Employee Discipline: Rethinking Strategy and Tactics

A short while ago I attended a social event and one of the other attendees had brought a local police officer as a guest. The two of us ended up in an extended conversation. It seems that he had just been notified that an appearance before the discipline review board was mandated. He was uncertain about what he was being called before the board and was clearly agitated by the fact. Our discussion focused on the way discipline was administered in the department and how the discipline review board was used as a tool of intimidation and fear.

Originally I had intended to write this e-zine on the topic of discharge for absenteeism. The above conversation, however, stimulated my interest in sharing some thoughts about why the discipline process is so often ineffective. My purpose is to focus on some basic principles that are necessary to ensure the effectiveness of your discipline program. I am offering the following seven points as a way to stimulate your thinking about the manner in which discipline is administered in your organization and the effectiveness of the discipline program.

First, the word discipline itself is intriguing because it has both a positive and negative connotation. “That child needs to be disciplined.” “She is a very disciplined employee.” How different these two sentences are. One uses the word discipline as a corrective action with the connotation of punishment in the context of something wrong. The other uses the word as an admirable characteristic related to effective performance. What I believe often gets lost is the fact that we ought be disciplining employees for the purpose of building a well disciplined team. Question, is discipline administered in your organization for the purpose of improving employee discipline? Or, do you simply punish people when they are bad?

Second, employees are disciplined for issues around misconduct and unacceptable performance. Yet when I have reviewed discipline protocols it is frequently obvious that they have been written to deal exclusively with matters of misconduct. The problem is that the two require distinctly different approaches. With matters of misconduct employees are disciplined with the expectation that whatever infraction has occurred will not happen again. Performance problems, on the other hand, are best dealt with by setting performance goals and then working with the employee over time to achieve those goals. Unacceptable performance does not generally involved an on and off switch. Rather it is a matter of growth and development. While an employee can be discharged for misconduct and/or for unacceptable performance, the path by which one arrives at the point of employment termination should be different.

Third, it is important to clearly distinguish between informal disciplinary acts and formal. Formal discipline (oral warnings, written warnings, suspensions) are usually less effective than the informal protocols (training, coaching, counseling and other softer forms of intervention) correcting and shaping employee behavior. For one thing, formal discipline is harder on the relationship between supervisor and subordinate and as such makes it more difficult to positively influence employee activities. But, formal discipline is frequently a legal or contractual necessity. My advice, do all you can informally before you move to the formal. Once you move to the formal it is generally very difficult to effectively utilize the informal.

Fourth, the culture of your organization is usually a stronger determinant of employee behavior then is your work rules and performance goals. Thus, disciplining employees may not be as effective towards changing behavior as the work you do to improve the culture; change the culture, change the behavior (this suggests another topic for an e-zine). At minimum what you need to be asking yourself when you discipline an employee is whether your other employees will support your decision to implement discipline or will they feel that your decision is unfair. While sometimes the perception that something is unfair is based on a lack of knowledge, where employees have the knowledge and your actions are viewed as inappropriate; then you have a much bigger problem than whatever you are attempting to address with the discipline.

Fifth, employee discipline tends to focus on eliminating what is not wanted. Their often seems to be an unstated assumption that if we eliminate what we don’t want, what is left will be what we do want. I doubt that this is true. If what we do want is an energized, enthusiastic and committed workforce does the discipline program help bring wayward employees into alignment with that objective? Or, does it focus on specific problems as opposed to the larger objective? You may find it advisable to benignly overlook certain problem areas while being diligent to pursue the larger goal.

Sixth, while I am a strong believer that informal tools are the best way to intervene into an employee problem, I want to be clearly on the record that you cannot ignore the formal tools if the problem has deteriorated to the point where it is clear that the informal approach will not work. When I ask human resource managers about the successful use of progressive discipline, the answer is almost always negative. They pretty much acknowledge that once they start into formal modes of discipline their goal is no longer to correct the problem but rather to satisfy whatever legal constraints there are on terminating the employment of the individual. My sense is that their reasoning is absolutely correct. If the problem by cannot be dealt with by coaching, counseling, a work plan, a memo of expectation, etc., then why do we think a two day suspension will change the employee’s basic approach to the workplace? From this perspective, therefore, the best approach I have seen to formal discipline is one found in a number of Teamster’s labor contracts. They call for termination of employment if an employee repeats an infraction, within a two year period of time, for which the employee has been previously given a written warning. The progression, then, calls for extensive informal efforts to work with the employee, followed by one written warning and then discharge.

