developed countries make a stronger commitment to wealth creation and wealth distribution in less developed nations.


Ethnic Conflicts. The number and intensity of ethnnic conflicts will increase worldwide, as well “terrorism” driven by these ethnic and religious differences.


Economic Versus Environmentalism. As economic development expands globally, pollution and global warming will accelerate, creating political and economic conflicts in all countries, with all parties culpable.


Demographic Dilemmas. The swelling population of young people in the developing world — and the need to create jobs for them — combined with the growth of the elderly population in the developed world and the need to take care of them — will create economic and political challenges for all.


SOURCE: “Global Literacies: Lessons on Business Leadership and National Culture” by Robert Rosen, Patricia Digh, Marshall Singer, and Carl Phillips (Simon & Schuster, 2000)


Workforce, April 2000, Vol. 79, No. 4, pp. 76-78.


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The Hunt for Public Sector IT

IIt’s no wonder the public sector is having a hard time competing for ITtalent. In light of the IT labor shortage, many private-sector companies areusing gee-whiz ways to lure new hires, such as stock options and conciergeservices, not to mention flashier bonuses like the shiny new BMWs offered lastyear by Mirronex Technologies Inc., a Skillman, New Jersey-based IT consultingfirm.


Competition like this can kick public organizations to the bottom of ITworkers’ desirability list. Therein lies the problem: How do you compete withdot-com companies offering glamorous perks? Says Lewis Temares, vice presidentfor information technology at the University of Miami in Coral Cables, Florida:”The only thing we can beat ‘em on is quality of life. Stock options areeating us alive!”


Fundamentally, there’s little difference between the public and privatesectors. Both view employees as their customers. However, the most obvious, mostconsequential difference is the lack of profit motive in the public sector. Inthe private sector, HR can use the profit motive in bargaining and compensation.Not so in the public sector, which often has more limited resources and isaccountable to elected officials and local citizens rather than corporate boardsof directors.


Given today’s shortage of IT professionals, public-sector professionalshave finally wised up. Not only are they marketing their greatest assets(stability, flexibility, and social-service values), they’re also turning toalternative sources and creative methods to keep a grasp on their fair share ofthe labor pool. Through a combination of benchmark surveys, trainingpartnerships, task forces, and monitoring of IT legislation, the public sectoris slowly regaining its stature as a worthy employer of choice.


The challenge, of course, is to keep pace with the demand.


Today’s IT labor shortage isn’t getting better.


According to a 1998 study by Arlington, Virginia-based Information TechnologyAssociation of America (ITAA), 346,000 IT jobs currently are unfilled in U.S.companies. Moreover, the U.S. Commerce Department’s Office of TechnologyPolicy report (“America’s New Deficit: The Shortage of InformationTechnology Workers”) indicated that between 1996 and 2006, more than 1.3million new systems analysts, computer scientists, engineers, and programmerswould be required to meet industry’s demands. These numbers reflect the ITworkforce shortage in the United States alone. Some government reports estimatethat the current IT shortage costs the nation $105 billion a year.


In that context, the International Personnel Management Association conducteda useful survey in 1998. “Our members wanted to know what were the bestpractices for recruiting IT workers,” says Judith Brown, director ofresearch for the Alexandria, Virginia-based IPMA. Of the survey’s 342respondents — representative of city, county, state, and federal entities –nearly half said they suffered from a shortage of IT staff. Among the mainbarriers to recruiting and retaining staff were low-based salaries compared tothe private sector, less advancement opportunity, and slow applicant tracking.


Interestingly, what is standard fare for the private sector hadn’t beenused by the respondents until recently. These strategies include signing bonusesfor new hires, sponsoring IT job fairs, using professional recruitment firms,sending direct mail to IT professionals, and awarding bonuses to employees whorefer candidates.


On the state level, the most effective recruitment methods identified wereprimarily Internet advertising, college internships, hiring above the minimum ofthe pay range, IT job fairs, campus recruiting, and hiring outside the civilservice test. In the state of New York, the Department of Labor even eliminatedwritten tests for IT professionals and implemented an education and experienceonly review, according to Brown.


Creative partnerships target seniors, women, and youths.


When you think about the IT shortage, doesn’t it seem as though everyone isfixating on the here and now? Sure, who wouldn’t want a young, ready-madecomputer operator, program analyst, and systems programmer? However, to meet theshort-term demand, you may have to consider the global recruitment pool. And inthe long run, consider the vast pool of untrained domestic candidates — theones who didn’t graduate from the top universities, only to flee to SiliconValley.


Then there are retired seniors. Unskilled women. High school youths.


“Managers, abandon one-size-fits-all rules and salaries. And considereveryone and everything a target,” advises Patrick Foss, a former recruiterfor the state of Minnesota and current tech advisor for techies.com in Edina,Minnesota.


Consider Scott Bird, an independent Certified Technical Education Centertrainer. After retiring from small business consulting, he embarked on a courseto become a Microsoft Certified Systems Engineer and Microsoft CertifiedTrainer. At age 72, he reached his goal in less than a year. “In just a fewmonths, I earned back all my training costs,” he says in a testimonialposted on Microsoft’s Web site.


Bird found out about the program through Arlington, Virginia-based GreenThumb, a national nonprofit corporation in the field of older worker employmentand training. This Green Thumb/Microsoft model provides certification-driven ITtraining to undeserved and under-represented individuals being overlooked by thetechnology revolution.


Contrary to some public opinion, mature workers who take advantage of ITtraining opportunities are especially desirable employees because they bringcompetency and wide experience to their new field, according to Green Thumb.Also, in their later years, many seniors are less concerned about pocketing topsalaries. They appreciate the opportunity to give back to their communitiesthrough social service. The public sector can market its work environment andrecruit employees through organizations such as Green Thumb Inc.


In another program, ITAA has partnered with Women Work!, a nonprofitorganization that helps women from diverse backgrounds to achieve economicself-sufficiency. Through a Women in Apprenticeship and Non-TraditionalOccupations (WANTO) grant, administered by the Department of Labor (DOL) Women’sBureau, ITAA and Women Work! have chosen four regional sites: Oregon, Tennessee,Maine, and Colorado. At each site, a minimum of 10 women will be trained andplaced in entry-level IT jobs.


ITAA also will assist in the identification of existing sources and thedevelopment of new resources that will provide guidance on how to recruit,train, integrate, and retain low-income women in IT jobs. This is another sourceof potential recruits for HR in the public sector.


And don’t forget the kids. ITAA has collaborated with Techworld PublicCharter School, an innovative high school (grades 9-12) in Washington, D.C. Itfirst opened its doors in September 1998 and now has approximately 150 studentswho have completed the ninth grade.


Most of the African-American students come from single-parent homes or havebeen raised by guardians such as aunts, uncles, or grandmothers. Public-sectoremployers can certainly compete with the private sector by offering e-mentoringor job-shadowing, curriculum development, internships, materials about ITcareers, and adjunct instructors.


“ITAA is urging the government to invest more funds in education andtraining,” says Olga Grkavac, executive vice president. Indeed, she says,the IT shortage in the federal public sector is quite alarming. It has emergedas one of the most serious concerns of chief information officers and othersenior government officials.


