Would You Pay .5% of Your Salary to Employ Your CEO?

Graph showing that CEO pay increases at faster pace than worker pay.

Let’s say you make $50,000. That means you would pay $250 annually to keep your CEO employed.

Are you willing to do that?

That’s, on average, how much each employee of a Fortune 500 company pays for their corporate F500 CEO in terms of the executive compensation of a CEO. Now, I know you don’t really pay any money out of your check to your CEO, directly. But, if your company wasn’t paying your CEO millions of dollars, could they be paying you a little more?

Or, do you believe the compensation your CEO is making is giving you, and all the other stakeholders of your organization, a good return on your investment?

new study is out that looks at this issue:

How much a typical employee of the S&P500 firms implicitly “contributes” to the salary of his/her CEO? An amount of $273 on average or 0.5% of one’s salary, that is, one half of one percent on an individual salary basis. To assess whether such a contribution is worthwhile, one must determine the value of the CEO for the organization and its workers and stakeholders.

I love the mental exercise of this. Being a CEO of a small business it truly brings into perspective what you bring, or don’t bring, to those you work with each day. At the level of a Fortune 500 CEO, and the amount of CEO compensation at those giant companies, it’s hard to even imagine!

Tim Cook, the CEO of Apple, had a total compensation of $125 million dollars in 2019, down from $136 million in 2018. Do you think the employees of Apple would be willing, across the board, every single one, to pay .5% of their salary to keep Tim as CEO or go with a cheaper option?

Better yet, Apple is a very successful, profitable company. If the employees of Apple chose another CEO making, let’s say, only $10 million per year, would that profitability really change that much?

Many people have this argument around college and professional coaches ‘ salaries in sports. Does an NCAA coach making $8 million a year at a power 5 conference, really that much better than a coach making $500K at a mid-major program? Probably not. CEOs probably aren’t that much different. It’s very rare to find a leader, or coach, who is truly transformational that you can point to and say, yep, Timmy is definitely worth what he’s getting paid!

It would be an interesting internal study within your organization to see what percent of your employees would say they would be willing to pay it. It’s really a great measure for your CEO to understand their impact and worth, and probably bring them down to reality a bit.

What do you think? Would you be willing to pay .5% of your salary to your CEO!?! HRU employees – you don’t have to answer this! I already know you would! 

For more by Tim Sackett visit TimSackett.com

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What Is This Hire Supposed To Do?

Side profile of woman showing lots of thoughts.

I’m only talking to leaders today. We tend to fall into this rut. I have a position on my team. A person leaves. We need to fill that position.

Before you fill your next position, as yourself this one question:

How will this hire bring us closer to reaching our business objective? 

In fact, you might want to ask that question in the interview of the candidate. How are you going to move us closer to meeting our business goals and objectives, and of course, first tell them what those are.

Too often we replace people without really seeking to understand if a certain position is really doing that. Well, we’ve always had a person in this position, so we need to replace this person. But, if that position isn’t really moving you closer to meeting your objectives, maybe it’s the right time to not hire that position, and maybe hire a new position.

Business objectives evolve and change over time. A position you needed five years ago, quite possibly might not be needed today.

I also find that what a certain position is supposed to accomplish sometimes devolves over time based on who had the position. Well, Timmy’s position was supposed to do “X”, but Timmy wasn’t very good at that, but we liked him and now Timmy’s position does “Y”. Really, so do we no longer need “X”?

If any position isn’t moving your department or business closer to your goals, it’s a position you should not be filling. We have a really difficult time as leaders not filling positions on our team that we’ve always had. We love to build our empires, not break them down. The reality is the most effective leaders don’t just backfill positions, they analyze where the real need is or isn’t in their world, and then work to make that happen.

Great leaders don’t backfill positions. Great leaders first decide is this role going to move us closer to meeting our objectives?

For more by Tim Sackett visit TimSackett.com

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Navigating The New 2020 W-4 Employee’s Withholding Certificate

The New 2020 W-4 Employee's Witholding Certificate

With every new year comes some sort of changes or updates with employee payroll, and 2020 is no exception.

