IRS Announces 2012 Contribution Limits
The Internal Revenue Service (IRS) and the Social Security Administration (SSA) have issuedthe cost of living increases for qualified retirement plans for 2012. The 401(k) elective deferral limit (i.e. 402(g)) has increased for 2012, but the catch-up contribution limit has remained unchanged.
Highlights of the limits for 2012 include the following:
- 401(k) elective deferral limit - $16, 500 in 2011 to $17, 000 in 2012
- Catch-up contribution limit - $5,500 in 2011 to $5,500 in 2012
- Section 415 limit (DC) - $49,000 in 2011 to $50,000 in 2012
- Section 415 limit (DB) - $195, 000 in 2011 to $200,000 in 2012
- Section 401(a)(17) includible compensation - $245, 000 in 2011 to $250,000 in 2012
- HCE definition - $110,000 in 2011 to $115, 000 in 2012
- Key employee definition - $160,000 in 2011 to $165,000 in 2012
- FICA taxable wage base - $106, 800 in 2011 to $110,100 in 2012
The full press release from the IRS announcing this year’s contribution limits can be found here.
10 Predictions for 2012: The Top Trends in Talent Management and Recruiting
The following 10 Predictions for 2012 article was written by Dr. John Sullivan and posted on the ERE Daily website.2012 Will Be “The Year of the Mobile Platform”
By the end of next year, even the skeptics will have to admit that the mobile platform will have become the dominant communications and interaction platform by early-adopting best-practice organizations. The capabilities afforded users of smartphones and tablet devices grows immensely day by day. Long before unified inboxes existed for the desktop, smart device users could see all incoming e-mail, social messaging, text messaging, and voice and video messaging in a single place. Tablets will become the virtual classroom, and an emerging class of tools will let employees manage almost every aspect of their professional life digitally. During the next year, talent management leaders need to invest heavily supporting execution of talent management initiatives across mobile.
The Additional Top Nine!
Intense hiring competition will return in selected areas — global economic issues will persist for years to come, but the global war for talent will continue spiking in key regions an industries. While growth has slowed somewhat in China, Australia and Southeast Asia — including India — continue to see dramatic demand for skilled talent. In the U.S. and Europe, demand is still largely limited to certain industries where skills shortages have been an issue for years. In high tech inclusive of medical technologies, 2012 will see a significant escalation in the war for top talent. As innovators and game changers step out of established tech firms like Facebook, Apple, Google, Twitter, and Zynga, a whole new breed to tech startups will be born each vying for the best of the best. While recruiting will move forward at a breathtaking pace, so too will “rapid” leadership development.
Retention issues will increase dramatically — almost every survey shows that despite high engagement scores, more than a majority of employees are willing to quit their current job as soon as a better opportunity comes along. I am predicting that turnover rates in high-demand occupations will increase by 25% during the next year and because most corporate retention programs have been so severely degraded, retention could turn out to be the highest-economic-impact area in all of talent management. Rather than the traditional “one-size-fits-all” retention strategy, a targeted personalized approach will be required if you expect to have a reasonable chance to retain your top talent.
Social media increases its impact by becoming more data-driven — most firms jumped on the social media bandwagon, but unfortunately the trial-and-error approach used by most has produced only mediocre results. Adapting social media tools from the business coupled with strong analytics will allow a more focused approach that harnesses and directs the effort of all employees on social media. Talent leaders will increasingly see the value of a combination of internal and external social media approaches for managing and developing talent.
Remote work changes everything in talent management — the continued growth of technology, social media, and easy communications now makes it possible for most knowledge work and team activities to occur remotely. Allowing top talent to work “wherever they want to work” improves retention and makes recruiting dramatically easier. Unfortunately, even though it is now possible for as much as 50% of a firm’s jobs to be done remotely, manager and HR resistance has limited the trend. Fortunately, managers and talent management leaders have begun to realize that teamwork, learning, development, recruiting, and best-practice sharing can now successfully be accomplished using remote methods. Firms like IBM and Cisco have led the way in reducing and eliminating barriers to remote work.
The need for speed shifts the balance between development and recruiting — historically, best practice within corporations has been to build and develop primarily from within. However, as the speed of change in business continues to increase and the number of firms that copy the “Apple model” (where firm is continually crossing industry boundaries) increases, talent managers will need to rethink the “develop internally first” approach. In many cases, recruiting becomes a more viable option because there simply isn’t time for current employees to develop completely new skills. As a result, the trend will be to continually shift the balance toward recruiting for immediate needs and the use of contingent labor for short-duration opportunities and problems.