For example, the average age in federal government IT departments ranged fromlate 40s to early 50s. More than 50 percent of these employees will be eligiblefor retirement within the next three years.


“The federal government is facing a crisis in its workforce,” saysGrkavac. Reaching out to under-represented social groups may be one of the bestways to ameliorate the shortage.


New Mexico sets up an IT task force.


It’s no secret that the state of New Mexico has one of the lowest percapita personal incomes in the nation — approximately 79 percent of thenational average, according to the New Mexico Economic Development Department.”You have to be creative and use very limited resources,” says JudithSizemore, bureau chief for management information systems for the state’sDepartment of Labor. “Now that we’re in the world of the Web, ourcustomers [local citizens] are demanding efficient and intuitive onlineservices.”


Local area network administrators are the most difficult IT professionals torecruit, says Sizemore. These are specialists who can ensure seamless servicedelivery of information. Despite its limited resources, New Mexico was one ofthe first states to post personal income tax pieces online. Now the Departmentof Labor would like to automate all the pieces that link unemployment insuranceto other customer-service needs. “Currently, all of our systems areseparate. We want to migrate toward allowing individuals to register forunemployment benefits and work at the same time.”


In order to meet such goals, the state’s personnel office and office ofinformation/communication management formed the Information Technology TaskForce on Human Resources. Created two years ago, it comprised the director ofthe state’s personnel office, the state’s chief information officer, andthree senior IT managers, including Sizemore. “We made a professional dealthat if we saw somebody who didn’t match our job architecture, we’d sharethat candidate information with others. What turned out was a greatpartnership,” she says.


The task force identified three major objectives:

  • Establish an IT professional development program.
  • Establish an IT internship program.
  • Establish an IT mentorship (“Grow Your Own”) program.

Because of the state’s limited resources, Sizemore says, the Department ofLabor also relies a lot on word of mouth. “We try to use as many no-costavenues as possible,” she adds. However, when funding is available, HRrecruiters place ads in Computerworld and hang posters in university placementoffices.


What New Mexico can’t offer in terms of high salaries, it makes up for inits quality of life. Landscape aside, many native New Mexicans are returninghome, seeking simpler lifestyles for their families, having been scathed bycorporate downsizings.


“You’re not going to get rich working in the state publicsector,” admits Sizemore. “But you’re not going to face anotherout-of-business sale either.”


Monitor legislation on foreign worker visas.


On February 9, Senators Spencer Abraham (R-Michigan), Phil Gramm (R-Texas),and Orrin Hatch (R-Utah) introduced a bill entitled the American Competitivenessin the 21st Century Act. The bill seeks to build on the successes achieved inbipartisan 1998 legislation that increased the caps placed on visas for highlyskilled foreign workers, known as H-1B visas. Public-sector employers need tomonitor these pieces of legislation and weigh their merits.


In a press statement two months ago, Senator Hatch explained that the twogoals of the bipartisan legislation were to allow for a necessary infusion ofhigh-tech workers in the short term and to make prudent investments in our ownworkforce for the long term. The bill increases the cap on H-1B visas to 195,000visas over each of the next three years. It also would exempt individuals whocome to work in U.S. universities and those who’ve received advanced degreesin our educational institutions.


“We also need to redouble our efforts to provide training andeducational opportunities for our current and future workforce,” saidSenator Hatch. “Thus, we raise an additional $150 million for scholarshipsand training of American workers for these jobs, for a total of $375 million foreducation and training under this program over three fiscal years. Ourlegislation, in other words, seeks to address both the short- and long-termneeds.”


Harris N. Miller, ITAA president, praised the new legislation. “WhenCongress raised the H-1B annual ceiling to 115,000 in 1998, no one anticipatedan even greater escalation in the demand for IT workers,” he said. “It’stime for Congress to increase the cap again.”


The question for public-service employers, however, is whether you’veconsidered hiring foreign workers at all. If you have, don’t be too quick toassume it’ll be that easy. Says Temares: “These foreign workers have alsoheard of stock options.” In other words, you’re still going to have tomarket the benefits of the public sector: social service and quality of lifeversus the entrepreneurial road.


Regardless of which recruiting strategy you use, keep in mind that you’researching for IT workers with specific values. Public-sector workers placedhighest importance on interesting work, while private-sector workers ranked thatfactor as fourth in importance. Good wages ranked first among the latter group.


But public employees ranked salary as second in importance, according toresearch conducted at Indiana University in South Bend by Cynthia Sutton,assistant professor of management, and Katherine A. Karl, assistant professor inthe School of Public and Environmental Affairs. “Public organizations [alsocan] play up job security and long-term careers. While they may downsize, it’sto a lesser extent than private organizations,” says Sutton.


Given those assets, the public sector may not need a complete makeover afterall. Just a better PR machine — and a bigger bag of recruiting tricks.


Workforce, April 2000, Vol. 79, No. 4, pp. 62-70— Subscribenow!

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The Many Faces of e-HR

Here are some of the ways that human resources can benefit through electronic systems:


  • Portals can create a single interface for accessing key data.


  • Online recruiting can eliminate paperwork and speed the hiring process.


  • Employee self-service can automate record-keeping.


  • A Web-accessible knowledge base can reduce questions to the HR department or a call center.


  • Electronic benefits enrollment lets employees sort through options faster, while reducing paperwork and questions for HR.


  • Electronic payroll can cut costs and make data more easily accessible.


  • Trading exchanges and e-marketplaces can reduce the cost of products and services.


  • E-procurement can eliminate catalogs and manual processes that are expensive and slow.


  • Electronic travel and expense reporting can crumple the paper glut and speed reimbursements to both employees and the company.


  • Online retirement planning can help employees map out their future, while reducing questions and paperwork for HR.


  • Online learning can slash travel costs and make training available anytime, anywhere.


  • Competency management can help an organization identify strengths and weaknesses.

Workforce, April 2000, Vol. 79, No. 4, p. 46.


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Interview Questions Legal or Illegal

Employment application forms and pre-employment interviews are the appropriate instruments for eliminating, at an early stage, unqualified or unsuitable persons from consideration for employment.


However, applications and interviews can also be used to restrict or deny employment opportunities for women and members of minority groups.


Court rulings and Equal Employment Opportunity Commission (“EEOC”) guidelines prohibit the use of all pre-employment inquiries that disproportionately screen out members of minority groups or members of one sex and are not valid predictors of successful job performance or which cannot be justified by “business necessity.” See Griggs v. Duke Power Co., 401 U.S. 424 (1971).


The guiding principal behind any questions to a job applicant is: Can the employer demonstrate a job-related necessity for asking the question? Both the intent behind the question and how the information is to be used by the employer are important to determining whether a question is an appropriate pre-employment inquiry. That is to say, an employer should consider whether the answers to the question, if used in making the selection, will adversely effect and screen out minorities or members of one sex.


The following is a representative list of questions with a short analysis of each question to determine whether it is an unacceptable or acceptable question and why. It is not all-inclusive.


