Your Business Resolution — Time For a Fresh Approach

business resolutionsFor many, January is the perfect time for a new start. Resolutions to go on a diet, exercise more, pay off debt, get a new job, and otherwise improve our lifestyles are as popular as ever. But, there’s another area where a fresh start can make a big difference — Your business.

The fact is, you’re probably so involved in the day-to-day running of your organization that you don’t take a step back and get a better perspective. When you’re able to step away for just a little while and look at things objectively, the chances are you can find some good stuff to improve in your business. Here’s how to go about it.

Step 1 — Set aside the time

Get some time in the diary in early January to remove yourself from everyday operations and allow yourself to review how you could improve how your business functions, policies, and procedures. Encourage your leadership team, key managers, and a selection of employees to be involved.  Not only is their input critical, it will also remove some of the burden off your shoulders.

Step 2 — Get out of the workplace

You can’t do this with distractions. Go offsite and have an away day where you can minimize the chance of interruptions and actually get some initiatives in place, bring key members of your team along with you.  Make it engaging, fun and ensure you have white boards to capture your ideas.  Take pictures so you can save the details of your discussion.

Step 3 — Identify the main areas you want to improve

Have an honest and open discussion with your team. Let everyone bring up the main pain points in the business. What’s unnecessarily complicated or difficult to do? What policies, procedures, or functions could be improved? You’ll want to keep the discussion constructive, but don’t leave anything off the table.

Step 4 — Categorize the problems

You’ll want to split the various issues into categories, for example:

  • People related — More training needed, new team setup, staff handbook updates etc.
  • Policy related — New and amended policies to make your workplace easier to do business in.
  • Procedure related — Changes to business processes, ways of doing things, and functionality.
  • Technology related — Issues with technology, hardware, software, etc.
  • Other — Any other issues that don’t fit neatly into the previous categories.

Step 5 — Brainstorm fixes

Once you’ve got your categories, see if any of the problems are related. After you’ve done that, go through and generate ideas on how to fix the various issues, especially your policies and procedures. Don’t consider any idea to be too outlandish.

Step 6 — Prioritize

Once you’ve got your ideas, prioritize the fixes. Deliver on ideas that are easy to implement and will have a good impact. Follow that up with the harder implementations that will still make a big difference. After that, carry out the changes that will still have an impact, even if it’s minor.

Step 7 — Give people accountability

Once you have a list of ideas, get people in your business to take ownership of them. Get project management in place to deliver on the ideas and fix the broken parts of your business. Then, get regular updates throughout the year on how things are going. Give your project managers the resources and people they need to make a positive change.

This can be a great way to incentivize and fire up your people to change their working environment. Whether it’s removing bottlenecks in a process, rewriting a policy, enhancing training for team members, improving hiring methods, or replacing old technology, small changes can have a big impact.

Carry this out every January, deliver on your changes, and you’ll have a beautifully functioning, sleek, and efficient operation in less time than you think.

Matt Bauer
President
mbauer@srfm.com

Business Resolution

Keeping Up With the Evolving Workplace

???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????With the age of Millennials gaining a stronghold in the workforce comes the dawn of the modern workplace. Times are changing surrounding how we hire and train, what we do to retain employees, and the dynamics within the office environment itself. Employees are seeing companies through different lenses these days, and employers have to rethink their employee strategies in order to attract and retain the best new talent.

Change is good, and if you want to keep up it’s time to let go of the past, embrace the present, and see into the future. The business landscape is evolving, and we’re going to discuss some things you can do to make sure you’re positioned to grow with it.

The Office in 2016

Increased technology, a path for growth, and a fresh view from management of workplace dynamics are what employees are expecting in today’s modern office. Millennials are vetting employers more deeply than ever and making choices on where they want to work based on culture, values, perks, and growth opportunities. Millennials want more than just a paycheck, and to attract the best up and coming talent, employers have to offer more. Let’s talk about what that means.

Keeping Up With The Times

One of the top criteria that Millennials use for deciding whether or not to sign on with a company is the quality of the management. Quality of management comes in many forms and is relevant on multiple levels. Here’s what I mean:

Technology: Does it seem like technology developments are moving faster and faster with each passing year? It seems that way, because it is that way. A company that doesn’t embrace and leverage new technology sends a message to employees (and potential employees) that you’re ok remaining stagnant and not so interested in embracing growth and change. This is a red flag for discerning Millennials who are ever-so-searching for upward growth.

