SPECIAL ISSUE: ECONOMIC FORECAST
A PUBLICATION DEDICATED TO WORKFORCE MANAGEMENT SOLUTIONS
VOL. 4 now
Is the economy on the UpswIng?
whaT’s new in
Top 3 flsa violaTions
& how To avoid TheM
To view an inTeracTive version of This publicaTion, go To:
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on workforce management.
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8 RecessioN RelieF:
5 is the ecoNomy oN the UPsWiNg?
By making proactive recovery plans now,
your organization can be more prepared
for the upturn than it was for the downturn.
13 WhAt’s NeW iN hR techNology?
Five questions you should be asking IT to
ensure that your organization’s HR function
is operating at peak productivity.
16 oN ReADeRs’ miNDs
Mike Taylor, Relationship Manager for
ADP Workforce Now HR Services,
addresses readers’ most pressing workforce
2 21st-ceNtURy stRAtegies FoR
mANAgiNg toP PeRFoRmeRs
When the employment tide starts to turn,
will your company be swimming with it or
against it? A look at emerging trends that are
creating new jobs and different work styles.
5 steeRiNg cleAR oF
Learn more about the three most common
FLSA blunders being committed by
today’s employers — and your best bets
for avoiding costly penalties.
WORKFORCE NOW | 1
When the employment tide
starts to turn, will your
company be swimming
with it or against it?
A look at emerging trends
that are creating new jobs
and different work styles.
2 | WORKFORCE NOW
t may take a little work, but if you look hard 30-50% of an annual salary to replace an
enough, you can find positive news about entry-level employee, 150% to replace a
the employment outlook. That’s largely due mid-level employee, and up to 400% for a
to the fact that emerging trends are creating specialized worker or high-level executive. To
new jobs and different work styles. put it in perspective, consider this: the Society
As people increasingly seek security, flexibility for Human Resource Management recently
and opportunities, more companies are facing estimated that it costs $3,500 to replace just
costly recruitment and retention issues as a one $8-per-hour employee.
result. It’s possible these trends could have a
direct or indirect impact on your company’s the imPoRtANce oF beiNg AN
workforce. “emPloyeR oF choice”
Here’s a look at some of the latest employment Almost every business has a brand image,
trends: regardless of size, industry, or target audience.
To recruit and keep the best candidates,
“hot desking” refers to workers who aren’t employers have to cultivate their “employer
tied to a particular office or workstation, often brand” as well. Your goal is to become an
working from their clients’ locations or from employer of choice — one eagerly sought
home. Being home-based is particularly out by workplace newcomers and experienced
appealing to parents and caregivers, for talent alike.
reasons that include quality-of-life issues as well It starts with communication. An employer of
as childcare costs. choice makes sure everyone is on the same
page when it comes to the company’s products
Rapid technology advancements and and services, procedures and processes,
upgrades are creating opportunities for big-picture business goals, and current market
technology professionals, especially those who strategies. Employers of choice also foster
specialize in networking, installation and support. two-way conversation, seeking input and
insight from the employee population at every
Similarly, the focus on sustainable or green level. Nine out of 10 employee suggestions or
business has resulted in growing opportunities critiques may not be actionable, but the 10th
for “green jobs” — positions that contribute to could be a golden nugget of insight that
the conservation of energy, expansion of wouldn’t have gotten to you any other way.
renewable energy sources, and conservation or Taking employee input seriously helps build a
improvement of the environment. powerful employer brand.
baby boomers are living longer and better DeVeloPiNg AND emPoWeRiNg
medicine is helping them lead more productive skilleD stAFFeRs
lives. That means more experienced help is An employer of choice invests in its employees
staying in the workforce longer. by providing on-the-job training or helping them
grow through outside resources. But it’s not
What effect will these trends have on your enough to identify needs and provide
organization, specifically your staffing needs? opportunities — you also must remove any
Slowly but surely, the workplace is shifting from barriers that might get in the way, like
a buyer’s market to a seller’s market. And too workloads or scheduling.
