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As more companies turn to wellness programs to try to gain an edge in efficiency and productivity, employers are still trying to figure out which programs are most cost effective and which will motivate employees to participate. But some trends are emerging.
The ERISA Industry Committee, the National Association of Manufacturers and IncentOne recently conducted a survey of 225 major U.S. companies employing 7.6 million employees to evaluate their wellness programs. It found that giving employees discounts on their premiums as an incentive to participate was falling out of favor. Premium discounts were the most popular incentive in last year's survey, but gift cards took the lead this year. Cash bonuses also were popular. And the incentives weren't skimpy. The average value of incentives per person per year ranged between $100 and $300, with an overall average of $192 per person per year, the survey found.
"Trinkets and T-shirts aren't enough to motivate employees for the long term," said John Engler, president and chief executive officer of the manufacturers association.
And employers are also more likely to reward program participation or completion than to reward reaching any one goal. Almost half of the companies responding to the survey offer rewards for simply participating in a program and 38 percent offered rewards for completing programs. Far fewer employers rewarded reaching specific goals set by those programs, such as losing a certain amount of weight or stopping smoking.
The survey also showed that the use of these programs is growing and that the vast majority of companies that have studied the return on investment in these programs say they are more than breaking even. These results back up the findings of other recent studies and surveys.
"The survey findings reveal that use of incentives among large employers is broad, but the science of incentives management is still evolving," said Michael Dermer, president and CEO of IncentOne. "Success in health and wellness programs will require employee engagement and motivation over time. That suggests a need for a combination of incentive design strategies and effective employee communication techniques that are tailored to a company and its employee culture."
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| The benefits of staying organized |
With all the complicated tasks that come with running a business, it is important to remember to take care of the simple things. A Vermont Catholic diocese is learning that lesson the hard way.
The Diocese of Burlington was recently ordered to pay $8.7 million after losing a negligence lawsuit brought by someone who said he was abused by one of the church's priests. But, according to a report from The Associated Press, the diocese's problems don't end there. The AP reported that the diocese can't find a copy of an insurance policy it says would cover part of the loss. The diocese now has sued its insurer to get a copy of the missing policy.
While this is an extreme example, it does illustrate the importance of proper record keeping. By taking some simple steps, it's easy to protect yourself from making a mistake like the diocese made.
* Make sure you keep one copy of your policy at your place of business and another at a second location, such as in a safety deposit box or with an attorney or accountant. This will protect your business in case of lost or missing paperwork or a fire or flood that destroys one of the copies. You also can scan your policies onto a secure server.
* Either the owner or a dedicated employee should be in charge of looking after your insurance policies and associated paperwork. This can be helpful not only in keeping track of records but in filing claims, paying premiums and dealing with premium audits.
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If your company uses a third-party vendor to manage e-mail or text messaging, a recent court ruling could make it more difficult to read your employees' messages.
In a somewhat confusing ruling that is sure to generate further litigation, the U.S. 9th Circuit Court of Appeals has ruled that bosses can't simply demand the content of e-mails and text messages stored on the computers of third parties. The court ruled that it doesn't matter if the company pays for the service, it still needs the employee's permission to look at the messages. The ruling doesn't apply to companies that manage their own e-mail on their own servers.
But the ultimate effect of the ruling, which hinges on the reading of something called the Stored Communications Act, isn't clear. First, the 9th Circuit only has jurisdiction in the western United States -- although its rulings can influence courts around the country. And legal experts have been debating the true meaning of the ruling since it was handed down in June. The bottom line for employers is that before you go rooting around in an employee's e-mails or text messages that are stored by an outside company, you should probably talk to a lawyer.
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| Think you drive well? Maybe not |
If someone asked, you'd probably say you're a good driver. In a recent study by Nationwide Insurance, 98 percent of drivers said they were safe when behind the wheel. But the same study also showed that more than 70 percent of those self-professed safe drivers admitted to doing something distracting while driving, from using a cell phone to eating. More than 40 percent said they have been hit or almost hit by someone talking on a cell phone.
The survey sited two major reasons for the prevalence of driving while distracted. First, there are simply too many technological distractions. Many people have a cell phone or another electronic device within easy reach while they are driving. Secondly, Nationwide pointed to a pressure people feel to pick up the phone when it rings. Almost two-thirds of cell phone using drivers said their families, friends and co-workers expect to be able to reach them at any time -- even when they are driving. And many said their fast-paced lives make it necessary to multitask while they are driving.
