This issue's articles include: The Importance of Benefits in Total Compensation; Committing to Wellness; Retirement Check-Up for the New Year; How to Build Credibility Using Social Media; It’s Really Just a Matter of Attraction; and Court of Appeals Agrees that Severance Payments Are Not Subject to FICA.

1. BIZGROWTH
I S S U E 5 4 • W I N T E R 2 01 3
S T R A T E G I E S
IDEAS TO HELP GROW YOUR BUSINESS
CONSIDER RETIREMENT CHECK-UP
THE FULL FOR THE NEW YEAR
PACKAGE: BUILDING
THE IMPORTANCE CREDIBILITY WITH
SOCIAL MEDIA
OF BENEFITS
COMMITTING
MERGERS & ACQUISITIONS: TO YOUR
A MATTER OF ATTRACTION EMPLOYEES’
WELLNESS
ARE SEVERANCE
PAYMENTS NOT
SUBJECT TO FICA?
ourbusiness
is growing yours

2. In This Issue… Human Resources
Human Resources.......................2
Consider the Full Package:
The Importance of Benefits
in Total Compensation
Employee Benefits.......................4
Committing to Wellness
Expanding Your Personal Wealth.... 5
Retirement Check-Up
for the New Year
Marketing...................................5
How to Build Credibility
Using Social Media
Mergers & Acquisitions...............6
It’s Really Just a
Matter of Attraction
Tax & Accounting........................7
Court of Appeals Agrees
Consider the
that Severance Payments
Are Not Subject to FICA
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Full Package:
The Importance of Benefits in Total Compensation
G
visit cbiz.com/invitation.asp. iven the relative dominance of cash compensation, compensation
You can also call us at professionals occasionally neglect to consider the other key
1-800-ASK-CBIZ (1- 800 -275 -2249). component in the total compensation package – benefits. Yet,
benefits are critically linked to compensation in providing total
rewards to employees due to the significant ways in which benefits
CBIZ in the News impact employers’ costs as well as employees’ perceived value of
total compensation.
NPR
Why dividends, capital gains With employee benefits typically equal to 20 to 40 percent of
are big part of fiscal cliff talks payroll expenses, they are a prominent part of total compensation. As
November 29, 2012
a result, benefits can offset or amplify cash compensation issues. For
US News & World Report example, total compensation analyses for public sector clients often
The myth of the permanent show that employees’ salaries are below median salaries in relevant
working class labor markets. However, a review of benefits reveals that public
October 30, 2012 sector employees frequently receive above average benefits. This is
largely attributable to richer retirement plans and a greater portion of
CNBC.com employer-paid, health-related benefits premiums. In this case, the sum
What disruptors need
to attract capital of below market salaries and above market benefits is relatively in line
October 18, 2012 with the competitive total compensation level. An illustration indicative
of the market comparisons regularly observed in the public and private
sectors appears on the adjacent page. (For simplicity’s sake, variable
For complete articles: cash pay has been ignored so that salary plus benefits equals total
cbiz.com/in_the_news.asp compensation.)
2 | BIZGROWTH STRATEGIES – WINTER 2013 CBIZ, INC.

3. Average Salary Average Benefits Average Total Compensation
(Actual as a % of Market) (Actual as a % of Market) (Actual as a % of Market)
Public Sector
88% 123% 100%
Organization
Private Sector
105% 92% 100%
Organization
The example scenarios above show employers’ organization want to position itself against competitors?
ability to balance salaries and benefits to achieve How should salaries, variable/incentive pay and benefits
overall competitiveness. Conversely, there are (both tangible and intangible) compare to other
also cases where deviations from market can be organizations? After such philosophies are established,
compounded by the inclusion of benefits in the an organization can utilize total rewards statements as
analysis. In peak recession years, for instance, well as salary increase, incentive plan and benefits
some organizations froze salaries, reduced their program updates to explain its compensation goals
share of health insurance premium payments and the efforts taken to align each employee’s total
and suspended retirement plan contributions; compensation package with these goals.
thus, both salary and benefits (and, thereby,
total compensation) fell behind market levels.
Employers must first determine their total
PRIYA J. KAPILA
compensation philosophy and that of each component CBIZ Human Capital Services • St. Louis, MO
in order to effectively communicate the value of the 314.995.5558 • pkapila@cbiz.com
total compensation package. That is, how does the
DISCLAIMER: This publication is distributed with the understanding that CBIZ is not rendering legal, accounting, or other professional
advice. To the extent anything herein could be construed as tax advice, such advice is not intended to be used and cannot be used
to avoid penalties under the Internal Revenue Code, or to promote, market, or recommend to another person any tax related matter.
This information is general in nature and may be affected by changes in law or in the interpretation of such laws. The reader is
advised to contact a professional prior to taking any action based upon this information. CBIZ assumes no liability whatsoever in
connection with the use of this information and assumes no obligation to inform the reader of any changes in laws or other factors
that could affect the information contained herein.
CBIZ, INC. BIZGROWTH STRATEGIES – WINTER 2013 | 3