Seventh, there is a quote from a Star Wars figure in a science fiction novel that I have often used when conducting training programs on employee discipline. It goes like this: “Always remember this; your enemy [misbehaving employee] is not wrong in his own eyes. If you keep this in mind you may make him your friend; if not, you can kill him [terminate employment] but without hate.” While recognizing that homicide is illegal in all 50 states, there is a huge amount of wisdom in this quote. I am oftentimes dismayed at the frequency with which the first principle (make the employee your friend) is ignored and instead we move directly to a vindictive action. While this is understandable within the context of the emotions that are sometimes created by serious employee misconduct, an immediate negative response will rarely bring about the desired impact on the employee and/or your work force. You can always move to discharge the employee but why not try something positive first?

I close this short essay on employee discipline by emphasizing the necessity to impose discipline “without hate.” I need say no more.

Next Month: Terminating for Absences

What options does an employer have when a supervisor begins a secret (or not-so-secret) relationship with a subordinate?

Inter-office dating is a fact of the workplace. While not the most optimal of situations, they can be innocuous enough when responsibly managed. A major problem arises when there is a differential in workplace power – when one has authority over the other. An asymmetric balance of power leads to questions of mutual consent. How can a subordinate that enters into a relationship with someone with power over them be argued to have given the same level of consent? Just as troublesome, when the relationship comes to light in the workplace the cries of bias and preferential treatment, whether real or imagined, can have terrible effects on employee morale and productivity.

What, then, can an employer do in the situation of the secret relationship… what are the options? Outright banning will not work, as it raises questions of privacy rights and may just encourage such relationships to stay underground. Remember, employers are just as liable for the fallout from relationships they’re unaware of as those going on under their noses. Keep in mind, firing one member of the relationship has proven to be legally questionable particularly if the supervisor is male and the subordinate female — a standing policy of firing the subordinate would (rightly) open the employer to allegations of sexual discrimination.

The answer, I believe, is in recognizing what an organization has a right to control and what might be considered improper interference. You have the right to control that which can be destructive to the organization. My recommendation is to craft and enforce a carefully written policy on personal relationships in the workplace. The policy needs to have at least two sections:

1. The first is a statement about the purpose and intent of the policy itself. Emphasize the fact that the policy is not to interfere in the personal lives of employees but rather to protect the employer against situations where there is an obvious and counter productive conflict of interest; guarding against circumstances that can create legal liabilities and reduce employee morale.

2. The second section needs to carefully describe the actions that are prohibited. The prohibition, however, cannot be against a personal relationship but rather against the hiring and/or supervising of a relative or close personal friend. The policy needs to particularly emphasize that employees are expected to reveal relationships where there is a conflict of interest (supervising a spouse or significant other, for example); secrecy is the big no-no.

Also, I have to confess to a certain reluctance with regard to the recommendation that one should write a policy on this issue. In general I am not a promoter of policy writing as my experience leads me to conclude that more often than not policies can get the employer in trouble. For one thing, it is always difficult to predict all of the different ways that the policy may have to be applied. As a result the policy may rise up and bite you when you are confronted with an unusual set situation. Additionally, employers all too often write the policy and then fail to enforce it. The unequal enforcement of a policy is fertile ground for plaintiff’s attorney. In this case, however, I feel that the policy is absolutely essential. Employees have a right to personal relationships, even in a superior — subordinate situation. It is not the relationship itself that is at issue. Rather it is the impact of that relationship on organizational behavior that must be addressed. This can only be managed through the development of a clear policy related to controlling the potential damage from those personal relationships that are impacting the organization.

Finally, when I consider the question that was asked it occurs to me that the “secret” relationship must have been reported by a member of the team to a higher level manager in the organization. Even without the policy, the employer has the right to confront the supervisor about any actions that compromise his or her effectiveness as a supervisor (notice that it is not the subordinate employee that one should confront). There are a number of actions that the employer can choose to do including moving one of the two parties to a different workgroup, or insisting that the subordinate employee’s performance evaluations and work assignments be under the direction of an outside supervisor. The bottom line is that the problem needs to be directly confronted.

Quote of the Month:

The aim of argument or discussion should not be victory, but progress.