many employers consistently underestimate the To keep your best people from feeling like
ramifications and costs of replacing employees they have to jump ship to get ahead, they need
who depart voluntarily. Regardless of market to see there’s room for advancement within the
conditions or employment statistics, you need to company. This means evaluating job perfor-
make every effort to retain your top performers. mance on a regular basis, in an organized
Why? Sources indicate it costs an estimated manner, so that you or your managers can give
WORKFORCE NOW | 3
employees feedback as well as point the way When employees can directly access informa-
to improvement and/or growth. tion or find answers on their own, managers are
Investing in technology also sends a strong free to focus on strategic rather than administra-
message — one that shows your organization tive duties.
is forward thinking and committed to giving Finally, don’t underestimate the value of
people the tools they need to thrive. For simple flexibility. Though not every firm can offer
example, online benefits systems are one-stop benefits such as on-site daycare or 100%
destinations that employees can use to manage telecommuting, be open to non-traditional
everything from their healthcare to their retire- arrangements like flexible work schedules or job
ment plans. These convenient systems also give sharing that demonstrate your organization’s
employees continuous access to important support for work/life balance.
documents like company manuals and manage-
ment reference materials, while paying addi- cUltiVAtiNg AND ReWARDiNg sUccess
tional dividends by cutting down on many Every business wants high-performing
common but time-consuming tasks handled by employees. By cultivating a culture that gives
your HR staff. employees the balance of flexibility and
Similarly, payroll management systems can accountability they need to feel challenged as
help reduce operating expenses while providing well as valued, your organization is taking the
support and security. Other types of information, right steps toward achieving “employer of
guidance and forms can also be housed online. choice” status in no time. n
YOuR EmplOYER BRANd:
What message is it sending?
Just as your corporate brand serves as the foundation for your marketing
efforts, your “employer brand” is a powerful lever for attracting and retaining
a high-performing workforce.
So, what exactly is an employer brand? According to Aberdeen Group, a
leading research provider, it’s the way your organization is perceived by your
current employees, prospective job candidates, and the market at large — a
perception that is reinforced by every interaction a company has with its
employees and the marketplace.
In a 2008 study, Aberdeen found that enhancing company brand and
reputation in the recruiting market was named as the number-one strategic
action among best-in-class organizations. To succeed, the report found,
organizations must seize every opportunity to create a brand that resonates
both internally and externally, and is accurately aligned with the expectations
of the current workforce. By leveraging a positive employer brand, companies
can achieve significant improvements — not only in talent acquisition and
retention, but in performance as well.
4 | WORKFORCE NOW
learn more about the three
most common FlSA blunders
being committed by
today’s employers — and
your game plan for avoiding
oF comPeNsAtioN ViolAtioNs
n business, as in life, mistakes can have a certain value. But that
doesn’t mean they can’t still be costly — especially if we don’t learn
from our mistakes or those of others.
Nowhere is that advice more apt than when dealing with federal
regulations such as the Fair Labor Standards Act (FLSA), which governs
the rules for minimum wage, overtime pay, recordkeeping, and youth
WORKFORCE NOW | 5
employment standards. least the federal minimum wage for all hours
Across multiple industries, it’s common to see worked, and time and a half their regular
the same FLSA violations being committed time rate of pay for all hours over 40 hours in a
and again, according to a recent research workweek unless specifically exempted.
paper by Vicki Lambert, CPP, president of These exemptions include bona fide
Lambert and Associates, a firm specializing in executive, administrative, professional and
payroll training. outside sales employees. It’s important to
According to Lambert, companies most note that job titles alone do not determine
commonly go astray in three major areas: exempt status. To qualify for exempt status,
employees must pass three tests: job duties,
• lassifying employees as exempt or
C salary level, and salary basis. For an
non-exempt exemption to apply, an employee’s specific
• Counting the number of hours worked job duties, salary amount and how that
• Calculating overtime pay salary is paid must meet all the requirements
of the Department of Labor’s regulations.
On the surface, these three areas seem
surprisingly simple. How could you possibly Accurately counting the number
miscount the number of hours an employee has of hours worked
worked? In reality, getting it right is not so Employees must be paid for all hours
simple — and not so cheap if you get it wrong. worked. Sounds simple enough, right?
Unfortunately, the FLSA
does not provide a clear
“THE MORE YOU LEARN FROM definition for “hours
worked.” In several U.S.