  1. How many children do you have?
    This question is inappropriate for two reasons.

    First, questions regarding marital status, number of children and childcare arrangements are not appropriate because they may be seen as being based upon the applicant’s gender. Under Title VII of the Civil Rights Act, it is unlawful to deny a female applicant employment because she has children or is planning to have a child at some future date. Second, this question is an inappropriate way of asking about an otherwise appropriate subject: availability to work.

    Questions asked to availability to work should be job-related. For example: What hours can you work? What shift(s) can you work? Can you work on weekends and/or holidays? Are there specific times that you cannot work? Do you have responsibilities other than work that will interfere with specific job requirements such as traveling?


  2. What country are your parents from?
    You may not ask an applicant where he/she was born or where his/her parents were born. You may ask if the applicant is eligible to work in the United States. Under Title VII pre-employment inquiries concerning national origin are not considered violations of the law in and of themselves.

    However, inquiries that either directly or indirectly disclose such information, unless otherwise explained, may constitute evidence of discrimination prohibited by Title VII. Some state employment practice laws expressly prohibit inquiries on employment applications concerning the applicant’s national origin. In some states, it may also be considered illegal to seek related data, such as the birth, place of birth or citizenship of parents, which could indirectly reveal national origin. 


  3. What is your native language?
    When an English language skill is not a requirement of the work to be performed, and an employer uses an English language proficiency test or requires English language proficiency, an adverse effect upon a particular minority group may result, creating a violation of Title VII.

    It is also inappropriate to inquire how an applicant acquired the ability to read, write or speak a foreign language. However, if the job requires additional languages, an employer may legitimately inquire into languages the applicant speaks and writes fluently. 


  4. What is your height? What is your weight?
    The EEOC and the courts have ruled minimum height and weight requirements to be illegal if they screen out a disproportionate number of minority group individuals or women, and the employer cannot show that these standards are essential to the safe performance of a job in question. See Davis v. County of Los Angeles, 655 F.2d 1334 (9th Cir. 1977), vacated and remanded as moot on other grounds, 440 U.S. 625 (1979); Dothard v. Rawlinson, 433 U.S. 321 (1977). 


  5. Have you ever been arrested?
    Questions relating to an applicant’s arrest record are improper, while questions of an applicant’s conviction record may be asked if job-related. The EEOC and many states prohibit the use of arrest records for employment decisions because they are inherently biased against applicants in minority groups in other protected classes.

    The EEOC has issued a Revised Policy Statement covering the use of conviction by employers in making employment decisions:

    First, the employer must establish a business necessity for use of an applicant’s conviction record in its employment decision. In establishing business necessity, the employer must consider three factors to justify use of a conviction record: (1) nature and gravity of the offense for which convicted; (2) amount of time that has elapsed since the applicant’s conviction and/or completion of sentence; and (3) the nature of the job in question as it relates to the nature of the offense committed.

    Second, the EEOC’s Revised Policy Statement eliminated the existing requirement that employers consider the applicant’s prior employment history, along with rehabilitation efforts, if any. The Revised Policy Statement requires that the employer consider job-relatedness of the conviction, plus the lapse of time between the conviction and the current job selection process.


  6. Do you own your own home?
    An interviewer should not ask if the applicant owns or rents a home or car, or if wages have been previously garnished, or if the applicant has ever declared bankruptcy, unless financial considerations exist for the job in question.

    Any employer who relies on consumer credit reports in its employment process must comply with the Fair Credit Reporting Act of 1970 and the Consumer Credit Reporting Reform Act of 1996.


  7. Did you serve in the military? What type of discharge did you receive?
    You may not ask what type of discharge the applicant received from a military service.

    You may ask whether or not the applicant has served in the military, period of service, rank at time of discharge, and type of training and work experience received while in the service. 


  8. How old are you?
    The Age Discrimination in Employment Act (“ADEA”) prohibits discrimination on the basis of age with respect to individuals over the age of 40. Requests that an applicant state his age may tend to deter older applicants, and may otherwise indicate discrimination based on age.

    Consequently, employment application forms which request information such as age will be closely scrutinized to assure that the request is for permissible purpose and not for purposes prescribed by the ADEA.

    Permissible purposes are limited to when age requirement or limit is a bona fide job application or is based on reasonable factors other than age. Under the EEOC’s Age Discrimination Interpretive Rules, requests for date of birth on the employment application are permissible, provided that an appropriate disclaimer is shown.

    In addition, any recruiting effort that is age-biased, such as seeking “recent graduates” or any question during the interview process that deters employment because of age is unlawful. 


  9. What church do you go to? What religion are you?
    There are no job-related considerations that would justify asking about religious beliefs or convictions unless your organization is a religious institution, in which case you may give preference to individuals of your own religion.

    In addition, inquiries as to the applicant’s religion are also not an appropriate method of determining availability to work. Employers have an obligation to accommodate the religious beliefs of employees and/or applicants unless to do so would cause undue economic hardship.

    The EEOC has determined that the use of pre-employment inquiries that determine an applicant’s availability have an exclusionary effect on the employment opportunities on persons following certain religious practices.

    Thus, questions relating to availability for work on Friday evenings, Saturdays or holidays should not be asked unless an employer can show that the questions have not had an exclusionary effect on its employees or applicants who would need an accommodation for their religious practices, that the questions are otherwise justified, and that there are no alternative procedures which would have a lessor exclusionary effect. EEOC Guidelines on Discrimination Because of Religion, 29 CFR 1605. 


  10. Are you a United States citizen?
    This question is not appropriate as a pre-employment inquiry.

    The EEOC Guidelines on Discrimination Because of National Origin indicate that consideration of an applicant’s citizenship may constitute evidence of discrimination on the basis of national origin.

    The law protects all individuals, both citizens and non-citizens domiciled or residing in the United States against discrimination on the basis of race, color, religion, sex or national origin.

    A person who is a lawfully immigrated alien, legally eligible to work, may not be discriminated against on the basis of his/her citizenship, except in the interest of national security, as determined under a United States statute or a presidential executive order regarding the particular position or premises in question. 


  11. Do you have any disabilities?
    The Americans with Disabilities Act (“ADA”) prohibits employers from asking disability-related questions to employment applicants. A “disability-related question” is any question that is likely to elicit information about disability. Under the ADA, an employer cannot lawfully ask an applicant whether he has a particular disability nor ask questions that are closely related to a disability.

    An employer, for example, generally may not ask an applicant whether the applicant will need reasonable accommodations for the job. An employer may not ask an applicant how many sick days he took with a previous employer; this question directly relates to possible disabilities.

    An employer may not ask an applicant about his worker’s compensation history. A question of this nature is viewed as relating directly to the severity of the applicant’s impairments. An employer may not ask an applicant about his current or prior lawful drug use. For example, an employer cannot ask an applicant, “What medications are you currently taking?”

    An employer may ask an applicant whether he can perform the essential functions of the job for which he is applying, with or without reasonable accommodation. Or ask applicants to describe how they would perform any and all job functions, as long as all applicants in the job category are asked to do this.

    When an employer reasonably believes that an applicant will not be able to perform a job function because of a known disability, the employer may ask the applicant to describe or demonstrate how he would perform the function.

    If the applicant has an obvious disability or voluntarily discloses a hidden disability to the employer, the employer may ask the applicant whether he needs reasonable accommodations and what types of reasonable accommodations he will need.