Joseph Joubert

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Making Work a Better Place to Be

This is the first e-zine that I have created in the last few months. I have spent the intervening time contemplating how I can better focus the e-zine as a HR tool. There are a number of changes that I have decided to implement. The most obvious of these is the look of the e-zine. A second objective is to make the e-zine more interactive. The addition of a reader question section is my response to this objective.

Perhaps the most significant change in focus, however, is my intention to tailor the e-zine towards my primary research and consulting interest: the creation of workplaces desirable to employees. You’ll notice that I have titled this e-zine Making Work a Better Place to Be. This title comes from a line in a song, It’s Amazing What Praising Can Do. The following are some preliminary thoughts about the steps that an organization can take to help build a desirable workplace.

• The different HR functions have to work together as a system. Recruiting, training, compensation, evaluation, and promotion all need to be in alignment with each other. All too often the different functions have different managers which result in a lack of alignment.
• The primary determinant of the employee satisfaction with the workplace is undoubtedly the organizational culture. A lot has been written about how to build a high performance, positive culture. The problem is that in all too many organizations very little has been done to consciously work on creating the culture. As a result the organizational culture is a product of the informal interactions of employees.
• I am convinced that the work we do with new employees during the first three months of their employment is a critical factor in shaping a positive workplace. This honeymoon period is the best time to shape positive attitudes and to ensure that the new employee is appropriately integrated into the culture.
• If you read the book, First Break all the Rules, you will find the empirical evidence to establish that one of the most significant factors in retaining high performing employees is the relationship between the employee and his or her immediate supervisor. Supervisor training needs to stress this fact above all others.
• There is an old adage, “I am professional; I do not need to like you in order to be able to work with you.” While in too many cases that adage needs to be true in order for work to be completed, the other side of the coin is that high performance is most certainly a product of alignment and collaboration. More importantly, working under the stress of unhappy relationships clearly does not create a positive workplace.
• Workplace conflict is important and necessary because it is the stimulus to needed change. Feuding and disputing are all too often an unfortunate side product of conflict. There is no positive benefit to feuding and disputing. Every organization needs to adopt methods by which to encourage constructive conflict without the feuding and disputing.
• Recognizing the contributions of each employee is one of the most powerful tools management has to encourage high performance and positive change. Not all recognition programs, however, work. Designing and implementing a recognition program that accomplishes its objectives is critical to organizational effectiveness. Additionally, the employee recognition program is a critical tool towards building a positive workplace.
• Employee recognition, high levels of collaboration, positive supervisor and subordinate relationships, all of these are wonderful. Unfortunately, there are times when management must demonstrate the ability to have a “hard edge” in order to ensure that these positive expressions will dominate the workplace. Disrespect, dishonesty, maliciousness our all cancers in the workplace and must be stamped out. Thus, where positive steps fail to resolve the problem, firm, fair, effective, formal discipline must be administered which includes the right/responsibility to remove the cancer from the workplace.

As you have probably surmised, each of the above bullet points is destined to become the focus of a future e-zine. My intention is to provide both concept and action steps. My hope is that you will find this material helpful to you.

Next Month’s Topic: B.S., F.U., B.H.: Dealing with Obscenity in the Workplace

Reader Question

Due to illness and vacation, I was left short-staffed. I had to have two of my employees work nine days in a row in order to maintain minimal staffing. Was I in violation of any laws by scheduling such a long stretch of work?

Federal legislation is silent on the topic of maximum weekly working hours for most non-minor employees, as long as minimum wage and overtime laws are observed. State laws frequently add some restrictions, however. For example, both California and Illinois have statutes requiring one full day of rest for every seven-day period.

California allows for longer stretches of work than six days for situations that reasonably require them, as long as there are enough days of rest in a calendar month to make the ratio of days worked to rest days at least six to one. Illinois does not make this exception, but lifts the requirement from executive, administrative and professional workers (among others). Consult your state Department of Labor for more information on this and other topics relating to wage and hour legislation.

Note: Do you have a perplexing HR question? Send us the question by clicking on thehawthornegroup@msn.com and let us take a shot at answering it. We will select one question each month and research it. Please indicate whether we have permission to publish your name and organization when identifying the question .

Books of the Month

Professional Growth Are you tired of the ditty, ‘think outside the box?” Then, you will find value in reading this month’s fast paced selection which encourages us to get back to the basics.