EVERYONE ELSE’S MISTAkES, THE Supreme Court rulings,
hours worked may
FEWER YOU HAVE TO MAkE YOURSELF.” include any time spent in
HARVEY MACkAY “physical or mental
exertion that is controlled
or required by the
Tasked with enforcing the provisions of the employer,” and all hours an employee is
FLSA is the Wage and Hour Division (WHD) of required to give to an employer. This
the U.S. Department of Labor — not exactly an includes waiting time if it is for the employer’s
agency you’d like to see knocking at your benefit, and all the time during a workweek
office door anytime soon. In 2008, the WHD that an employee is required to be on the
recouped an estimated $185 million in back employer’s premises.
wages, in the process assessing employers These circumstances might also be
over $3 million in civil penalties for overtime considered hours worked:
and minimum wage violations.
• On-call time
be AleRt to commoN • Attendance at meetings or lectures
comPliANce PitFAlls • Travel time
To avoid contributing to the WHD coffers • Special one-day assignments
this year, re-examine your processes to • ime spent accessing and reviewing
ensure you’re remaining compliant in these emails while out of the office
calculation of overtime pay
exempt vs. non-exempt employees Many employers commonly believe that
The FLSA requires that all employees be paid at overtime is calculated using the employee’s
6 | WORKFORCE NOW
The Classification Conundrum:
Contractor or Employee?
Misclassification of an employee as an independent contractor can have serious
implications for your bottom line. The IRS can reclassify independent contractors as
W-2 employees, resulting in the imposition of fines, penalties and back taxes for
which the employer is generally liable.
Typically, an employer must withhold income taxes, withhold and pay Social
Security and Medicare taxes, and pay unemployment tax on wages paid to an
employee. You do not generally have to withhold or pay any taxes on payments to
According to the IRS, businesses must weigh factors like these to correctly classify
behavioral — Does the company control what the worker does and how?
Financial — Are the business aspects of the worker’s job controlled by the
payer? Consider how the worker is paid, whether expenses are reimbursed,
and who provides tools or supplies.
type of Relationship — Are there written contracts or employee type-
benefits? Is the work performed a key aspect of the business?
The keys to correct classification include looking at the entire relationship,
considering the degree or extent of the right to direct and control, and finally,
documenting in detail the factors used to make your decision.
hourly rate, and multiplying it by 1.5 and the the chAlleNge FAciNg comPeNsAtioN
number of overtime hours. If no other factors PRoFessioNAls
beyond straight and overtime hours are Today’s business environment has made
involved, that would be absolutely correct. understanding the latest FLSA requirements
However, if the employee’s regular rate of extremely important in order to stay compliant information on
pay includes items such as a shift differential, while meeting your organization’s HR needs. Of “The Top 3 FLSA
non-discretionary bonus, or a cost-of-living course, the FLSA covers much more ground than Violations and How to
Avoid Them,” visit
adjustment, this formerly simply calculation can simply the three areas outlined above. But
become infinitely more complex. Employers understanding the dynamics — and the workforce-management/
must then determine on a case-by-case basis if ramifications — of the three most common docs/whitepaper/
these additional payments are included in the violations will give your organization a head FLSA_White_Paper.pdf
to download the
regular rate of pay in order to calculate start in avoiding inadvertent and expensive complete white paper.
overtime correctly. contributions to the WHD any time soon. n
WORKFORCE NOW | 7
IS THE ECONOMY
ON THE UPSWINg?
In the words of Sir Isaac Newton, “Every action has
an equal and opposite reaction.” By making proactive
recovery plans now, your organization can be more
prepared for the upturn than it was for the downturn.
epending on where you live or work,
you may have noticed some interesting
billboards in your neighborhood
recently. The Outdoor Advertising Association of
America (OAAA) is sponsoring a campaign
with the theme “Recession 101,” using relatable
and light-hearted messages to help people
maintain perspective about the state of the
8 | WORKFORCE NOW
economy. Recently spotted: “Interesting fact schools, and investing in new energy
about recessions. They end.” “It’s a test. Not a technology. The Recovery Act is also intended
final.” “Stop obsessing about the economy. to save public sector jobs, protect vital services,
You’re scaring the children.” and provide assistance to workers hurt by the
One could argue that the OAAA has a vested weak economy.
