Challenge and Growth: The Keys to Life-Long Satisfaction

This is the last of the series of e-zines that are written on what I consider to be the four foundational elements for building a positive workplace. In the prior three e-zines I looked at the topics of building a positive culture, productivity and quality relationships. In this one, I want to look at the relationship between continual learning and viewing the workplace as a positive experience. My hypothesis is that work is more attractive when an employee experiences challenge and growth on a regular basis. As is true of all the e-zines, the following reflects some of my thoughts on the topic as compiled from my reading and experiences.

I feel the need, however, to begin with a disclaimer. I do not believe that all employees desire challenge and growth. This fact is not necessarily bad for the organization so long as work is effectively being done. In any regard, for a variety of reasons there are employees who, at various times in their lives, are content to come to work, do their job and go home. Being challenged to grow is not seen as a positive to them as it requires effort and focus that these employees would rather not provide. But, I believe that this group of employees is usually in the minority, that they can change and that the learning organization, as it has been called by Peter Senge, is the desirable place for most employees.

Additionally, I believe there is a common view that growing means moving up and/or out in the organization. But in my view, while that would frequently be true, it seems to me possible that one can experience a lifetime of growth while remaining in the same position throughout the entire span of employment. A patrol officer in a police department, for example, can do the same job for 30 years and still find plenty of opportunity for personal and professional growth. I think we do individuals in the organization a disservice when we automatically conclude that someone who has been in their position for a long period of time is stuck. People do get stuck, but staying in the same position for a long period of time is not necessarily the measure of that fact and people can be stuck even when they move from position to position.

Similarly, if an individual is not doing well in a position, learning something new or acquiring new skills may not be the answer to the problem. The individual may be a poor fit for the position. If a position, for example, needs a gregarious person who meets new people easily and the organization has promoted an individual into the position whose personality is reclusive, it may not be wise to conclude that the person simply needs to "meet the challenge and grow."

Also, I do want to emphasize that this article is not about a performance improvement plan where an employee has been found wanting and is being directed to "grow." The issues and problems that surround informal and formal disciplinary acts have their own unique dynamics. That is not to say that growth which occurs through a performance improvement plan is not valuable, but rather to simply recognize that there are unique elements to corrective action that lay outside the scope of this short essay.

Having laid out the above points, I want to return to my hypothesis that meeting challenges, learning new skills and concepts – growing is invigorating. The following are four suggestions on how the organization can help create an environment where employees find plenty of opportunity to grow and where accepting new challenges becomes part of the enjoyment of work.

First, the social psychologist Anselm Strauss in his excellent book Mirrors and Masks discusses the two conditions that create growth and change in an adult. The first is the desire to change and the second involves receiving the type of feedback that will allow someone to know how or what to change. The bottom line of the first point is that when someone does not want to change you will receive resistance not growth. The solution to this problem is not to focus on the resistance but to focus on the absence of any desire to change. By looking for a method to help build desire, resistance should simply disappear.

As a person who has conducted a great many training programs, I have on many occasions encountered a situation where an individual in the session talks a great game but is identified to me as the chief violator of effectiveness protocols. This is where Strauss' second point fits in, I believe that individuals often see themselves as doing the right thing but need a coach to help them see where they are making mistakes.

A personal example I frequently use in presentations involves my experience on the golf course. Years of frustration at my inability to improve finally led me to a coach. His first comment to me was that "if you practice the wrong thing you will simply get better at being bad." Work with a video camera and his expert observations has substantially improved my golf game and enormously increased the enjoyment of playing golf.

Strauss' two points are clearly demonstrated here. I very much wanted to grow and I got the coaching I needed in order to know what I needed to change if I wanted to improve. As a side note, this is one of the reasons why I believe that a lot of corporate training is a waste of time. It does not help people to recognize where they specifically need to change. The one size fits all simply does not facilitate personal growth.

Second, psychologist Carl Rogers is famous for saying that "we all grow best in an environment of positive social regard." The difficulty many organizations have is that growth is often the byproduct of mistakes. Mistakes or incidents create what I have heard called the "teachable moment." These become wonderful opportunities for lessons to be learned but so often there is a tension and defensiveness to the environment that it makes growing in the positive sense extremely difficult. My experience has been that when there is a big boo-boo, there is not a lot of positive social regard running around.

It seems to me that there are two parts to dealing with this problem. First, the supervisor or person using the incident for learning purposes has to avoid finger-pointing behavior. The focus has to be on the lesson that is to be learned as opposed to the mistake that was made.

Second, I want to draw from my experience playing baseball (first golf then baseball, good grief). In baseball when you make an error all your teammates turn to you and say, "shake it off, shake it off." They all know that if the negative affect lingers in the players mind, the player is more likely to make another error. Similarly, for a situation to be turned into a positive learning experience, the person who has made the mistake in a corporate setting has to "shake off" the internal negative affect created by making the mistake. Unfortunately, supervisors are not necessarily skilled in using the shake it off, shake it off mantra.