On December 5, 2019, the IRS issued the final version of the 2020 Form W-4 Employee’s Withholding Certificate, designed to help employees withhold the correct amount of federal taxes throughout the year. I have taken look into the NEW W-4 form so I can provide you with an easy understanding of the new requirements and a brief guide to filling out the form.

The biggest change in the W-4 form is the elimination of allowances, this was a result of the Tax Cuts and Jobs Act of 2017.

In the past it was easy:

  • 1) Pick your filing status: Single, Married, Married filing Single, or Head of Household
  • 2) Pick your Number of Allowances 1-10,(the higher the allowances the less taxes taken throughout the year).

However, in this revamped 5 Step form it now has employees’ detail the number of qualifying children in your household, as well as other dependents you care for, and take a closer look at other personal financial adjustments that could affect their annual taxable income.

So, with a new form comes new questions and most likely some confusion. In my payroll department as I am sure many others can relate, we often get the questions “How do I fill out the W-4?” or “What should I put on my W-4?” Employers can guide employees with completing the form, but cannot or should not provide employees with advice on deductions or additional withholding. We always recommend employees to consult with their tax preparer on how to fill out their tax forms that would be most financially beneficial. 

As employers we have a few responsibilities when it comes to the employee tax withholding certificates:

  • We must retain a W-4 Form for all employees.
  • Current employees hired prior to 1/1/2020 do not need to fill out new forms unless they wish to change their withholding for the year.
  • Any employee hired after 1/1/2020 will be required to fill out the new 2020 W-4 form.  
  • Any employee that claimed EXEMPT status for 2019, will need to complete the new form for the new year.
  • Encourage your employees to check their withholdings or speak to their tax preparer.
Stressed man looking at computer

Employees also have the option to use IRS Tax Withholding Estimator to help them complete the new Form W-4. If employees choose to use the estimator they will need to have the following information available to complete it accurately: Employee and Spouse data for current salary & bonus, YTD Federal Tax withheld, current federal tax withheld from last paycheck, and most recent pay period end date. Personally, I do not recommend this method because I find it to be confusing and messy and will leave your employees with more questions than answers.

Even though most of us use an automated payroll service to complete our payroll, we still need to be an available resource for our employees. Below you will find what I like to call the dummied down guide to filling out the 2020 W-4 Form.

Here is a simple guide to completing the New W-4 Form:

Step 1 (Required): Enter in all personal Information: Name, Address, Social Security Number, and Filling Status

Step 2: Complete if you have more than one job or have a spouse with income

Step 3: Complete to claim your dependents 

Step 4: Complete for other adjustments

  • Step 4a:  Complete to have additional taxes withheld from other income NOT FROM JOBS (retirement income, interest, etc.)
  • Step 4b: Complete to REDUCE your tax withholding (Use the Deduction Worksheet)
  • Step 4c: Complete to withhold ADDITIONAL Taxes, for Non-Resident Alien status, or to EXEMPT yourself from withholding taxes. 

Step 5 (Required): Signature and Date

*Please Note: If you complete Step 1 and 5 (ONLY) leaving Step 2, 3, and 4 blank your withholding will be computed based on your filing status standard deduction and tax rates, with no other adjustments. Completing Step 1 ONLY is equal to claiming zero exemption under previous W-4 forms.*

As an additional resource I have included a link to the FAQs on the IRS website: https://www.irs.gov/newsroom/faqs-on-the-2020-form-w-4

Questions? Feel free to reach out, I am here to help!

Jacki Rieder, Vice President of Finance

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DisruptHR Lansing! March 19th – Call for Speakers is Open!

DisruptHR Lansing Logo

By Tim Sackett

Lansing, MI is about to get all Disrupted and Stuff! Everyone already knows I’m a big believer in DisruptHR events. I’ve spoken at many, I’ve been on the team running DisruptHR Detroit from the beginning, and I decided to start DisruptHR Lansing in my own backyard!