interest in filling billboards that might otherwise The Recovery Act will save or create nearly
be empty, but the idea came from an anonymous four million jobs over the next two years. The
donor who wants to “remind Americans of the money is being distributed to state
things that make this country great.” governments, schools, hospitals, contractors
The point is this: Recovery will happen. And and other types of organizations. While your
you have a lot more control over how your organization may not be a direct recipient of
company prepares for the upturn than it did for government funds, It’s hard to imagine a
the downturn. business that won’t benefit from the Recovery
Act in some way. As funded entities hire, re-hire
iNVestiNg big iN the RecoVeRy or stabilize, the jobs created will have a ripple
The American Recovery and Reinvestment Act of effect on general consumer and business
2009 (Recovery Act) was signed into law by demand for all types of goods and services.
President Obama on February 17, 2009. It The federal government has been mandated
addresses an economic crisis in this country to make the process as transparent as possible;
second only to the great Depression, and it was www.recovery.gov has been created so that
enacted specifically to get the economy back on everyone has access to information about how
track. Billions of federal tax dollars have been and where money is being distributed. By
allocated for initiatives such as modernizing the tracking where the money is going and staying
nation’s infrastructure (roads, bridges, mass aware of events in your market area, you
transit), revamping health care, improving our should be able to project how and when
WORKFORCE NOW | 9
recovery efforts will begin having an impact on outsourcing to explore:
your business (if they haven’t already).
If you’re frequently on the road, you may not
gettiNg yoUR bUsiNess ReADy FoR need a full-time assistant. A virtual assistant
the UPsWiNg can help you with time-consuming tasks like
Use this time to assess your needs for re-entering managing voicemail and email, research,
growth mode. For most businesses, managing fact-checking, event planning, travel
increased costs for items like equipment and arrangements — almost anything you can think
inventory is going to be less of a challenge than of that takes you away from your core business.
managing your time and people needs.
Rather than trying to predict the future when it Payroll solutions ensure that your company’s
comes to specialty staffing needs, more payroll needs are met on time, every time,
companies are thinking outside the box and helping you streamline your payroll process,
leveraging the strategic benefits of outsourcing. improve productivity and simplify administration.
If you look outside your company for business Payroll services manage time-consuming
services, you’ll find providers that can give you processing and tax filing tasks so your HR team
an edge over direct competition, and help level can turn its attention to more strategic needs.
the playing field between your business and its
bigger competitors. Why? Because you’ll be By using the services of a marketing
dealing with specialists. consultant, you can plan and implement
Here are just a few examples of selective effective marketing programs that can help
10 | WORKFORCE NOW
you increase your business results at a faster ready to staff up, many HR service providers
rate. You can find a professional who knows can also help you find, hire and keep
your industry and is positioned to jump right employees, as well as help prevent you from
in — whether your goal is to take advantage making expensive hiring mistakes.
of an immediate opportunity or to develop a
long-term plan. PUttiNg the FocUs oN
tax and compliance services keep your Many companies have chosen to hunker down
business current with constantly changing laws and ride out the current economic turmoil. Is
and regulations, help you meet strict government yours among them? If so, it may be time to stick
deadlines, and avoid costly fines and penalties. your head up and take a fresh look at the
Experts in governmental regulations can help bigger picture — making sure that your team’s
you reduce expenses, mitigate risk, and focus is on mission-critical imperatives rather
eliminate laborious manual tasks. than administrative necessities.
If you’re a believer in Newton’s laws of
hR service providers can help you track motion, it’s only a matter of time before
benefits plans, integrate time and attendance the economy that went down comes back up.
records with talent management solutions, Use the time in between to make plans, and
improve communication with your employees, you’ll be in the best possible position to take
and give your managers access to tools like your business right back into growth mode
online performance reviews. When you’re when the recovery hits full speed. n
YOUR PIECE OF THE RECOVERY
AND REINVESTMENT PIE
Opportunities abound for many businesses that in the past might not have considered
pursuing government projects. You can now search online for opportunities across the
entire federal contracting community.
Start with FedBizOpps.gov for all federal government contracting opportunities that
exceed $25,000. The site lists all major solicitations, contract awards, subcontracting
opportunities, surplus property sales, and even foreign business opportunities.