Get Back in the Box – Douglas Rushkoff

Personal Growth Parker Palmer is one of my favorite authors and his most recent book explores in a very meaningful way the path to being a whole person

The Hidden Wholeness – Parker Palmer

Quote of the Month

Character cannot be developed in ease and quiet. Only through experiences of trial and suffering can the soul be strengthened, vision cleared, ambition inspired, and success achieved.

Helen Keller

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Administrivia, the Bane of Human Resource Management

Recently I was reading a copy of Fast Company Magazine, one of my favorite sources for recent information about business and organizational life, when I ran across an article I found totally intriguing. The title of the article was, “Why We Hate HR.” The article was written by Keith Hammonds, the deputy editor of Fast Company Magazine, and can be found in issue 97 (August 2005) at page 40. I found this article stimulating enough that it drove me to provide my reaction in written form.

At the outset of this article, the author announces that he does not like HR, and goes on to explain why:

The Human-Resources trade long ago proved itself, at best, a necessary evil – and at worst, a dark bureaucratic force that blindly enforces nonsensical rules, resists creativity, and impedes constructive change. HR is the corporate function with the greatest potential – the key driver, in theory, in business performance – and also, the one that most consistently under-delivers.

One of my favorite sports talk shows has a segment in which the listener can call in and give a “rant.” This article, which is about eight pages long, is a great rant. Yet, based on my HR experience, the quality of the rant is in part a reflection of the accuracy of the diagnosis.

HR will only achieve its promise, from the point of view of the article, if it begins to focus on being strategic and providing organizational leadership. HR needs to be a major player in designing and implementing strategies for organizational effectiveness, and it must provide leadership towards promoting and ensuring high levels of employee performance. In the author’s view, those two functions are given lip service but are simply not a part of the main HR menu in most organizations.

My intention is to use the e-zines that will follow in the next few months for the purpose of setting forth some thoughts on how to change the path of HR towards achieving its potential. In this e-zine I want to begin this project by noting the difference between the tasks that are most frequently assigned to the HR department and how they relate to the larger goal of providing strategy and leadership. To put it bluntly, the picture is not very bright.

Many of the tasks assigned to HR can at best be called administrivia. Tasks such as pay, benefits, and retirement can all be put into this classification. Obviously, each of those areas is extremely important. Making sure that employees are promptly and correctly paid and dealing with their medical insurance issues, to focus on a couple, are all time-consuming and vital activities but, at a basic level, entirely irrelevant to the success of the organization. As to evidence for my conclusion that these activities are not important to the success of the organization, I will simply point to the fact that they are increasingly being sub-contracted to an outside firms. Surprise! In many cases outside firms can perform HR tasks more efficiently and cost effectively then the HR Department. Clearly, if your prime activities involve fulfilling functions that can be easily farmed out and are not core to the success of the organization, it is not surprising to see why the individuals engaged in these activities will not be viewed by the organization as strategic and leaders. Moreover, I believe it is reasonable to assume that it will be difficult for HR to focus on administrivia, and still retain high levels of competency related to strategy and leadership. There is a fundamental belief that good peace-time generals do not make good war-time generals. The demands on the position of general are significantly different from peace-time to war-time.

Question: what “rules” in your HR Department? Administrivia? Those functions have to be done, but they do not have to rule.

Hopefully, the point that I am trying to make is now clear, and I have set the table for the next e-zine which will begin to look at the process of revitalizing the HR function.

Quote of the Month:

To unleash the extraordinary efforts of your workforce, you must first believe this to be possible. Then, you must make sure that your people have the resources, support, and freedom to meet the challenges – or seize the opportunities – when they present themselves. – Libby Sartain, Chief People Officer, Yahoo! Inc.

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Trial Services: Making the Marriage Work (by Chris Flamm)

Earlier issues of this E-zine focused on the legal aspects of the Trial Services period, and discussed the idea that this is the ideal time to bring the employee into alignment with organizational culture. In this issue we will explore some specifics of how to do precisely that, as well as explore the genesis of culture in an organization.

The Trial Services phase of employment has too often been viewed as a weeding out period. Many employers use this time to focus on what may be undesirable about an employee while they still have the ability to discharge that employee with no liability attached.

However, in terms of building a strong and successful organization, this time period can often be used to much greater success if it is viewed as a time to plant, fertilize, and nurture, rather than a period to deliberately seek for and weed out employees who shouldn’t make the cut. What seeds do you want to sow in your organization? What good habits and behaviors do you want to take root? What type of organizational culture do you want to encourage and help sustain? The trial services period is your best opportunity to construct a productive, long term relationship with your employees while helping to build a high performance, high commitment culture.