4. Employee Benefits
Committing to
Wellness
T
here have been an increasing number of articles,
news stories, presentations, webinars and
the like on the benefits of having an employer-
sponsored health and wellness program. The case
studies have been reviewed and the ROIs have been
proven: an employer-sponsored health and wellness
program has the ability to positively impact an
organization’s bottom line.
The most important element of a successful provided with quarterly communications and talking
wellness plan is to understand that wellness is a points that they can share with their teams.
major, economic business strategy – one that requires
Establish a wellness committee. An effective
a high level of organizational commitment and change.
wellness committee can provide opportunities for
Like all corporate strategies, the wellness plan needs
both management and employee involvement in the
to align with the organization’s values and goals.
development and promotion of the program. A well-
The following are strategies to ensure organizational formulated wellness committee serves many important
commitment and wellness program success: functions, including developing and promoting the
organization’s health and wellness brands and
Conduct key interviews to determine
themes; creating a sense of employee ownership in
organizational readiness. Interview employees from a
the program; ensuring input from a broad range of
good cross-section of the organization to ensure that company stakeholders and perspectives; providing
all levels, departments and locations are represented. a source of internal support and advocacy for the
Ask key questions regarding current work conditions, program; and helping to drive employee enthusiasm
attitudes, senior leadership support and the feasibility and participation.
that health and wellness initiatives will be adapted and
supported by all facets of the organization. Obtain operational commitment to the strategic
wellness plan. It is important to ensure that the work
Develop a senior leadership business case. environment, policies and procedures are in line
Management needs to understand how supporting with the company wellness mission. From looking
employee health supports the business strategy, at policies such as smoking, leave of absence and
mission and vision. Gain the acceptance and approval sick days to evaluating vending machine and meeting
of senior leaders so they are aware of the goals and food service options to assessing on-site exercise
initiatives of the wellness strategy and understand opportunities like gyms, walking paths and stairwells,
that they will be accountable for ensuring success. these items must be considered in determining
Develop mechanisms of accountability so leaders operational support of the wellness objectives.
understand what is expected of them.
Develop an annual wellness budget. The
Provide coaching and develop a change organization needs to account for wellness activities,
management and communication plan. The incentives and events that will incur costs. Having
organization needs to be prepared to make cultural a pre-approved budget will ensure programs are
and behavioral changes that support employee health funded and any incentive dollars are pre-approved.
and wellbeing. Employees often require coaching to Communicating a wellness budget also shows
help prepare for change, manage change and reinforce organizational commitment to the wellness initiatives
the change. Also, each employee needs to be aware of in anticipation that a return on the investment made
his/her responsibility to support a culture of health. will be achieved.
Prepare a senior leadership communication tool
kit. Senior managers need to understand the best way
JENNIFER GRAY
to communicate with their employees regarding health CBIZ Benefits & Insurance Services, Inc.
and wellness initiatives. To ensure a clear, concise Dublin, OH • 614.793.2453 • jgray@cbiz.com
and consistent message, senior leaders should be
4 | BIZGROWTH STRATEGIES – WINTER 2013 CBIZ, INC.

