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  • The country’s boom and bust cycle has led to hundreds of thousands of layoffs across the country in recent months. Technology and media-related organizations have taken the majority of headlines in this regard, including household names and employers such as Amazon, Microsoft, and Google. A layoff is the temporary or permanent termination of employment by an employer for reasons unrelated to the employee’s performance.

    Coming off the end of the year, many companies are currently reviewing annual budgets and attempting to adjust overhead costs to increase (or create) profitability. If this sounds familiar to your situation, it’s crucial that you proceed with caution. Avoid stumbling over legal issues that could cost your business more money than the money you’re trying to save by laying off your employees. Continue reading to understand the most common mistakes business owners make when they lay off employees.

    Failure To Follow Legal Requirements

    Business owners must follow legal requirements when laying off employees. One of the most common mistakes business owners make is being unaware of the Worker Adjustment and Retraining Notification (WARN) Act. The WARN Act helps ensure advance notice in cases of qualified plant closings and mass layoffs. The U.S. Department of Labor has compliance assistance materials to assist workers and employers in understanding their rights and responsibilities under the provisions of WARN.

    The following are frequently asked questions when it comes to complying with the WARN Act:

    Am I covered by the WARN Act?

    This act requires employers with 100 or more full-time employees to provide at least 60 calendar days advance written notice of a worksite closing affecting 50 or more employees or a mass layoff affecting at least 50 employees and one-third of the worksite’s total workforce.

    If I’m considered a temporary layoff or furlough, do I need to provide workers with a notice under the WARN Act?

    A WARN Act notice must be given when there is an employment loss, as defined under the Act. A temporary layoff or furlough that lasts longer than six months is considered an employment loss.

    Will the Department of Labor provide me with a letter stating that I have complied with the WARN Act?

    Additional questions and answers can be found here. Failure to follow legal requirements can result in legal action against the business and could potentially damage your business’ reputation.

    Not Having A Clear Plan

    If you’ve come to the unfortunate realization that you are considering or have considered laying off employees, it’s critical that you have a plan in place. Be sure to document the process in which you choose and the steps you will take to ensure it’s the same for every layoff. Consider adding the following to your plan:

    • Intended post-layoff organizational structure
    • Business objectives
    • Identify job positions that are unnecessary or redundant 

    This ultimately helps you create a documentary record and avoid the legal risks caused by discrimination claims. Laying off employees is a significant decision that requires careful consideration and planning. Business owners need to have a clear plan that outlines the reasons for the layoffs, the process for selecting employees to be laid off, and the support that will be provided to the remaining employees.

    Hiring Replacements To Fill “Eliminated” Positions

    While you may already know this, it’s important to remind yourself that you should not eliminate a position and then fill it shortly after. The consequence could be a lawsuit on your hands and, most likely, hefty costs headed your way. The lawyer could argue that when you “eliminated” the position, it was a pretext for discrimination as you went and hired another individual for that same position shortly after. If you lay off an individual because you’re eliminating their position, then do just that. After six months, you can reevaluate the need.

    Not Communicating Effectively

    A common mistake business owners make when laying off employees is not communicating effectively. This should come as no surprise. When employers don’t communicate effectively, it leads to confusion for the employees you lay off. If it comes down to the fact that you’re making more money, why are you laying off your employees?

    To avoid this mistake, be clear about why you are laying off your employees. If you feel that appeasing your shareholders is more important than keeping individuals employed, explain that to these employees. It’s important to be honest and transparent about the reasons for the layoffs and their impact on the business and its employees. Failure to communicate effectively can lead to confusion, resentment, and distrust among employees.

    No Support For Those Who Are Affected

    Amidst a massive layoff season for large companies, we see many of these businesses lacking support for their laid-off employees. HR departments and management teams have decided to scale back what they spend on support, such as career coaching, for those affected by the layoff.

    Layoffs create a stressful and uncertain environment for employees. As a business owner, you should provide support and resources to help them through this challenging time. Consider providing them with access to the following:

    • Counseling services
    • Financial advice
    • Career coaching
    • Employee assistance programs (EAP)

    On the other hand, keep your support relevant. Remember in early 2022 when Peloton laid off about 20% of its workforce but gave them a free annual Peloton membership on their way out? Employees, and customers alike, were appalled by the company’s misstep. Support is good, but proper support is better.

    Not Considering Alternatives

    Business owners should always consider alternatives to layoffs before making a final decision. Currently, many businesses are tightening their belts and searching for methods to reduce costs without resorting to employee layoffs. While layoffs provide immediate savings to the organization, they ultimately come with long-run costs that businesses can suffer for years.

    So, if you’re leaving layoffs as a last resort, there are a variety of alternatives you can take to put your company in a position to navigate any obstacle thrown your way. Consider the following alternatives:

    • Furloughs
    • Offer employees a voluntary short-term sabbatical
    • Consider pay cuts
    • Establish a hiring freeze
    • Offer early retirement 
    • Cut work hours
    • Reduce insurance premiums

    Not considering these alternatives can have a negative impact on the morale and motivation of the remaining employees.

    How A PEO Can Help During These Challenging Times

    Laying off employees is never an easy decision for any business owner. It can be a difficult and emotional process; however, it’s sometimes necessary for the survival and success of your business. If it comes down to laying off employees, avoid these common mistakes mentioned above. Fortunately, when you partner with a professional employer organization (PEO) such as Group Management Services (GMS), we help you avoid these common mistakes. GMS experts provide you with the guidance and support you need. We ensure you follow legal requirements, communicate effectively, explore alternatives to layoffs, and support remaining employees. Contact us today to learn how we can help you during these challenging times.

     

    Frequently Asked Questions

    What’s the difference between a layoff and a furlough? 

    A layoff is the elimination of a position. A furlough is a temporary unpaid leave of absence or reduction in hours typically resulting from a lack of work or budget cuts. 

    When can I lay off employees? 

    If you’re expecting or seeing a significant decrease in business sales, you can institute layoffs. This looks different for every organization but may include one or more of the below situations: 

    End of a contract or a season

    End of casual/part-time work

    End of the school year

    Temporary shutdown of operations

    Permanent shutdown of operations

    Position eliminated/redundant

    Company restructuring

    Employee bankruptcy or receivership

    What will employees be paid on? 