Employee referrals are coupled with social media — the employeereferral program in many organizations is operated in isolation as are the organizations’ social media efforts, but talent managers are beginning to realize that the real strength of social media is relationship-building by your employees. With proper coordination, employee relationships can easily be turned into employee referrals. This realization will lead to a shift away from recruiters and toward relying on employees to build social media contacts and relationships. The net result will be that as many as 60% of all hires will come from the combined efforts. The strength of these relationships will lead to better assessment and the highest-quality hires from employee referrals.
Employer branding returns — Employer branding and building talent communities are the only long-term strategies in recruiting. True branding is rarely practiced (hint: it’s not recruitment marketing) especially in the cash-strapped function of today, but years of layoffs, cuts in compensation, and generally bad press for business in general may force firms to invest in true branding. The increased use of social media and frequent visits to employee criticism sites (like Glassdoor.com), make not managing employer brand perception a risky proposition. While corporations will never control their employer brand, they can monitor and influence in a direction that isn’t catastrophic to recruiting and retention.
The candidate experience is finally getting the attention it deserves — Organizations have never treated candidates as well as they did their customers, but the high jobless rate has allowed corporations to essentially abuse some applicants. As competition for talent increases and as more applicants visit employer criticism sites like Glassdoor.com, talent leaders will be forced to modify their approach. At the very least, firms will more closely monitor candidate experience metrics as they realize that treating applicants poorly can not only drive away other high-quality applicants but it can also lose them sales and customers.
Forward-looking metrics begin to dominate — Almost all current talent management and recruiting metrics are backward looking, in that they tell you what happened in the past. Other business functions like supply chain, production, and finance have long championed the use of “forward-looking” or predictive metrics and the time is finally coming when talent management leaders will shift their metrics emphasis. Forward-looking metrics can not only improve decision-making but they can also help to prevent or mitigate future talent problems.
For the full article, please visit ERE Daily.
Happy (Belated) Boss’s Day!
National Boss Day fell on a Sunday this year, so we’re celebrating today instead. Some may think it’s a holiday invented by Hallmark or a bunch of brownnosers, but regardless of how it came about, we can’t emphasize the importance of expressing gratitude enough. According to Harvard’s Shawn Achor, author of The Happiness Advantage, 75% of job success is based on optimism, social support and managing stress in a positive way. Boss’s Day, Secretary Day, and the like are all great holidays in building a thanking culture. Here are a few ways to say thank you:
- Verbal Communication: Stopping to say thank you is an effective and cost-free way to say
- Ring the Bell: We’ve found that incorporating a physical bell in the office and using it to salute those who have hit a milestone, personal victory, project completion or new client win provides a quick “Hooray” for the people involved.
- Personal Notes: A personal, handwritten note goes a long way in expressing gratitude.
- Significant Events: Once a month during our meetings, we acknowledge significant events that have occurred within our lives.
- Tokens of Appreciation: Whether it’s freshly baked cookies, flowers, or a small gift, these tokens symbolize your appreciation.
How will you show appreciation to your boss?
Top 10 ways to Maximize your Social Networking Strategy!
- Join industry specific blogs or user groups.
- Always make sure your own information on social networks is up-to-date.
- Devote time each week to expanding your network.
- Understand how to build effective search strings.
- Involve your company and colleagues in leveraging networks.
- Use social media to advertise any open positions.
- Participate in the conversation in online groups and blogs; then ask questions to make yourself more knowledgeable in your industry vertical.
- Share company updates.
- Network through twitter and twitter search.
- LinkedIn and Google + are your best networking buddies!
Kathy Albarado - Corporate Culture for Community Change
If one were to work an average of 8 hours a day, 5 days per week, from the age of 18 to the age of 65, one would spend over 90,000 hours of their lifetime in the workplace. For Kathy Albarado, President and CEO of Helios HR, that’s 90,000 hours of potential. While many employees across America find themselves begrudgingly sitting down at their desks each morning and eager to leave when the clock strikes five o’clock, Kathy has dedicated her life and energy to the transformative power of corporate culture. “My personal passion has always been to make an impact through the creation of a corporate culture in which an employee’s life is not checked at the door, but is rather enriched and enjoyed within the walls of their workplace,” she explains. “When you can create a place that people love to be a part of, that enthusiasm spills over into the community.”
