Strategic HR Lawyer

It seems that employers and employees don't necessarily agree.  A recent survey suggests that  "...Employers and employees have dramatically different opinions of why workers remain in their jobs, showing US companies may struggle to retain employees in an improved job market."

For employees its 1) benefits, 2) financial compensation, and, 3) their career growth and earnings potential.  Employers, however, believe that management climate, supervisor relationships and culture and work environment keep their employees at work.

In my experience, managers always seems to have a relatively warped sense of their value to employees.  They believe that they are engaging, motivate employees, have open door policies and send messages to employees that they are valued.   For their employees, it seems that according to this survey, nuts and bolts count first, particularly in this economy.  Even if employers do believe this about themselves, many times their actions in practice are contrary to the spirit of these employee-friendly policies.

Not all employers are as misguided as I suggest, but if an employer doesn't even know why employees work there, that's a problem.  And those that think human resources is back office administration, holiday parties and compliance are the ones most likely to fall into this trap and face massive turnover once the economy recovers

Follow this Link:  Firms, workers differ on why people stay in jobs

Posted By Diane Pfadenhauer In Employee Relations , Trends | Permalink

Years ago, the water cooler or the company break room/cafeteria was the place their employees got their information - typically in the form of gossip.  Now, with the proliferation of technology in the workplace - through instant messaging, PDA's cell phones, email, etc. - workplace gossip has the capability of traveling more furiously and faster. This article claims that employees get their dirt from:

• the office break room (36%),
  
• at a co-worker's desk, workstation or office (33%),
  
• through e-mail or instant messaging (10%).
  
• only 1% of employees say they head to the water cooler to learn what's really going on.

Now, perhaps some employers have become cheap and eliminated some of the water coolers, but in any event, it highlights the need for employers to monitor communication, clarify the rumor mills, and ensure that its own communication is clear and widespread. Posted By Diane Pfadenhauer In Employee Relations , Policies & Procedures , Trends | Permalink

I recently authored an article on Plant Closings and the WARN Act.  All too often, we think about bare bones compliance and fail to see the need to engage remaining or transitioning employees in the process of closing a facility.  This article, Beyond the Warn Notice:  Getting to the Tipping Point and Beyond, appeared in the July/August issue of Human Resources Advisor Journal (published by Thomson West).

Perhaps some recent employers in the news with significant layoffs could learn a thing or two... Posted By Diane Pfadenhauer In Corporate Turnaround , Employee Relations , Employment Law , HR Strategy , Policies & Procedures | Permalink

Everyone knows that the workplace is always full of situations where people often have difficulty getting along, where someone has been wronged, or where someone feels slighted in some way.  Carrie Mason-Draffen, as Newsday reporter, has written a column for the last 10 years dealing with these issues.  She constantly receives notes and letters from readers asking her how to handle a difficult situation at work.  She typically calls in outside experts to help answer their questions.  I've seen fellow collegaues, the department of labor and other experts lend their words of wisdom to help set an employer or employee straight - sometimes with legal implications and sometimes with just plain common sense.  This past weekend I shared my insight with Carrie on a workplace situation that dealt with accommodating an employees allergies to perfumes and the like.

More importantly, however, Carrie recently wrote a book, 151 Quick Ideas to Deal With Difficult People, capturing a decade of a wealth of information into useful tips that everyone can use to make the workplace just a little bit better for all of us.

 

Posted By Diane Pfadenhauer In Employee Relations | Permalink

Often effective communication with employees is touted as advantageous, beneficial,and the stuff that makes the warm and fuzzy types happy.  The 2005/2006 Watson Wyatt Communication ROI Study™ shows that effective communication is a leading indicator of an organization’s financial performance.  Some of the findings:

• Companies that communicate effectively have a 19.4 percent higher market premium than companies that do not.
• Shareholder returns for organizations with the most effective communication were over 57 percent higher over the last five years (2000-2004) than were returns for firms with less effective communication.
• The 2005/2006 study found evidence that communication effectiveness is a leading indicator of financial performance.
• Firms that communicate effectively are 4.5 times more likely to report high levels of employee engagement versus firms that communicate less effectively.
• Companies that are highly effective communicators are 20 percent more likely to report lower turnover rates than their peers.
• Two-thirds of the firms with high levels of communication effectiveness are asking their managers to take on a greater share of the communication responsibility, but few are giving them the tools and training to be successful.
• Global firms are not customizing their messages to meet local needs or cultural sensitivities.
• On average, firms within the financial and retail trade sectors rank among the most effective communicators. Health care, basic materials, telecommunications and other service companies rank among the least effective communicators.

I've gotten on the communication bandwagon myself, having written a few articles on the subject in the context of corporate turnaround and mergers/acquisitions.  See the sidebar on the left for some of these.