    Employees terminated without cause and on layoff will likely receive employment insurance (EI). For most individuals, the basic rate for calculating EI benefits is 55% of the average insurable weekly earnings, up to a maximum amount. 

    Can my employee work while on EI? 

    Yes, you can recall employees for short periods of work, but it must be under a week. 

    How long is a layoff for? 

    The maximum time for a temporary layoff has been extended from 60 to 120 days to ensure temporarily laid-off employees stay attached to a job longer. This change was retroactive for any temporary layoffs related to COVID-19.

    How do I recall employees back to work?

    Employers must provide a written notice to the laid-off employee, and it must include the following:

    Be in writing

    Be served on the employee

    State that the employee must return to work within seven days of the date the recall notice is served on the employee

    How are positions identified for layoff? 

    Before implementing a layoff, agencies conduct workforce planning processes. The Department Director or Administrator must determine which areas will be affected based on the following criteria:

    Geographical location

    Class series

    Class and applicable option

    Full or part-time positions

    What information is included in a layoff notice? 

    A layoff notice must include transfer or displacement options for:

    Statewide transfer within your department

    Voluntary demotion to another position within the department and geographical location

    Move back to the most recent former class

    How much notice of layoff should my employees get?

    Permanent employees must be given a minimum of 30 days written notice.

  • Earlier this month, the California Occupational Safety and Health Appeals Board (OSHAB) announced that outdoor job sites must contain accessible potable drinking water. Water must be placed within close proximity to where employees work. It was determined that outdoor workplace drinking water must be located “as close as practical” to areas where employees are working, which encourages frequent hydration.

    On February 6th, 2023, OSHAB clarified that the term “as close as practicable” in terms of providing water to prevent heat illness means that the water must be as close as reasonably can be accomplished to encourage frequent water consumption. Millions of U.S. workers are exposed to heat in their workplaces or job sites. Although exposure to heat is preventable, thousands become sick from occupational heat exposure every year, and in some cases, it’s fatal. Most outdoor fatalities, 50% to 70%, occur in the first few days of working in warm or hot environments because the body needs to gradually tolerate the heat over time. The Occupational Medicine and Wellness center states that workers should drink five to seven ounces of water every 15 to 20 minutes to prevent dehydration.

    Help Your Employees!

    If you have employees that are working endless hours outside, especially in the heat, it’s essential that you take steps to prevent them from getting injured on the job. Providing your workers with easy access to water while on the job site is one of the easiest steps you can take to protect your workers. Our safety experts ensure you remain compliant and take every step possible to protect your biggest asset – your employees. Interested in learning more? Contact us today.

  • Despite the ongoing construction boom, the construction industry faces several challenges in today’s economy. There continues to be a shortage of building materials, paired with prices spiking significantly, which drives up project and rebuilding costs – not to mention the cost of labor due to a nationwide workforce shortage. With all those factors paired together, construction costs continue to skyrocket.

    Businesses within this industry are engaged in new construction or reconstruction activities, including the repair or renovation of existing commercial and residential structures, roadways, and bridge construction. The following are typical work activities in the construction industry:

    • Painting
    • Roofing
    • Siding
    • Sheet metal
    • Water well drilling 
    • Installation of flooring
    • Landscaping
    • Sandblasting

    How A PEO Can Help Your Business During These Challenging Times

    Despite these challenges, the construction industry is expected to grow rapidly within the coming years, driven by factors such as urbanization, population growth, and government investment in infrastructure. Businesses within this industry must adapt to these challenges to remain competitive and meet the needs of a rapidly changing economy.

    Follow along to see the additional challenges these businesses face and how a professional employer organization (PEO) can help you overcome them.

    Regulation

    Laws and regulations are constantly changing and affect many construction businesses. If you have a business operating in multiple states, you must comply with all laws in each state. Business owners often have difficulty juggling the different legalities, which leads to costly fines. It’s easy to miss an update about a change in the current laws and/or new legislation relevant to you. When you partner with a PEO, you’re provided with HR experts who ensure you comply with these ever-changing rules and regulations, so you focus on other aspects of your business.

    Minimize accidents in a high-risk industry

    It’s no surprise that this industry is prone to accidents which can lead to hefty penalties. While falls continue to be the top cause of injury on construction job sites, the Occupational Safety and Health Administration (OSHA) compiled a list of the most common violations they see within the construction industry, including:

    • Fall protection, general requirements 
    • Hazard communication 
    • Scaffolding
    • Lockout/tagout
    • Respiratory protection 
    • Ladders
    • Powered industrial trucks 
    • Fall protection, training requirements 
    • Machine guarding 
    • Personal protective and lifestyle equipment, eye, and face protection

    Failing to provide your employees with safety standards enforced by OSHA, you could face hefty penalties. In 2022, the average penalty for a willful or repeated violation was $145,027. While all of this can have detrimental effects on your business, there are ways you can mitigate these risks. It’s essential that you have safety programs for injury prevention. Without a healthy and efficient workforce, you cannot keep operations running and thriving. Partnering with a PEO takes all of this off your shoulders. A PEO takes a proactive approach to workplace safety through various services, including the following:

    • Onsite consulting 
    • Jobsite inspections 
    • Accident and injury investigations
    • Training
    • OSHA inspection and citation assistance
    • And so much more

    At the end of the day, partnering with a PEO allows you to dedicate more time to monitoring and coaching employees through safety best practices.

    Retaining and recruiting top talent

    As employees continue to leave their careers for better opportunities, it’s essential that you find ways in which you can stand out from your competition. The easiest way to do that is by offering a competitive benefits package that includes benefits your employees want and need to survive during these challenging times, ultimately helping you attract and retain top talent. Studies show businesses whose employees rated them highly on benefits saw a 56% lower attrition rate.

    Employees in this industry want access to the following benefits:

    • Health insurance 
    • Employer-matching retirement plans
    • Life and disability coverages
    • Paid time off (PTO)
    • Financial incentives and performance bonuses

    A partnership with a PEO enables you to develop and administer a comprehensive benefits package. They group small to medium-sized businesses to provide you with benefits at price points that are typically only available to larger companies. Kalynn Muha, GMS’ Recruitment Manager, expressed, “By partnering with a PEO, you’re able to utilize their experienced recruiters to stay on top of the current job market trends. This is important in the construction industry as it allows business owners to remain in  the field while HR experts dedicate their time to finding the right talent for your business.”