    For example, an applicant for a receptionist’s position voluntarily discloses that he has diabetes and will need to take breaks to take his medication. The employer may ask the applicant questions about the reasonable accommodations he will need, such as how often he will need to take breaks and how long the breaks must be.

    An employer should inform all applicants of the essential functions of the position and of the employer’s attendance requirements. The employer may then ask whether the applicant will be able to perform these functions and meet the attendance requirements. An employer may also ask about an applicant’s attendance record with a prior employer.

    This question is not considered to be disability-related, because there may be many reasons unrelated to disability why a person may not have met the attendance requirements of a previous job. 


  12. When was the last time you used illegal drugs?
    An employer may ask applicants about current and prior illegal use of drugs. An individual who is currently using illegal drugs is not protected under the ADA. For example, an employer may ask the following of an applicant: “Do you currently use illegal drugs? Have you ever used illegal drugs? What illegal drugs have you used in the last six months?”

    These questions are not likely to tell the employer anything about whether the applicant is addicted to drugs. On the other hand, questions that ask how frequently the applicant has used illegal drugs are likely to elicit information about whether the applicant was a past drug addict. An employer may not ask questions that refer to past drug addiction. 


  13. Do you drink alcoholic beverages?
    An employer may ask an applicant questions about his drinking habits, unless a particular question is likely to elicit information about alcoholism, which is a disability under the ADA. An employer may ask an applicant whether he drinks alcohol, or whether he has been convicted for driving under the influence of alcohol. These questions do not reveal whether someone has alcoholism.

    On the other hand, questions about how much alcohol an applicant drinks or whether he as participated in an alcohol rehabilitation program are not permitted. Questions of this nature are likely to elicit information about whether the applicant has alcoholism. 


  14. Have you ever undergone psychiatric evaluation?
    This is not an appropriate question.

    The EEOC enforcement guidance on psychiatric disabilities limits the questions asked of any applicant about any psychiatric disability.

    Under the ADA, the term, “psychiatric disability,” includes mental impairments, such as any mental or psychological disorder including emotional or mental illness. It includes major depression, bipolar disorder and anxiety disorders such as panic disorder, obsessive-compulsive disorder and post-traumatic stress disorder. A mental impairment also includes schizophrenia and personality disorders.

    As with physical disabilities, an employer is not permitted to ask applicants any questions that are likely to elicit information about a psychiatric disability. A limited exception comes into play when the employer reasonably believes that an applicant has a psychiatric disability for which the applicant will require accommodation.

    Generally speaking, an employer can only reasonably believe that an applicant will need accommodation if the applicant discloses his psychiatric disability to the employer during the hiring process or if the applicant tells the employer during the hiring process that he will need such accommodation. 


  15. Are you dating anyone right now?
    While this question may not be evidence of discrimination, interviewers should avoid questions of a personal nature. Personal questions are generally irrelevant to the hiring process, and may give rise to claims for invasion of privacy or sexual harassment.

    There should be some direct correlation between the information requested and the applicant’s ability to perform the functions of the job for which he is applying. If there is no legitimate business purpose for a question, don’t ask it.  


  16. When did you graduate from high school?
    This type of question can be considered an indirect inquiry as to an applicant’s age and may create an inference of age discrimination. While such a question does not inherently violate the Age Discrimination in Employment Act, a more appropriate approach is to simply ask the interviewee if he or she has a high school diploma or equivalent.

    Further, an employer must consider whether a high school education is necessitated by the duties and functions of the position for which applicants are being interviewed. The United States Supreme Court has found an employer’s requirement of a high school education discriminatory where statistics showed that such a requirement operated to disqualify blacks at a substantially higher rate than whites and there was not evidence that the requirement was significantly related to successful job performance.


    The standard applies to all groups protected under Title VII and to all questions related to educational achievement, if no job-related requirement or business necessity exists. While an employer may generally inquire as to the applicant’s educational background, there must be some degree of relationship between the level of education required for the position and the job duties of the position.


  17. Do you have any family members who work here now or who have worked here in the past?
    Information about friends or relatives working for an employer is generally not relevant to an applicant’s competence.

    Requesting such information may be unlawful if it creates a preference for relatives of current employees in the selection process and the composition of the present workforce is such that this preference reduces or eliminates employment opportunities for members of protected groups.

    As a general rule, however, unless an adverse effect on women or minorities can be shown, nepotism is not illegal. 


  18. What clubs or organizations do you belong to?
    As phrased above, this question is unacceptable because it could be seen as seeking information that is not job-related and which could relate to gender, national origin, religion or other status protected under Title VII.

    It would be more appropriate to ask: “What professional or trade groups do you belong to that you consider relevant to your ability to perform this job?” This question would elicit similar information, but only to the extent that it is relevant to the job in question. 


  19. What is your maiden name?
    This question could be seen as an inappropriate inquiry under Title VII because it indirectly asks a female applicant to disclose information regarding her marital status.

    Questions about marital status are frequently used to discriminate against women and to deny opportunities for female applicants. If you need to contact a former employer, you may, however, ask all applicants if they have ever been known by any other name. 


  20. What is your race?
    Title VII prohibits discrimination based on race and color. Again, pre-employment inquires concerning protected status are not considered violations of the law in and of themselves. However, this inquiry directly asks an applicant to disclose information regarding a protected characteristic, and, unless otherwise explained, may constitute evidence of discrimination prohibited by Title VII.

    An employer may legitimately obtain information needed to create and implement an affirmative action plan, or to meet other government recordkeeping requirements, or even for the employer’s own efforts to recruit minorities and/or women.

    The information should be kept separate from other employee records to ensure that it is not used to discriminate in making personnel decisions. One means of collecting such data that has been approved by the courts is the use of a “tear-off sheet,” which is an anonymous sheet that is separated from the application and used only for purposes unrelated to the selection decision.


If It’s Not Job-Related — Don’t Ask
Data on such matters as marital status, number and age of children, and similar issues, which could be used in a discriminatory manner in making employment decisions, but which are necessary for insurance, reporting requirements or other business purposes can and should be obtained if a person has been employed, not by means of an application form or a pre-employment interview.


It is reasonable to assume that all questions on an application form, or any pre-employment interview are for some purpose, and that selection or hiring decisions are made on the basis of the answers given.


When facing charges of discrimination, the employer bears the burden of proving that answers to all questions on application forms or in oral interviews are not used in making hiring and placement decisions in a discriminatory manner prohibited by the law.


The employer must establish that the questions do not seek information other than that which is essential to evaluation of an applicant’s qualifications for employment. It is, therefore, in an employer’s own self-interest to carefully review all procedures used in screening applicants for employment, eliminating or altering any not justified by business necessity.


This article is prepared in summary form and is not to be construed as legal advice or opinion on any specific fact or circumstance.


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Net Gains to HR Technology

Only a few years ago, Cari Willis was thrilled to have employees update their personal information online. The idea of automating a cumbersome and time-consuming process seemed like a breakthrough that could help revolutionize the HR department. And in many respects it did. “It was one of the first steps toward becoming an electronic human resources department and a better-run company,” says the manager of HR e-business solutions at IBM.


