Building Workplace Trust with Background Checks

Building Workplace Trust With Background Checks

Sponsored by Veremark

Trust. We all know it’s essential for a healthy, productive company culture. But as an HR or business leader, what steps are you taking right now to bolster workplace trust?

If you’ve been focused on other priorities, it’s time to take another look at what’s happening with trust among your ranks. Here’s why…

The State of Workplace Trust

Reliable sources tell us why trust deserves our attention:

  • According to Deloitte, when people trust their employer, they’re 260% more motivated to work and are 50% less likely to look for another job.
  • Gallup says employees who trust their managers are more likely to be satisfied, engaged, and productive at work. Yet only 21% of U.S. employees strongly trust their company’s leaders.

Managing trust requires finesse. And employees want leadership to play an active role — especially in these uncertain times. That’s why we’re looking closer at one way you can elevate workplace trust on today’s #WorkTrends podcast…

Meet Our Guest: Daniel Callaghan

Daniel Callaghan is the CEO of Veremark, an international background screening and pre-hire check service he founded in 2019 as an alternative to the weak solutions available at that time. Veremark is designed to give companies peace of mind and complete confidence when reviewing prospective candidates’ credentials or rescreening existing employees.

Here are highlights from our conversation…

3 Keys to Workplace Trust

Welcome, Daniel. You often talk about the 3 pillars of trust. Would you explain this concept?

Sure. Obviously, with the rise of virtual and hybrid work, the nature of employment is changing. It’s becoming more transactional, with shorter tenures. At the same time, cynicism is growing between employers and employees. So it’s increasingly important to build trust.

The first pillar of workplace trust is about getting the right people on your team.

The second is ensuring that everyone is acting ethically and with integrity. Trust isn’t one-sided. Both the company and employees need to be accountable.

And third, both parties need to know this relationship is reciprocal and valued for the long-run.

Research shows significant business benefits from trust. For example, employers that leverage these pillars see triple-digit productivity gains compared with low-trust companies.

How Employers Develop Trust

So what does it take to create a culture of trust?

Nothing happens overnight. But as you build on the framework we’ve outlined, it helps to look at how technology can facilitate trusted relationships.

For example, with the first pillar, background screening is important to ensure the right people are on your team. And a platform like ours can drive really impactful results.

Linking Background Checks With Workplace Trust

Could you tell us more about successful background screening works?

Credential verification is more than checking someone’s college grades. It’s about establishing a level of credibility and integrity, so you’re confident that a person is a safe workplace colleague and will add value to your culture.

First, start with the right objectives. You’ll want a positive mindset about why you’re introducing this process. It should be appropriate for your industry and roles.

For example, broader checks aren’t necessary for a low-risk business with low access to cash, and where someone is working from home. But for a financial services company that’s hiring lots of senior financial executives, you’ll want a more rigorous program that goes far beyond just ID, criminal, and credit checks on a domestic or global scale.

Second, choose a partner carefully. An outsourced provider ensures you’re not exposed to claims of discrimination, or misuse of data, or asking the wrong question in the wrong location. Domain experts with governance and compliance controls can avoid costly missteps.

Finally, you’ll want to do this with care. Job hunting is stressful for candidates and background screening is a necessary inconvenience. So make sure it’s as easy and transparent as possible. People should know where they are as they move through the process.

How Tech Improves Efficiency

You offer an innovative way to streamline verification, right? Tell us about that…

We know background screening is inconvenient for employers and candidates, alike. So why should you pay legacy services to recheck information that doesn’t change, such as your academic history?

We don’t think that’s fair. So we made it possible to turn verified data into digital credentials that candidates can use as a “career passport” to share with others in the future…

 


Learn More About Building Trust at Work

Find out how a more effective hiring process can strengthen your organization…
>> Get Veremark’s new ebook and claim your 10 FREE background checks now!

 


Listen to This Full #WorkTrends Episode

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Earned Wage Access - Why HR Leaders Shouldn't Fear This Breakthrough Benefit

Earned Wage Access: Why HR Leaders Shouldn’t Fear This Breakthrough Benefit

The pandemic and inflationary conditions are putting extraordinary pressure on workers to provide for their families. In fact, the U.S. government estimates that nearly 40% of citizens would struggle to cover the cost of a $400 emergency. What’s more, 60% of survey respondents told Bankrate they’re falling behind in saving for an unexpected expense. Even people with full-time jobs are struggling financially, and many are at risk of running out of cash between pay periods.

As a result, a growing number of employers are responding with creative solutions. Historically, bi-weekly or monthly payroll processing has been the norm. However, this can create problems for employees who live paycheck to paycheck, especially when unexpected expenses arise.