Successful organizations operate as a team. Whether in sports, the marketplace, or the non-profit world, teams need to coordinate their actions. A football team can’t win if everyone plays offense and team members fight each other to be the one to score the touchdown. Each team member understands the purpose of his actions and how it dovetails into the actions of others on the team. There can be no intelligent coordination without this understanding. Lack of understanding and coordination add up to a losing season in football; no less so in an organization.

A new hire must have two levels of understanding to be successful within the organization: the general and the specific. The general requires that an employee understand that he or she must work for the overall benefit of the organization and must act in a manner that promotes quality relationships with fellow employees. As to the specific, question number one should be: does your new employee know and really understand the mission or purpose of your organization? Question number two should be: does he or she understand the purpose of his or her own job and how that fits in with the jobs of others? The most productive employees are productive primarily because they understand the purpose behind their work and how it fits into the overall purpose of the organization. They have learned how to coordinate their actions to work effectively with others on their team.

New employees need to emerge from the trial services period having demonstrated that they have the necessary knowledge and are in alignment with the general and the specific expectations. Two factors can make or break the marriage during this “honeymoon period”. The first is the approach you use to train your new hires. The second is the culturally accepted practices and habits new hires acquire from your other employees. These two items predict the long term health of your organization and determine whether the marriage will be fruitful or end during the trial services period.

Turning first to training, the most effective method and the most positive for the new employee is to plan and implement an active process for teaching the employee how to do the job. The supervisor should encourage the employee to see the relationship as that of coach and coached. Maintaining the coaching relationship helps to insure a positive response to input. A coaching relationship also infers a hands on approach to training activities.

Second, culture is formed by more than a mission statement. It is formed by the actions and attitudes of all of its members. The Trial Services phase is where new hires have the opportunity to learn how to contribute to the organization as well as what to contribute to the organization. This is your chance to get them on the team, get them excited, and help them understand the purpose of their job in the higher context of the team mission. The habits and practices they pick up during this period are the habits and practices they will keep. You have a chance to recreate your culture in its most positive aspects every time you hire and train

The following are some suggestions as to how you can maximize the effectiveness of the trial services period as a time for training and as a time to help align the new employee to the culture.

1. The first suggestion is not so much an action step as it is a goal for much of your work with the trial services employees. The orientation and training of new employees is often an excellent opportunity to refresh and refocus the work of your experienced employees. Using the existing employees to help train and orient the new employee not only benefits the new employee but also can help reenergize the experienced employee. Of course you will want to make sure that the right lesson is being given which means a briefing session with the experienced employee thus providing the added benefit of opening a new door for productive communication with the experienced person.
   
   

2. The validation method is a recommended method of training a new employee. While not ignoring the need to correct the incorrect, the employee’s work is inspected periodically for what has been done correctly and well. A list of successful accomplishments can be far more helpful in shaping desired behavior then verbal or written statements about deficiencies. It is very easy to slip into a process of only commenting on that which needs to be changed. The intent of the validation method is to help set up and reward good habits and good work right from the start. This approach generates enthusiasm and commitment for the job at hand. It has the added advantage of helping the new employee quickly feel like a contributing part of the team.
   
   

3. A team approach to orientation can be a powerful tool both to reaffirm the basic culture and to bring the trial services employee into alignment with that culture. One method for implementing a team approach is to assign each team member an orientation task and the time needed to carry out the task. A second and probably more effective approach is to facilitate a team meeting specifically for the purpose of orienting the trial services employee. A good place to initiate the discussion is with a general question such as: what are the most important areas of orientation for our new team member? The responses can be put on a flip chart and then systematically discussed by the team with a focus on insuring the new employee’s understanding.
   
   

4. One important way to define and understand organizational culture is by the values that are held in common. A team exercise that can be used to help align the trial services employee to the culture is called shared values. Again, the supervisor works as the facilitator and asks the team this question: to work effectively together, what professional values do we need to hold in common? This question can lead to some intense discussion and some very good spin off questions such as: what is a value? Do we always act consistent with our values? Do we have shared values? What does it mean to act in alignment with these values? As a side note, one measure of the strength of the team is the level of honesty in the discussion over values.
   