Helios celebrated its tenth anniversary in September of 2011, and throughout its first decade, it racked in outstanding success. It grew forty percent in 2010 and is on track to grow another fifty percent this year, supporting between 80 and 100 customers at any given time. Despite Kathy’s obvious proficiency as a leader and affinity for what she does, however, she reports that she never had a burning desire to be an entrepreneur. She served as VP of Corporate Services at PriceInteractive, a rapidly growing speech application service provider, for four years before launching Helios. “As an employee there, I felt productive, engaged, and like we were really building something,” she remembers fondly. When the owners sold Price to a publicly traded company based in Boston, however, everything changed. “I couldn’t stand to see the culture we’d built unravel so rapidly,” she explains. The deal was completed in February, and she resigned in May.
Kathy then found herself confronted with the age-old question: What next? Thoroughly engrossed in her work with Price, her professional network had lain dormant for several years. Undeterred, however, she began reaching out as she examined whether she would return to the corporate world or whether starting her own business was a better route to take. She invited people to coffee, bought them lunch, and asked how they’d started their companies, how they’d grown them, and what needed to be considered throughout the process. “They were all very gracious and eager to help, and I realized that I couldn’t get excited about accepting another corporate opportunity because the culture we’d had at Price was so special,” she reports. “That’s when I realized that, if I could engage in an intentional focus on corporate culture and then share that vision with other executives and CEOs, I could help them as they grow and scale. I realized that I wanted to start a company that would help these leaders implement and maintain the right infrastructure to attract, retain, and engage the best workforce in the best place to work.”
In preparing to launch Helios, Kathy polled her network extensively but took each pearl of wisdom with a grain of salt, careful to review its applicability to her own unique situation. One trusted friend and business owner recommended that she keep her day job at Price until she had lined up her first customer, but Kathy decided that this wasn’t the right path for her. At the time, she was the single mother of her young daughter, Amanda, which had taught her the importance of perseverance. “As a single mom, you just do what you have to do to move forward,” she affirms. “You don’t complain or whine, you just do it.” Her own childhood, as well, had taught her the value of independence and following one’s own path. “After my parents got divorced, my mother remarried into an abusive relationship that lasted for seven years,” she says. “I’m a firm believer that, if you’re in a bad situation, you leave and hold out for a good one. Do what you have to do, and don’t settle.”
After taking several weeks to realize that her dream was to build incredible company cultures for organizations throughout the Washington Metropolitan area, Kathy’s mission became very focused. She launched the company in a home office basement, and she remembers nights when Amanda, at a spunky eight years old, would offer to make grilled cheese for the two of them while Kathy worked. Kathy also recalls with gratitude the support of her husband, Kevin, who was patient and supportive throughout the long days, nights, and weekends it took her to launch and grow the company. Helios’s original model has evolved over the years since that time and now provides human capital management, consulting, outsourcing, and recruiting solutions for a phenomenal client base focused on evolution and forward motion. For smaller companies of a hundred people or less, Helios often serves as a fully outsourced HR function that provides a team approach. “Whether our clients need someone focused on compliance, someone who can conduct a compensation analysis for them with some benchmarking, or a technology expert to advise on what system to use as they scale, we provide them with access to all these resources, whereas if they hired one dedicated person to fulfill their HR function, that person probably wouldn’t have as broad of a background,” Kathy points out. Alternatively, for midsize and larger organizations, Helios does consulting work specializing in organizational development. In this capacity, it advises on growth management, reporting structure changes, role clarity, and adequate training and support functions, among others. Finally, Helios provides recruiting services across all professional services positions through an hourly model which saves an average of 30 percent on contingent search fees and on the placement of HR professionals on a competitive retainer. Helios’s consultants are unique in that they rarely serve more than four clients at once, whereas many of its competitors use models in which a hundred clients can be assigned to one account manager. Helios consultants are thus extremely involved and visible within client organizations, providing CEOs and leadership teams with comprehensive and in-depth strategic advice and counseling. Kathy has also recently begun to leverage her extensive commercial network to begin organically building into the Federal sector in response to the market’s expressed needs. “I love that my access to these executives allows me to help them find innovative solutions to their challenges, which are often very similar from one company to the next,” she remarks.
One such opportunity came in 2007, when Kathy was struck with the idea to launch the Apollo Awards through Helios. Though some advisors told her that Washington already had enough awards, she received positive feedback as well and decided that they’d put out a call for nominations in March of 2007 for an awards program that met in May of that same year. 188 people attended the first ceremony where 4 winners were chosen amongst 12 finalists, and all the CEOs of those finalist companies attended. “It was amazing to see all that energy and goodwill created in the community,” Kathy marvels. “People want to see how they stand against other companies in their size category, and we create a white paper to then distribute the findings. People love to be around like-minded executives, and the event is about collaboration and camaraderie— everything that Helios stands for and seeks to promote.”