Are Payday Loans the Answer?

One solution involves payday loans, where employees borrow money from a third-party provider using their upcoming paycheck as collateral. However, there are predatory companies in this space that charge desperate people outsized fees. Even reputable payday loan companies charge hefty interest rates that are likely to create even more financial strain.

Thankfully, there is another opportunity for employees who are living on a paycheck-to-paycheck basis. It’s called earned wage access.

What Is Earned Wage Access?

This benefit ensures that people receive the money they’ve earned before the day they normally would receive their paycheck. How does this help? Imagine one typical scenario:

While waiting in the supermarket checkout line, one of your staff members realizes they don’t have enough money to cover all their groceries. After using their phone to request immediate access to a specific amount of money, the employee finds available funds in their checking account before they even get to the register.

In addition, thanks to advances in real-time payment infrastructure, human resource teams can offer this kind of benefit without changing the way they process payroll. By working with your financial institution and payment processors, you can implement earned wage access via real-time payments, instead of through traditional ACH payments.

5 Benefits of Earned Wage Access

Earned wage access is attractive to employers and employees, alike. Here are 5 compelling reasons why:

1. Employees Increasingly Expect it

During the pandemic, people who were laid off or needed an extra income stream often turned to gig-based jobs. Many gig economy companies pay people daily, or immediately when they finish a job. So, not surprisingly, these workers now prefer similar payment terms for their full-time jobs.

2. It is a Strong Recruiting Tool

Earned wage access is quickly becoming the norm. 70% of middle-market companies already offer this capability, and about 25% are planning to implement it soon, according to a 2022 Citizens Bank payments survey. In today’s competitive talent market, this growing trend puts companies at a disadvantage if they don’t provide it.

3. It Helps Boost Employee Retention

Once employees are onboard, earned wage access helps reduce “quiet quitting” as well as other forms of job dissatisfaction and disengagement that contribute to turnover. In fact, according to research from DailyPay, 59% of people with on-demand access say it motivates them to go to work. As a result, employers that offer this capability have improved their tenure rates by as much as 73%.

4. It Gives Employees Peace of Mind

78% of people with access to earned wages say it helps them pay bills on time and avoid late or overdraft fees. When people have instant access to the money they’ve earned, it helps them avoid falling behind on bills or experiencing other money burdens.

This means they’re less likely to be distracted by financial worries throughout the day and are more likely to focus on their job responsibilities. In fact, 74% of users say access to earned wages has helped reduce financial stress.

5. It Enhances Financial Wellness

Organizations naturally want to avoid putting employees in financial jeopardy. This is why many are educating staff to think of earned wage access as a “break-in-case-of-emergency” option, rather than a standard way to manage their income.

To support this mindset, many employers introduce earned wage access in tandem with financial literacy training. This helps employees learn about on-demand pay within the broader context of personal financial management.

As a result, they begin to view earned wage access as a “fallback” option in unusual circumstances, when immediate access to extra cash is necessary. In fact, according to one survey, 51% of users say on-demand wage access has helped improve their financial health, and 50% say it has helped them become more disciplined about spending.

The Bottom Line on Earned Wage Access

To recruit and retain talent in today’s challenging labor market, employers are increasingly turning to unique, practical perks that make life easier for employees. This is why earned wage access is quickly changing from a nice-to-have advantage to a must-have benefit for employers who want to remain competitive.

Fortunately, introducing this special pay option doesn’t require HR and financial teams to do anything differently. All you need to do is ensure that your organization works with payment providers who offer this service. As you roll out earned wage access, you can expect employees to respond with a stronger commitment to their work, and a deeper desire to remain with an employer that cares about their family’s financial health.

Navigating the Affordable Care Act - Strategies and Best Practices for Employers

The Affordable Care Act: Employer Strategies and Best Practices

Sponsored by ADP

The Affordable Care Act (ACA) has transformed how employers offer and deliver healthcare to their employees. Whether you’re an established employer who’s been tackling the ACA’s myriad regulations since Day One, or a newer employer navigating them now, there are two elements you can’t overlook. First, compliance isn’t an option, it’s a must. Second, the ACA isn’t simple — and there’s a lot to know.

The risks of ignoring or getting ACA regulations wrong include potentially costly penalties, as well as tarnishing your carefully built employer brand. The good news is that there are plenty of resources in place for getting it right, from information to experts to technology. Read on for some tips on the best practices and strategies employers need to know to comply with the ACA.