Flexibility: As the workplace changes, so do our workdays. The traditional 9 to 5 is a thing of the past in many business settings, and employers are embracing more unconventional methods like implementing 4 day work weeks and allowing more telecommuting. This tells prospective employees that management takes a smart approach to cutting costs and streamlining operations which also allows for a more balanced work-life dynamic for the employee. It’s a winner with Millennial for sure.

Wellness: Employees expect more from the workplace in terms of personal development. They ask the question: If I spend 8 to 10 to 12 hours a day at my job, what am I getting out of it besides a sense of achievement and a paycheck? Wellness programs are an essential part of any companies’ employee strategy. An investment in the health and wellbeing of employees not only improves the quality of life for workers, it’s proven to increase productivity and it lowers insurance rates for the business.

What can a company do to keep up with the times?

Don’t be Fred Flintstone: Nothing is more frustrating for employees than outdated technology that slows down their day. Provide the right tools for your people and it goes a long way in improving their happiness and increasing their productivity. Assess and upgrade equipment as needed like; Phones, Computers, and Printers and if they say “Made in Bedrock” on the bottom, get an upgrade.

Limber Up: Consider some alternatives to the 8 hour workday if they make sense for your business model. Will a four day week work fly? Can some of your people telecommute part of the time? If the answer is yes, test out some of these options, they could save you money and increase productivity.

Take Care of Your People: If you don’t have a dedicated Wellness Program, get one started. A comprehensive wellness program is an attractive benefit for prospective employees and it will pay you back in spades, by way of:

  • Lowered health care costs.
  • Reduced absenteeism.
  • Higher employee productivity.
  • Reduced workers’ compensation and disability-related costs.
  • Reduced occurrences of injuries.
  • Improved employee morale and loyalty.

Step up Your Game: If you have a wellness program in place, great, you’re on the right track. Consistent growth and improvement of your wellness offerings tells employees that they mean something to the company and are worth the investment. Think about expanding your program and even throwing in some lifestyle benefits in the office like; Yoga classes, fitness areas, and even allowing pets in the office.

Millennials love to see that a company is invested in their personal and professional growth; I think we all like to see that. So, especially in this age of the evolving workplace it’s important for employers to stay up with the times, embrace the changes, and provide a culture that’s attractive to up and coming talent.

At Sinclair we’re dedicated to Employee Wellness. We look at an organization from every angle and we will customize a wellness program focused on developing a healthier and happier workforce in your business. Get in touch with us today to see what we can do for you.

Matt Bauer
President
mbauer@srfm.com

11 Smart Financial Moves You Have to Make

Giving Back: Charitable Giving Opportunities

Giving Back: Charitable Giving OpportunitiesAccomplished individuals often look for opportunities to express their values and give back through charitable giving.  In fact, Bill Gates and Warren Buffet started an initiative called the Giving Pledge, which encourages the world’s wealthiest people to give away much of their fortune to charity.  Over 100 notable contributors have made the commitment to dedicate the majority of their wealth to philanthropy, including Richard Branson, Michael Bloomberg, Diane von Furstenberg and Mark Zuckerberg.

In addition to benefitting the community or cause the giving is focused on, charitable giving can also provide benefits to the donor.  Whether you’re nearing the end of your career and looking to leave a legacy or you’re passionate about a cause or making an impact for future generations, establishing a charitable giving approach can have the added benefit of reducing your taxable income.

 So how can you incorporate charitable giving into your larger estate planning strategy?

  • Utilize Donor-Advised Funds – Donor funds are traditionally sponsored by public charities and provide a rather uncomplicated way to donate money.  Donations to a donor-advised fund are deductible in the year they are contributed but can be given to charities in other years.   Donors can enjoy a tax deduction of up to 50% of adjusted gross income for cash donations or 30% for appreciated assets.   Donor-advised funds are good for individuals who want to give back but don’t have the time to be more involved or hands on.  On the other hand, the donor does not have much control over the way the funds they donate are ultimately utilized.
  • Set Up a Foundation – Not for the faint of heart, starting a foundation is for individuals who really want to get involved, roll up their sleeves and have control over the process to benefit a cause.  Running a foundation is much like running a business, with a board of directors and trustees, and requires an extensive amount of time and focus.  Most non-profit foundations are tax exempt.
  • Start a Scholarship Fund – Not only has the cost of higher education surged by over 500% in the past 30 years, but college textbooks costs are also on the rise, having increased by 73% over the past 10 years.  A great way to give back and to personalize your giving is by starting a scholarship fund.  Whether your late father had a love of law or your mother was passionate about music, you also often have the ability to honor a loved one by setting up a fund in their name.  On the tax side, scholarship fund donations are usually treated the same as donor-advised funds.