Born in Alexandria, Virginia, Kathy has spent her whole life in the area. As a child she didn’t have a specific end career goal in mind, but was instead quite flexible and opportunistic. In college at George Mason University, she changed her major four times but ultimately settled on Psychology, which permitted her to intern at the Northern Virginia Mental Health Institute for 18 months. Working intimately with a wide range of patients in this capacity taught Kathy that all people are people, and that one had to be purposeful and unrelenting in their composure and intentions in order to be taken seriously. It also taught her the critical importance of pulling one’s own weight on a team, as failure to do so could result in serious injury. “As we progress down our careers, it’s interesting to see how experiences teach you what you do and don’t want,” she reflects now. “I learned from that one that I didn’t want to go into clinical work. It’s important to remember that there’s always an opportunity to reinvent who we are and where our story is going.”
Kathy waited tables through college and managed a women’s sports retail store afterward but soon realized she wanted to head in a different direction, so she started personnel management classes and discovered an acute passion for the burgeoning field. She then began interviewing around town and was given a position at a company called Dewberry, where she developed a solid foundation in HR with the help of top-notch mentors. Within her first six months, she coordinated a program to consolidate the company’s 20 different vendors to optimize their savings and mass volume discounting. She was also coached extensively in the importance of strong writing skills. “You have to be able to write in order to think through complex issues and articulate them effectively, and a mentor at Dewberry would redline my memos to help me learn those skills,” she recalls.
After Dewberry, she worked at ITC Learning, where she was challenged to truly stretch her limits and venture beyond her comfort zone. Her boss could tell that she was capable of more than her skill set and background implied, and he pushed her beyond HR by having her report to him directly on the business’s operations and sales force. “He was a visionary, and I helped him to execute those visions,” she explains. “Now, as I implement my own visions, I’m confident that I don’t have to have all the details figured out before launching a project. Even if I only have 80 percent of things ironed out, I continue to move forward, accept feedback, and adjust as I go. I don’t overanalyze things, and my decision may change from one day to the next because of that, but each decision is a better decision than the one that came before.”
In advising young entrepreneurs entering the business world today, Kathy echoes the popular sentiment that there’s no replacement for experience. “When you assume a position, be humble, appreciative of the opportunity, and aim to show them what you’re capable of,” she urges. “Having a strong work ethic and being able to understand and manage expectations is a skill set you only gain with experience, so understand that you need to develop that track record.”
Beyond this, Kathy echoes the entire philosophy upon which Helios is built: that success is never achieved in isolation. It takes a network of compassionate, supportive, collaborative people to help build a company. It takes a team of enthusiastic, driven, fulfilled employees to keep that company afloat. It takes collaboration between leaders and consultants to develop the kind of corporate culture that enables such a team to persist. And it takes the work of all social institutions to build better societies, whether they’re public or private. “There’s so many things leaders can do to impact the community, whether it’s providing employee time and support for volunteerism or educating people about community needs and solutions,” Kathy points out.
Despite Helios’s certain accomplishment, Kathy feels that one of her greatest successes is ultimately personified in Amanda, who is now 18 and a co-founder of Collective Change, a charity that provides easy ways for communities to come together, promote awareness, and raise money for important causes worldwide. Kathy fondly remembers the night of the organization’s first fundraiser, when her daughter directed the event to raise money for Haiti with exceptional poise, grace, and conviction. “I believe every person and every company has the privilege and obligation to give back,” says Kathy. “What I love most about Helios is having the opportunity to impact our client companies and to then connect these clients with the greater community to leverage that momentum. Amanda is an exceptional example of how that momentum can embody real change, and that, to me, defines success.”
− By Gordon J. Bernhardt, CPA, PFS, CFP®, AIF®
About Gordon J. Bernhardt President and founder of Bernhardt Wealth Management and author of Profiles in Success: Inspiration from Executive Leaders in the Washington D.C. Area, Gordon provides financial planning and wealth management services to affluent individuals, families and business-owners throughout the Washington, DC area. Since establishing his firm in 1994, he and his team have been focused on providing high-quality service and independent financial advice to help clients make informed decisions about their money. For more information, visit www.BernhardtWealth.com and Gordon’s Blog.