5. Expanding Your Personal Wealth Marketing
Retirement How to Build Credibility Using
Social Media
for the New Year
T
he beginning of a new year is a good time to
revisit your retirement planning strategies.
To start, consider all of your
retirement savings, such as 401(k) Have you Googled yourself recently?
Are you happy with the results?
and 403(b), and obtain the total
W
amount you have saved thus hether you are trying to generate business,
far. A more sobering picture get a new job or expand your professional
of your retirement readiness network, social media is one of the most
emerges when you take efficient tools to accomplish these goals. While
that total and execute a almost anyone can build an online presence, the key
simple calculation: take is to build an effective profile across multiple social
4% to 5% of the total channels that showcases your true expertise.
savings and the result Many people believe you have to spend a ton of
approximates the annual money to have your website featured on the first page
income your retirement funds of search engine results, when in fact, you can do this
will generate. Industry experts for free. There are four key social media channels you
say that one should expect to yield can use to build credibility online and enhance search
about 85% of the income from one’s last working engine results, all at no cost:
year. This number is a generalization; therefore, you
should evaluate what you might want to do after 1. LinkedIn: LinkedIn is purely a professional
retirement and also consider your spending habits. networking site. The first thing you should do is
create an effective profile by following ten key steps.
After getting a snapshot of your retirement These steps can be viewed in the Summer 2011
preparation, you may want to increase the rate at issue located at cbiz.com/bizgrowthstrategies.
which you are saving. Be sure to take full advantage Once you have built a dynamic profile you can begin
of any corporate matching program where the to post status updates with articles and resources
company will contribute a certain percentage of your that showcase you as an expert in your field.
own contribution to your retirement account for up 2. Twitter: No, Twitter isn’t all about following
to a certain portion of your pay. In addition, evaluate celebrities. As a business professional, you can use
if your budget will allow a total contribution of 10% Twitter to share important, time-relevant news,
to 15% of your annual income for your 401(k). This updates, events, etc. Plus, search engines love
is the percentage range suggested by many experts. Twitter! This is also a great avenue to reach out to
For 2013 the IRS allows up to $17,500 per year per media outlets. Tip: Everyone loves the kudos when
401(k) account. you retweet one of their tweets. This is a great way
Also, establishing an IRA is a great way to save up to recognize others in your industry who are also
to $5,000 per year (and $6,000 per year for those ages sharing relevant content. Spend the time to build
50 and older) even if it is with after-tax dollars. your Twitter profile, including carefully crafting your
bio and using hashtags.
Annuities can be a good option to supplement your
retirement income (after tax). Some annuities guarantee 3. YouTube: What? There is more to YouTube than cute
a certain return for life, which is a good way to protect cat videos? Yes, YouTube is a great tool for you to
yourself against the risk of exhausting your resources showcase “how-to” or other informative videos that
during retirement. highlight you as a credible resource. Don’t worry
about the fancy equipment or setup. Studies show
Even if you are satisfied with your financial progress that more natural, raw-looking videos have better
toward retirement, there are still a few maintenance traction. Another idea is to create a “behind the
issues to consider. Depending on how the markets scenes” video of your business or career. YouTube
(Continued on page 8) (Continued on page 8)
CBIZ, INC. BIZGROWTH STRATEGIES – WINTER 2013 | 5

6. Mergers Acquisitions With a substantial number of Baby Boomers
nearing retirement age, acquirers have trained a keen
It’s Really Just a eye on companies that will help serve the health care
Matter of Attraction
needs of this aging segment of the population.
Software companies: Darlings of the deal
community, companies with few employees or assets
other than intellectual property are always attractive.
I
f you happened upon a sophomore class in college A number of small software companies with minimal
physics, you might catch the students being tested revenue recently have sold for substantial multiples.
on the basic principles of physics, electronics and
Bolting a new software application onto a large
magnetism. The magnetic state of an object refers to
customer base allows for revenue expansion that
how that object reacts (degree of attraction) within a
simply isn’t available in many other fields. Further,
magnetic field.
the area of intellectual property surrounding a lot of
If you timed things right, you might actually see new applications has become an area of focus for
the students with their right fist thrust in the air and acquirers in recent years. The value of intellectual
their thumb extended (toward them). No, they aren’t property can’t be underestimated, as evidenced by
hitching a ride; they’re using their hands as a visual the infringement case won by Apple Incorporated in
representation of the direction a magnetic field its suit against Samsung Group.
rotates around the flow of an electrical current.
Homeland security-related companies:
You’re wondering where I’m Any sector where the government
going with this? is able to throw around mass
In the field of MA quantities of money in the name
transactions, there is no right of protecting the homeland
hand rule, but from time draws a lot of attention
to time certain types of from potential acquirers.
acquirers exhibit strong Companies that develop
attractions (work with technologies to help
me – almost magnetic) ensure national security
to certain types of will continue to draw
companies from an substantial attraction
investment standpoint. from the investment
The following are sectors community.
attracting interest in the Energy sector
market today: companies: The investment
Health care-related community is a little
businesses: Health care schizophrenic when it comes
isn’t getting any cheaper. As of to energy plays. On one hand,
the last statistical year available they like energy companies as
(2008), health care spending they realize that conventional energy
represented over 15 percent of our Gross is derived from dwindling resources.
Domestic Product, which places us at the top of On the other hand, they are concerned about
the list of nations. There is no doubt that our health the cyclical nature of the commodities consumed
care is excellent when compared to most nations, but by conventional energy sector companies and the
any sector that represents such a substantial amount wild swings in resource values driven by Wall Street
of a nation’s GDP is bound to be fertile ground for speculators. When it comes to renewable energy, again,
innovative and growing companies. there is a lot of initial interest, but also a fair degree
of concern over businesses whose profitability is often
predicated by the existence of government support.
What the government giveth, the government can also
In the field of MA transactions, take away.
certain types of acquirers exhibit strong
attractions (almost magnetic) to
LUKE SAGE is registered with CBIZ Financial
certain types of companies from an Solutions, Inc. member FINRA, SIPC and
investment standpoint. Registered Investment Adviser.
858.795.2088 • lsage@cbiz.com
6 | BIZGROWTH STRATEGIES – WINTER 2013 CBIZ, INC.