But one year’s headline is another year’s old news. No longer is it good enough to provide employee self-service. In order to meet the needs of more than 140,000 active employees and 116,000 U.S. retirees, IBM’s human resources department has migrated almost entirely to electronic tools. Benefits enrollment, retirement planning, succession planning, e-recruiting, online learning, competency management, and more have gone the “e” route. In addition, HR is now working to seamlessly link HR data to payroll.


“We have applied the vision and road map for IBM to the human resources department,” says Willis. “There is a tremendous value proposition in conducting transactions and business online. The goal is to become totally e-HR so that we can create greater value for everyone involved.” Already, human resources has slashed costs, shredded paperwork, and improved its ability to manage data efficiently. In fact, in today’s emerging digital economy, HR is quickly becoming a hub for corporate systems and data.


It’s no trivial matter. According to Forrester Research, business-to-business transactions could top $2.7 trillion by 2004. It’s a tectonic shift that’s allowing some organizations to supercharge revenues, gain millions of new customers, and boost their companies’ market capitalization to stratospheric levels. But only with the right architecture in place. And, increasingly, that requires HR data and systems that can support broad organizational initiatives.


That’s certainly the goal at IBM. The Riley, North Carolina, office hasn’t spared any effort to evolve toward a totally electronic future. Already, 40 percent of all active IBM employees handle their benefits enrollment through their Web browsers. They’re able to log on from work or home, click off selections, and navigate through the task within five minutes. “In the past, the process was disjointed and confusing. It wasn’t unusual for an employee to need days to figure out what to do,” says Willis.


For the company’s HR department, the paper-intensive process created its own set of nightmares. Human resources found itself sinking under the weight of various booklets and forms. Managing printing, mailing, and processing proved time-consuming and expensive. And the number of calls from perplexed employees had become overwhelming. Although call center reps are handling the same call volume as before, they’re fielding fewer inquiries, says Willis. “Today, they’re able to provide aid to those who need it the most.”


Analyze any of IBM’s other e-HR initiatives and the story is much the same. Big Blue is steadily transforming processes internally and beyond. (For more about IBM’s Optimas Award-winning program, see “Out of the Red, Into the Blue,” in the March 2000 issue of Workforce.) Willis notes that IBM has more than 500 data elements related to each employee. Although HR maintains a proprietary database that holds all employee records, other departments use the data for an array of purposes — from handling travel and expense reimbursement in finance to managing procurement approvals in the purchasing department. In every case, the data is routed electronically throughout the enterprise.


According to David Link, vice president of The E-workplace Initiative at the Baltimore-based Hunter Group, a well-designed enterprise resource planning (ERP) program or human resource management system (HRMS) is at the center of such efficiency. Increasingly, this central repository for data serves as a traffic cop for routing data, forms, and approvals to the appropriate person or department — usually with sophisticated workflow. “Though e-business within human resources is still in the early stages,” he says, “more and more employers are saying, ‘I need to get extended value out of the ERP.'”


Establish new boundaries.
Yet if an enterprise resource planning system is the brain of today’s organization, then the Web is the heart. It pumps data to all corners of a company, and beyond to the supply chain. It can cull disparate data from diverse systems and present it in new and valuable ways — via online reports or portals that serve as a window into information, knowledge, and key metrics. Equally important, the Internet can tie together seemingly unrelated systems to ratchet up the value proposition.


For example, an e-procurement system might use HR data to establish rules about authorizations and approvals. An operations system might access HR data to tweak staffing levels or help a company plan an expansion more effectively. It might also play a central role in designing more efficient production or sales methods.


This brave new world requires a different HR department than in times past. According to Thomas B. Hickey, a vice president for META Group Consulting, based in Westboro, Massachusetts, the walls between enterprise systems are crumbling. That’s making it necessary for human resources departments to understand the business side of IT, including the analysis and planning process.


Explains Hickey: “HR must ask itself, ‘Which systems offer the greatest payback and value, both within HR and for the organization? Which technologies and tools best integrate with other systems?’ It’s essential to understand how the various pieces of the enterprise puzzle fit together.”


It’s also essential to look outside the four walls of the corporation for opportunities. Employees can view electronic check stubs or their 401(k)s from PCs at home or work, even though the data might reside thousands of miles away on another company’s computers. The emergence of application service providers (ASPs) has also opened doors to new tools and capabilities, particularly for smaller firms that don’t have an IT department or cash to plunk down on expensive software. ASPs let HR departments rent software — ERP packages, time and attendance applications, benefits systems, and more — to run a department or even an entire organization.


Location means less and less.
To be sure, in today’s e-business-oriented world, it’s also irrelevant who oversees a process and where the computers reside. The key consideration is, who can manage a task most efficiently? That has led to new tools, such as Web-based trading exchanges, that are quietly redefining the way buyers and sellers come together. Many of these tools simply weren’t possible in a brick-and-mortar economy.


One such hub, TrainingNet, is a good example of how an e-marketplace can transform business-to-business transactions. TrainingNet aggregates various types of instruction — classroom, on-site, online, books, videos, and CD-ROMs — from over 1,200 providers. When clients, which include the likes of Harvard University, Lockheed Martin, Harley-Davidson, and Scientific-Atlanta, log on to the Web site they can select courses through TrainingNet’s e-commerce marketplace. Later, it’s possible to import data into a time-management system or ERP application. “It is a powerful way to access professional training opportunities … without adding complexity,” boasts Dave Egan, TrainingNet’s vice president of provider relations.


Genzyme Corp, a Cambridge, Massachusetts, biotechnology firm, turned to the system in 1999 to boost its e-HR capabilities. Previously, the company had operated its own training program, but that had proved costly and inefficient, explains Russell Campanello, senior vice president of HR. For one thing, employees from 20 Genzyme offices around the country had to fly into headquarters every time they needed instruction. For another, administering the program had become a headache. “In the past, the courses consisted only of what HR considered useful,” he says.


Using TrainingNet, the firm’s 3,500 employees can now locate courses close to home. When an employee logs on to Genzyme’s intranet site, he or she can search through more than 150,000 course offerings that the biotech firm has screened and approved.


But what sold Campanello and other company executives on the concept was the ability to dynamically adjust offerings in response to competency needs and actual demand. HR can view reports and plug data from TrainingNet into its PeopleSoft system for deeper analysis. It also can monitor how employees click through the site.


Developing such capabilities in-house would have been out of the question, says Campanello. “It would have been impossible to assemble the vendors or create all the courses.” But even a scaled-down homegrown training program would have met formidable barriers. “Getting the attention of IT to build a training intranet would have been impossible,” he states.


Nevertheless, the online education and training program is only one part of Genzyme’s ambitious electronic business strategy. Other e-HR programs include recruiting, retirement planning, health-care administration, and managing various policies and directories. Genzyme has also linked its HR data to payroll, security, and supply-chain management projects.


Take it a step at a time.
Larry Dunivan, vice president of HR systems at Lawson Software, believes that the revolution has only begun. “Dramatic changes are afoot in the way HR users interact with each other and the external buying community, thanks to the evolution of e-business.”


