March 2012 Compliance and Culture Newsletter

“All labor that uplifts humanity has dignity and importance, and should be undertaken with painstaking excellence.” — Martin Luther King, Jr.

This issue discusses:

• Editor’s Column: Seven Employment Practice Trends to Follow
• What Can Employers Do About Off-Duty Conduct?
• Ninth Circuit Overrules NLRB on Employee Protections
• Employee Loses FMLA Protection for Not Cooperating
• Why Are Employees So Unhappy?
• Online Time
• Play Social Scientist
• Form of the Month: HR That Works Mission Poster

We have also provided you with the Form of the Month.

Please click here to view the newsletter in PDF.

Editor’s Column: Seven Employment Practice Trends to Follow

The law is an evolving landscape. Here are some items to watch for in 2012.

1. The continued influence of the NLRB over the private workplace — Not only is the NLRB continually making it easier to organize; it has also ventured into the social media arena, and has begun reviewing independent contractor issues (the board focuses on these issues because independent contractors can’t unionize).
2. Continuing attack on the independent contractor classification — The IRS and state agencies want their tax dollars and are clamping down on 1099 misclassifications. See  www.dol.gov/whd/workers/misclassification/ and www.1099timebomb.com.
3. Increasing coordination among agencies — If you misclassified someone as an independent contractor, not only can they now organize your company, but the IRS and state agencies will probably be coming after you for back taxes, failure to supply Workers’ Compensation insurance, overtime, and other expenses. If you have independent contractors, I encourage you to look at the Independent Contractor Training Module, which includes a report, a checklist, and more.
4. Continued rise in disability accommodation claims — Because more and more Americans are becoming disabled, you can expect a continued growth in disability accommodation claims. Last year, the EEOC was very aggressive on failure to accommodate claims. For example, Verizon had to pay handsomely because its no-fault attendance policies violated both the ADA and FMLA. As always, you can get help from legal counsel and use the resources of the Job Accommodation Network.
5. An increase in benefits related claims — It seems as if every employer is looking for a plan to reduce its overall benefit costs. Over the year, we’ve been questioned about all sorts of carve-out schemes, the impact of putting employees onto somebody else’s payroll, giving one group one plan and another group of employees a different plan, asking people to use their Medicare instead of company benefits, and so on. This activity is sure to generate ERISA and discrimination claims. The DOL has just updated its Affordable Care Act pages. See www.healthcare.gov/law/index.html, www.dol.gov/ebsa/healthreform and Frequently Asked Questions from Employers Regarding Automatic Enrollment, Employer Shared Responsibility, and Waiting Periods.
6. Social media craziness — It’s only just begun. The risk implications can be severe and immediate. Not having a well-thought out policy is a big mistake. See the Sample Social Media Policy on HR That Works and have an attorney review it.
7. Restrictions on background checks — The EEOC and state agencies are clamping down on employers’ ability to obtain credit and criminal background information. Make sure you use a background check company such as Global HR Research that knows the law.

What Can Employers Do About Off-Duty Conduct?

In many states, the answer is nothing as long as the conduct is legal. Here’s an excellent summary of legislation protecting employees created by the Conference of Legislators.

Ninth Circuit Overrules NLRB on Employee Protections

The Ninth Circuit, known as the most liberal and employee-friendly federal circuit in the nation, recently overrode an NLRB ruling on employee protections. In this case, an employee complained legitimately about working conditions, but lost his protection when he started berating his manager, calling him plenty of F-word names we cannot repeat here and also telling him that he was stupid, nobody liked him, and that everybody talked about him behind his back. During the employee’s outburst, he stood up, pushed his chair aside, and told the manager that if he fired him the manager would regret it. The manager then fired the employee.