Thanks to the Human Resources Blog.

Posted By Diane Pfadenhauer In Corporate Turnaround , Employee Relations , Mergers and Acquisitions , Policies & Procedures | Permalink

The Internal Revenue Service has issued a new Fact Sheet regarding classifying employees properly.  According to the Fact Sheet:

"The rash of natural disasters that have hit the United States in the last several months have caused many businesses to hire additional workers to help them meet increased demand for their goods or services. These businesses must make sure they treat their workers properly to make sure everyone can meet their tax obligations.

Most workers fall into two categories:  Independent contractors or Common-law employees

The main factor a business must use in determining how to classify its workers is the degree of control the business has over its worker. The more control the business has over a worker; the more likely it is that the worker is an employee rather than an independent contractor."

The Fact Sheet also provides links to other available detailed information on this subject from the IRS.

It's amazing to see how many organizations are still confused about this issue.  I can't tell you how many times, I hear people refer to people that work for them as (my pet peeve!) "1099 Employees."

Thanks to Benefitsblog for bringing this to our attention.

Posted By Diane Pfadenhauer In Employee Relations , Policies & Procedures | Permalink

Many organizations find themselves confronted by seemingly conflicting regulations when it comes to whether it is permissible to mandate that only English be spoken in the workplace.  Often employers consider such a requirement as a result of safety concerns, because of regulation in their particular industry or the desire to mitigate employee relations problems which may arise as a result of cultural differences in the workplace.

The EEOC provides some specific guidelines in this area and, not surprisingly, frowns upon such rules where they prohibit employees on breaks and meal periods from speaking a language other than English.  There is a fundamental difference between requiring employees to only speak English in the workplace and a requirement that they have the ability to read and write English.  The latter does not prohibit them from speaking other languages while the former does.  Follow this link for more on the EEOC's guidance on English Only Rules.

Posted By Diane Pfadenhauer In Employee Relations , Employment Law , Policies & Procedures | Permalink

Delphi has taken a few punches since filing for bankruptcy.  Its seemingly excessive bonus plans for key employees angered union members and became fodder for media criticism.  Seems that Delphi CEO Robert "Steve" Miller, who has known for being bluntly outspoken about the financial issues facing Delphi, is trying to demonstrate a little compassion for employees.   This article in USA Today describes his recent statements . Specifically,

"Workers have built their lives around their high wages, and Delphi is working with its biggest customer and former parent, General Motors, to find a reasonable way to bring Delphi's labor costs in line while maintaining workers' standard of living....Behind all this financial drama are the lives and livelihoods of thousands of Delphi workers. They played by the rules and cannot be blamed for taking a high-paying job. ... They are at risk of being severely impacted and disappointed. I don't blame them for being angry."

Moral of the story - sometimes honey works better than vinegar.  A bit of compassion can go a long way in trying to get employees and other stakeholders on board with what is seemingly a daunting initiative.

Posted By Diane Pfadenhauer In Corporate Turnaround , Employee Relations , HR Strategy | Permalink

I'm back from my trip to the Gulf area this past week with the Turnaround Management Association.  As I previously mentioned, we did a series of workshops in Baton Rouge and New Orleans for businesses in the area.  Dan Dooley, CTP of Morris-Anderson (Chicago) was our fearless leader, Anu Singh, CTP of Huron Consulting Group (Chicago) spearheaded the process of combining all of our presentations into a great program.   Also presenting were Pat O'Keefe of O'Keefe and Associates out of Detroit, Vince Liuzza from the local TMA Chapter, and yours truly.  The amazing staff of TMA headquarters in Chicago and the leadership of the local TMA chapter coordinated the activities ensuring a worthwhile event for everyone who participated.

We led the participants through the basics of the turnaround process, how to deal with bankers, lenders, the pros and cons of filing for bankruptcy protection and employee retention and other issues.   

Despite our frenetic schedule, we managed to go on a tour of devastated areas early Thursday morning.  The devastation was unbelievable.  I think its true that the media has all but forgotten as the news we see in no way portrays the reality of the situation down there.  Some amazing things we learned and saw while there:

• Around 200,000 homes were destroyed
• HALF of the area is still without power
• The homes of MOST of the people I spoke with were completely destroyed
• The population of Orleans parish is now at about 70,000 (down from about 400,000)
• The lack of employees is incredible - Many restaurants and other stores are operating with only one shift and limited hours.  Burger King is paying $10/hour and offering $500 monthly bonuses.
• The largest park in the area is now a garbage dump as a staging area for the 40 YEARS of garbage created by the disaster.
• And the list goes on....