A good case in point, he says, is online recruiting. Not only is it possible to post a requisition to a system and have it go out to job boards such as Monster.com or HotJobs, but it’s also relatively easy to tie in ancillary activities such as real-time background checks, credit checks, and reference checks — all without human intervention. “The HR system itself becomes a portal for related services.”


Yet achieving outstanding results through e-business is anything but a slam-dunk. Link says that any HR department considering an e-business initiative must thoroughly understand the new economy. “In reality, e-HR touches every corner of a business. And it requires new tools, such as portals, to consolidate, manage, and deliver information efficiently. Ultimately, human resources must be aware of the dynamics of e-business in the marketplace.” That means viewing and analyzing Web sites of dot-com companies on a regular basis, and even thinking like a dot-com company.


Genzyme’s Campanello couldn’t agree more. He now focuses on thinking and reacting like an Internet start-up. “There’s no way to get e-HR systems operating at 100 percent efficiency right out of the gate,” he says. “The goal should be to hit 70 percent and improve things incrementally as you learn.”


Campanello also recognizes the importance of marketing — something that has made the Amazons and Ebays of the world household names in only a few short years. “E-business can succeed within an organization only if there’s a way to migrate customers from paper to computers,” he says. “People have to see value in what you’re offering them and have a reason to change the way they do things.”


More often than not, this new era of e-HR also requires cooperation and effort from all the various departments, and the support of senior management. It means creating task forces and implementation teams, as well as gleaning the expertise of outside consultants. And it requires an understanding of security and design issues. In the end, fitting everything together is not as simple as buying and installing best-of-breed programs. Detailed analysis and a thorough understanding of IT and strategic business issues are essential. “The Internet has raised the bar in terms of functionality and capabilities,” says Hickey.


Despite the many challenges, companies like IBM and Genzyme are proving that e-HR can redefine processes and elevate performance. It also can help transform technology into an asset that boosts the importance and value of human resources. Says Link: “Many HR departments have automated a few specific processes. The real gains will come over the next few years, as organizations evolve to a totally electronic workplace.”


Workforce, April 2000, Vol. 79, No. 4, pp. 44-48.


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Are You Ready to Outsource Staffing

Today’s HR departments are outsourcing everything from background checks toexit interviews. Though it isn’t new for these types of services to be handedto outside firms on an as-needed basis, what is new is that more HRadministrators are taking a macroscopic view of staffing.


They’re figuring out what can — and should — be done in-house versus whatcan — and should — be done more effectively outside the organization.Realizing that much of the staffing function is not the core HR competency itonce was years ago, many senior HR professionals are no longer keeping suchactivities as résumé management and candidate sourcing under their dailyscrutiny.


“What we had seen in the past is that companies would outsource aportion of their hiring process — like reference checking or testing,”says Terry Terhark, senior vice president of Chicago-based Aon Consulting Corp.’sHR outsourcing practice. “What we’re seeing more of today is [thatcompanies are] outsourcing the entire process.” He adds: “Staffingoutsourcing is continuing to grow at a faster pace than what it was.” AndTerhark thinks this trend will continue to pick up speed in the coming years. By2001, it’s estimated that $319 billion in corporate resources will lie outsideof corporate boundaries.


Human resources represented 16 percent of all outsourcing expenditures in1997 (the most recent figures available), according to “The OutsourcingIndex,” compiled by Murray Hill, New Jersey-based Dun & BradstreetCorp. and The Outsourcing Institute, a professional association and executivenetwork. Although it isn’t known exactly how much of the HR outsourcing piegoes to staffing activities, anecdotal evidence suggests that it’s a largechunk.


HR has also turned to outsourcing because staffing — especially recruitment– has become more complicated. “In the past 12 months, the recruitmenthorizon has changed more than in the previous 10 years,” says Kim Shepherd,president and CEO of Decision Toolbox, a multi-service recruitment,Internet-based applications technology, and advertising agency based in LongBeach, California. “Every time you turn around there’s a new searchengine, and HR’s trying to figure out which one to use and how to keepup.” It seems much easier to pass the function along to someone else.


However, it’s important for human resources leaders not to get caught up inthe outsourcing trend without taking a serious look at their staffingobjectives. Now, more than ever, employees are companies’ most valuableassets, and staffing an organization is a strategic HR function. Becauserecruitment is so critical in today’s tight labor market, it’s important toask: Should your staffing function be performed outside the organization? Has itdrifted far enough away from HR that it can be considered “non-core”?And whom can you trust to fulfill your staffing needs?


What’s core? What isn’t?


Overseeing the staffing function is key. However, carrying out the day-to-dayelements of it, as in the case of in-house recruitment, may not be.”Recruitment capability is core,” says Edward Ferris, “but notin-house — at least not when your staffing needs are high or cyclical.”


Ferris spent many years as a senior human resources professional in a varietyof organizations before becoming a management consultant and president of PlusUltra Inc., a management-consulting firm based in Doylestown, Pennsylvania.Drawing from his many experiences in outsourcing the recruitment part ofstaffing, Ferris thinks the following competencies are key:

  • Research capability to fill the candidate funnel
  • Qualifying to reduce the funnel to those with a good fit
  • Recruitment to convince good candidates to consider new opportunities
  • Pre-selection to make sure job candidates are a good fit with client needs
  • Process methodology to manage candidate inventory
  • Having good scripts
  • Having good data collection capability, reports generation, performancemetrics, and technology.

In addition, it’s important to have seamless communication links, datamanagement and knowledge repositories. “Few companies can, and should, pullall this off in-house,” says Ferris, but he admits: “Outsourcing ofrecruitment isn’t for everyone or all situations or companies. It certainlyhas worked for me. But it all hinges on finding the right partner who has theright mind-set, methodologies, and technologies.”


That’s exactly the position that Sue Hagen, vice president of humanresources for Dole Foods Inc., has taken on the issue of outsourcing thestaffing function. She has outsourced some recruitment tasks to DecisionToolbox, which has helped her with needs such as developing recruitment ad copy,recommending a recruitment ad strategy, placing ads, doing a first screen ofnetted résumés, and even making initial phone contact with potential jobcandidates.


In addition to outsourcing those services, Hagen says she prefers to usecontract recruiters for certain searches. “They’re helping not only toscreen and interview, but in some cases, flush through the job requirements withmanagers,” she says. And Dole also employs recruiters in-house. Right now,the balance between recruiters on staff and on contract is working well at Dole’sWestlake Village, California, headquarters.


But Hagen isn’t interested in outsourcing the entire staffing function.”We would keep open to looking at [doing that], but we consider people oneof the very strategic parts of our business,” she says. Dole, which employs53,500 people worldwide, hires approximately 30 to 50 new people at the company’sheadquarters each year. Adds Hagen: “I would be reluctant to [completely]outsource what I think is a very strategic part of running a business.”


Because the people on Hagen’s HR staff have lots of tenure with Dole, herteam has a good sense of what the open jobs entail, and what the Dole culture islike. “We wouldn’t necessarily be able to transfer that knowledge as wellto a third party if we were to completely outsource the function,” shesays. “I think if the demographics in my own department were such that wehad a lot of new people in HR, it would be a different situation.”


Which part of staffing should you outsource?