The Affordable Care Act Explained: A Comprehensive Mandate 

Signed into law in March of 2010 by President Obama, the Affordable Care Act established a mandate that changed the nature of employment, scaffolding a platform of healthcare offerings — and plenty of risks around non-compliance.

Size Matters

The bigger an organization, the more complex healthcare offerings are going to be, in general. The same is true with ACA compliance risks. But smaller organizations aren’t exempt. While not required to offer health coverage for their employees, if they do offer coverage, it must conform to ACA standards. For smaller businesses trying to attract and retain talent by offering benefits comparable to larger competitors, staying in compliance is critical.

1. Smaller Organizations

The ACA defines smaller organizations as those with less than 50 full-time or full-time equivalent employees. According to U.S. Census Bureau data published by J. P. Morgan Chase, nearly half of U.S. employees — 47.3% — work for small businesses. Most smaller businesses are very small: 88.1% have under 20 employees.

Smaller organizations may be eligible to offer their employees health insurance through the Small Business Health Options Program (SHOP) Marketplace. This marketplace provides a platform for small employers to explore and purchase health insurance plans for their employees, with the ability to easily compare plans, access enrollment tools, and potentially qualify for small business tax credits.

If an organization has less than 25 full-time equivalent employees, and the sum total of average annual wages falls below a certain threshold (which changes year to year), it may be eligible for tax credits under the Small Business Health Care Tax Credit to help offset the cost of providing health insurance coverage to employees.

2. Larger Organizations

Any employer with 50 or more full-time or full-time equivalent employees is considered an applicable large employer (ALE) according to the Affordable Care Act. ALEs need to offer at least basic health care coverage — known as minimum essential coverage (MEC). They also need to meet the ACA’s Employer Shared Responsibility Provisions, which mandate that health insurance coverage is offered to at least 95% of the organization’s full-time employees and their dependents.

The ACA describes mandated coverage as “affordable” and “adequate” — terms that can’t be ignored. Employers are prohibited from placing the burden of excessive costs onto employees (as in unbalanced cost-sharing).

Affordability criteria apply to all employers: essentially, it’s correlated to an employee’s required contribution for coverage, which is no more than 9.12% of that employee’s household income in 2023. As for adequate coverage, it must conform to ACA standards and include essential health benefits.

Timely Reporting and the Right Forms

Employers face a range of reporting requirements, including accurate documentation, timely, careful reporting of employee information, and filing by the deadline with the IRS and other state agencies. Most organizations will want to work with ACA experts to make sure they’re complying with the ACA’s strict and complex reporting requirements. There are layers of information to address correctly, along with periodic changes to adjust to as the ACA is updated.

While small employers don’t have to file the same IRS forms as large employers (see below for those), they may be required to provide a Summary of Benefits and Coverage (SBC) to their employees, as well as other information. Again, it’s important to stay up to date to meet transparency requirements, avoid penalties, and receive certain tax credits.

As for large employers, along with various forms for state agencies, they need to file:

  • 1095-C form with information on what the coverage offers, employee eligibility, and coverage affordability;
  • 1094-C form that summarizes information on the 1095-C, and includes an overview of compliance with ACA requirements as well as the number of employees covered;
  • 1095-B form for health insurance providers and self-insured providers, which includes information on people covered under their health plans, duration of coverage, period of coverage, and other details.

These forms are usually filed at the end of February or March (if filed digitally) of the next calendar year for the year before. That means the right forms have to be provided to employees by January 31. (As with all things IRS, best not be late. Read on…)

Employer Penalties and Risks 

Depending on the size of your organization and the level of non-compliance with the ACA, you could be looking at substantial penalties.

Calculate your potential risk with ADP’s ACA Compliance calculator.

  • For smaller organizations, the penalties are understandably smaller in scale. But there are consequences if, for instance, they fail to provide affordable coverage, or if an employee qualifies for a premium tax credit through the Health Insurance Marketplace — since they didn’t have access to affordable health care coverage through their employer.
  • For large organizations, as of 2023, an ALE that doesn’t meet the 95% compliance requirements for full-time or full-time equivalent employees and their dependents could face a 4980H(a) penalty. This is a yearly penalty of $2,880 (or $240 for each month) per full-time employee,minus the first 30 employees. An ALE that provides unaffordable employer-sponsored coverage, provides coverage that doesn’t meet minimum value requirements, or has one or more full-time employees who receive subsidized coverage through the exchange could face a 4980H(b) penalty. This is a yearly penalty of $4,320 divided by 12 for each full-time employee who receives subsidized coverage through an exchange in a month.