Interested in a federal grants? Federal agencies offer more than 1,000 grant
programs and access to approximately $400 billion in annual awards. Visit Grants.gov
to search and apply for grants from 26 different federal agencies.
minority and woman-owned businesses may want to seek certification credentials
to open doors to bigger opportunities. For information, visit organizations like the
National minority Supplier development Council (msdc.adaptone.com/nmsdc) or the
Women’s Business Enterprise National Council (wbenc.org).
WORKFORCE NOW | 11
iN hR techNology?
1987 article in The New York Times by
Nobel Prize-winning economist Robert Solow
you should be
ignited a firestorm when it questioned the
relationship between computers and productivity.
Though that debate still continues today on certain
asking IT to hot topics — the relative merits of being wired 24/7,
for example — the majority of HR professionals are
ensure that your certain to acknowledge the role that computers and
technology play in easing their departments’ daily
organization’s administrative burdens.
With rapid shifts in business technology happening
almost daily, it’s more vital than ever that your HR
HR function is team maintains solid relations with your IT department,
working together to ensure that your organization
operating at leverages today’s best-of-breed human resources
technology tools as effectively as possible.
peak productivity. Here are five questions you should be asking your
IT department to start a productive dialogue:
HOW INTEgRATED ARE WE?
growing companies often find themselves with “patchwork” HR IT solutions cobbled
together and modified by necessity as new needs arise. Lack of integration across
vital systems can have serious repercussions in terms of productivity and continuity.
Think about it — the common appearance and menu functionality across every program in
the Microsoft Office suite isn’t by accident. Non-integrated systems force a steeper learning
curve when it comes to training new users, and repetitive data entry (entering payroll data in
separate payroll and tax systems, for example) can lead to costly mistakes thanks to simple
Fully integrated systems (also known as Human Resource Information Systems, or HRIS),
bring together under a single interface interdependent HR processes such as payroll
processing, benefits administration, and applicant tracking. With the latest generation of HR
applications delivered over the web (known as SaaS, or “Software as a Service”), companies
can skip the expensive investments in hardware that presented a significant barrier to
implementation in the past. Upgrades, too, are simpler than ever, as developers can push out
new features faster, allowing your business to adjust to shifting market conditions as needed.
WORKFORCE NOW | 13
HOW REDUNDANT ARE WE?
If people are your organization’s most important asset, your HR data is equally
important. A Pepperdine University study recently estimated that lost data costs
U.S. companies an average of $18.2 billion dollars each year.
What protections do you have in place to protect employees’ privacy and guard against
data loss — whether from hardware failure, environmental catastrophes like fire or flood,
or external security breaches from malicious hackers or identity thieves?
Review your system protections with your IT pros to ensure that adequate data protections
exist, your backup and recovery systems are tested regularly, and a business continuance
plan is in place in the event that one or more of your offices becomes inaccessible. Even
the best recovery system is useless if no one knows how to use it when disaster strikes.
HOW CAN WE DO WE HAVE A
BETTER MANAgE CLEARLY DEFINED
STAFFINg, AND ACCESS POLICY?
PROFESSIONAL Here’s an issue that’s sure to generate
DEVELOPMENT? strong opinions on both sides of the
The best workforce starts with the argument. For many senior managers, access
best hiring and retention tools. to social media technology — blogging,
Applicant management programs are Twitter, Facebook, YouTube — is immediately
fast becoming the norm for seen as a distraction or time waster.
automating functions like processing Conversely, younger hires view them as
applications and ranking respondents’ must-have tools for collaboration and getting
résumés — routine tasks that often business done.
consume the bulk of a hiring Before adopting a knee-jerk “no access”
manager’s time and attention. policy, consider the elements of social
Screening and selection tools take the networking that may be in line with broader
process one step further, using management strategies. For example,
thorough candidate screenings to internal video blogs or knowledge banks
ensure compliance and reduce risk. can help employees more easily connect
Once your organization’s made with one another and share information,
the right hire, technology-based time especially in larger or far-flung organizations
and attendance solutions can where simply walking down the hall to ask
streamline employee scheduling, track a question isn’t possible.
activities, and manage absences, As social media moves from strictly
helping you optimize your labor marketing and branding applications to
investment. To keep employees tools for lead generation, customer
challenged and motivated, consider communication, and internal communication
using performance appraisal or talent and collaboration, companies of all sizes
management software to simplify need to have a clear strategy for social
the process of tracking goals and media tools — and an equally clear policy
identifying skills gaps. on employee usage.