Our first event, DisruptHR Lansing 1.0 will take place in Downtown Lansing on March 19th in the evening (more details to follow) at The Exchange. Great speakers, free food and drinks, and disruptive HR talks throughout the night!

What is DisruptHR?

  • 5-minute hr-based micro-talks. Might be HR, talent, employee experience, leadership, rap music, who knows!
  • Each talk has a very specific format – 20 slides and each slide moves automatically every 15 seconds.
  • The goal is to be fast and challenge the status quo of the people side of the business!


We’ll be selecting a great group of speakers. I encourage HR pros and Leaders from the Mid-Michigan area to throw your names into the hat for speaking spots!!! It’s a great way to get yourself on stage with a group of fellow HR peers who’ll support you and laugh at our bad HR jokes!

Speakers also get a professionally recorded version of your talk. This is an awesome parting gift for your own development, and to show other conferences, etc. if you decide you want to speak in a longer format in the future. Almost every conference I know now asks for some proof of your ability to speak, as such, this becomes a very valuable piece of content!

Why Speak at DisruptHR Lansing 1.0? 

1. Well, I’ll be there!

2. Lansing, MI is the capital of Michigan. The epicenter of all things people in our state. It’s also might be the one place in Michigan that needs the most HR disruption!

3. HR pros need a network. We need to support each other. This is a great event to make that happen!

4. Cocktails & Hugs! (which ironically is the name of one of my upcoming future books!)

5. I’ll owe you!

Let’s face it. It’s March 19, 2020. We’ve just spent the last 120 days in pure grayness. We need to get out and do something! The event space will be intimate, the energy will be high, and we’re going to have some fun!

Come join us! Tickets will go on sale after the holidays. We wanted to open up the Call for Speakers first!

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How Would A College Education Be Different If You Were An Investor?

Graduation Cap traded for Money

There’s a concept that is starting to gain some steam in college tuition funding called “Income Share Agreements”. The basis of these agreements is pretty much “I” (the investor) pays “you” (the student) to go to college and get an education. Once you graduate and get a job, I take some of your annual salary for an agreed-upon time.

From the Washington Post:

In an ISA, a student borrows nothing but rather has his or her education supported by an investor, in return for a contract to pay a specified percentage of income for a fixed number of years after graduation. Rates and time vary with the discipline of the degree achieved and the amount of tuition assistance the student obtained. An ISA is dramatically more student-friendly than a loan. All the risk shifts from the student to the investing entity; if a career starts slowly, or not at all, the student’s obligation drops or goes to zero. Think of an ISA as equity instead of debt, or as working one’s way through college — after college.

I like this alternative to student loans because it puts much of the risk on the investor and away from the student. Also, if higher education institutions get involved with these kinds of investment funds, it truly puts accountability back on their organization to ensure they are producing graduates who are desired and prepared.

Purdue University has been doing a ton of testing with these types of agreements:

Although the very nature of ISAs protects the participant, early adopters such as Purdue have built in safeguards. A user-friendly computer simulator provides quick, transparent comparisons with various public and private loan options. No investee pays anything for the first six months after graduation or until annual income exceeds $20,000. For those graduates who get off to fast career starts, a ceiling of 250 percent of the dollars that purchased their education limits total repayment.

All of this gets you to think about what might be possible if we walked away from traditional student loan programs altogether!

What if…

  • The amount of your investment into a student returned more than you could make on the stock market?
  • Students had to present themselves, as high schoolers, to investment groups to get funding for university?
  • Investors and investing groups were only willing to fund students in careers where they could get a good return on investment? Say goodbye to history majors!
  • College students had to meet with their investors and explain why they got a “C” and missed class because they were drunk!?
  • Organizations and HR Departments started investing in potential future talent in a very real way!?

I love disruption to traditional things we have come to believe just can’t be changed. This isn’t perfect and there are a lot of questions, but it’s worth testing and trying. What we know is traditional student loan programs are not working at all! Something has to change.

I’m GenX and a Capitalist, so I love the accountability of both the investor having to make sound, prudent investment decisions around who they feel is most likely to give them a great return on investment, and the student’s accountability of understanding there’s a cost/benefit to your career choices and what it will cost to pay back those choices.