"We found Americans think they're safe drivers, even thought they admit to driving while distracted," said Bill Windsor, associate vice president of safety for Nationwide. "This dangerous false sense of confidence combined with current 'rules' making it socially and professionally unacceptable to not respond immediately to a call or e-mail, have made (driving while distracted) commonplace, but Americans need to realize that there is no such thing as (safely driving while distracted)."
Many interviewed for the survey said laws banning cell phone use in cars would help. Some also like the idea of technology that would prevent the use of phones in cars. But ultimately, the best way to be a safe driver is to take responsibility for yourself and put down the coffee and phone while your driving.
"When it comes to preventing distracted driving, laws, company policies and education are important, however, individual Americans -- whether we've had our license for four months or four decades -- are in the driver's seat when it comes to putting the brakes on (driving while distracted)," Windsor said.
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| ADA overhaul in the works |
An expansion of the Americans with Disabilities Act is rocketing its way through Congress. The House of Representatives recently passed the ADA Amendments Act by a significant margin and the bill enjoys bipartisan support.
The law, if approved in its current form, would effectively increase the number of people covered by the ADA and make it easier for them to prove workplace discrimination. The bill specifically outlaws the use of consideration of measures that reduce the effect of impairment, such as medication or prosthetics, in deciding whether someone has a disability under the law. The bill also seeks to broaden the reach of the law after it was narrowed by recent court decisions.
The bill is result of a compromise between disabled advocates, business groups and lawmakers. The changes are now supported by the U.S. Chamber of Commerce and the National Association of Manufacturers. The White House, through the Office of Management and Budget, issued a statement saying the administration broadly supported the aim of the bill, but still had "significant concerns" with some of its language. President Bush has not indicated he would veto it.
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| Growth on coast continues |
Even after several devastating hurricanes in the United States this decade and despite the potential risks global warming presents to American coastlines, the value of insured property along U.S. gulf and east coasts exposed to danger continues to grow at a rapid rate.
Between 2005 and 2007, the insured value of coastal properties grew at 7 percent a year, according to AIR Worldwide Corp. That rate of growth, which came despite a collapse in the real estate market, would lead to a doubling in value every decade.
"Overall, 38 percent of the total exposure in gulf and East Coast states is located in coastal counties, which accounts for nearly 17 percent of the total value of properties in the U.S.," the AIR report said. That kind of growth in value means the losses associated with hurricanes are only going to go up. New York and Florida have the most exposure along their coasts. Residential and commercial properties in both states have insured value of more than $2 billion.
As Hurricanes Katrina and Rita have shown, this kind of exposure along the coasts can lead to devastating problems for both businesses and insurers. The risks associated with coastal counties should be taken into account when businesses make decisions about locations and expansions.
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| Business briefs: Suits get easier |
It just got a bit easier for employees to successfully win age discrimination lawsuits. In a 7-1 decision, the U.S. Supreme Court ruled that the burden is on the employer to show that there is another "reasonable" factor, besides age, to take action against an employee. In this case an employer needed to lay off 31 employees. The company used a points system to rank each employee and laid off those who finished with the least points. All but one of the employees laid off was at least 40 years old. An expert witness showed it was nearly impossible for that to happen simply by chance. The ruling means that employers looking to take action with older employees will have to be more careful when doing so.
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| Business briefs: What's in a name? |
After weeks of flooding and devastation in the Midwest, some are worried that the terminology used to describe the disaster might lead some to believe that they are relatively safe from a future deluge. A scientist at the USGS Missouri Water Science Center told The Associated Press that the terms "100-year" and "500-year" floods have led some people to think that once they go through one big flood, they have had their once-in-a-lifetime disaster. The AP reported that after similar floods in 1993, some people dropped their insurance thinking another similar disaster couldn't strike again for many years. "We, the United States Geological Survey, almost need to quit using the term '100-year flood,'" hydrologist Gary Wilson told The AP. "It could happen twice a year, if you're unlucky."
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| Business briefs: Losses skyrocket |
It was a bad first quarter for catastrophic property losses in the United States. In fact, it was the worst first quarter in at least a decade, according to ISO, a provider of data and analysis for the insurance industry. U.S. insurers are expected to pay an estimated $3.35 billion in property losses from nine catastrophes, ISO said in a statement. Most of the losses were blamed on severe weather, such as tornadoes and flooding. The costliest event, at $955 million, was caused by severe weather that spread from Texas to Ohio in early February. The rest of the year isn't looking any better either. Flooding in the Midwest could easily top several billion dollars in losses.
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