Third, I am convinced that the most productive kind of learning comes from genuine dialog. Being talked to by your supervisor or going to a training program where you're talked at may have some value, but I do not believe it reaches the deeper levels for change and growth. That is not to deny that some supervisors are extremely good at engaging subordinates in meaningful interaction. Additionally, as a member of the National Speakers Association, I am aware that one measure of a truly effective speaker (trainer) is the ability to create a sense of dialogue between speaker and each individual member of an audience. Still, there is something truly unique about dialog. Perhaps most important it can create synergy around problems and solutions.

This is one of the reasons that I have worked with some of my colleagues to create what we call a dialog deck. Our dialogue decks looked like a regular playing cards on each of which is a question for discussion. Supervisors or trainers can use the deck to stimulate interaction – dialog. Typically the decks are written around touchy subjects that people often find difficult to discuss. My experience has been very good in being able to use the deck to create a non defensive dialogue around these topics.

Fourth and finally, I am a believer that learning energizes the individual. I am also a believer that daily routine can dull our mental capacities. I am sharply critical of many training programs that are offered by organizations. Some of this negativity will undoubtedly be explained in future e-zines for the purpose improving what is offered. Paradoxically I am a strong believer in a well designed facilitated learning experience. This is an opportunity for people to dialogue about important issues, to consider different points of view, to expand their knowledge on a subject, to be renewed and refreshed. One important measure of good training ought to be the amount of energy that is created by the program.

It is absolutely clear in my mind that dynamic learning makes work a better place to be.

Next Month: Last quarter I taught a new course in the MPA program titled Managing the Performance of Public Sector Employees. I plan on sharing some of the ideas with you that came out of that class.


Answer to question

I recently applied for a transfer within my organization. I received an e-mail message back from the HR Director in which she indicated that in her perception I was over qualified for the position and therefore was not being considered. Isn't this a decision for me to make and do I have any legal protections?

Years ago I was arbitrating a dispute between teachers and a school district in a rural western state. The teachers introduced into evidence a decision by a local judge involving a similar type of dispute that had led to a legal action by the teachers against the district. I treasure part of the judge's decision in which he wrote in a manner that only a rural judge can that, "unfortunately there is nothing in statute that protects teachers against the stupidity of management."

The simple fact is, and the judge is obviously correct, that the law affords management substantial freedom to act as it perceives best. Therefore, management can act with great brilliance or substantial stupidity; freedom allows choice. I frequently in my discussions with my graduate students and other individuals find that there is a mistaken belief that somehow the law protects the employee against a bad decision. It does not unless that decision violates some specific prohibition such as the prohibition against discrimination on the basis of race or the prohibition against discrimination on the basis of a disability.

As to the matter of being over qualified, the HR Director shares a perspective common to a lot of organizations. Over qualified employees usually don't last very long in a position and are often unhappy during the time that they perform the duties of the position. It is not unreasonable for an organization to want to find an employee that is a good fit for the position. While it can be frustrating to a person who has applied for a position to see someone less qualified, from an experience and education perspective, receive the transfer, less qualified may actually be better qualified. This is one of the reasons that organizations speak about upward mobility and why they rarely consider downward mobility.



Books

Professional Growth: We know what to do, but we don't do it, why not? How would you like to have three keys that will significantly help you move from the knowing of how to proceed to the actual implementation?

Change Or Die: The Three Keys To Change At Work And In Life
Alan Deutschman


Personal Growth: Marti Seligman has done it again. This is another of his books that has great practical application when it comes to the work we are all doing on improving our life; becoming more of what we want to be.

What You Can Change and What You Can't: The Complete Guide To Successful Self-Improvement Learning To Accept Who You Are
Martin E. Seligman


Quotation

The illiterate of the 21st century will not be those who cannot read and write but those who cannot learn, unlearn, and relearn.

Alvin Toffler


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Relationships: Quality is Not a Luxury

I am sure you have heard the phrase, “I am professional; I do not have to like you to be able to work with you.” While there is obviously some level of truth to this saying, it clearly does not describe an ideal situation. The simple fact is that business is much easier to conduct when relationships amongst the players are positive. I believe that all of us find it easier to work when our professional relationships are marked with respect, trust and a positive affect.

This is the third in a series of four e-zines which are looking at what I call the foundational elements for creating a great workplace. The first of the four looked at the organizational culture, the second at the concept of productivity and the last will look at growth and advancement. This e-zine focuses on the quality of relationships under the belief that attractive workplaces are marked with great relationships. While it may be simplistic, I believe it is fundamentally true to say that all great things, at least in a business sense, flow from the quality of relationships. So what constitutes “quality?” Read on.