   

This E-zine ends by returning to a critical point. The trial services period is best used when it is viewed as a time to grow or build something that can be sustained over time. Pulling the weeds is important but the desired growth must be the critical focus. All too often the primary focus is on weed pulling with little thought given to the possibilities and potentialities. Hopefully this e-zine has opened the door to working towards a more productive trial services period.

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In Defense of the Trial Service Period

Often times new e-zines come from a problem presented to me either through the arbitration process or one of my other professional activities. This e-zine is the second in a series of three related to the trial services period. During this past week I ran into a familiar problem dealing with the trial services period. In this case, the employer has a 90 day trial services period and a practice of dismissing an unsuccessful employee on the 89^th day of employment; perfectly acceptable practice per the last e-zine. As a matter of policy, no reasons are given for the dismissal other than the statement that the employee has not successfully completed the trial services period. Problem! In this case, the employee was deaf; a fact that constitutes a disability under the ADA. The plot thickens, the employer, during the prior two years, has only dismissed two employees during the trial services period; the instant employee and one prior. The prior employee was also deaf. Now we are in trouble.

While the courts have long recognized, as was discussed last month, that an employee can be dismissed without cause during a bona fide trial services period, the courts have never found that a trial services period protects the employer against the requirements of the ADA. The case is still pending as an EEOC complaint but my guess is that the employer is in trouble on this one.

While the ADA does not protect employees who fail to carry out the essential tenets of their job, the employer has a major burden to both demonstrate that it does not have an inappropriate pattern of unlawful discrimination and that the decision to dismiss the employee on the 89^th day was based solely on permissible reasons. For the purposes of this e-zine, I want to emphasize that the requirements of specific statutes will always trump your personnel policies – including the portion on Trial Service. You must always meet the minimum requirements of law in the way that you apply your policy.

The important point of this month’s e-zine, however, is not to focus on the legal issues concerning the trial services period, but rather to look at the possibilities. The trial services period should be all about performance. True, one dimension of the issue of performance concerns whether an employee can demonstrate the ability to perform at an acceptable level. But, when focus is attached exclusively to the right of dismissal, it misses the potentialities of the trial services period.

While the unfettered right of dismissal is an important element in a trial services period, it cannot be allowed to overshadow the more significant element which is the use of the trial services period to light a fire in new employees. If what the employer seeks is high performing employees, constant reminders that the new employee “may not make it” hardly seems to be an incendiary practice. Rather than dismissal, the focus during trial service periods should be on practices that help insure a long-term commitment to high performance. Three thoughts come to mind to help build this practice.

First, in the book First Break All the Rules, the authors cite extensive research that indicates the strong correlation between high performance and a relationship between the employee and the immediate supervisor. I do not think these research results are surprising as it makes logical sense that we all work better in an environment of positive social regard. If an employee trusts, respects and/or appreciates his or her immediate supervisor, obviously the employee will be more open to direction and coaching. The trial services period is clearly the time to establish those qualities in the relationship. What I am suggesting is that attention to relationship is as important, in the long run, as attention to work performance.

Second, the trial services period is an ideal time to bring the employee into alignment with the culture. While a more extended discussion of the process by which alignment can be achieved is a good subject for a future e-zine, I want to make two quick observations at this point. First, employees learn about culture through the modeling efforts by supervisors and fellow employees. Thus alignment can only be achieved through the involvement of team members. However, there is a double advantage to the employer of including team members in the process of creating alignment. Not only will the group process help bring new employees into alignment; it will also reaffirm to existing employees the importance of the culture.

Third, completing the trial services period has to mean something. One of my favorite definitions of happiness is “happiness is the successful completion of a worthy goal.” When a pilot successfully completes training, he or she receives wings to memorialize that feat. Having personally gone through that process, I have a clear memory about the feeling of accomplishment. In my view, that feeling of accomplishment is needed by the employee to fuel commitment and a high level of future performance. The employer needs to do something to show that passing from trial services to regular employment is a significant event.

Finally, you probably have guessed from reading this e-zine that the question of how to most successfully structure and implement a trial service period is my current, top research interest. I am convinced that the trial service period is the most effective time for the employer to head off performance problems by focusing on procedures that can help insure performance successes. The new employee is generally the most open to responding to these efforts. I am currently working with a couple of clients to completely redesign their whole approach to the trial services period. If any of you are interested in the specifics of what we are doing, please let me know.

Next month we will complete the three month e-zine series on trial service periods.

Quote:

What lies behind us and what lies before us are tiny matters compared to what lies within us.

Ralph Waldo Emerson

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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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