Some other things to take into consideration when making charitable donations are the type of property being donated (which can have an impact on tax consequences) as well as how the contribution is made. 

It’s important to work with a trusted advisor who will help you to navigate the intricacies of charitable giving and to determine what is right for your goals, financial situation and desired level of involvement so that you can leave the legacy you desire.

Matt Bauer
President
mbauer@srfm.com

Giving Back: Charitable Giving Opportunities

FLSA Overtime Rule Change

FLSA Overtime Rule Change On March 14th, the new Final Regulations on the Fair Labor Standards Act were sent to the Office of Management and Budget for final review.  The proposed U.S. Department of Labor (DOL) changes to the “white-collar exemption” in the Fair Labor Standards Act (FLSA) could make more than 5 million individuals eligible for overtime pay—individuals who currently aren’t eligible. This could have a significant impact on employers who may face increased labor costs and compliance efforts.

To qualify for the white-collar exemption, an employee must satisfy a variety of tests, including a duties test, a salary basis test and a salary level test. Currently, under the salary level test, only white-collar workers making less than $23,660 a year are automatically eligible for overtime pay. Under the proposed rule, the salary threshold would increase to a projected $50,440 per year in 2016 and would be updated automatically each year in order to keep up with rising costs.

On Feb. 9, 2016, 108 bipartisan members of Congress signed a congressional support letter, addressed to DOL Secretary Tom Perez, expressing concerns about the proposed rule. Lawmakers are concerned about the unintended consequences for both employers and employees.

One of these concerns is the unclear explanation of the duties test, which is one of the main components used in determining whether employees are exempt from the FLSA provisions. In the proposed rule, the language is posed in question format instead of in a concrete way that employers can easily understand.

Another concern mentioned in the letter is that increasing the salary threshold by such a significant amount—113 percent—disregards the geographic diversity of the country. It states that since the purchasing power of a dollar is different in various parts of the United States, the DOL is ignoring the differences that exist between rural and urban areas.

If the rule is passed as drafted, its most negative impact could be on individuals entering the workforce and mid-level managers. Many small businesses cannot afford to increase their employees’ salaries and would be forced to take actions that could include reducing employees’ hours or shifting salaried employees to hourly status. This could mean a reduction in benefits and could be perceived by salaried employees as a demotion.

In addition, employers would need to re-examine employees’ exemption statuses, review and revise overtime policies, notify employees of changes and adjust payroll systems. Employers may also incur additional managerial costs because they might need to spend more time tracking when employees clock in and out.

The DOL, on the other hand, projects that the higher salary level requirements could actually simplify the process of employee classification because employers would not be required to perform a duties test for employees making less than $50,440 per year, which, in turn, could result in fewer lawsuits and lower legal costs for employers.

The DOL invited the general public to comment on the new rule from June 3 to Sept. 4, 2015, during which it received more than 200,000 comments. The comment period is now closed and a final rule is expected in the summer of 2016. The time between the date the final rule is announced and the date it goes into effect could be short—giving employers little time to make changes.

The Final Regulations could be released as early as May or June, but likely no later than July 7th, with an effective date likely on or before Labor Day, September 5th.  Employers should consider the impact these regulations will have on their current workforce classifications in advance of the effective date.

Matt Bauer
President
mbauer@srfm.com

FLSA Overtime Rule Change

2016 Federal Budget Delays ACA’s Cadillac Tax & Suspends Two Other Taxes

On Dec. 18, 2015, President Barack Obama signed a federal budget bill for 2016 into law, which makes significant changes to three tax provisions under the Affordable Care Act (ACA). This new law:

  • Delays implementation of the ACA’s Cadillac tax on high-cost group health coverage for two years, until 2020
  • Imposes a one-year moratorium on the collection of the ACA’s health insurance providers fee,for 2017
  • Imposes a two-year moratorium on the ACA’s medical device excise tax, for 2016 and 2017

The provisions affecting these ACA taxes took effect immediately, once the bill was enacted.