Suffice to say, almost 4 months after Katrina hit it looks as though it happened yesterday!  Thankfully, TMA will continue its work to help businesses in the area.  For those interested in continuing TMA activities in this area you can visit the TMAssist Blog here.

Posted By Diane Pfadenhauer In Corporate Turnaround , Employee Relations , Miscellaneous , Weblogs | Permalink

I'm off to New Orleans with the folks from the Turnaround Management Association, so posting will be light this week.  We have a heck of a schedule, everyone has been working 'round the clock to put this all together and we're all looking forward to doing good.  I'll post as I can with any updates.

Posted By Diane Pfadenhauer In Corporate Turnaround , Employee Relations , Miscellaneous | Permalink

Instant messaging and other forms of electronic communication can pose serious problems for organizations.  This little article I wrote for Law Technology News describes some of the pitfalls.  If you think email is too informal, look at what your employees are writing in instant messages!  Many employers have found that their employees are using IM utilizing their private (AOL, MSN and the like) accounts.  What's the problem with that you ask?  Read on (free registration required)...

Posted By Diane Pfadenhauer In Employee Relations , Employment Law , Policies & Procedures | Permalink

A recent article in the New York Times (free registration required) discusses how Costco has become the Anti-Walmart.  The article discussed how Costco has given Sam's Club a run for its money.  What's really interesting about the article (and perhaps more important) is the discussion of how Costco treats its employees, much to the dismay of Wall Street.  Specifically:

1.  Costco benefits for employees are not just a little bit better than average, they are substantially better than their competitors.
2. The average Costco employee earns $17/hour, 42% more than employees at Sam's Club.
3.  Turnover is virtually non-existent.
4.  Jim Sinegal's (president of Costco) salary is 10% of what CEO's earn at comparable organizations.
5.  401(k) matching contributions range between 3% and 9% depending upon length of service.

The lesson here is that when an organization takes care of its people, it can be wildly successful.  Although some on Wall street argue, according to the article, that it's better to be an employee of Costco than a shareholder or customer, it's performance over the years has been quite good.  But, I think the question for Wall Street is how good is good enough, and is the balance of stakeholder interests appropriate?  As many organizations whittle away salaries and benefits it's refreshing to see a demonstrated commitment to employees.

Posted By Diane Pfadenhauer In Employee Relations , Staffing, Recruitment, Selection , Trends | Permalink

Everyone knows by now that the Krispy Kreme board terminated 6 of its top executives (see USA Today article here).  Everyone probably also knows that several months ago the company brought in a turnaround expert to do exactly that for the company.  What isn't being discussed, and quite frankly hardly ever gets discussed in the news is the following:

What is the corporation is doing to ensure that the employees and other stakeholders remain engaged? 

This has always been a soap box issue of mine and has been the subject of some recent articles I have written on the subject.  There is often a tremendous void between the ivory tower and the rank and file employees (the ones, in this case, that take those steaming hot donuts out of the fryer one by one).  It would be interesting to see them discuss openly how they are addressing the people issues associated with the turnaround.  Let's not forget that they went public a few years ago and that prior to that, they were a privately held company for decades.   I suspect there is a lot of history there.  There are also many other significant change issues going on for the organization.  What are they up to?

Posted By Diane Pfadenhauer In Corporate Turnaround , Employee Relations | Permalink

Workforce.com reported that the Gallup Organization developed, after an extensive survey, a series of questions that will show how engaged your employees are.  Gallup call it Q12 and finds a correlation between high scores on the questions and employee performance.  They are:

• Do you know what is expected of you at work?

• Do you have the materials and equipment you need to do your work right?

• At work, do you have the opportunity to do what you do best every day?

• In the last seven days, have you received recognition or praise for doing good work?

• Does your supervisor, or someone at work, seem to care about you as a person?

• Is there someone at work who encourages your development?

• At work, do your opinions seem to count?

• Does the mission/purpose of your company make you feel your job is important?

• Are your associates (fellow employees) committed to doing quality work?

• Do you have a best friend at work?

• In the last six months, has someone at work talked to you about your progress?

• In the last year, have you had opportunities at work to learn and grow?

The list was developed by Gallup several year ago, but it's still useful today.  Not only is it correlated with better job performance, but certainly the employee relations climate in an organization should be must improved with high marks on these questions.

Posted By Diane Pfadenhauer In Employee Relations | Permalink

Often HR practitioners are confronted by employees who allege they were mistreated by their supervisors.  Often the employees quote inappropriate statements by managers that make the the HR manager's skin crawl.  This article will make one rethink the feeling,  "I've seen it all...," and make the company pray that plaintiff's counsel is not within earshot.

Posted By Diane Pfadenhauer In Employee Relations | Permalink