We recently had Dr. Alan Zimmerman join us as a Webinar guest to help us become better leaders. He reminded us that we’re all leaders because we all influence people. As I have preached for many years, our emotional intelligence has as much to do with our ability to be good leaders and managers as our technical skills. While some of us are naturally born leaders most can certainly learn how to be much better. In fact, according to a recent Inc. magazine article, most business owners admit that they’re strength is not with the “people thing.” Less than 20% of them felt they had strength in that area.

Here’s a checklist based on Dr. Alan’s presentation which is recorded and can be accessed by HR That Works members anytime.

1. Build rapport – You do that with caring, trust, and a proper attitude.
2. Build respect – You do that with belief in people, demanding excellence from them, and acting honestly.
3. Recognize people – You do this by acknowledging that they are important, observing their good conduct, and communicating your appreciation to them.

For each one of these leadership traits, Dr. Zimmerman suggested a handful of skills that would help you to be better at each one of them. Again, you’re invited to watch or listen to this excellent webinar.

P.S. As I noted in my conversation with Dr. Zimmerman, these factors also apply to self-leadership and self-discipline. To what degree are you creating a good internal rapport, treating yourself with respect and recognizing the good that is within you?

“Your work is to discover your work and then to give yourself to it with all your heart.” —The Buddha

This issue discusses:

• Editor’s Column: HR Survival
• 1,500 Hours of Your Life … Wasted Away On Busywork
• ‘Intentional Growth’ In Your HR Career
• Watch Those Attendance Policies!
• The Economy: Prepare for the Other Shoe to Drop

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

Please click here to view the newsletter in PDF.

Editor’s Column: HR Survival

An excellent article in the October Backpacker Magazine discussed five emotional aspects of preventing deadly threats. Although the “threats” facing human relations professionals might not be as extreme as dangling from a cliff, we’re certainly guaranteed a turbulent future. Here’s how the five emotional intangibles in the article might apply to the survival of HR:

1. Assess risk – As the article asks, “What’s the worst thing that could happen if I do this?” Another good question to consider is “Whose judgment would I be concerned about if things didn’t work?” You should also ask, “What’s the worst thing that could happen if I don’t do this?” This gives a broader understanding of the risk. For example, the real risk that our economy can go south again would affect your entire company, as well as you. If the risk of the economy going south is greater than the risk of improvement — and the downside is extreme — have a contingency plan. How would HR help to manage a 15%-30% drop in revenue?
2. Stay calm – The article recommends that you “Take control by forcing yourself to slow down.” When you’re used to running 75mph, it’s important to stop, breathe, and think. Give yourself the opportunity to find that safe, calm place for observation and reflection.
3. Set priorities – According to the article, “You need to be able to survive the conditions you’re in. Assess your situation and determine your most pressing needs.” Not all HR risks are equal. For example, the risk of making a poor hire is perhaps the most serious in terms of frequency and severity. Another significant risk is failing to get rid of a poor performer or an employee who is sabotaging your brand on social media. What are the three greatest risks your company faces and what plan do you have for addressing them?
4. Be a leader – In risky times, resist groupthink by discussing possible scenarios up front. Give each employee a specific assignment to focus on in risky times. What tasks can you assign to HR subordinates, other managers, or employees?
5. Stay positive — According to the article, “A powerful desire to keep living leads directly to successful survival stories. You don’t have to be comfortable to survive this situation.” I can supplement this statement by adding “A powerful desire to be a strategic HR executive leads directly to successful career stories.”

Risk management is an exercise in logic and emotion. To reduce their exposures, HR professionals must use both.

1,500 Hours of Your Life … Wasted Away On Busywork

“Work can be a life-draining affair.” —Joseph Campbell

Effective time management is essential if you wish to be a successful HR executive — and have a life at the same time. According to CEO surveys, when HR professionals focus their time on administrative and compliance duties (positions in which one is particularly likely to say “no”) their companies don’t see them as being strategic partners to the business. The problem is that HR executives spend an average of only 25% of their time on strategic activities. From a career and company goals perspective, this is akin to orchestrating their own demise.