Cadillac Tax Delayed

The ACA imposes a 40 percent excise tax on high-cost group health coverage, also known as the “Cadillac tax.” This tax is intended to encourage companies to choose lower-cost health plans for their employees, but also to raise revenue to fund other ACA provisions.

This provision taxes the amount, if any, by which the monthly cost of an employee’s applicable employer-sponsored health coverage exceeds the annual limitation (called the employee’s excess benefit). The tax amount for each employee’s coverage will be calculated by the employer and paid by the coverage provider who provided the coverage.

Although originally intended to take effect in 2013, the Cadillac tax was immediately delayed until 2018 following the ACA’s enactment. The new 2016 federal budget further delays implementation of this tax for an additional two years, until 2020.

The new law also:

  • Removes a provision prohibiting the Cadillac tax from being deducted as a business expense
  • Requires a study to be conducted on the age and gender adjustment to the annual limit.

There is some indication that this additional delay will lead to an eventual repeal of the Cadillac tax provision altogether. However, while several bills have been introduced into Congress to repeal this tax, President Obama has indicated that he will veto legislation repealing any ACA provision.

Moratorium on the Providers Fee

Beginning in 2014, the ACA imposes an annual, non-deductible fee on the health insurance sector, allocated across the industry according to market share. This health insurance providers fee, which is treated as an excise tax, is required to be paid by Sept. 30 of each calendar year. Thus, the first fees were due Sept. 30, 2014.

The new 2016 federal budget suspends collection of the health insurance providers fee for the 2017 calendar year. Thus, health insurance issuers are not required to pay these fees for 2017.

Employers are not directly subject to the health insurance providers fee. However, in many instances, providers of insured plans have been passing the cost of the fee on to the employers sponsoring that coverage. As a result, this one-year moratorium may result in significant savings for some employers on their health insurance rates.

Moratorium on the Medical Devices Tax

The ACA also imposes a 2.3 percent excise tax on the sales price of certain medical devices, effective beginning in 2013. Generally, the manufacturer or importer of a taxable medical device is responsible for reporting and paying this tax to the IRS.

The new 2016 federal budget suspends collection of the medical devices tax for two years, in 2016 and 2017. As a result, this tax will not apply to sales made between Jan. 1, 2016, and Dec. 31, 2017.

The Effect on Other ACA Provisions

Although this new federal budget makes significant changes to these three ACA taxes, it does not affect any other ACA provision. Therefore, all other aspects of the ACA continue to apply as they did prior to this law’s enactment, with no changes or delays.

Matt Bauer

President

mbauer@srfm.com

2016 Federal Budget Delays ACA’s Cadillac Tax & Suspends Two Other Taxes

Start early and stay the course: Tips for handling higher education expenses

College SavingsFor the past 20 years, higher education costs have not only risen (much) faster than inflation, but they’ve increased at a higher rate than costs in just about any other sector, including health care! While total inflation since 1994 has averaged 2.3% a year, health care costs have risen 3.7% yearly on average. But that pales in comparison to college costs, which have risen 5.2% on average every year.

The average in-state school charges $9,139 for tuition annually, while private schools are charging an eye-popping $31,231 (with some well past the $50,000 mark). It’s no wonder there’s a crushing $1.2 trillion in outstanding student debt, with a rising rate of delinquencies.

A key takeaway: The earlier you get started on planning for your children’s education, the better…even if you don’t yet have children! But whether your budding scholar is wrestling with algebra or still learning his ABCs, you can take steps now to help ease the financial burden of college.

Start early if you can, but just start — Saving for college works on the same principle as planning for retirement: the earlier you start, the easier it will be on the other side. Even if it’s a mere $50 a month, commit now to creating a plan that will help you meet your goals. (Hint: We can help.)

Get your student involved — Though we saturate our high achieving kids with higher educationopportunities to acquire knowledge, basic financial “street smarts” often gets overlooked in the classroom and at home, especially when there’s little struggle for needs or wants. Teaching kids early how to save, how to budget, how to avoid debt, and how to be charitable, will pay enormous dividends down the road. When your child earns money from an odd job or a birthday card from Aunt Jane, help them learn the power of compounding by encouraging them to contribute some of it toward their education.