The Court reminded us that in order for an employee to lose NLRA protections, it would consider these factors:

1. The place of the discussion
2. The subject matter of the discussion
3. The nature of the employee’s outburst
4. Whether the outburst was in any way related to a fair labor practice

The Board is required to balance those factors carefully. In the end, the Act permits some leeway for impulsive behavior, which must be balanced against the employer’s right to maintain order and discipline. As the Court reminded us, if an employee is fired for denouncing his supervisor in obscene, personally degrading, and/or insubordinate terms, the employee may lose the protection of the National Labor Relations Act. When the Court looked at the language, the physically aggressive nature of the employee, and his flat-out belligerence, they decided that he had lost his protections.

As mentioned in previous posts, the NLRB has now waded into social media waters with these conversations. So far, its decisions have been very pro-employee, as was the underlying decision in this case. Click here to read the case.

Employee Loses FMLA Protection for Not Cooperating

After being terminated, a plaintiff filed an FMLA retaliation claim; however, she could not prove any improper employer conduct, only improper conduct on her part. The plaintiff’s untimely documentation under the FMLA resulted in her eventual termination, which the court then upheld. It also rejected any argument of “intermittent leave,” because this was not indicated in the FMLA certification or by agreement.

A note from the court to the wise:

“Employers facing questionable certifications have two preferable options: 1) they can require the employee to obtain a second opinion from a different provider at the employer’s expense; or, 2) after granting the employee the opportunity to correct any shortcomings, they can obtain the employee’s permission to clarify or authenticate a questionable certification with the original health care provider. Although these measures are discretionary, utilizing them would avoid the factual disputes and questions of reasonableness that conceivably arise from the employer’s decision to classify an FMLA request as facially invalid without first working with the employee to resolve any discrepancies.”

Click here to read this case, a classic example of the FMLA gone wrong.

Why Are Employees So Unhappy?

Poll after poll describes how dissatisfied today’s workers are. For example, in a recent poll by Staples, 33% of employees said they feel unappreciated at work, while 38% were searching for a new job. Likewise, in the annual Education and Work poll conducted by Gallup, dissatisfaction with healthcare benefits increased 11 points in the past three years, followed by a seven-point increase in dissatisfaction over the potential for promotion at work. According to the poll, job issues causing the most dissatisfaction were: On-the-job stress (34%), health insurance benefits (30%), compensation (30%), employer retirement plan (28%), chances for promotion (26%), vacation time (20%), recognition for work accomplishments (19%), job security (18%), and amount of work required on the job (17%).

What can we learn from this? Here are my observations:

1. Half of employees are more satisfied at work than the other half. This is the way it always has been and always will be.
2. Stressful financial times cause us to focus on productivity, efficiency, and running lean — which generates a lot of stress. As business owners and managers, we should do everything possible to acknowledge this stress and try to do something about it. For example, do you encourage your employees to take breaks or do you really keep your fingers crossed, hoping they’ll work through them at their desks? If you don’t already have a wellness plan, you should create one because it can help with stress management.
3. Health insurance benefits have greater meaning to employees than straight compensation. In his book, Predictably Irrational, Daniel Ariely explains that health care benefits are a social contract, while compensation is an economic contract. Apparently, a dollar spent on benefits is worth more in total impact than a dollar spent on compensation — something that you should bear in mind when gutting your benefit plans.
4. Years ago, the Gallup organization did the largest poll about employee retention ever conducted. It concluded that there were three main reasons for turnover:
   • The person in the job is a misfit; they don’t have the skills or personality profile to succeed in it. In a sense, both employee and employer are filling a gap that will be short lived.
   • A lack of perceived career growth or opportunity. Here’s where management has to step in with such tools as career ladders, career days, succession planning, and an overall discussion about finding the opportunity at your company.
   • The most important relationship an employee has is the one with his or her immediate boss. Guess what? Half of all bosses are above average and half of them are below average. Which half do you have managing for you? How much training do you offer managers on being better managers? Do yourself a favor and take advantage of the extensive training on HR That Works that will help them be better managers.
5. It’s essential for management not to crawl into a cave during stressful times. Rather, they need to stand out front, give honest information, and handle the tough questions. Unfortunately, at too many companies, people are surviving as individuals, rather than as a team.
6. As Steven Covey says, begin with your circle of influence. Start right where you are and focus on those people you work with or manage directly.