The Speed of Trust is a new book by Stephen M. R. Covey. The basic premise of this book is that business transactions and business activity all work more efficiently when there is a high level of trust in the relationship of the players. He makes a very compelling argument. In the absence of trust, everything slows down while the parties go to great lengths to do their “due diligence.” I have always believed that trust, in the context of business activities, is a reflection of reliability. Or, how about this from Confucius: If language is not in accordance with the truth of things, then affairs cannot be carried on to success. Double speak will destroy trust very quickly.

In 2005 Marcus Buckingham and Curt Coffman released their book First Break All the Rules: What the World’s Greatest Managers do Differently. Based on a massive amount of data collected by the Gallup organization, this book explores what organizations successfully do to keep their top performers. Not surprisingly, having a great relationship with one’s supervisor and having a close friend at work are two of the top five reasons why top performers stay.

One of the series of courses in the MBA program that I teach at Portland State University is in the area of labor relations. Does it surprise you at all for me to say that the quality of the relationship between the labor organization and the management is a critical component in how quickly and effectively they are able to resolve problems? If their relationship is strained, marked with distrust and full of animus, problem solving is often a tortured event. On the other hand, even when disagreement is substantial, where the parties respect each other they are far more likely to successfully work through the problem and find a solution acceptable to both.

Enough talk about why quality relationships are an essential part of a great workplace. The important question focuses on what can be done to create positive relationships. I have a thought or two to share with you in response.

To begin, I read somewhere in the distant past that many of the effective approaches to improving the quality of relationships are counter-intuitive. That is, these approaches involve doing the exact opposite of what we feel like doing. One of my favorite Abraham Lincoln quotes is his statement, “I find when I do not like a man that I need to get to know him better.” This is what I believe is meant by counter-intuitive. I usually find that when I do not like a man, the last thing in the world I want to do is to get to know him better (think of your favorite political whipping person). Yet most of us, when we study the matter, probably agree with the sentiment expressed by Lincoln.

Also, what I have found about building relationships is that the Robert Sutton book, The Knowing-Doing Gap definitely applies – knowing what to do is easy; it is the doing that is hard. Don Miguel Ruiz, in his marvelous book The Four Agreements, repeats on a number of occasions that each of the “agreements” are simple, very powerful and hard to do; with the first (be impeccable with your word) being the hardest.

I agree and, therefore, put before you three simple, powerful, counter-intuitive and hard to do suggestions.

First, Roger Fisher and Scott Brown, in their book Getting Together: Building a Relationship that Gets to Yes provides two key thoughts. They argue that a quality relationship should be pursued separately from the business issues that are being dealt with. Trying to build a relationship at the same time that one is dealing with a sticky business problem is difficult at best. Moreover, it is possible to build and maintain a good relationship even where the parties disagree on an issue. Respectful disagreement is possible and in almost every case will lead to better solutions and outcomes than disrespectful disagreement.

Additionally, Fisher and Brown are great proponents of what they call “unconditionally constructive behavior.” This is what I consider to be the counter-intuitive aspect of what they are proposing. Typically, we condition our constructive behavior upon the positive behavior of the other party. If they are less than honest, we are less than honest with them. If they fail to consult with us, we choose not to consult with them. According to Fisher and Brown, everyone loses when you participate in this game. One engages in unconditionally constructive behavior because it is in your best interest to do so. There is no benevolence or altruism involved. For example, one acts reliably even if the other acts unreliably because to act reliably is in your best interest. There are no positive payoffs from acting unreliably regardless of what the other party is doing.

Second, dealing with grumpy, grouchy, demanding people is frustrating and usually produces personal fantasies filled with revenge themes – how can I best get even with this person. Here is a counter-intuitive idea from the book and training film titled Fish! One of the most popular training films ever and based on a fish market at the famous Pike Place Street Market in Seattle, Washington, Fish! encourages us to “make the day” of the contentious person. Instead of “getting even” strategies, why not pursue the goal of making the individual’s interaction with yourself the best part of that person’s day? Two amazing things happen when you pursue this goal. One is that you may find an astonishing transformation in the person you are dealing with. The other is that you will feel much better personally when pursuing a positive strategy as opposed to being consumed by negative thoughts and actions.

Remember what I said earlier: these are simple, powerful concepts that are difficult to implement. It is hard to want to “make the day” of a person standing in front of you who is doing everything possible to make your day miserable.

Finally, I want to set forth Robert Greenleaf’s thoroughly discussed topic of servant leadership. Greenleaf’s work emphasizes that leadership is most effective when it is not viewed as power over subordinates, but rather is seen as being in service to those around you. Since Greenleaf’s original work in the nineteen eighties, there have been a multitude of other books written on the same subject. The point is always the same: being in service is far more effective than lording it over.