Take advantage of 529 plans — Just as Powerball is not a retirement strategy, it’s not one for paying school bills either. Instead, open up a 529 plan, which is a tax-advantaged savings/investment account that allows parents, grandparents, and other caregivers to save for a child’s education while minimizing taxes. When matriculation time comes, funds in the account can be used for tuition, room and board, books, and other supplies.

Overestimate costs — The 5.2% year-over-year increase in college costs likely isn’t going away anytime soon. When estimating future expenses, plan for the worst. Besides tuition and boarding costs, don’t forget to include costs like books and other incidentals (e.g. late-night pizza).

Consider the public option — Great public schools can be a real “value play” in education, offering a Grade A experience at (relatively) modest expense. Encourage your student (and yourself) to strongly consider affordable public schools, versus expensive private schools that may require the albatross of parental and student debt.

Don’t skimp on your retirement contributions — Your children’s education is important, but so is keeping your retirement goals on track. Continue to fund your 401(k) and IRA plans as you save for college. (And if there’s income to spare, encourage your child to start contributing to an IRA once she starts working.) Besides being tax advantaged, funds in retirement accounts are not considered when colleges determine need-based financial aid packages. (The equity in your primary home, a family-owned business, insurance policies, and annuities are also usually excluded.)

Paying for college can feel daunting, but having the right plan in place can make it smooth sailing. Need help getting started? We can help.

Matt Bauer

President

mbauer@srfm.com

First step of retirement planning? Figure out your goals

First step of retirement planning? Figure out your goalsAre you ready for retirement? There are a lot of calculators out there, from simple to complex, that claim to help you figure that out by crunching your numbers and spitting some back at you.

Knowing the numbers can be helpful to give you a basic idea of where you stand. (FYI, we like this calculator from Bankrate.) But numbers without context — especially those that require a healthy dose of assumptions and guesstimating — provide little insight.

Everyone’s situation is different. Some people are just focused on not outliving their money. Others are seeking to expand their range of experience as they age, and still others are most concerned about what they leave behind.

Do you want to travel the world? Do you plan to leave a financial legacy for your children, your friends, charitable organizations you’re passionate about? Dreaming of retiring to a relatively high cost area like Cape Cod or Hawaii?

Answers to these kind of questions will fuel the conversation about whether you are “on track” for a “secure” retirement.

Goals don’t have to be set in stone but they begin to form the equation of how much you need to save, what percentage of income you need to replace in retirement, and how much you can safely spend in the meantime.

As for tactics, some truisms apply to nearly everyone:

Only count on what you send ahead — Do not take Social Security for granted. Assume it First step of retirement planning? Figure out your goalswon’t be there and think of saving for retirement as sending supplies ahead before your journey begins.

Pay yourself first — Take advantage of employer sponsored retirement savings plans to put saving and investing on autopilot.

Don’t obsess over taxes — You can’t predict what tax rates you’ll be subject to in the future, especially if retirement is decades away. Sleep soundly and diversify your tax exposure by holding both tax-deferred and tax-free accounts.

Find room for a Roth IRA — We adore the Roth IRA for tax free growth, unlimited investing options, and the ability to serve as a backdoor emergency fund. (More on this in a future blog.) For nearly everyone eligible to contribute, a Roth should be retirement plan bedrock.

These are just some of the very basics. At Sinclair Risk & Financial, we analyze your specific situation and help design a retirement plan tailored just for you…once you have your goals in place. Spend some time early in the New Year thinking about your ideal future and give us a call to help make it happen.

Matt Bauer

President

mbauer@srfm.com

Help your employees get the most out of their benefits

Help your employees get the most out of their benefitsSmart business owners know that to attract and retain quality employees, they must provide a congenial working environment where employees can find opportunity for growth, success, and professional satisfaction.

Happy, healthy, productive employees make a business stronger and translate into profits and organizational success.

Obviously, base compensation is a key recruitment and retention tool and must be competitive, but owners who fear being priced out of the skilled labor pool are not alone. Employers are increasingly focusing on boosting benefit packages, in lieu of significant wage increases, to keep staff happy. The good news is, when promoted correctly, those benefits can begin to match salary as a key factor in employee satisfaction.