7. Tax Accounting
Court of Appeals Agrees
that Severance Payments Are
Not Subject
to
FICA
T
he Sixth Circuit Court of Appeals has affirmed a which, if the case is accepted, will drag out the issue’s
district court decision that severance payments ultimate resolution for a number of years.
made to employees pursuant to an involuntary
In the meantime, employers that paid FICA
separation from employment due to a reduction in
taxes on severance payments due to a reduction in
workforce are not subject to FICA taxes. Employers that
workforce should file protective refund claims before
have been forced to downsize their workforce in the the three-year statute of limitations expires on those
current economy should consider filing protective refund tax liabilities. Therefore, if an employer paid FICA on
claims to recover these taxes. As the IRS likely will qualifying severance payments to employees in 2009,
appeal the decision to the Supreme Court, employers the employer generally has until April 15, 2013 to file a
should continue to subject severance payments to FICA refund claim.
taxes (and subsequently file protective refund claims)
until the issue is ultimately resolved. The claims must be filed using Form 941-X or
945-X to correct errors previously made on the Form
The Sixth Circuit’s decision in U.S. v. Quality 941 (Employer’s Federal Quarterly Tax Return) or Form
Stores, Inc., CA-6, 2012-2 USTC ¶50,551 (Sept. 7, 945 (Employer’s Federal Annual Tax Return). To file for
2012) reinforces the district court’s conclusion that both the employer and employee portions of the FICA
supplemental unemployment compensation benefits you must certify that you reimbursed your employee or
(SUBs) are merely treated as if they were wages for secured his consent to allow the claim for refund or,
income tax withholding purposes under IRC Section after reasonable efforts, have been unable to do so.
3402(o) and are not actually wages, and thus, are not
The IRS will not grant any refund claims until the
subject to FICA taxes. In reaching its conclusion, the
issue has been resolved, but filing the refund claim
Court looked to the legislative history of §3402(o), as within the statute of limitations will protect your rights
well as to its very title – “Extension of withholding to to the refund should the issue ultimately be decided in
certain payments other than wages.” the taxpayer’s favor. The potential refunds, which would
Resolution of this issue is far from complete. include interest on the taxes paid, could be significant.
The Sixth Circuit’s opinion is in direct contrast to the To determine whether you qualify for this refund
Federal Circuit Court of Appeals’ decision in CSX Corp. opportunity or for assistance with filing the necessary
v. U.S., 518 F.2d 318 (Fed. Cir. 2008). The IRS has claims for refund, contact the author or your local
also issued several rulings wherein only certain types CBIZ MHM tax professional.
of SUBs were exempt from FICA taxation, such as
those that are conditional on the employee’s receipt
MARC MINKER
of unemployment compensation benefits. Given the CBIZ MHM, LLC • New York, NY
large amount of taxes at stake, the IRS likely will file 212.790.5826 • mminker@cbiz.com
an appeal of this decision to the U.S. Supreme Court
CBIZ, INC. BIZGROWTH STRATEGIES – WINTER 2013 | 7

8. our business
is growing yours
Expanding Your Personal Wealth Marketing
(Continued from page 5) (Continued from page 5)
move, the percentages of your also makes it very easy for you to embed videos
asset allocation will shift and directly into your website, blog or other social
may no longer reflect your channels.
initial goals. Your investment
goals also may have changed 4. SlideShare: SlideShare is a public sharing site that
over time. Whatever the case, allows you to upload presentations, whitepapers,
it is crucial to rebalance your brochures and videos to “share” with the world. By
portfolio regularly so that it doing so, you can expand your sphere of influence.
reflects your initial or most up-to-date target allocation. With detailed analytics, you can track how many
Some retirement plan vendors offer automatic people have viewed or downloaded your documents.
© Copyright 2013. CBIZ, Inc. NYSE Listed: CBZ. All rights reserved. • CBIZ-020, Rev. 54
rebalancing features where participants may set their There is even a built-in lead system that will collect
accounts to be periodically evaluated and rebalanced. contact details for those who would like more
Finally, remember to revisit and update the beneficiary information about your services.
of your retirement funds, following any important Take the time to develop effective profiles for each
changes in your life. of these four sites. Be strategic with the keywords that
Sufficient cognizance and active planning are you use on each site, as this will help improve your
paramount in successfully achieving your retirement rankings. Finally, remember to periodically monitor your
goals. The beginning of a new year is a great time to search engine rankings to be better informed about
keep these objectives in check among other ambitions what the online world says about you.
you might have for 2013.
JUNG EUN OH AMANDA MARKOS
CBIZ Retirement Plan Services • Cleveland, OH CBIZ, Inc. • San Diego, CA
216.520.6622 • jung.oh@cbiz.com 858.795.2253 • amarkos@cbiz.com
8 | BIZGROWTH STRATEGIES – WINTER 2013 CBIZ, INC.