When deciding to outsource staffing functions, you should think about whichparts of the function are strategic, operational, or maintenance-oriented. Thendecide, of those pieces, whether you need to outsource the entire function orjust pieces of it, or to keep it all in-house.


The processes that most HR managers are tending toward outsourcing these daysare the more tactical ones, rather than the more strategic ones, such asworkforce planning. For example, activities such as résumé management andoffer-letter generation are tasks that don’t necessarily require internalexpertise to accomplish, and can be prime staffing-administration candidates foroutsourcing.


That’s exactly the tack that NCR Corp. has taken with regard to variousaspects of the staffing function. The Dayton, Ohio-based AT&T spin-offcompany, which deals with diversified computer products employs approximately33,000 employees, and hires about 3,000 to 4,000 new people each year worldwide.Because NCR has been transitioning to shared-services centers for the pastseveral years, the firm’s senior management team has recognized the benefitsof centralizing services. By gaining economies of scale, the firm can funnelresources — especially human resources — into other core business functions.


“Our decision to utilize an outsource vendor was linked to the fact that– and this is an across-the-company effort — we’ve taken a look at theactivities, processes, and functions that we have to perform inside the company,and we’ve decided which ones are core to our business and which ones we reallydon’t need to handle directly, that we could have an outsource vendor do forus,” says Dan Delano, director of HR operations for NCR. Delano manages NCR’sshared-services center in the United States. The center takes care of NCRpayroll, HR data management, and staffing administration.


Before NCR’s staffing function moved into the shared-services center, NCR’sHR staffing organization took care of all staffing activities. “It wasreally an issue of: How do we best utilize the resources that we have inside thecompany? We want to align the resources that we have as closely as we can tocustomer-facing, value-added roles around our core business,” Delanoexplains.


Now, NCR employs the Aon team to perform a variety of tasks: posting jobs toNCR’s internal job-posting board or externally through various Web sites,selecting good Web sites on which to post job requisitions, and managing theinflow of résumés from NCR’s recruiting activity with a Resumix system atits headquarters in Findlay, Ohio. Then, onsite at NCR, Aon manages theextraction of the résumés that are appropriate for the various job openingsand presents them electronically to the hiring managers. The managers take itfrom there.


But once a manager makes a hiring decision and wants to make an offer, theAon team gets involved again to generate the offer letter and coordinates allthe post-offer activity once the candidate accepts the job, such as initiatingdrug screening and background checks (which is taken care of by other vendors)and notifying the relation vendor if a relocation is necessary. They alsoprepare all the documentation required to put the new hire on NCR’s payroll.In addition, the Aon team sends out a welcome packet of information about thecompany. Aon also is responsible for responding to any unsolicited résumésthat come in over the Internet or by mail.


Although NCR has had this model in place for a few years, Delano says his HRteam is looking to update it. “In the staffing area, it’s very expensiveand in many cases inefficient to be looking to external recruiters. What we’relooking at in the future is perhaps redesigning our staffing model to havein-house recruiters and would also do a lot to automate the whole process. Forinstance, we’re looking at a lot of Web-based tools for recruitment in termsof résumé management and, in effect, moving away from paper-based résumés.As part of that process, we want to be able to implement a pre-assessment toolsthat would allow applicants online to assess themselves against the various jobsthat we have and determine whether or not they are right for the job.


“So, between the automation of the process, putting a lot of focus onthe Web and Web-based tools, and adding pre-assessment capabilities and in-houserecruiters, we can make the process a lot more efficient.” In addition,Delano says they would still look to outsourcing vendors for the kind of supportthey’re already using.


Finding the right vendor “fit” is critical.


Once you’ve decided which parts to outsource, perhaps the most importantdecision you’ll have to make is picking a vendor.


Here’s the ultimate nightmare: Your in-house recruiters or referencecheckers don’t understand the culture of the organization they represent,namely yours. “This happens all the time and can be very dysfunctional fromboth a process and an image point of view,” says Ferris of Plus Ultra.”It’s also one of the reasons that argues for outsourcing of staffing,because in outsourcing, by design, you’re creating an alliance and apartnership that builds closeness of understanding and relationship, andminimizes these issues. You collaboratively agree on standards and scripts andthe outsourcing company should act as your ambassador to the marketplace.”


The single most important aspect of the outsourcing vendor-selection processis finding a partner who intimately understands a company’s culture and itsgoals. In a word, the partner must fit with your company’s goals and culture.But first, you have to understand what your staffing and outsourcing goals are.


“We’ve learned some hard lessons in the past from some of our vendoroutsourcing, whether it’s staffing or other areas,” says NCR’s Delano.”You have to have a clear strategy of what you’re trying to accomplishand how you want to go about doing it. If you yourself don’t know what you’retrying to accomplish, whether it’s with an outsourcer or with in-houseresources, then you really are diminishing your potential for success.”


From there, figure out the processes that are needed to support those goals.”You can’t go out and ask a vendor to provide that support for youwithout a clear understanding of how it should be done,” Delano says. Thevendor also should be able to provide the customer with leadership around how toimprove the client’s processes. “The [vendor should] understand industrytrends and best practices and help the customer transition from a process they’vehad in place to a more effective outsource relationship,” says Delano.”We try to look at our vendors as partners — and when I say that, I meanwe’re looking for a two-way relationship.”


It’s just as important to find the right staffing outsourcing partners, asit is to finding the right employees. Here’s the skinny from consultants onhow to get the fit right. Do all of the following: establish clear criteria, setup a rigorous selection process, and involve line and staff in making thedecision based upon capability, systems methodologies, track record, financialstability, and culture.


Experts and HR managers who’ve been through the process suggest that HRmanagers put together an outsourcing “selection team” that comprises:

  1. procurement officers who qualify major suppliers
  2. subject matter experts to assure technical competence and quality
  3. customers who check out the suppliers’ track records, references, andpersonnel.

“We’ve typically established a long list, [of vendors] which may be asmany as 30 to 40 companies, and quickly shrunk it to a four to six that weinterview. Then we narrow it down to two or three finalists,” says Ferris.Visit the companies’ sites, talk to their people, and call their references.


Once you’ve made your decision, it’s important to be clear with thevendor what services they’re going to provide, what their performance levelsare and how they’re going to be measured, and what technology they’rebringing to the table.


In other words, clearly define the critical components that define therelationship, and put them in writing in a well-outlined contract. “If thatisn’t defined on the front end, you will suffer a lot of pain later,”says Delano.


Staffing an organization is a serious endeavor in today’s tight labormarket. Having good outsourcing partners can help HR with either tactical orstrategic workforce staffing activities. Knowing how to choose these vendorswisely can make all the difference between success and failure.


Workforce, April 2000, Vol. 79, No. 4, pp. 56-60— Subscribenow!