What do you think? Would you allow one of your kids to get into one of these arrangements, or would you have been willing to do this in college? I think I would have had very few people want to invest in me, but those who did would have been paid back in spades!

For more by Tim Sackett visit www.TimSackett.com

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Navigating Paid Leave Laws

By Teresa Carper

Navigating the various state Paid Leave Laws can be exhausting!  

If your company, like HRU, operates in multiple states then you know how difficult and time consuming it can be to stay on top of this ever growing trend.  I have two white boards in my office and one of them is solely dedicated to paid leave laws. 

But hold on, it doesn’t stop at the state level, you must also consider the state municipalities that may differ from the state law.  The number of hours that an employer must provide to eligible employees under the paid leave laws differ by state.  Similarly, accrual, use of paid time and roll-over of unused accrued time also differ.   

To help you out, I have created a chart that includes current states and municipalities requiring paid sick leave and or paid medical leave with a link to the state or local legislation.   The chart is below:

  Additionally, keep in mind that paid sick leave and paid medical leave are only a fraction of the leave laws employers are required to provide.  Make sure that your leave policies comply with your applicable state or local legislation to minimize the risk of legal claims such as retaliation, discrimination and or interference.   

Questions?  Feel free to reach out, I am here to help!  

Teresa Carper, Vice President of Operations

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What We Say Versus What We Want In A Job

Saving Puppies from Fire

My wife always tells me it’s actions, not words that make a difference. You can say all of this great stuff, but if you do nothing, it’s meaningless. I think we would all agree with this.

So, when we hear graduating students, candidates, and employees tell us what they really want is “Meaningful Work” in their careers, we have to understand that those are “Words”! Not actions, just words. A new study from Olivet Nazarene University Meaningful Work Survey asked this question and, predictably, found this:

So, yeah, 90% of us believe that meaningful work is critical for our career and happiness. Sounds about right, those ‘words’ tend to always come out when we talk about our dream job, etc.

Then the study asked another question. It was basically, given your current career, job, etc. what is the one thing that would make it better? An action. But, remember those words!? What you would believe would make their career/job better should be “more meaningful work”! 90% of you idiots just answered that is was super important for your career and happiness!

Here’s what they actually said:

Show. Me. The. Money!!!!

Yep, you know I love this! “We just a job that saves puppies! That would make me so happy!” Oh, wait, saving puppies only pays $23,000 per year!?! Yeah, screw those puppies! I want to work for a private equity firm! I’m a boat, bitch!

Want to retain your employees? Stop trying to make your employees believe that the rubber vomit you’re manufacturing matters and pay them more and give them flexibility! Stop asshole managers from treating their people bad! And magically, you’ll have high retention and your people will love working for you, even though you don’t save puppies!

I get it, deep down, we all want to do something that changes the world for good. We want to help others, and save puppies. And the concept of meaningful work does really matter, given all other things, like compensation, flexibility, great leaders and co-workers, etc. are equal.

If I can make six figures a year saving puppies, I’m saving puppies. You’re saving puppies. We are all saving puppies!

But it doesn’t, so our actions speak way louder than our words when it comes to career choices and change. Meaningful work is not the most important thing for people in their careers. Its something to consider, but don’t get too caught up in believing it’s going to fix all of your employee experience issues!

For more by Tim Sackett visit TimSackett.com

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Is Time or Money More Valuable?

You might have seen this in the news that Estonia has started experimenting with a new way to punish speeding drivers. Instead of making them pay a fine for speeding, they are giving them an option to ‘take a timeout’ instead for 45 minutes to an hour, right then and there. Which brings up the question: What is more valuable to these drivers, their time or their money?

From the article:

Drivers caught speeding along the road between Tallinn and the town of Rapla were stopped and given a choice. They could pay a fine, as normal, or take a “timeout” instead, waiting for 45 minutes or an hour, depending on how fast they were going when stopped.

The aim of the experiment is to see how drivers perceive speeding, and whether lost time may be a stronger deterrent than lost money.