Online Time

According to a Nielsen poll, here’s how Americans spend their time online:

The chances are that when your employees access the Web at work, this is what they’re doing. The survey doesn’t break down the percentage of time in each of these categories that’s related to personal matters. However, you can assume that — unless you’ve encouraged or allowed your employees to go online for business purposes — most of their use is going to be personal.

As we discuss in the Social Media Training Module, this is a battleground in the workplace. Employees are demanding greater and greater freedom, flexibility, telecommuting, multitasking, etc. It’s how they were raised. Older managers who try to control this new workforce closely find themselves causing dissatisfaction and non-productivity in the process. They also have to consider that dissatisfaction can spread like wildfire through mobile devices and might be protected by the National Labor Relations Act and a variety of other laws.

Here’s the solution: Have a dialogue with your workforce about the use of the Web, social media, mobile devices, etc. Acknowledge that, although the workplace has changed, productivity remains the bottom line. This is another reason why the ability to benchmark performance results is more important than ever. Do you really care if employees spend half their day on their mobile devices, if during the other half of their day they meet or even exceed benchmarks? Although this might rub us the wrong way, is it really something that we should worry us? For example, I use a number of independent contractors through programs such as Elance. I don’t police any of them. I’m simply hiring them to produce results — which is exactly what you’re doing, or should be doing, with your employees. The question is, to what extent is that result clarified? To what degree can inappropriate use of mobile devices undermine activities that enhance your bottom line? Just as important, which employees are using mobile devices in a way that’s helping to grow your business? How can you learn from those employees?

As mentioned, the Social Media Training Module offers a one-hour webinar on this topic, as well as a shorter update video that explains NLRA constraints on social media use by employees. The personnel forms also include sample policies on the use of social media and mobile devices.

Play Social Scientist

I’ve coached many executives over the years. One of the questions I ask is whether they spend more time reading about other companies’ stories or creating experiments and stories of their own. More than half of the executives admit that they spend more time focusing on the outside than looking on the inside. To help executives, I encourage them to play social scientist.

1. Be a good observer.Step back and take a mile-high view of the environment. Look at the situation with fresh eyes. If you were a social scientist who walked into your company today, what would you observe about it? Simply being “present” in your situation is the best way to be an observer of it.
2. Conduct surveys. Social scientists love surveys. You can ask any question you want. Let your imagination be your guide. Consider creating a Survey Question of the Month all employees are required to answer. When this begins producing results, you might bump it up to two a month, or even one a week. Make sure that these surveys solicit ideas, as well as opinions.
3. Generate data.The next step is to translate your observations and survey results into data you can use. For example, what do your observations and survey results tell you are the 20% of critical factors that would generate 80% of the desired results? Usually this 20% consists of three things. What’s the data around it?
4. Run experiments to verify your data.Now that have some information, play with it. If employees tell you that what they want more than anything else are improved benefits, then dig deeper. Create experiments that compare the perceived value of improved benefits versus other equally attractive options.
5. Finally, publish your results. Educate your stakeholders on what you’ve learned and how using this valuable information can improve their career and the company. Of course, when you publish your results, you’ll be open to critical judgment, as well as praise and understanding. That’s what comes with sticking your neck out.

P.S. HR That Works Tools to consider using include a variety of employee surveys, HR department survey, benchmarking report, and tools.

Form of the Month

HR That Works Mission Poster (PDF) – This poster defines us — what we care about, who we are, what we do. How could you create a fun poster like this for your company?

Podcast

Click here to to listen to this month’s newsletter podcast.

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©2012 Reprinted with permission from HRThatWorks.com, a powerful program designed to inspire great HR practices.

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