Along with making the investment in offering your employees more, internal communication and education about how and why to use these benefits will help increase adoption rate and employee satisfaction.

Wellness programs: Incentivize it!Wellness programs, which promote healthy habits and long-term positive change, are one of our top recommendations for bottom-line success. Quite simply, healthy employees are productive employees, and wellness programs create a fruitful partnership between management and staff. They are not without investment: smoking cessation programs, complimentary weekly healthy lunches, and gym membership reimbursement are just some of the ways you can invest. But like all good resolutions, the hardest part is sticking to it. Consider developing creative ways to encourage employees to take advantage of those offerings, plus routine medical screenings.

Take a vacation, really! — You offer paid time off, adding more days as a reward for Help your employees get the most out of their benefitsseniority and milestones. The problem is…your employees aren’t using it, even when they say they are. This is a uniquely American problem and it is nothing to be proud of. The productivity level of stressed out, always-on employees, no matter how dedicated and talented, will suffer, costing you in the long run. Make vacation and breaks away from the office a part of your company’s culture. Owners and other senior staff can set a good example by being conspicuously absent for vacation, even if secretly checking in via smartphone. The key is balance, which will never exist if nobody ever leaves the office. 

Take this free money, please! — Americans are woefully, frightfully unprepared for retirement, so much so that the Golden Years are much more likely to be the Leaden Years. According to the National Institute on Retirement Safety, the median retirement account balance is $3,000 for working-age households and $12,000 for “near retirement” households. If you offer a match in your 401(k)/403(b) retirement plan (and if you don’t, let’s talk about the tax benefits you’re missing out on), include that match when you cite a position’s salary. Help new hires and existing employees alike by making them realize that not participating is the same thing as voluntarily cutting pay.

We’ll pay you to learn! — Younger employees may not cite professional development opportunities as a top job benefit, but they’ll quickly grow to love it once taking part. Furthering the education and real-world experience of staff at all levels provides personal growth while making your business that much smarter. Don’t just say you offer professional development opportunities, make it part of your HR function to proactively encourage and schedule relevant conferences and classes for employees.

Looking for more ways to help your staff get the most out of benefits? We can help.

Matt Bauer

Sinclair Risk & Financial Management
mbauer@srfm.com

Protect Your Company from “CEO Fraud”

Protect Your Company from “CEO Fraud”Remember the e-mails claiming you’d won the Nigerian lottery, full of misspellings and bad grammar and requesting your bank account information so funds could be wired?  These amateur e-mail scams are a thing of the past and a new, rapidly growing and sophisticated threat is targeting businesses worldwide and has already resulted in more than 7,000 companies in the U.S. losing over $740 million since 2013.

Business e-mail compromise (BEC), also known as “CEO fraud,” is a financial scam that targets companies of all sizes that utilize wire transfers to pay foreign suppliers.  “CEO fraud” usually takes place when legit business e-mail accounts are compromised utilizing social engineering or computer intrusion techniques.  According to the FBI’s Internet Crime Complain Center (IC3), there has been a 270% increase in BEC victims since the beginning of 2015.  A majority of the reported fraudulent transfers have gone to Asian banks in China and Hong Kong.  

A recent example outlined by the FBI occurred when the accountant of a U.S. company received an e-mail from her CEO, who was travelling abroad on vacation, asking her toProtect Your Company from “CEO Fraud” transfer funds for an important acquisition by the end of the day.  This wasn’t an unusual request and the e-mail said the accountant would hear from a lawyer with further details.  The lawyer got in touch via e-mail and sent what appeared to be a legitimate letter of authorization with the CEO’s signature and the company logo, with instructions to wire more than $737,000 to a bank in China.  The accountant wired the money but was shocked when she talked to her CEO on another matter the next day and mentioned everything had gone through, as the CEO knew nothing about the request.

So how can you ensure your company doesn’t become a victim of “CEO fraud?”

  • Use multiple means of communications to verify a requested transfer is legitimate.  For example, if the request came by e-mail, phone the person who sent it to verbally validate it.  And be sure to use known phone numbers associated with that person versus whatever is included in the e-mail.
  • Consider implementing an approval process for large payments that requires two executives sign off on large wire transfers.
  • Be suspicious of requests that urge immediate action or secrecy.  Consider holding customer requests for international wires transfers for an additional time period to validate their legitimacy.
  • Carefully review and scrutinize all requests for transfers of funds that are received by e-mail.  Look for red flags, like a slightly different configuration of an e-mail extension; i.e., an e-mail ending in .co instead of .com or an e-mail address that utilizes a hyphen instead of an underscore, like legit-company.com versus legit_company.com. 
  • Be careful about posting financial and personnel information to your company’s website and social media.  For instance, listing international conferences your senior leaders will be attending could present an opportune time to conduct the scam.