Early results of this pilot program are unclear, as it seems that those who can pay the fine will, while those who would be hit harder by a financial fine will tend to take the timeout.

These types of tests are what we should be doing with our own employees within organizations. Everyone has different values of certain things, but we tend to build rewards and punishment programs all the same. Do well and you’ll get a $500 bonus! Or do well and you’ll get an extra day off!

Rarely do we build them where we give people the option – do you want more time or more money as your reward, or on the flip side, for your punishment do you want money or time taken away?

I’ve used both and not one is 100% correct. I’ve had goals set that would reward is something was met, but also if it wasn’t met then the person or team would have to come in and work extra time. I can tell you, no one liked coming in extra to meet their goals. So, making some work extra, for the same pay, seems to be a big deterrent, but also a pretty crappy work experience.

On the flip side, being able to take more time off is really liked by some, but not all. You’ll have some folks who actually really enjoy coming into work, and taking a bunch of extra time off gives them anxiety to be away from the office.

Is there a magic solution? 

The one thing I see that consistently has the biggest impact on a positive employee experience in any environment I’ve worked in is simply flexibility. Treat employees like adults and let them integrate their life with their work and make the choices they need to make to make both work as effectively as possible.

Sounds easy, it’s super hard and complicated in real life! Because it’s complicated, we tend to do the opposite and have a bunch of rules, which then just makes it miserable for everyone. I prefer to give the flexibility, but and then take care of the outlier issues that crop up. We believe there will be many issues, but it’s fewer than you think.

One easy way to control for all of this is to have really great, non-subjective, measures of success. The reality is if someone working for me is successful, then they should have the freedom to have the flexibility they desire.  What I know is time and money are both valuable depending on the situation you are currently in, and those values can change daily for some people.

For more from Tim Sackett visit TimSackett.com

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What Is The Best Day To Post Your Job?

By Tim Sackett

It’s a blocking and tackling-type of a question in talent acquisition and recruiting, right? Most of us believe it’s part science and part art. “Well, Tim, that all depends on…”

No, it doesn’t.

It depends on data and the Appcast data from their 2019 Recruitment Media Benchmark Report says this:

Yep, it turns out Monday is the day. Then on Tuesday. Then Wednesday. Then Thursday. Then Friday.

Any questions?

It makes sense, right? We tend to hate work the most on Mondays. As the week starts to go by, we tend to hate work a bit less, as it gets close to the weekends.

By the way, this is true for almost any type of content and interaction. If you want to have the most exposure of something, you release it on Monday. If you want to see a story or piece of content die, you release it on Friday or Saturday! The same goes for job postings!

Does this mean you should only post your jobs on Monday to get the most bang for your buck? Hmm. Great question (I just asked myself)! The data would say yes, but you really have to test this with your own jobs and marketplace.

Also, there are Monday’s you would never post because it’s a holiday or some other calendar factor that doesn’t give you the best opportunity for traffic.

It’s probably clear that when that hiring manager is begging for you to post the job on Friday, “to get a head start on next week” you tell them to shut up and do their job, and you’ll do yours! For the most part, you’re going to post jobs Monday – Wednesday and stay away from the end of the week and weekends, as a broad policy.

I remember my Mom (she started the company I run now) telling me early on in my career that you should always fire someone on a Monday, not a Friday. “If you fire them on Monday, they take the rest of the week looking for their next job. If you fire them on Friday, they sit at home all weekend and get depressed, angry, drunk, all of the above!”

Now she said this based on zero data, but a lot of experience firing people and believing the Monday fires were better, and now when I see the data about how many people apply on Mondays it makes me wonder if everyone was like my Mom and fires people on Mondays!

I like the data from Appcast. It’s a robust amount so you can’t question the accuracy of when people like to apply to jobs, and it passes the ‘eye-test’ of feeling about right. I think all of us want to believe people spend their weekends applying to jobs, but the reality is most people like to get paid to apply to jobs while they’re working!

Article by Tim Sackett on FistfulOfTalent.com

For more by Tim visit TimSackett.com!

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