When I advise HR executives to manage their time more effectively by minimizing administrative and compliance activities, I get a variety of “reasons” why they don’t do so:

• This simply has to get done.
• Somebody has to do it.
• I don’t have the time to delegate this right now.
• There’s nobody else here to do it.
• I’m not sure I would know how to delegate it properly.
• I can’t manage the person to whom I delegated it.

These are all poor excuses that can block your career success.

Let’s think about some numbers. Suppose you spend an average of 10 hours a week managing payroll and other administrative tasks. Let’s say you earn $40 per hour (roughly $80,000 per year) and administrative tasks such as this are the least valuable work you do. In fact, it’s work that $20 an hour people can do. On the conservative side, every hour that you do this work, the company loses $20 an hour — which comes to $800 a month or $9,600 a year. If you put this same effort into doing $60 an hour strategic work instead, the company would gain $20 every hour — and you’d be in a far better position to ask for a raise.

Think about it: If you waste 10 hours a week for the next three years, that’s 500 hours this year, and 1,500 hours during the next three years of your life that you’ll never get back! What’s more, this waste will cost the company at least $30,000.

If you label your work as “A”, “B,” and “C” work, you should be spending 80% of your time on A work, 20% on B work — and zero time on C work. Otherwise, you’re spinning your wheels.

C work basically wastes time completely. It’s nothing you can delegate; it’s just something you should stop doing. B work is administrative and can be delegated or outsourced — such as payroll and benefits administration. Focus on A work: What the business needs and what you want to get great at doing. A classic example would be training in a company that’s focused on technological advances.

To determine where your time is going — and should be going — use this checklist:

A-Level Activities:

• Meeting with the executive team to understand their vision, mission, value, goals, etc.
• Studying and understanding the company’s strategic plans, financials, succession plan, markets, branding, and other operations.
• Identifying the critical human resource needs for this organization (surveys, observation, focus groups, interviews, etc.).
• Input into the company’s overall compensation plan, including pay rates, incentives, bonuses, rewards programs, etc.
• Creating strategic plans and processes for carrying out top objectives.
• Developing training plans to support implementation.
• Input into the company’s overall risk-management plan, including assistance with the purchase of benefit programs, Workers Comp insurance, Cyber Liability insurance, and Employment Practices Liability insurance (EPLI).
• Creating systems for hiring, performance, retention and compliance.
• Facilitating creativity, branding, suggestion systems, etc.
• Implementing any other company strategic objectives to which you can provide input.

B-Level Activities:

• Payroll and benefits administration.
• Implementation of hiring, performance, retention and compliance systems.
• HRIS management.
• Delivery of training.
• Creation of employee handbook and executive contracts.
• Personnel files management.
• Attendance, vacation, and leave management.
• COBRA administration.
• Compliance posters and handouts.

C-Level Activities:

• Employee dramas.
• Meetings that go nowhere.
• Doing any $10-20/hour work.

‘Intentional Growth’ In Your HR Career

Keeping with this theme, an excellent article by John C. Maxwell in a recent issue of Success magazine identifies the key factors in “intentional growth.” Here are my recommendations on using these factors to help yourself grow as an HR professional.