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Promoting Direct Deposit

The Direct Deposit and Direct Payment Coalition offers these ten quick and easy ways to increase your company’s Direct Deposit participation rate:

  • Use paycheck stuffers
    • several times a year to remind employees of the advantages of Direct Deposit.
  • Simplify sign-up
    • by placing brochures and sign-up forms in cafeterias, at reception desks and in other areas frequented by employees. Keep sign-up forms within easy reach of any promotional posters.
  • Use simple enrollment forms
    • . In surveys on Direct Deposit, some people have indicated that sign-up forms are too complicated.
  • Print reminders
    • about Direct Deposit on paychecks.
  • When sending out email bulletins
    • about Direct Deposit, include the sign-up form for employees to complete and return.
  • Offer Direct Deposit shirts
    • , mugs and other items to new employees as a reminder to complete the sign-up form included in their orientation kit.
  • Have human resource staff wear Direct Deposit buttons
    • or shirts on certain days, e.g., casual Friday, to keep Direct Deposit top-of-mind.
  • Offer incentives
    for human resource staff members to sign-up employees for Direct Deposit.

  • Check out NACHA: The Electronic Payments Association’s Web site (https://www.nacha.org/pubs-for-you) for more about promoting Direct Deposit within your company.
  • Tie your activities in with the official Direct Deposit and Direct Payment Week, May 15-19, 2000. More information is available at http://www.directdeposit.org/dd.html.

SOURCE

: The Direct Deposit and Direct Payment Coalition was formed to promote the benefits of Direct Deposit and Direct Payment to consumers, companies and the country. The coalition, composed of the Federal Reserve, NACHA: The Electronic Payments Association and regional ACH associations, sees Direct Deposit and Direct Payment as leaders in a system that is moving quickly to electronic payments of all kinds.

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Why to Offer Direct Deposit to Employees

In case your CFO needs convincing…


Direct Deposit can save your company money.


  • Companies can save up to $1.25 per payment by using Direct Deposit instead of checks.
  • Direct Deposit eliminates the cost of delivering checks to employees at different locations.
  • Direct Deposit eliminates the chance of lost or stolen checks and the resulting charges for stopping payment and check replacement.
  • To see how Direct Deposit can save your company money, use a Benefits Calculator available at www.directdeposit.org/companies/calculator.html

Direct Deposit can save your company time.


  • Direct Deposit makes payroll reconciliation easier and can help you streamline your tax reporting at the end of the year.
  • With Direct Deposit, there is no need for special check handling when employees are on vacation or out of the office.
  • Direct Deposit reduces time spent storing and securing unissued checks because check stock is not required for the payroll earnings record.

Direct Deposit can help your company gain productivity.


Studies show that some employees spend the equivalent of three workdays each year going to the bank to deposit their paychecks.


Direct Deposit benefits employees.


  • Ninety-seven percent of employees who use Direct Deposit are very satisfied with it.
  • The chance of your employees having a problem with a check is much greater than with Direct Deposit.
  • Direct Deposit is especially helpful for employees who travel and those who work from home because they collect their pay without visiting the office or the bank.

 


SOURCE: The Direct Deposit and Direct Payment Coalition, March 2000. The coalition was formed to promote the benefits of Direct Deposit and Direct Payment to consumers, companies and the country. The coalition, composed of the Federal Reserve, NACHA: The Electronic Payments Association and regional ACH associations, sees Direct Deposit and Direct Payment as leaders in a system that is moving quickly to electronic payments of all kinds.

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Four Great Reasons to Sign Up for Direct Deposit

Information you can use to communicate Direct Deposit to employees.

  • Direct Deposit is safe and confidential.

  • Payments made by Direct Deposit have never been lost. In fact, you are much more likely to have a problem with a check.
  • Direct Deposit is confidential. A check passes through many more hands than a Direct Deposit transaction.
  • Problems, which are rare, are quickly resolved. By contrast, problems with checks may take much longer to correct.
  • Direct Deposit is convenient and saves you time.
  • By using Direct Deposit, you may save the equivalent of three workdays each year by not having to go to the bank to deposit checks.
  • You don’t have to be in town for your money to be securely deposited into your account. No more extra trips to the office to pick up paychecks.
  • Direct Deposit is fast.
  • Direct Deposit gives many people access to their payments one to four days earlier than a check. There is no waiting for a check to clear.
  • Direct Deposit helps you manage your finances.
  • With Direct Deposit, you decide how to divide your pay among your accounts, and it will be done automatically each payday.
  • Direct Deposit gives you control. Financial planners recommend Direct Deposit as one step toward gaining control of your finances (it can be easier to save money when it’s not in your wallet).
  • Most employers will issue a payment stub that is identical to what you receive with a traditional paycheck. It will show how much was deposited into your account and how much was taken out for taxes, insurance and other items.

 


SOURCE: The Direct Deposit and Direct Payment Coalition, March 2000. The coalition was formed to promote the benefits of Direct Deposit and Direct Payment to consumers, companies and the country. The coalition, composed of the Federal Reserve, NACHA: The Electronic Payments Association and regional ACH associations, sees Direct Deposit and Direct Payment as leaders in a system that is moving quickly to electronic payments of all kinds.

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Frequently Asked Questions about Direct Deposit

Here are answers to some common employee questions.


Q: What is Direct Deposit and how does it work?


A: Direct Deposit is a safe, proven, confidential method of receiving a payment. Money is electronically transferred from a company or organization into your checking or savings account.


Q: How do I know when my payment has been deposited?


A: Most employers will issue a payment stub that is identical to what you receive with a traditional paycheck. It will show how much was deposited in your account and how much was taken out of your pay for taxes, insurance and other items. If your employer does not issue payment stubs, your bank will notify you within two days of receiving the Direct Deposit or will provide you with a telephone number to use to check the status of your deposits.


Q: When do I have access to the money?


A: Typically, your payment is available first thing in the morning on payday.


Q: If I use Direct Deposit, how can I be sure that no one will have access to my account?


A: Direct Deposit is a confidential way to send and receive payments. Although your company does have a limited ability to reverse your Direct Deposit payment, it can only access funds that were deposited in error, such as when the company has issued the transaction twice or issued a deposit in the wrong amount. Fewer people see your account information with Direct Deposit than with checks.


Q: Can I divide my pay among different accounts if I use Direct Deposit?


A: Yes. You can have your pay deposited into one account or split among several accounts. Decide once how you want your pay divided and your plan will be carried out automatically every pay period. This increases your financial control and discipline in saving for the future.


Q: If I have a problem with Direct Deposit, how do I solve it? Whom should I call?


A: Problems with Direct Deposit are rare. In fact, you are much more likely to have a problem with a check. But if any problem should arise, contact your employer or your financial institution. The problem can usually be corrected immediately.


Q: What happens if I change banks?


A: Just fill out a new authorization form with your employer and provide your written permission to switch accounts.


Q: Can my employer require me to use Direct Deposit?


A: The benefits of Direct Deposit are convincing enough for most employees who use it. However, the following 11 states do allow an employer to mandate Direct Deposit: Alabama, Kentucky, Louisiana, Maine, Mississippi, Missouri, Nebraska, North Carolina, South Carolina, South Dakota and Washington. Utah only allows mandates under certain conditions. Check your state’s labor codes for the most current information.


 


SOURCE: The Direct Deposit and Direct Payment Coalition, March 2000. The coalition was formed to promote the benefits of Direct Deposit and Direct Payment to consumers, companies and the country. The coalition, composed of the Federal Reserve, NACHA: The Electronic Payments Association and regional ACH associations, sees Direct Deposit and Direct Payment as leaders in a system that is moving quickly to electronic payments of all kinds.