Applying the same reasoning to relationships, I would like to promote servant relationships. Tim Sanders' book Love is the Killer App provides excellent ideas on how one can properly express love in the workplace by being in service. Sanders believes that love is the killer app because it ultimately is the most powerful business tool.

A closing thought; Robert Heinlein is one of my favorite science fiction writers. Before his death he wrote almost 100 books. His best known character is a man by the name of Lazarus Long (still living at the age of 3,000). Lazarus Long is an interstellar warrior along the lines of Hans Solo. There is a little book called The Famous Quotations of Lazarus Long and in it you will find:

Always remember this; your enemy is not wrong in his own eyes. If you keep this in mind you may be able to make him your friend. If not kill him, but not with hate.

Whenever I use this quote I always remind the audience that on a planet far, far away killing may not be a problem. On earth it is a different matter. So, go easy on the killing part. There are two aspects of the quote, however, which I am very fond of. First, there is the counter-intuitive concept of turning your enemy into your friend. Second, and a good place to end this column, hate is a sure destroyer of relationships and it has no positive outcomes. Even when an organization is confronted with the necessity to take decisive action against an employee, a negative affect does not have to be a part of that process.

Next Month: Growth and Advancement as a component of the great workplace.

Reader Question

We are downsizing our agency by eliminating some programs. Most of the employees in those programs will be laid off. A substantial majority of the employees that will be laid off are over 40, while a significant majority of those retained are under 40. Are we in trouble?

Obviously you are concerned with what we call age discrimination. The ADEA (Age Discrimination in Employment Act) is the Federal statute of interest, and there may very well be state statutes that would apply. You should definitely assess your situation to determine whether there is a potential problem of sufficient risk that it warrants seeking specific legal advice. For example, you use the words “substantial majority.” What is the total number that you are laying off and what is the actual percentage of senior employees being laid off, as compared to the percentage of senior employees being retained? Is there a significant wage gap between the two groups? The arithmetic itself may make you vulnerable. If so, I would definitely want to check with a knowledgeable attorney as to how the law relates to your particular situation and as to whether there are court decisions that may give guidance on the matter.

While I will leave it to the attorneys to give specific council, there are some general comments that may be helpful with regard to employment and age discrimination. First, with regard to the concept of employment discrimination, there is both the issue of disparate treatment and disparate impact, both of which are prohibited by the ADEA. Disparate treatment involves singling out a protected group for adverse action. Disparate impact concerns what appears to be a neutral action, but one that disproportionately, adversely impinges on a protected class (senior employees being a protected class). Depending on the specific facts of the situation, either one of these two could be present in the situation described in the question. Most likely, however, the situation involves a question of disparate impact.

The antidote for a claim of disparate impact is a valid argument by the employer that actions were taken for a bona fide business reason. Be careful, what may appear on its face to be a neutral action (not favoring one group over another) may be seen quite differently by the courts. Here are some questions you might want to ask yourself:

• Why are we closing these programs while keeping others?

• Will we be reopening, in the near future, the same programs and hiring younger employees?

• How is it that the programs we are closing have the senior employees while the programs we are keeping have the junior?

• Are we denying bumping rights to our senior employees while in the past we have been open to finding positions for the senior employees in the programs we are retaining?

Answering these questions is important to fully understand the implications of what you are doing and to fully explore your vulnerabilities.

Books of the Month

Professional Growth: Marketing departments specialize in writing powerful, sticky messages. Regardless of your position, however, getting your messages to stick can have a substantial payoff. I found the following book very useful even though I have little to do with marketing.

Made to Stick - Chip Heath and Dan Heath

Personal Growth: Are you intrigued by the debate between science and theology? A Joyful Theology is a simple book with a powerful and deep message. I like books that expand your thinking and leave you feeling joyful.

A Joyful Theology – Sara Maitland

Quote of the Month

Instead of loving your enemy, treat your friend a little bit better.

Edgar Watson Howe

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Thoughts on Trial Service Employement

Private sector employment includes non-profits (private corporations with non-profit status). The law, however, does not always treat public sector employment the same as private sector employment. When writing these e-zines, I have attempted to carefully draw this distinction, when the distinction is important. Last month, I wrote an e-zine on severance pay. Unfortunately, as one of the recipients kindly pointed out in a return e-mail, I overlooked the fact that severance pay is by and large forbidden in public employment. Various federal and state statutes prohibit the “gifting” of public funds and severance pay is typically considered a gift – no work, no pay. Thus, while there may be a gray area over whether the employee must work the last few days before leaving employment in order to receive full compensation, clearly multi-month severance packages cannot be put together for public employees. I feel much better now that I have cleared the record on this issue.