    Workers’ compensation coverage

    As a business owner, one of your main responsibilities is ensuring that your employees are cared for. That’s where workers’ compensation coverage comes into play. Should an accident or illness in the workplace take place, this coverage prevents you from being liable for lost wages, medical expenses, or being vulnerable to costly lawsuits. The U.S. Bureau of Labor Statistics reports 150,000 injuries annually on construction job sites. That’s exactly why you need this coverage, as accidents are bound to happen.

    PEOs understand how important your employees are. As the backbone of your business, the last thing you want is for your employees to get injured. However, should an accident occur, it’s critical to have a highly trained team to help facilitate claims management. With the construction industry being high-risk, it’s quite challenging for businesses to find an insurance carrier that gives them a reasonable price. Fortunately, PEOs offer a competitively priced solution for high-risk businesses that often helps improve long-term workers’ compensation costs in the long run.

    Reduces the burden of filing taxes

    Tax season is arguably the most dreaded time of the year for small business owners. Tax-related tasks take up so much of one’s time and are complicated, which can cause more mistakes to occur. Experts found that business owners spend nearly five hours filing and paying payroll taxes pay period. A PEO can take over payroll-related federal, state, and local tax filings. Whether during the busy tax season or year-round, PEOs are there throughout the entire process so you focus on growing your business.

    Partner With A PEO Such As GMS

    As a business owner in a high-risk industry, partnering with a PEO such as Group Management Services (GMS) could be the solution you’ve been looking for. Partnering with GMS helps businesses in the construction industry save money on HR-related expenses such as employee benefits, payroll processing, and workers’ compensation. We also help businesses comply with employment laws and regulations, reducing the risk of costly penalties and fines. Nearly a quarter of our clients are based in the construction industry. All your HR tasks are handled under one roof and taken on by our dedicated HR experts. Whether you’re a roofing or sheet metal business, we’ve got you covered. Contact us today to learn how we can help your construction business today.

     

  • As quarter one of 2023 is coming to an end, it’s never too soon to start thinking about your temporary workers coming on board in the summertime. You must familiarize yourself with child labor laws that could affect whom you hire. Over concerns that minors are being forced to work hazardous jobs, the Biden Administration is setting up a task force to vet U.S. sponsors of migrant children more thoroughly and increase efforts to investigate and prosecute child exploitation cases in workplaces across the country.

    Various investigations revealed that children are crossing the border without their parents and are being forced into punishing jobs that ignore child labor laws. The Department of Labor (DOL) stated that they will target factories and suppliers that illegally employ children and larger companies with child labor in their supply chains. These migrant children typically use false identification and find jobs through staffing agencies that don’t verify their Social Security numbers. The DOL recorded a 70% increase in children illegally employed by companies within the last five years. In 2022, they found that 3,800 children had been employed by more than 800 companies in violation of child labor laws.

    Understanding Child Labor Laws In The U.S. 

    The Fair Labor Standard Act (FLSA) established minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and Federal, State, and local governments. Under the FLSA, children of any age are generally permitted to work for businesses entirely owned by their parents, except those under the age of 16 may not be employed in mining or manufacturing. In addition, no one under 18 may be employed in any occupation the Secretary of Labor has declared hazardous. The following are occupations that are banned for all minors under the age of 18:

    • Manufacturing or storing explosives
    • Driving a motor vehicle or working as an outside helper on motor vehicles
    • Coal mining
    • Occupations in forest fire fighting, forest fire prevention, timber tract, forestry service, and occupations in logging and sawmilling operations
    • Power-driven woodworking machines
    • Exposure to radioactive substances and ionizing radiation
    • Power-driven hoisting apparatus
    • Power-driven metal-forming, punching, and shearing machines
    • Power-driven meat-processing machines, slaughtering, and meat-packing plants
    • Power-driven bakery machines
    • Balers, compactors, and power-driven paper-products machines
    • Manufacturing of brick, tile, and related products
    • Power-driven circular saws, band saws, guillotine shears, chain saws, reciprocating saws, woodchippers, and abrasive cutting discs
    • Wrecking, demolition, and ship-breaking operations
    • Roofing operations and work performed on or about a roof
    • Trenching and excavation operations

    In addition, children ages 14 and 15 may be employed outside of school hours in various non-manufacturing and non-hazardous jobs for limited periods of time and under specified conditions. Children under 14 cannot be employed in non-agricultural occupations covered by the FLSA. The following are the hours and times of the day that 14 and 15-year-olds may work:

    • Outside of school hours
    • No more than three hours on a school day, including Fridays
    • No more than eight hours on a non-school day
    • No more than 18 hours during a week when school is in session
    • No more than 40 hours during a week when school is not in session
    • Between 7:00 a.m. and 7:00 p.m. – except between June 1st and Labor day, when the evening hour is extended to 9:00 p.m.

    Additional information can be found here. 

    Your Responsibilities As A Business Owner

    As a business owner, you must comply with these labor laws, even if the child is yours. As we begin approaching a busy summer season when many businesses start hiring minors, it’s essential that you familiarize yourself with the federal and state laws relating to the employment of minors. Fortunately, when you partner with GMS, we ensure you remain compliant and hire minors correctly. We confirm they’re working the correct hours and times. In addition, we assist you with posting your state and federal labor posters throughout your business, so your employees understand their rights. Ultimately, we help your business runs simpler, safer, and stronger. Contact us today to learn how we can help you.

  • Remote work is a term that will never leave the workplace vocabulary. Now, more than ever, employees want to work from home, full-time, or part-time. As their employer, it’s essential that you listen to their needs and try your best to give them what they want. We get it. When the COVID-19 pandemic arose, the thought of having your employees work virtually was a thought we never thought possible. But it worked! 77% of those who work remotely at least a few days per month showed an increase in productivity. In addition, studies show that 30% of employees completed more work in less time.

    As a business owner, however, it’s your call at the end of the day to determine if your employees should be working remotely or if they need to work on-site. Whatever you decide, we’ve provided you with various resources to help you throughout your decision-making process. We created a guide, “The Guide To Managing A Remote Team,” that will take you step by step and show you how to manage your remote team more effectively should you choose that route. News flash! It will be challenging, but if your employees want this benefit, and studies show it actually increases productivity amongst your employees, why not give your employees what they want?