• Start today. Your power lies in the present. Although it’s important to create strategic plans, you need to begin where you are. What will you do today to have a greater impact on your company and help you grow in your career?
• Take complete responsibility for growth. I’m not a fan of blame or justification. As the Buddha stated, “What comes to you, comes from you.” Your HR career and its impact on the company is what you’ve chosen it to be — at least up to now. It’s your responsibility to grow your career and make bottom-line decisions where you work.
• Learn from mistakes. I did a training program on Making Mitsakes (the misspelling is intentional). One of the best ways to prevent making mistakes is to “model” people who have been successful before you. For example, who are the most balanced, effective HR executives you’ve ever met — and what are they doing right? Chances are, if you do the same things they do, you will be equally successful.
• Rely on hard work, rather than good luck. In this economy, you need to work both hard and smart. One important caveat: Don’t think that working longer hours than everybody else is smart.
• Persevere long and hard. There are no quitters on the way to success. Expect bumps in the road. As I often state in my workshops, how we deal with what feels unfair to us determines our personal culture. People who adopt a survivor mentality, as opposed to a victim mentality, will come out on top.
• Stick with good habits. The worst habit I see in managers is poor time management (see the article “1,500 Hours of Your Life … Wasted on Busywork”) How many of you have taken a disciplined approach to how you use your time? If you’re an HR That Works Member, take advantage of the Time Management Training Module.
• Follow through, rather than talking big and doing nothing. It’s far better to get something done and then publicize it afterward, than to brag about what you will do and then trying to justify why you failed to deliver. As the saying goes, “Under-promise and over-deliver.”
• Take risks. This is a real challenge for the HR community. Having coached many HR executives, I can tell you that most of them tend to follow the rules, rather than taking risks. I encourage you to read Orbiting the Giant Hairballby Gordon MacKenzie. By the way, the term “hairball” refers to company policies and procedures — something that HR is great at developing.
• Think like a learner. Whether it’s from mistakes or study, life is one big learning lesson. To earn more tomorrow, you must learn more today. This holds true for both the individual and the company as a whole. To what degree are you enhancing your education?
• Rely on character, as opposed to talent. Having integrity, doing what you said you were going to do, when you said you were going to do it, shows character.
• Never stop growing. Don’t let yourself get comfortable for too long. You’re either growing or you’re fading. How would you describe what’s going on with you? Where do you have to coax, encourage, and inspire yourself to take the next step toward your growth?

None of this should come as news. It’s about taking action! As Maxwell reminds us, “Growth doesn’t just happen — not for me, not for you, not for anybody. You have to go after it!”

Watch Those Attendance Policies!

Every month we receive dozens of calls from employers asking whether they can terminate an employee with an attendance problem. In most circumstances, they have every right to do so — especially if there’s a well-defined attendance policy and the company holds other employees to a similar standard. Employers get in trouble when the attendance problem results from a work injury, disability, serious medical condition, pregnancy, or other protected category that impacts the employee or a family member. All too often, employers don’t ask why somebody missed work. In one case, an employer told us the employee was late for work on a repeated basis because she had been having flu-like symptoms and getting sick. The employer never asked what might be causing the problem. It turns out that the employee was pregnant. Terminating her would have been a huge, and costly, mistake.

The law does not expect employers to be doctors or psychiatrists. However, it does create a standard of liability that requires managers to determine, if there is a disability, serious medical condition, or pregnancy involved. In the end, a judge or jury will determine whether the employer met this standard.

In most circumstances, employers don’t face lawsuits for their compliance failures. But bear in mind that it only takes a single employee bringing a claim to expose you to hundreds of thousands of dollars in damages (not to mention legal costs). This is another good reason to make sure that your company purchases Employment Practices Liability Insurance. HR That Works Members should take advantage of the training modules and other tools on leave management.

The Economy: Prepare for the Other Shoe to Drop

Although I don’t pretend to be a financial expert, I have disciplined myself to learn basic accounting principles. The more financial news and literature I read, the more I want to pound my head. Here’s why:

The global economy remains shaky. The industrialized world, the U.S. included, has fallen deeply into debt. To maintain our affluent standard of living, we have mortgaged our countries, states, cities, and households. Debt is crushing us. Despite their best efforts, many nations will have to devalue their currencies eventually. Japan is one such example. In countries with aging populations (such as Japan, the United States, and Western Europe), demographic trends are upside-down. For the foreseeable future, fewer and fewer workers will be supporting more and more retirees, an unsustainable situation. Something will have to give.

Keynesian economists argue that we can keep going into debt because sooner or later we’ll have boom times and be able to pay off our obligations. For example, at the crest of the dot.com boom, governments were actually running surpluses and we thought we were rich. Those days are gone, at least for a while, until the demographics change once again.

I speak in front of many private company CEOs. Most of them are feeling shaky, even the ones with a positive cash flow. They don’t like the tea leaves either. Collectively they’re highly reluctant to put any of their cash into making investments, including hiring new employees.

