Business Services Industry

Vermont helps poor workers help selves: generational poverty creates special needs

HR Magazine, Nov, 2007 by Diane Cadrain

Low-income workers, with generations of poverty in their family history, have particular challenges that can keep them from being successful at work or even traveling to the workplace. The Vermont Society for Human Resource Management (SHRM) State Council wants to help employers give their employees the tools to overcome poverty and stay on the job.

[ILLUSTRATION OMITTED]

A number of indicators point to deepening poverty and widening gaps between rich and poor in Vermont, said David Murphey, senior policy analyst for the Vermont Agency of Human Services. The average annual wage of Vermonters has remained consistently under the national average for more than a decade. And about one in 11 Vermonters lives in poverty. But drawing a paycheck doesn't put an end to those problems.

"Low-income workers have barriers in their lives--child care, literacy, health care and transportation, for example," said Beth Kuhn of the Vermont United Way.

Kuhn said that a major local employer has 40 percent annual turnover among its housekeeping staff, which is much higher than the national average for its industry, and that nearly half of those who leave do so in the first 90 days.

"They never quite get established in a job," Kuhn said. "Our hypothesis that we hope to test is that if you intervene a lot up front and get employees over the hump and established, then they stay."

In 2006, the Vermont State Council developed a training program to raise workplace awareness of poverty. The training built on the work of Ruby Payne, Ph.D., of the aha! Process Inc. focusing on the difficulty that poor children experience in most schools. A Michigan corporation, Cascade Engineering, adapted Payne's work and gained an 80 percent retention rate in its welfare-to-career program. An aha! consultant conducted the training sessions throughout Vermont.

Next, Vermont SHRM partnered with the United Way, Chamber of Commerce and other groups to launch a more ambitious project: identifying best practices to help companies hire and retain employees coming from backgrounds of generational poverty. Vermont SHRM called the project Working Bridges, and by June 2007, almost 100 participants had attended two training sessions.

Working Bridges now includes two active work groups, financial stability assistance and training. A third group focuses on mentoring.

Financial stability. "If a car breaks down, or a heater stops working, or a light bill comes due sooner than expected, families experience stress, and sometimes they come to HR and ask for cash advances," said Gina Catanzarita, HR director for Engelberth Construction of Colchester, Vt.

The financial stability work group has researched best practices in handling employee requests for emergency cash and has identified a credit union that will advance employees money.

"Sometimes these employees had no prior relationships with a financial institution," said Justin Worthley, HR director at Rhino Foods in Burlington, Vt. With the help of Working Bridges, Rhino now uses the credit union to authorize loans of up to $750, to be paid back by payroll deduction.

Eventually, Worthley wants all employees who ask for loans to receive a financial assessment and financial literacy training to help them get out of the cycle of living from paycheck to paycheck.

Training. The project has also set up a subgroup to develop programs to train organizations about economic class issues.

"Most supervisors are middle class, and they think that if a car breaks down or a child gets sick, the employee should deal with it and get to work," said Catanzarita. But that may not be an option.

Mentoring. A third subgroup will focus on employee mentoring approaches.

"The mentoring program will help get low-income employees over the barriers they face," said Kuhn. "We'll also be working with senior managers to understand those problems."

DIANE CADRAIN IS AN ATTORNEY AND FREELANCE WRITER IN CONNECTICUT.

Online Resources

See the latest news about SHRM members, programs and services at www.shrm.org/hrnews/insideshrm.>