On to this month’s topic. On August 10, of this year, one of my colleagues and I will be speaking at a national conference in Las Vegas, Nevada. For the record, I most enjoy speaking at conferences in: New York, Orlando, Anaheim, Las Vegas, and anywhere in Hawaii. The focus of the presentation is on managing the trial services employee. The presentation will look not only at the organizational and legal issues around the trial services period but will also map out steps that can be taken to initiate the new employee into the organizational culture. The early work that I have completed to prepare for this presentation has led me to believe that it is a topic worth discussing in the e-zine. Specifically, I intend to use the next three or four e-zines to construct an outline for effectively managing the trial services employee. In this issue I will begin by looking at two critical issues: 1) what should we call the trial services period, and 2) what significance does employment law place on the trial services period.

What to call it?

Most of the personnel handbooks that I run into still call the trial services period a “probationary period.” For a number of reasons, I believe that using the term “probationary period” to discuss the first stage of an individual’s employment is a very poor title. I recognize that it is commonly used this way but believe the term “probationary” has too much connotation of wrong-doing. Felons serve a probationary period in lieu of jail time or they are placed on probation post jail. Employees are put on probation when they have done something wrong. Thus, starting employment on probation carries the unnecessary and inappropriate sense of wrongdoing.

The term “trial services period” carries with it the concept that one is being given the opportunity to demonstrate capabilities. This is a time of training and development. It is also a time that both parties, employer and employee, can assess whether the position is a good fit for the employee. Most importantly, it is a golden opportunity for the organization to build off of a new employee’s enthusiasm for the job and appreciation for being given the job.

Significance of Employment Law

From the standpoint of employment law, there are good reasons why an employer benefits from distinguishing between an early trial services period and regular employment. First, either through a labor contract or through the organization’s personnel policies, most employees are afforded a grievance procedure by which to bring a formal complaint. Almost all of the labor contracts that I have reviewed clearly deny to the trial services employee the right to grieve dismissal during the trial services period. In other words, if you remove the trial services employee from his or her employment, that separation cannot be challenged. If you do not have a labor contract or where one does not apply, personnel policies can still distinguish between the rights of the trial services employee and the rights of the regular employee as regards the filing of a formal complaint.

Second, in the landmark Supreme Court case called Loudermill (1985), the Court emphasized that employment status in the public sector was a creation of the policies and rules promulgated by the employer. The Court goes on to emphasize that once the employer has created an employment status that carries with it a sense of permanency (regular employment), then that employee has a property interest in their employment and must be granted full due process for a discharge. This decision by the Court, in the view of legal authorities, clearly permits the employer to establish a trial services period that would carry with it no constitutional due process issues rights (no expectation of permanency thus no property interest).

While the Loudermill decision applies only to public sector employment, I believe the Court’s logic in that decision has broad applications. There are many good reasons why it is advantageous to make a clear distinction between the permanency of regular employment and the impermanency of trial services. While the next e-zine will look at the importance of making that distinction in a positive way, as a general matter of employment law it is often useful to make that distinction.

Reflecting over the points outlined above, I am closing this e-zine by offering three suggestions:

1. Review your personnel policies and/or your labor contract and determine whether the word trial services better reflects the early period of employment in your organization than does the word probationary period. If you have not made the change, is it possible to do so?

2. Review the language that describes the trial services period (probationary period) in your personnel policies or labor contract. Is it overly negative, focusing on consequences for the failure to perform? Without diminishing a clear message that separation can occur if the employee is not successful during the trial services period, can the language be written to emphasize that this is an opportunity for the new employee to shine?

3. Does the language of your labor agreement and/or personnel policies clearly indicate that the separation from employment for the trial services employee is distinctly different than the discharge of a regular employee? In my view, an organization ought to discharge a regular employee for cause while it separates a trial services employee for failure to pass the trial services period. The two are distinctly different. Similarly, the employer should not be using formal discipline on the trial services employee. If you cannot bring forth the desired behavior with coaching and training, then the employee has not passed trial services and should be removed from service.

One last point, personnel policies/labor contracts also use the concept of a trial services period (probationary period) for a promotion. Again, I believe it wise to focus on the positive. One difference related to the trial services period for promotion will involve the right of an employee to return to a prior position if he or she fails the trial services period. I cannot imagine that one would want to promote an individual if he or she was doing a poor job in their existing position. Thus, it seems to me that the right of return makes good sense. The policies, however, should be clear on this point.

As noted above, in June we will turn to the “art” of successfully managing the trial services employee and the organizational benefits that derive from putting a greater emphasis on working with the new employee.

Quote of the month:

We cannot teach people anything;

we can only help them discover it.