14 | WORKFORCE NOW
HOW USER-FRIENDLY ARE WE?
Respondents to a January 2009 study commissioned by ADP said that nearly half
their HR team’s time (45%) is spent on a combination of payroll-related activities
(18%), HR administration (14%) and benefits administration (13%) — repetitive,
time-consuming tasks that leave little room for more strategic contributions to your organization.
Companies are now turning to self-service portals that allow employees to access, maintain
and modify information via a web browser. This shift to self-service functionality for employees
and managers alike is a direct response to the competitive challenges of today’s knowledge
economy, making it the preferred method for improving internal service and enhancing the
lines of communication between your company and its employees.
The benefits of these self-service portals are two-fold in positioning your organization as an
employer of choice — demonstrating your responsiveness and techno-savvy to employees,
while freeing your HR team to concentrate on more strategic initiatives to further reinforce that
leadership position and attract top talent.
hARNessiNg techNology to DRiVe iNNoVAtioN
With human capital the largest investment of just about every business, it makes sense to also
invest in the technology needed to make the most of that valuable capital. By staying ahead of
the technology curve and making sound investments, you’ll ensure that your HR strategies and
goals are aligned with the technology needed to achieve them. n
WORKFORCE NOW | 15
On ReadeRs’ Minds
Mike Taylor, Relationship Manager
for ADP Workforce Now HR Services,
addresses readers’ most pressing
workforce management questions.
Q: We’Ve jUst begUN ReVisiNg oUR comPANy’s
extRemely DAteD emPloyee hANDbook. Do
yoU hAVe ANy RecommeNDAtioNs FoR
cURReNt best PRActices thAt We shoUlD keeP
iN miND DURiNg this PRocess?
A: If your handbook hasn’t been updated in a while, chances are
it doesn’t address many relatively new issues such as the use of
technology or legislative mandates for the Family and Medical
Leave Act (FMLA) or the recent changes to the Americans with
Disabilities Act (ADAAA).
To stay current with best practices and remain in compliance,
your employee handbook should include clearly stated
information on the following:
• Use of cell phones in the office
• ccess to online social networking sites,
such as Facebook or LinkedIn
• Drug and alcohol use
• Workplace violence
Older handbooks are often out of compliance when it comes to
issues like risk and safety, and family and medical leave,
particularly regarding pregnancy-related absences.
Congratulations on recognizing the importance of an up-to-date
employee handbook. By defining and communicating your
organization’s policies and standards, you’ve taken an important
step toward the fair and consistently applied personnel policies
that are the hallmark of today’s leading employers.
16 | WORKFORCE NOW
Q: mANAgemeNt WANts to mAke seVeRAl chANges to
the PAiD holiDAys obseRVeD At oUR comPANy. WheN is
the best time AND WAy to ANNoUNce these chANges?
A: Several considerations should come to mind when making changes like paid
holidays, including minimizing any disruption to business activities and the
potential impact on employee morale. Rather than a mid-year change to the
holiday observance schedule, which could affect employees’ childcare or
vacation plans, consider implementing a new schedule for the new year — and
communicating changes well in advance.
Many companies choose to communicate in stages — sending a general
notification that the holiday policy is being reviewed, followed by a detailed
summary of the changes and timeline for implementation. By mapping out a
strategy well in advance, you’ll be in a better position to control how and when
these changes will be best received by your employees.
Q: oUR oRgANizAtioN is UNFoRtUNAtely AmoNg those
tAskeD With imPlemeNtiNg A ReDUctioN iN FoRce (RiF).
hoW Do We eDUcAte oUR mANAgeRs oN the PRoPeR
WAy to select the PositioNs to be elimiNAteD?
A: When tasked with an RIF, objective criteria and consistency in the criteria
used to make the cuts is critical. Steer clear of any considerations that could be
considered biased, such as an employee’s attendance record, and be aware of
the impact on protected classes of employees.
For example, companies often consider length of tenure as the criteria for
a reduction, but fail to recognize that its longest-tenured employees may be
protected by age discrimination legislation.
By being as objective and consistent as possible across the board, your
company can apply the fairest possible criteria to conducting the RIF. n
WORKFORCE NOW | 17