    Giving The People What They Want 

    Whether you’re ready to make that jump in providing your employees with the benefit of a more flexible work schedule or you’re still questioning it, let’s ask ourselves the following questions.

    How do my employees complete their work productively?

    You most likely have a workforce of individuals from all different age demographics. Whether they’re recent college graduates or have been in the workforce for over 30 years, they all work differently. It’s your job to hear from your employees and determine how they can be most productive at work. Some may say they prefer working in the office five days a week, while others say they’re more productive when working from home every day. Others may enjoy having the balance of working from home one or two days a week and in the office the rest of the week. 42% of individuals aged 25 to 34 prefer to work from home. You must determine what works best for each employee and accommodate their needs.

    What is the purpose of your office?

    While pandemic restrictions have spindled down and our lives are trying to return to the pre-pandemic norm, offices remain empty. As we’ve discussed, your employees enjoy the flexibility of completing their work in the comfort of their own homes. With this type of workforce, it’s essential that you take time to think about your office’s purpose. A survey showed that 82% of employees believe that having a purpose is essential for their company. Purpose shapes your company’s strategy, engages customers and community, and drives choices at moments of truth. Your company’s purpose addresses the fundamental question of “why.” How the workforce is running in today’s economy means it will take more effort to attract your employees to come into the office. Consider designing a space that fosters human connection and creates tailored, authentic experiences.

    Do you clearly define terms and roles?

    You may run a business with employees who simply cannot work remotely. You must clearly state who can work remotely. Consider creating a list of positions that can be done hybrid or fully remote and those that can’t. You must have a clear explanation as to why some employees can work remotely while others cannot. In addition, clearly define your remote workers’ expectations, when they should be working, if they need to come into the office, how often, and so much more. This step is critical as it dictates how productive your workers will be once you implement a flexible work schedule.

    What Now?

    We get it. It’s a lot to process, and it can be overwhelming. At GMS, we make this process as seamless as possible. Our role as a professional employer organization (PEO) is to take on these administrative burdens, so you no longer have to deal with them. We can help write job descriptions that clearly state if the role is hybrid, completely remote, or in the office. In addition, we can update your employee handbooks to reflect the changes to your employees’ roles in a remote setting. At GMS, we do everything from benefits and risk management to payroll and human resources. Count on us and contact us today to learn more.

  • Your employees spend the vast majority of their waking hours in the workplace. Whether they’re conducting work in the office or in a remote office, employees are managing workloads, engaging with customers and other employees, and are tasked with the daily pressures of performing their job duties. This ultimately leads to poor mental health at work.

    To improve the well-being of your workforce, have you considered enhancing your employees’ benefits package? You’re most likely familiar with benefits such as health insurance, retirement plan options, vision and dental insurance, pet insurance, and more; however, perhaps an employee assistance program (EAP) could be the perfect fit for your business.

    Continue reading to better understand what an EAP is and its benefits for your business.

    What Is An EAP?

    An EAP is a voluntary, work-based program offering free and confidential assessments, short-term counseling, referrals, and follow-up services to employees with personal and work-related problems. They typically offer employees free counseling benefits, which are usually alongside a company’s health insurance plan, so they have a stable and reliable outlet for managing workplace stress and anxiety.

    How Does An EAP Work?

    An EAP aims to connect employees with counselors and other support resources when they’re struggling, whether in their personal life or with work. Typically, the resources provided through an EAP are free, with a 24/7 line your employees can call. Calls are completely confidential and administered through a third-party provider. This allows your employees to feel comfortable expressing their problems to someone whom they can trust and rely on for support.

    The following are common areas that an EAP can help your employees with: 

    • Nutrition 
    • Anxiety
    • Depression
    • Grief during the loss of a loved one
    • Legal issues
    • Relationship issues
    • Basic medical advice
    • Finances
    • Substance abuse

    An EAP is designed to assist your employees in the interim; it’s not a long-term solution. When your employees talk to an EAP professional, they help them identify the root of the problem and then provide an action plan. If additional measures should be taken, that will be determined as well.

    Benefits Of Having An EAP Within Your Business

    Life’s challenges can negatively impact your employees’ productivity and performance when they cannot cope with them. When you provide them with an EAP, they gain access to resources to help them cope with their situations and speak to someone during challenging times. Ultimately, it can even benefit you, the employer, as it can reduce the negative impact on your company’s bottom line and overall morale. Alongside that, the following are the benefits of offering an EAP at your business:

    • Improved productivity 
    • Stress management
    • Decreased absenteeism 
    • Reduced accidents and fewer workers’ compensation claims 
    • Greater employee retention
    • Affordable resources
    • Employee-focused culture 

    How Do I Create A Successful EAP?

    The most critical step in creating a successful EAP is asking your employees what services would be beneficial to them. Consider following the below steps when creating your own EAP within your business:

    1. Gather employee feedback – Ask your employees where they’re struggling and what They believe may remedy the situation.
    2. Explore provider offerings – There are many EAP providers, each having its own plans and services. Be sure you do your research and weigh out all the options to determine which one would be the right fit for you and your employees.
    3. Compare the numbers – Every plan has its own limitations on the number of covered employees, the number of services offered, and how often your employees can access the service.
    4. Integrate it within your existing benefits plan – Once you find the right plan, it’s time to work with your EAP provider to integrate the services into your existing benefits package.

    Partner With GMS

    When you partner with a professional employer organization (PEO) like Group Management Services (GMS), you gain a partner that will help you implement this within your business every step of the way. In addition, GMS has contracted with Espyr to provide employees and their family members with a comprehensive EAP. Our EAP provides your employees with the following services:

    • Legal and financial consultation 
    • Child care information 
    • Elder care services 
    • Adoption specialists 
    • Academic resources
    • Pet care services
    • Special needs services 

    Contact us today to learn more. 

  • Taxes are a fundamental part of running a business, and understanding employer tax obligations is critical to remaining compliant with federal and state regulations. Two employment-related taxes that often cause confusion are FUTA (Federal Unemployment Tax Act) and SUTA (State Unemployment Tax Act) taxes. These taxes are essential for funding unemployment benefits for workers who lose their jobs through no fault of their own. 

    Although these taxes both fund unemployment compensation, they differ in their calculation methods, who is responsible for paying them, and their impact on businesses. Understanding these taxes can help employers avoid penalties, manage tax costs, and stay compliant with federal and state regulations. 