- Galileo

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The Facts on Severance Pay: What's Required and What's Advisable

Severance pay has recently become a topic of discussion with a client and, as a result, I took some time to do a little research. Severance pay is extra compensation (treated like regular wages) paid to employees as a result of involuntary termination or as an enticement to voluntary termination. Since severance pay is treated as wages, it would go on the employee’s W-2 just like any other wage. If you are in a situation where you might consider offering or providing severance pay, there are a few facts that you should be aware of.

1. Severance pay is not covered under federal wage and hour (FISA) legislation but is covered in a few state statutes. For example, the State of Maine requires severance pay in the case of relocations or shutdowns. Therefore, an employer should check with their state department of labor before determining whether to offer severance pay and, if offered, how much to provide.
   
   

2. While many employers provide severance pay for managers and executive level employees, very few provide it to hourly employees. This distinction may very well be an issue addressed by state statute, so one should be careful in making this decision.
   
   

3. Severance pay is usually provided as either a matter of the employer’s general practice or a specific policy. Only infrequently is it provided on a case-by-case basis.
   
   

4. Severance pay, in many situations, would be better considered as a severance package. Within this package you might have matters related to insurance, pension benefits and severance pay. If so, the employer should keep in mind that parts of the severance package may be a requirement of statute and other parts a voluntary action on the part of the employer. The employer should maintain the ability to separate the voluntary from the required in the event that agreement cannot be reached on the whole package.
   
   

5. Frequently, companies that provide a substantial severance payment will condition the payment on the employee’s agreement not to take any legal action against the employer. In such a case, the employer should be aware that the employee has the right to refuse the severance pay and proceed with the legal action – assuming that legal action can be taken. At least one source that I found indicated that the courts are more responsive to a no-lawsuit restriction on severance pay when it is a matter specifically addressed in the company’s policies.
   
   

6. Obviously, if the employee has the right to accept or refuse the severance package then the employee also has the right to negotiate the terms. Since there is no duty to bargain, the employer can reject the employee’s efforts to negotiate the severance package or can attempt to take advantage of what might be an opportunity to reach agreement that would ultimately save the employer a substantial amount of money and be to everyone’s advantage.
   
   

7. The amount of severance pay is typically related to the number of years of service; with a cap often being placed on the total number of years for which credit will be given. For example, a one-year employee may be granted a one-week severance package, a ten-year employee might be given a ten-week package and a seventeen year employee a fifteen week severance pay benefit where the company has a fifteen week maximum benefit. Since severance pay is not a matter of law, there is no rule as to what is reasonable. Consistency in the employer’s severance pay activities would be advisable.
   
   

8. Generally speaking, you should not expect an employee to make a final decision with regard to severance pay the first time you make the offer. See it as a multi-session negotiation. For example, you might have an initial sitting with the employee in which you lay out the broad perspectives of your severance package with the conclusion that you don’t want any response from the employee at this time but would rather have the employee take it and study it for a week and come back so that you can discuss it. A week later you may sit down with the employee and work out elements such as matters related to pension, medical insurance or other things involved in this package with additional discussions over the amount of severance pay and the no-lawsuit provision. You can then schedule an additional follow-up sessions. On the other hand, the employee may be fully willing to resolve all matters during the first or second session and, if so, proceed to settlement. Always remember that time means everything in negotiations and what a person is not willing to accept at one point in time they may be fully willing to accept at some later point in time.
   
   

9. Severance pay can be given as a one-time payment or in multiple payments. Multiple payments have substantial value if there are conditions that the employee needs to meet that are part of the severance package.
   
   

10. The following is some sample severance pay policy language that you can tweak to meet your specific situation:

SEVERANCE PAY

A. An employee who has been employed for a continuous period of at least 18 months and who is involuntarily separated from employment for reasons other than misconduct or unacceptable performance and who is not eligible for an immediate annuity shall receive severance pay.

B. The amount of severance pay shall be one week’s salary for each year of the first fifteen years of service and two weeks salary for each year of service after fifteen. No severance pay will be granted for service after the twentieth year.

C. Upon separation, the employer shall pay the employee’s severance pay at monthly intervals in an amount equal to his or her basic monthly salary until such time as all severance pay that is owed has been fully paid to the employee.

After having spent a substantial amount of time researching this question, I have arrived at the conclusion that for most of my clients it is wiser not to have a specifically written severance policy than it is to have such a policy. A specific severance pay policy may unduly restrict a small employer. Also, there is nothing that prohibits the negotiations of severance pay, on a case by case basis, and conditioning those negotiations on the specific facts of the involuntary separation.

Finally, since I am self-employed, I have no one with whom I can negotiate my own severance pay. I decided to resolve this matter by setting up a personal severance pay fund in the event that I terminate myself and I am beginning to set money aside in that fund. In the event that any of you feel sorry for me, have an overwhelmingly generous spirit and would like to contribute to my personal severance pay fund, I will gladly accept such donations.

