Data & Research July 15, 2010

Employers Turning to Career Development to Prevent Job Churn

Most U.S. organizations are increasingly focusing on career development as a way to retain and attract talent, a new survey by Hewitt Associates shows.  

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A Hewitt news release said, however, most large employers polled said their current career development programs aren’t effective in meeting the needs of the company or their employees.  

According to the findings, 77% say that career development is more important to them than it was five years ago. Additionally, 89% say that career opportunities are one of the most important drivers of engagement and retention. Fifty-five percent of companies think that both career development and pay—as a rewards strategy—are equally important to employees in today’s economic environment.  

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“A year ago, many employers relaxed a bit and felt secure that their top talent would stay at the company because job prospects elsewhere were so bleak,” said Mollie Kohn, principal in the Talent and HR Solutions Consulting practice at Hewitt Associates, in a news release. “But now, with signs of economic recovery, organizations are realizing they need to work hard—and quickly—to limit churn among their most critical talent. Focusing on career development is a low-cost option that can have an enormous impact on workers’ engagement and retention.”  

Few companies polled said they were pleased with how these programs are handled within their organization. Nearly two-thirds of employers (64%) don’t believe they fully comprehend career development and are not satisfied with their programs.  

Not surprisingly, companies also sense that workers are not pleased with the current opportunities they’re offered. Most (85%) report that workers perceive their companies as having “some” or “limited” available career opportunities. Additionally, more than half (56%) of companies say that career development tools are not easily accessible to workers.  

Hewitt surveyed human resources professionals at 193 large employers In March and April 2010.     
Compliance July 15, 2010

Trade Group Urges Form 5500 Deadline Delay

 A retirement services industry group has sent a letter to federal officials urging they put off the deadline for filing the Form 5500 and 5500SF for the 2009 plan year.
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Jan Jacobson, Senior Counsel, Retirement Policy of The American Benefits Council, contended in the letter that the deadline should be moved off to the later of December 31, 2010 or 9 ½ months after the end of the plan year. 

Jacobson offered the comments to Phyllis C. Borzi, Assistant Secretary, Employee Benefits Security Administration of the U.S. Department of Labor and Monika Templeman, Acting Director, Employee Plans of the Internal Revenue Service 

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“As you know, the 2009 Form 5500 reflects the most substantial revisions to the annual reporting requirements affecting employee benefit plans in recent memory,” Jacobson said in the letter. “The content of the Form 5500 has undergone dramatic revisions. The new Schedule C places the onus on employers to gather information about a wide range of direct and indirect plan services arrangements, and has generated a host of information-gathering challenges.” 

Jacobson also pointed out that: 

  •   manyemployers will be filing a new form, the Form 5500-SF 
  • others, particularly employers that maintain section 403(b) plans, will effectively be filing the Form 5500 for the first time. 
  •  there has been confusion over the elimination of the Form SSA as a schedule to the Form 5500, and its transition to a filing requirement with the Service through the new Form 8955-SSA (which has not yet been released). 
  • the 2009 Form 5500 (other than the Form 5500-EZ) must for the first time be filed electronically using either EFAST2’s web-based filing system or an EFAST2-approved vendor. Some of the EFAST2-approved vendors have only very recently developed their systems and made the necessary software available. 

The letter continued: “This has left very little time for service providers that offer Form 5500 preparation services to test the software and confirm that the e-filing process is free of problems. More generally, the delay has made it difficult for employers and plan service providers to develop systems and procedures for managing and delivering electronic filing services.” 

According to the letter, the Form 5500 is due by the end of the seventh month following the end of the plan year. For calendar year plans, this means the Form 5500 is due by August 2, 2010 (as July 31 is a Saturday). 

“Taken as a whole, we are concerned that many employers, particularly small employers, will file belatedly; others will meet the filing deadline but will file a defective Form 5500,” Jacobson wrote. “Even for large employers, we can foresee substantial challenges arising, largely associated with the Schedule C. These problems are exacerbated by the limited assistance that is available as problems arise.”   

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