    What Is FUTA Tax? 

    The Federal Unemployment Tax Act (FUTA) is a federal payroll tax that employers pay to fund unemployment benefits at the national level. This tax helps support state unemployment programs and covers administrative costs for running unemployment systems nationwide. 

    FUTA ensures that state unemployment agencies have the resources to provide temporary financial assistance to unemployed workers. It also funds extended unemployment benefits during economic downturns when states may run out of money. 

    Key details of FUTA tax: 

    • Who pays it? Only employers pay FUTA tax. Employees are not responsible for contributing. 
    • 2025 FUTA tax rate: The standard rate remains 6.0% on the first $7,000 of each employee’s annual wages. 
    • Potential FUTA tax credit: Employers who fully pay their SUTA taxes on time can receive a tax credit of up to 5.4%, reducing their effective FUTA rate to 0.6%. 
    • Purpose of FUTA: These funds go toward unemployment insurance (UI) programs and help states during high unemployment periods when state funds are depleted. 

    What Is SUTA Tax? 

    The State Unemployment Tax Act (SUTA) is a state-mandated payroll tax that funds unemployment benefits for eligible workers within that specific state. Unlike FUTA, SUTA tax rates, rules, and wage bases vary by state. 

    SUTA taxes directly fund state unemployment benefits for workers who lose their jobs through no fault of their own. These programs ensure financial stability for workers while they search for new employment. 

    Key details of SUTA tax: 

    • Who pays it? Employers are responsible for SUTA taxes, though in some states (like Pennsylvania, New Jersey, and Alaska), employees also contribute. 
    • Tax rates vary by state: SUTA rates depend on state laws, employer industry, and individual employer experience ratings (how often they’ve had former employees claim unemployment). 
    • State-specific wage base limits: Unlike FUTA, which has a fixed wage base of $7,000, each state sets its own wage base for SUTA tax. In 2025, these limits range from $7,000 to over $50,000, depending on the state. 
    • Purpose of SUTA: These funds are used to provide unemployment benefits to workers in that specific state. 

    Key Differences Between FUTA And SUTA 

    Why Employers Must Stay Compliant 

    Employers must accurately calculate, report, and pay FUTA and SUTA taxes to avoid penalties, interest, and increased tax liabilities. FUTA credit reductions can occur if a state fails to repay federal loans for unemployment benefits, leading to higher FUTA tax liabilities for employers. Frequent layoffs can increase an employer’s SUTA tax rate due to a higher “experience rating,” resulting in higher state unemployment taxes. 

    Late payments, incorrect filings, or misclassifying employees can lead to severe penalties from the IRS and state agencies, including fines, interest, and even criminal charges. States with outstanding federal loans may face FUTA credit reductions, causing employers to owe more in FUTA taxes until the loan is repaid. Ensuring compliance with FUTA and SUTA tax requirements is essential to avoid these costly consequences. 

    How to Ensure Compliance 

    • Stay updated on state tax rates: Because SUTA rates and wage bases change annually, employers should monitor state updates. 
    • File reports on time: FUTA taxes are reported quarterly using IRS Form 940, while SUTA filings vary by state. 
    • Work with a payroll partner: Outsourcing payroll tax management to a professional employer organization (PEO) ensures compliance and reduces the risk of penalties. 

    How GMS Can Help 

    Managing unemployment taxes can be challenging, especially for multi-state employers navigating different SUTA rates and regulations. Group Management Services (GMS) helps businesses: 

    • Accurately calculate and file FUTA and SUTA taxes 
    • Stay compliant with state and federal tax laws 
    • Reduce their SUTA tax burden through proper claims management and best practices 

    GMS can provide expert guidance and comprehensive payroll services if you’re unsure about your company’s FUTA or SUTA tax obligations. Contact us today to learn how we can simplify payroll tax management for your business. 

  • The labor market is always shifting as employees retire, seek out new jobs, and navigate disruption. In a December 2022 poll by Monster.com, workers reported they were seeking new jobs for better pay, more growth opportunities, or the need to get out of a toxic workplace.

    Now seems to be a great time to make the change. The unemployment rate is at 3.4%, the lowest it’s been since May 1969. Right now, there are about two open jobs for every unemployed person in America. All signs say it should be easy to hop into LinkedIn and score your dream job in a matter of days – so why does it still feel so hard to get hired?

    The best way to answer that question is to understand the current labor market and what it means for job seekers.

    Key Labor Market Stats For 2023

    The U.S. Labor Department’s January report showed an increase of 517,000 jobs, far exceeding its estimate of 187,000. Leisure and hospitality added the most jobs as companies bounce back from the pandemic-related pause in tourism, but health care is expected to take the lead in job growth as the nation’s population continues to age.

    The current labor force is growing (albeit slower than in recent years), the GDP is expected to increase 2.1% annually, and the Bureau of Labor Statistics is projecting an increase of 8.3 million jobs over the next decade.
    From an economist’s or politician’s perspective, the U.S. job market certainly is booming. But an employed economist’s point of view is far different than your average job seeker’s. From an applicant’s perspective, the market may seem a little tumultuous.

    Biggest Changes In The Job Market

    The COVID-19 pandemic caused a multi-year shakeup of the global market, with many industries and organizations pivoting operations to comply with new policies and changing health regulations. Working from home became a necessity for office jobs to maintain productivity during a time of quarantining and social distancing, while essential workers took precautions and adapted to new safety rules.

    Before the pandemic, only six percent of individuals in the U.S. worked primarily from home. Now, 66% of U.S. employees work remotely, at least part-time, with up to 92% of employees working remotely at least one day per week. That’s a huge leap!

    Impressive job market numbers can give the illusion that we’ve fully recovered from quarantine. Still, it can take years, even decades, for the workforce to recover from such a significant shift – especially its impacts on mental health.

    Biggest Challenges In The Job Market

    By definition, it’s a job seekers’ market, but that doesn’t mean applicants are coasting. Many are facing their fair share of challenges.

    Economic disruption

    We’ve already mentioned the economic changes brought about by the pandemic and the novelty of remote work, but there are other reasons the fate of the economy remains uncertain. It seems there’s always a valid reason why a potential recession could be looming in the near future. And, while grappling with the fear of a recession, workers are also navigating high inflation and possible stagnation. For some people, these issues are compounding, resulting in layoffs, lower-than-expected wages, and workplace stress.