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A Thoughtful Review of the Latest Changes to the Fair Labor Standards Act (FLSA)

Having received a couple of requests for info on the new overtime regs, I decided to provide a comprehensive overview of the changes to the Fair Labor Standards Act. Basically, despite Congressional challenges, new federal overtime rules are in effect that substantially change the overtime status of millions of American workers. The “Overtime Security Rule” is a revision of the Fair Labor Standards Act (FLSA) which was implemented by the Department of Labor (DOL) on August 23^rd of this year. The revision of the FLSA represents only the third time that overtime rules have been updated since the FLSA went into effect in 1938. The last revision occurred in 1975.

How Have the Rules Changed?

The most significant changes in the 474-page revision of the FLSA are an increase in the salary cap of workers who are automatically eligible for overtime and a change in the determination of which employees are exempt from overtime pay.

Under the new rules, any employee who earns up to $23,660 per year is automatically guaranteed overtime whenever they work more than forty hours a week, regardless of their job duties. This is a substantial increase from the previous cap of $8,660 per year, and covers everyone from blue collar workers to clerical staff to managers, regardless of whether they are paid on an hourly or salary basis. The DOL estimates that this change will grant overtime protection to some 6.7 million workers nationwide.

The second change redefines which employees are considered exempt from overtime. Under the new rules, workers who make more than $23,660 per year are exempt from overtime if their duties are professional, administrative or executive. The law also generally excludes anyone who makes $100,000 per year or more from earning overtime, regardless of their duties or salary basis. Critics of the new rules estimate that this change will eliminate overtime protection for nearly 6 million workers.

Who’s Entitled to Overtime?

So how can an employer know for sure which employees should receive overtime? First, for employers who have employees covered by a collective bargaining agreement which gives them more generous rights to overtime than the new rules, the terms of the labor agreement supersede the new rules.

Second, employers should be aware of what the laws are in their particular state. In states that have different overtime provisions, employers must abide by whichever standards are more beneficial to the employee. States that have separate overtime regulations include: Alaska, Arkansas, California, Colorado, Connecticut, Hawaii, Illinois, Kentucky, Maryland, Minnesota, Montana, New Jersey, North Dakota, Oregon, Pennsylvania, Washington, West Virginia and Wisconsin. A quick trip to the web site for the DOL of the state will provide any desired information.

After taking these two factors into consideration, there are three major tests for determining overtime eligibility.

1.) How much does the employee earn? If the employee makes less than $23,660 per year ($455 a week), they are automatically entitled to overtime, regardless of their duties or salary basis.

2.) What is the employee’s salary basis? Employees who earn more than $23,660 per year and are paid on a “salary” basis are generally exempt from overtime. Salaried employees are paid a fixed salary per pay period, regardless of hours worked, as opposed to employees who are paid “by the hour”. Hourly employees are generally entitled to overtime pay.

3.) What are the employee’s duties? White collar employees who earn more than $23,660 per year are exempt from overtime if their duties are primarily managerial, administrative or professional.

“Managerial” employees are defined by the rules as those whose primary duty is the management of an enterprise (such as a department, store or subdivision), those who customarily and regularly direct the work of two or more other employees, and who have input into personal decisions such as hiring, firing, promotion, etc. (regardless of whether the employee has the sole discretion to do so). Unless otherwise guaranteed overtime by a collective bargaining agreement, employees in this category generally include: executive staff, managers, assistant managers, supervisors and team leaders.

“Administrative” employees are those whose primary duty is performing office or non-manual work directly related to the management or general business operations of the organization. Administrative employees also exercise “discretion and independent judgment”. Unless otherwise guaranteed overtime by a collective bargaining agreement, employees in this category generally include: administrative assistants, executive secretaries, school principals and vice-principals, school counselors, human resource staff, purchasing staff, public relations and quality control staff.

“Professional” employees are those who are “learned professionals” or “creative professionals”. “Learned professionals” are generally those whose jobs require advanced knowledge of science or some other field of learning which is gained through specialized intellectual instruction. “Creative professionals” are those who perform work requiring invention, imagination, originality or talent. Unless otherwise guaranteed overtime by a collective bargaining agreement, employees in the professional group include: restaurant chefs, nurses, financial service industry workers, insurance claims adjusters, teachers, lawyers, engineers, actors, musicians, dental hygienists, pharmacists, journalists and funeral directors.

The law also guarantees overtime to several groups of workers, regardless of salary or duties, including: blue collar workers (such as carpenters, craftsmen, construction workers, etc.), “first responders” (such as police officers, fire fighters, paramedics and EMTs), computer workers (such as system analysts and computer programmers), and inside sales employees.