Staying in Compliance: 6 Best Practices

Ensuring compliance with the ACA takes a multi-pronged approach, from staying on top of eligibility information, to meticulous documentation, to leaning on an expert team, to leveraging the best technology. Consider these six best practices as part of your ACA strategy:

1. Dive into Employee Eligibility

This isn’t a guessing game. Employee eligibility criteria involve multiple factors, including hours worked and full-time or part-time status. Full-time means those working at least 30 hours a week or 130 hours a month, on average. Full-time equivalency looks at the combined hours worked by part-time employees.

2. Manage Affordability

Stay on top of affordability requirements as they change year to year, and make sure you understand the ACA’s definition of affordability. Employers should also regularly review their coverage to make sure it’s still within affordability parameters, since healthcare costs are rarely fixed. Be proactive at monitoring costs so you don’t wind up in noncompliance.

3. Maintain Documentation

Create a system for keeping all documentation related to ACA. Retain all records on eligibility, coverage offers and any changes made to health plans. Keep all documentation on affordability calculations and credits, as well as communication with employees.

Retain all reports and forms, and include details about when data was filed, what data was filed, and other pertinent information. Whatever format you use — such as electronic folders or Cloud-based storage — make sure it’s secure, accessible, and permits easy, fast retrieval. Establish document retention protocols that meet industry best practices as well as your organization’s own internal practices.

4. Conduct Continuous, Careful Reporting

Timely and accurate reporting of required information is crucial for ACA compliance. Stay updated on reporting deadlines and be ready to provide the necessary documentation in compliance with ACA regulations. Another trigger for penalties is not filing accurate or on-time information returns with the IRS and applicable state agencies. A shoddy reporting system could be expensive.

 5. Build a Team You Trust

A thorough compliance strategy team can provide the critical support employers need to navigate the ACA’s complexities. It ensures that a business can benefit from a breadth of expertise, establish a coordinated approach, and stay on top of regulatory changes and developments.

The presence of an ACA team can also encourage compliance across multiple tiers and locations of a larger organization, establishing a single source of truth, as it were, along with a consistent, timely, organized strategy. Adherence isn’t always a simple matter. As with all complex regulations, there may be gray areas and there will likely be questions. How effectively and quickly these can be addressed could make all the difference when it comes to avoiding penalties.

6. Harness the Power of a Digital Platform

Combining a team that understands ACA compliance with digital tools that streamline ACA compliance processes is a win for any organization. It enables employers to focus on core business operations without losing sleep over ACA compliance risks. A robust platform designed to simplify and optimize at the same time can offer a range of functions covering everything from reporting and forms access to data hygiene and updates. It’s a highly effective approach to mitigating risk and minimizing compliance gaps.

What to look for in an ACA compliance platform? Look for a system packed with the right features. Look for automation that makes it easy to generate ACA forms with accuracy — that, alone, can be a game changer. Make sure the platform offers integration and data management between HR, benefits administration, and ACA reporting tools, as well as a central, safe location for records and data management.

Real-time monitoring and reporting, easy-to-use dashboards and analytics can provide of-the-moment status and progress, and support timely compliance. Tools for calculating potential risks and penalties can shed light on questions quickly and support better decision-making. As with any modern platform, an array of integrated features means an employer is well-supported. In this case, integration is essentially table stakes.

If You Get a Penalty Notice

The most important first step to take if you receive a penalty notice is to respond quickly. Then, reach out to your team. And if you don’t have an ACA team of HR professionals or dedicated, trusted ACA experts, this is when you’ll need it.

Lean on your team for guidance on how to best establish a plan of action. Focus on responding with thorough due diligence and correct documentation. Make sure the reasons for the noncompliance finding are clear, and carefully address and resolve each requirement detailed in the penalty notice with your team’s support.

The Affordable Care Act: New Landscape, New Complexities, New Changes

Like many transformative pieces of legislation, the ACA is anything but static. It’s a continually iterating set of requirements and standards. Established with the best of intentions, it undoubtedly raised the bar for what employers offer in terms of healthcare to their employees, as well as how much time, care, and effort goes into administration.

At the same time, modern organizations are dealing with the pressure to stay competitive, stay relevant, attract and retain strong talent, and grow in the new world of work. Healthcare as an industry has also changed — and its evolution continues.

The keys to navigating the ACA in this environment are adhering to best practices, reaching out for external expertise, and leveraging the best digital solutions available. It’s this combination of resources that will most effectively streamline compliance efforts, reduce risks, and provide the most comprehensive and affordable healthcare to your workforce.


Learn more about compliance with The Affordable Care Act from ADP’s ACA experts in this on-demand webinar: “The ACA and Health Care Reform: Federal and State Developments.”