    Automation

    While it’s unlikely robots will stage a revolution or take over nearly half our jobs, as some feared, automation remains a threat to some jobs. There are already robots and artificial intelligence (AI) programs that can check inventory, fill out forms, and write articles . It’s only a matter of time before robots do more complex tasks, especially with recent developments in AI.

    Automation has the potential to shrink the number of available jobs, prompting workers to learn new skills or seek jobs in other industries. But it also means employees skilled in machine operation will be in high demand—people who understand how automation works and how machines can best be used in business settings.

    Competition

    If you want to be successfully employed in the next decade, you’re going to need to be prepared for some intense competition—both with other applicants and with existing employees. Often, there are so many qualified candidates vying for a particular role that it can feel like an uphill battle.

    Even a booming economy comes with its share of layoffs, struggling companies, and inflation challenges leading workers to seek higher wages. This increases competition, the number of candidates applying for jobs, and the demand for specialized skills, so it takes a lot more effort to stand out from the crowd.

    Recruiters are always looking for impressive resumes, and the more they see, the higher their standards climb. Job seekers can find themselves struggling to get noticed, even if the employer is looking for someone with their exact skillset. The applicant pool is large, and, because the economy is cyclical, it’s likely only going to get bigger.

    Increased desire for remote work

    The workforce has spoken – no one really wants to go into the office every day anymore. But not every available job offers that sort of flexibility. The number of available hybrid and remote roles is increasing, but applicants are running to these roles first. This creates an influx of applications for the positions that recruiters must weed through one by one, bottlenecking the hiring process . The best way to overcome this is to be on top of the pile, meaning workers must constantly seek out and pounce on hybrid or remote opportunities. The early bird gets the home office!

    How To Stand Out In An Applicant Pool

    With so many individuals applying for the same jobs, recruiters are pickier about whom they hire. They have more options than ever before and want to double down on making sure that the person they hire will be the best fit for their company.

    So how do you make yourself stand out among all these other applicants? There are several key things that recruiters look for:

    • A well-tailored resume: Include keywords related to your industry or profession on every page of your application materials—especially on your résumé. This will help recruiters easily find you when they’re searching through hundreds of applications at once.
    • Skills: Recruiters want to see that you have what it takes to do the job well, so they’ll be looking to your skills to gauge whether you’ll be successful in the role. Now is a great time to rack up a certification or two to boost your resume.
    • Personality: Recruiters want someone who will fit into their culture and work well with other employees. While your resume may reflect a small part of that, your cover letter and interviews will be what seals the deal. Be sure to mention your performance at previous jobs and how you worked within your team.
    • Engagement: Actively engaging with the recruiter shows commitment. Be sure to follow up on your application and always prepare strong questions to ask in your interview.
    • Honesty: Be honest about your achievements, gaps in your work experience, or hang-ups in the past. This will show recruiters that you’re transparent and ensure they won’t have to be the ones to voice any “red flags” they see.
    • Research: Know the job you’re applying for! This means doing some digging on the company, its structure, and values ahead of your interview. Good research will also help with formulating questions for the recruiter that are specific to the organization itself.
    • Social media: Many recruiters are using social media sites such as LinkedIn as part of their hiring process these days. Make sure that all of your social media profiles are professional and up-to-date so recruiters can get an idea of who you are before they meet with you in person.

    Although the job market has its fair share of challenges, there are still ways in which applicants can leverage their skills to ensure they are taking the most effective steps toward a dream career path.

    Remember, too, that motivation and confidence go a long way to securing a new role. With the right resume and solid interviewing skills, job seekers have the potential to reach new heights in 2023!

    GMS Helps Streamline Recruiting Efforts

    With the rise of virtual reality, remote work, and AI, recruiters must change their game in order to keep up with their candidates. This is where GMS comes in. Our human resources experts work closely with you to offer guidance on hiring and training. Additionally, our partnerships with LinkedIn and Indeed make posting job ads simple and easy, getting you in front of quality candidates faster. Let’s talk!

  • People are a fundamental aspect of any organization. They give life to the culture and make the organization what it is, which is why inclusivity matters. An inclusive culture makes people feel appreciated and as if they are working towards creating a common good for everyone. It inspires people to be more productive and to achieve levels they never thought were possible before working with an inclusive company. This kind of culture is attractive to the workforce and makes their employees more satisfied with their job, which ultimately improves the overall productivity of these businesses.

    But what does creating an inclusive culture look like, and how do you get started? First, let’s cover why inclusivity matters and some of its benefits.

    Why Inclusivity Matters

    When you think about company culture, words that pop into your head may include engagement, productivity, and innovation. But what about inclusivity? An inclusive culture is part of a healthy organizational environment that respects the value of everyone. It’s also a buzzword for many companies that want to attract diverse talent. But it’s not just about diversity. It’s about achieving an inclusive environment where all employees feel included regardless of gender, race, religion, and age.

    There’s a big difference between actively fighting for diversity and inclusivity and pretending they don’t require attention. It’s time we stop thinking of these issues as topics that exist in an imaginary, faraway land. That’s because 78% of job seekers say they want to work for diverse companies. Diversity, equality, and inclusion are business initiatives that connect with employees on a fundamental level — which is why we can’t afford to ignore them. Perks of creating an inclusive workforce include:

    • Higher job satisfaction 
    • 5.4 time higher employee retention
    • Higher employee morale
    • Increased ability to recruit a diverse talent pool
    • Higher revenue growth

    It’s no secret that employees want to feel included and valued in their workplace, however the hard truth is that many companies lack diversity despite saying they value certain qualities. The good news is many businesses are trying to achieve more inclusive workforces, but not all are doing so effectively. Whether you’re a manager or team member, it’s essential to understand the elements that contribute to hiring and retaining diverse employees and what barriers might prevent your company from creating a more inclusive environment.

    How To Build An Inclusive Culture

    Building an inclusive culture within your organization doesn’t happen by accident, it’s the result of going through specific steps and challenges. Below, we’ll look at ways you can help create a climate for everyone in your organization to be heard and accepted.