With the right knowledge, checks and balances and scrutiny, you are less likely to fall victim to a BEC scam.  However, if your company is impacted, act quickly!  Immediately work with your financial institution to contact the financial institution where the fraudulent transfer was sent and then contact the FBI and file a complaint with the IC3.

Matt Bauer

President

mbauer@srfm.com

8 Reasons pre-screening employees is just smart business

Matthew-Bauer

I spend my workday helping Sinclair clients manage risk, avoid hidden pitfalls, and implement initiatives that give them the best chance to be prosperous and successful. I do this work happily, it gives me great joy! That’s why I am such a strong advocate of making sure organizations have a structured, consistent approach to pre-screening employees.  It floors me that more than half of organizations do not conduct any kind of background check.

Hard work and strategic planning can suffer mightily in the face of bad hiring decisions. Too often employers don’t take pre-screening seriously enough, only to deal with negative consequences after the fact.

Best practices in hiring include background and drug screening and a thorough dive into references, social media, and other online sources. This isn’t about nitpicking, playing “gotcha” with someone who inflates a title or educational achievement on a resume, this is about protecting your organization from the potential for serious disruption within.

Here are eight reasons why pre-screening potential employees is not only smart risk management, but smart business:

Reduce overall liability — If your organization is one of the more than half that don’t do even basic criminal background checks, you could easily be hiring somebody with a violent past, perhaps even with a track record of altercations in the workplace. Once that person is within your fold, your staff is at risk and you’ve created a huge liability for your company.

Reduce health care and absenteeism costs — Employees that bring substance abuse problems to the workplace cost their employers big time, to the tune of $81 billion annually. In no way should sober individuals who previously had a problem be disqualified from a position, but an active alcoholic/drug abuser is another matter entirely, and one easily corrected by pre-employment screening.

Customer relations — You’ve recruited a young person for a front-line, customer facing position. He seems pleasant enough, and impressed you with his enthusiasm for working with the public. Outside of management eyes though, he can be rude, unhelpful, and catty, alienating your customer base. Had you followed up on reference checks, you would have learned that’s why he was shown the door at his last job.

Avoid poisoning the office culture — She had the right education and experience and did well in interviews. You were in a rush to fill a critical position and didn’t worry about references who didn’t call back. Turns out your new hire is a Debbie Downer who is quick to bring her personal grievances into the workplace, adding tension and dysfunction that can easily spread and grow.

Keep management from getting distracted — Once taken root, a difficult employee becomes a handful to manage, consuming an outsized portion of attention from your senior staff. It’s amazing how quickly one or two problem employees can suddenly command so much energy.

Keep flexible — Difficult employees tend to be the least flexible, the least open to management initiatives and changes in strategic direction. They may go along with the program when the boss is within earshot, but as soon as she’s out of sight, the problem employee is quick to badmouth the strategy to others, gumming up the works, sowing doubt, and making it harder to get buy-in from staff.iStock_000019568102Small

Avoid getting stuck — Despite the fact that nearly all non-union workers are “at-will,” problem employees are hard to get rid of without incurring substantial litigation risk. Plus doing so can also disrupt staff dynamics. It’s better to do everything possible to avoid the situation in the first place.

Avoid negative publicity — When it comes to bad publicity, it used to be you only had to worry about the folks who bought ink by the barrel. Now you have to worry about everyone with an internet connection…which is everyone! Disgruntled ex-employees can trash you on Facebook, Twitter, and other social media platforms. They can leave negative reviews on sites like Glassdoor and a host of others that exist just for that purpose (and have very good SEO).

In short, your problem employee is not going to go quietly, so the best approach is to try as best you can to avoid hiring them in the first place.

Not sure how to implement a best-practice pre-screening program at your organization? Contact me today to see if Sinclair can help.

Matt Bauer                                                                                                                     President,Sinclair Risk & Financial Management                                                            mbauer@srfm.com