For more information on determining which employees are exempt and non-exempt, check out the DOL’s website which includes listings by position and exemption type, exemption tests, fact sheets and frequently asked questions. The website is located at www.dol.gov/esa/regs/compliance/whd/fairpay.

What Steps Should Employers Take to Comply?

There are several steps all employers should take to ensure that their organization is in compliance with overtime rules.

1. Review your state law on overtime

2. Review the provisions of any collective bargaining agreements

3. Check the salary levels and salary status of employees

4. Revise job descriptions and clarify which employees are exempt

5. Train HR and payroll employees on the new rules

6. Consult with legal counsel as needed

Finally, before reclassifying employees as exempt under the new rules, be sure to consider the effect it will have on employee morale and retention. Employers always have the right to voluntarily pay overtime to any worker. As with any new rules, it’s only a matter of time before some of these new overtime provisions are challenged in court.

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Thoughts on Issues of Performance, Attendance and the ADA

1. As promised in the first edition of the Williams’ HR Insights e-zine, I am providing additional information into the implementation of a no-fault attendance policy. If you are contemplating a no-fault policy, give careful consideration to the following points:

-- A fault based attendance program rests heavily on the requirement that employees provide a doctor’s statement for absences related to an illness or accident. A bona fide doctor’s statement justifies the employee’s absence, and bars the employer from taking action against the employee. A no-fault policy does not require a doctor’s slip for any absence. I like this fact because doctors will always provide a statement, even if it says no more than, “patient X visited me on X day and reported that he had a sore throat.” Notice that this statement does not indicate whether or not the employee could have worked. In fact, as most of you know, it often seems that a doctor’s statement is one element of an elaborate game that is being played out between the employer and the employee. The no-fault policy is an attempt to get away from this game, and simply recognize that the employee was hired because there is work to do. When an employee is not at work, the work is not being done. While there is some latitude a reasonable employer must give for an illness and/or other personal problems, the employee’s good attendance is an essential tenet of the job.

-- Please note that the exception to the first bullet involves an absence that is covered under FMLA. Any absence covered by FMLA cannot be assigned an attendance point under the no-fault attendance program. Thus, a no-fault attendance policy would need to be constructed that clearly differentiates those absences that would produce an attendance point from those that would not. A no-fault attendance policy, as explained in the July e-zine, is usually based on a point system where the accumulation of a certain number of attendance points will lead to discharge. Examples of what might trigger an attendance point include any absence (multiple consecutive days of absences are typically viewed as one absence or one point), a tardiness of 45 or more minutes, a no call/no show, funeral leave and time taken off during the day for personal reasons. Please note that a one-day absence that is a no call/no show would receive two attendance points.

-- One of the important elements of a no-fault attendance policy is that very legitimate absences (funeral leave) are given an attendance point – the employee is absent. Thus, while your policies may provide for funeral leave (paid or unpaid) the absence would still create an attendance point. Under a well-crafted no-fault policy, however, employees with good attendance will quickly remove any attendance points that have been placed on his or her record.

2. While we are on the subject of employee attendance problems, I ran across a recent court decision (State of Washington) where the employer was held liable for the taunting of an employee by fellow employees over absences related to an on-the-job injury. The employees were upset because they felt the injury was faked and resented the fact that the employer had provided light duty alternative work. As a result, a group of employees made life miserable for the injured employee. This cost the employer a great deal of money, even though the employees were told to “knock it off” by their supervisor on a number of occasions.

3. There are two legal concepts that are of substantial importance as applied to state and federal law. The first is the word “pretext.” Whenever the court evaluates an employee’s claim under statutes, such as ADEA, ADA and OSHA, the critical question asked by the court is whether the reasons given by the employer for discipline or discharge are simply a pretext provided to justify an illegal action under the statute. Thus, the evidence provided by the employer, in order to satisfy the court’s concern over pretext, must by solid and well-documented.

4. The other term of significance is “essential functions.” The problem with the term “essential functions” is its slippery nature. Employers are not required to change an essential function of a position to accommodate an employee. An essential function is a job duty that is fundamental, basic, necessary and indispensable to filling a particular position; as opposed to marginal duty divorced from the essence or substance of the job. Also note that an essential function includes both the expected conduct for the position and the actual service that is required from the employee.

A recent Nevada case, upheld by the Appeals Court, provides insight into the importance of the “essential functions” concept. The Appeals Court affirmed that an employee is not entitled to reasonable accommodation, under the ADA, when he or she is unable to perform the essential functions of the job. The protections of the ADA apply only when an employee with a bona fide disability is able to perform the essential functions of the positions. The employer must be careful with this concept, however, because if the disability is the result of a workplace injury, the employee may be entitled to reasonable accommodations under state disability statutes.

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