    Make inclusion a core value

    An inclusive culture isn’t just talk; it’s a core value. This means inclusion is ingrained in every part of your organization, from your employee handbook to management to everyday work life. That’s why it’s crucial to get everyone on board with what inclusive values imply and what it looks like when you have an inclusive culture.

    Hire inclusively

    It’s crucial to talk the talk and walk the walk. One of the most important things you can do is to create an inclusive hiring culture. According to a Deloitte survey, 80% of people say inclusion efforts are an important factor when choosing a company. Hiring inclusively not only shows you advocate for inclusion, but it also gives you access to a larger talent pool. Ultimately, it proves that you value and care about diversity versus only saying you do.

    Practice active listening

    Active listening plays a crucial part in communicating effectively. Listening may seem obvious, but active listening can easily take a back seat if we’re not mindful when communicating. It takes practice and discipline, especially in a work setting where everyone has big ideas and wants a voice. Ways to practice active listening are to:

    • Pay attention: Give the speaker your undivided attention and acknowledge what they’re saying. Make sure you are providing eye contact, not looking at your devices, and not getting distracted by incoming notifications or emails.
    • Show that you are listening: Mention specific parts of the conversation, ask questions, and repeat what they’re saying for clarity. This shows you heard what they said and are willing to learn more. Small verbal comments such as “yes” and gestures such as nodding can convey that you are actively listening.
    • Provide feedback: Feedback shows that you care about someone’s success and that you heard what was said. One tool to use is paraphrasing, such as “what I’m hearing is” or “it sounds like you’re saying,” to reflect on the speaker’s words.
    • Defer judgment: Making assumptions and interrupting only wastes time, plus it’s frustrating to the speaker. Allowing the speaker to finish their words saves them from feeling unheard and disappointed. This may make them feel undermined and not like they can speak up in the future.
    • Respond appropriately: Being candid, open, and honest, but also respectful, is vital when responding to the speaker. It’s best to treat individuals how you want to be treated.

    Celebrate differences

    Differences don’t have to be a barrier; they can be a learning opportunity and allow us to celebrate others. This often looks like giving your employees a platform and championing their cultures. Instead of ignoring differences, we can uplift them in the workplace and provide solutions. Ways to do this are by doing the following:

    • Encouraging educational opportunities 
    • Learning at lunch talks
    • Hosting diversity days
    • Developing a multicultural calendar
    • Paying attention to cultural nuances 
    • Addressing communication barriers
    • Supporting employee advancement

    Proactively address harassment and bullying

    Facilitating an inclusive culture means there is zero room for harassment and bullying. Being proactive in your approach to addressing these matters is vital. This means creating a system for these situations and a plan for handling them while informing your employees of the severity of these issues, so they know they’re not taken lightly. Having a means for harassed employees to express what they have experienced is also essential. For some organizations, that may be a formal email, for others, that may be a one on one with a manager to inform them of mistreatment. Regardless of how you decide to formalize your process, be sure to be considerate of your employees and be human. Hear out their concerns and provide sympathy, support, and understanding.

    Share inclusion metrics with employees

    When creating a plan that applies to your overall culture, it’s only natural to keep your employees in the loop. Be prepared to receive employee feedback and be open to growing in areas needing work. Don’t be afraid to share inclusion metrics and how you’ve developed your organization to be more diverse and focused on inclusion.

    Regularly educate your employees about diversity and inclusion

    Creating a culture that celebrates diversity is no easy feat. Some ways to continually educate your staff about diversity are to bring in experts, regularly conduct training, and provide resources for learning more. Diversity training can help prevent workplace bullying, discrimination, and harassment by promoting respect for all employees regardless of race, gender, ethnicity, age, and religion. When employees are motivated and feel their efforts are respected, they are happier with their job and more productive.

    Revisit the conversation regularly and track your progress

    Create tangible goals and stick to them. Finding opportunities for growth within your organization regarding inclusion is the key to success and adaptation. Empower your employees to speak on these topics and regularly conduct conversations where they can voice their concerns. One way you could do so is through anonymous polls and surveys.

    It will never be enough to say that your company has an inclusive culture. You must work at it over the course of time to get there. It takes effort, but it’s ultimately worth it for everyone involved. At the risk of sounding like a broken record, you will fail if you don’t get buy-in from everyone: every department, every employee, and every stakeholder.

    The key to building an inclusive culture is to focus on making people feel welcome and comfortable. It’s easy for companies to overlook this because they think of diversity mainly as an HR issue. But it’s more than that. Diversity has a lot to do with empathy, starting with you, the manager. Are you making it clear that your team is open to different points of view?

    GMS Is Here To Help 

    There are many things to consider when hiring and building an inclusive work environment. It’s easy to gloss over the minor details, but those little things ultimately add up to make a good workplace culture—inspiring employees to feel comfortable in their jobs, be productive, and stay for the long haul. These aspects of culture, both big and small, make our workplaces feel accommodating. At GMS, we can help you create a plan for bettering your culture and hiring diversely. Let’s talk!

  • When employees are set up for success, companies enjoy the benefits. Happy, motivated employees are likely to be more productive and satisfied with their jobs, reducing turnover. While there are many options you, as an employer, can provide to create a great place to work, there are factors outside of the workplace that have a direct impact on the overall well-being of your employees.

    An employee assistance program (EAP) is one tool employers can use to help stressed-out employees and improve morale and work performance. Let’s break down what an EAP does, how it benefits both employers and employees, and how your company can get the most out of its program.

    What Is An Employee Assistance Program?

    The Society for Human Resource Management (SHRM) defines an EAP as “a work-based intervention program designed to assist employees in resolving personal problems that may be adversely affecting the employee’s performance.” These intervention programs are designed to give employees support for private matters until they can find a more permanent solution.

    Employee assistance programs are a great way for businesses to improve their overall employee productivity and health. The programs provide employees with access to confidential counseling and support, as well as referral services for mental health care, substance abuse treatment, and other services. An ideal EAP should meet the criteria listed below:

    • Confidential – Given the personal nature of employee issues, EAPs should allow employees to seek support privately and anonymously.
    • Accessible – Services provided by an EAP should be accessible online and easy for employees to contact during and outside of work hours.
    • Available – Services should be readily available to all employees and immediate family members who are eligible for the program.
    • Short-term – EAPs aren’t meant to be permanent sources of aid. The services an EAP provides are designed to give employees access to key services and short-term help until they can find a good, long-term solution.

    The exact form of support can differ greatly from program to program; however the goal is the same – to give employees the support they need to address factors that impact their mental and emotional health.

    Examples Of Employee Assistance Programs

    The average EAP provides a wide range of services aimed at providing critical support for your workforce, but the exact offering can vary from program to program. It’s most common for EAPs to address a number of personal issues, including the following concerns:

    • Relationship challenges
    • Grief over the loss of a loved one
    • Financial or legal problems
    • Stress management
    • Mental health issues, including anxiety, depression, and PTSD
    • Substance abuse
    • Workplace or domestic violence
    • Crisis management

    EAPs offer confidential, professional counseling and support to employees, free of charge. Some can even be accessed via phone, text, or email 24 hours a day, 365 days a year.

    While EAPs were traditionally developed to support personal issues, modern programs have expanded to include further services. Employers have found that several additional stressors impact work-life balance and an employee’s future plans. As the workplace evolves, modern EAPs have also included the following forms of support:

    • Childcare
    • Eldercare
    • Adoption specialists 
    • Retirement planning
    • Living wills
    • Pet care
    • Academic and tutor resources
    • Personal and professional development

    Benefits Of Employee Assistance Programs

    More stress means more problems for both employees and employers. According to Gallup’s 2022 State of the Global Workforce Report, a whopping 57% of U.S. employees reported feeling stress on a daily basis. By alleviating that stress, EAPs can help businesses enjoy the following benefits:

    • Reduced absenteeism 
    • Increased productivity 
    • Better morale
    • Improved retention
    • Stronger applicant pools

    Reduced absenteeism

    Outside stressors can often lead to employees taking additional sick days or simply calling off to attend to personal issues. EAPs give employees the means to alleviate those stresses. A study by Federal Occupational Health (FOH) found that companies that offer EAPs saw a 69.2% decrease in absenteeism by giving employees access to various means of personal support.

    Increased productivity

    Just because employees are physically at work doesn’t mean that they’re productive. Behavioral health concerns such as stress, anxiety, or depression directly impact how engaged employees are at work. That same FOH study found that employees with access to assistance programs were 22.8% less checked out while on the job and more invested in their work.

    When an employee has an issue that’s causing them to miss work or perform poorly, it can trickle down to affect the entire department’s productivity. Having a program in place that helps individuals deal with these issues before they become a problem is a great way to be proactive.

    Better morale

    Another benefit the FOH found was that EAPs could improve employees’ sense of overall well-being. Studies found that EAPs increased users’ life satisfaction by 24.2% by addressing stressors that caused personal distress. In turn, employee morale is substantially better when employees take advantage of EAP services.

    Improved retention

    Simply put, stress makes good employees leave. EAPs show employees that your business cares about their well-being, making them less likely to suffer burnout or look for a fresh start somewhere else. In addition, EAPs can help prevent employees from being fired by helping them manage personal issues before they negatively impact their work performance.

    Stronger applicant pools

    Assistance programs can also encourage solid talent to join your business. According to SHRM, 76% of employees “Consider mental health benefits to be a critical factor when evaluating new jobs.” An EAP is a clear sign that your business takes employee mental health seriously.

    How To Get An Employee Assistance Program Started

    Getting started can be overwhelming. Here are some tips on how to launch an EAP plan:

    1. Decide what kind of EAP you want. Do you want one that caters specifically to your company’s needs, or do you want a one-size-fits-all program?
    2. Decide on a budget. Your budget will be an important consideration when choosing an EAP. You can calculate how much it will cost per employee by year or month to get a baseline—it might be less than you expect!
    3. Research different EAP providers—they should all have websites where you can read about their services and compare pricing and the benefits offered. Analyze the information from each provider and choose one that best fits the overall needs of your company.

    Another option is to contact your company’s insurance provider and see if they offer an EAP service. For a truly turn-key experience, you can hire a third-party agency to broker an EAP program for your business. It’s important to keep in mind that the size of your business may ultimately determine how many options are available to you.

    Once you have done the heavy lifting of choosing a program and getting an EAP in place for your business, it’s critical to focus on employee communication. It’s important that everyone in your organization, from HR to management, understands their role in the program and how to assist if an employee needs assistance from the program. In addition, it’s crucial that the EAP rollout is well communicated throughout your organization so that each employee understands the value of the program, what is being offered to them, and how to take advantage of this benefit.

    How To Maximize The Value Of Your Employee Assistance Program

    Offering an EAP is one step. Getting employees to use it is another. National studies find that EAP utilization averages just under 10%, but not because the programs are ineffective. SHRM reports a couple of key reasons for the low usage rate:

    • Privacy concerns – Employees either feel uncomfortable sharing personal issues or are afraid that employers will gain access to their personal health information.
    • Lack of promotion – Companies either don’t promote these programs efficiently, or employees aren’t aware of how to access services.

    Even with low participation numbers, employers who offered an EAP typically enjoyed a return on investment of at least $3 for every $1 spent, according to the 2020 Workplace Outcome Suite. Still, there are ways that businesses can encourage better EAP participation and receive even more value from their programs.

    Regularly promote EAP awareness 

    It’s not uncommon for employees to only hear about their EAP once during the onboarding process or when the program launches. It’s best to give employees regular reminders about their EAP and how to access these services. These reminders can come in multiple forms – during annual meetings, email updates, etc. Regardless of how you send the message, multiple reminders will only increase the odds that employees will utilize these services.

    Stress your commitment to privacy 

    It’s not always easy for individuals to admit they need help. That said, it’s essential to communicate that employees can privately access services online or on the phone around the clock.

    In addition, employees should understand that their interactions with these services are completely private and are not shared with the employer or others within the company. By stressing the private nature of an EAP, employees are more likely to explore these services on their own terms.

    Work with HR advocates

    It’s not always easy to manage the various aspects of benefits administration by yourself. Fortunately, you don’t have to promote and manage your EAP alone. The right EAP provider can help you maximize the effectiveness of your program.

    GMS partners with businesses to offer critical assistance and educate employees about how to best utilize these services. We help employers deliver a quality benefits package without having to spend the time to administer these benefits by themselves, including group health insurance, assistance programs, and more.

    Ready to enhance your employee benefits package? Contact us now about how GMS can help you save time and money through expert benefits administration.