Here’s why I’m sharing this gloomy prognostication: You need to prepare your company and clients in case the economy tanks by 10%, 15%, 20% or even more. I believe that such a downturn is only a matter of when, because I see no reason for things to be anything but “flat” at best.

To help prepare you and your clients for this economic crisis, I’d recommend that you follow these guidelines:

• Change all the time. How do we continue to differentiate ourselves is the question we constantly ask ourselves at HR That Works. Being ordinary, being like your competition, being the same company you were five years ago, won’t cut it moving forward. When the shoe drops, your image needs to be progressive and forward thinking — and yet offer stability.
• Generate a Plan B under which you can survive a 20% drop in revenue. It would be smart to scale this plan assuming a drop of 10% to 40%. If you don’t have the expertise to generate such cash flow projections on your own, you can easily find someone to do it for you on Elance. I did this for my company and it cost roughly $500. That’s money well spent. Knowing that you have a plan to address the worst that could happen offers great comfort.
• Tighten up performance benchmarks to improve your performance in general. This is no time to stand for subpar performance because somebody has either been there for a long time, is related to someone, is very likeable, etc. Results are what matter.
• Have your entire team watch The Accounting Game webinar on HR That Works. This is the best accounting webinar I’ve ever seen. Also, have the team watch Brad Hams’ Ownership Thinking. Bear in mind that Accounting is the course most often dropped or failed in college.
• Conduct “what if …” workshops with your management team and employees. Remember, none of us are as smart as all of us!

The primary goal of risk management is preparation. Don’t let yourself get too comfortable — and thus vulnerable. Have a plan to keep well prepared in case the economy tanks again.

Form of the Month

Reasons People Leave (PDF) – Use this checklist as a starting point in understanding the causes of unwanted turnover.

Podcast

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

REPRINT POLICY: Reprints are welcome! All you have to do is include the following notation with reprinted material:

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

Podcast: Play in new window | Download

1. Find out your numbers – Use the HR That Works Cost Calculator and get to the bottom line of your HR practices.
2. Create a rolling 90-day game plan – You must plan to succeed and without a plan, you plan to fail. Focus on one strategic objective per month and update your 90-day game plan every 30 days. Make sure the leadership team knows what you’re up to.
3. Reinvent performance management – First of all, realize that most managers and employees will be glad that you finally ditched the old system. Then, watch the Performance Management Training and the ROWE (Results Only Work Environment) recorded webinar and then conduct a workshop to see how you can generate a performance management system that works organically for your company.
4. Introduce the Creativity Checklist and Employee Suggestion Form and require that people use it  The ideas you generate should help pay for the HR That Works program for many years to come.
5. Create a social media policy that works – Involve the head of IT, marketing, and a group of employees to fashion an approach that works for all parties.
6. Use the HR That Works Compliance Survey every six months – Doing so will ride you of unwanted claims in the process.
7. Conduct an HR survey of your management team – The HR That Works Management Survey will let you know how the management team views the strength of your contributions and where they need more help from you.
8. Bring your employee handbook to life – Fact is, most employee handbooks are boring at best. On the Employee Handbook page is the contact information for our graphics expert, Summer Bonne, who will help you getting your handbook act looking right.
9. Ask yourself this when you hire: Am I more interested in creating the future or preserving the past?
10. Have some fun! Be creative! Get out of the box! HR has a real opportunity to generate some positive dramas at your company- and we all know we need those!

“If you are not prepared to be wrong you’ll never come up with anything creative.” —Sir Ken Robinson, author and educator

This issue discusses:

• Editor’s Column: Podcast Learning
• I-9 Employer Handbook
• How Companies Get Busted for Independent Contractor Violations
• Questions for Leaders
• Benefits and the Social Contract
• Inviting Employees to Leave
• IRAC – A Lawyer’s Way of Thinking
• EEOC Sues Trucking Company for Improper Pre-Hire Testing

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

Please click here to view the newsletter in PDF.

Editor’s Column: Podcast Learning

I’m a big fan of podcast learning. During the past four years, I’ve educated myself on a wide variety of subjects from business to personal growth, financial matters, and spiritual ones.

I would encourage all businesses to make their managers and employees podcast learners. For starters, your HR person should be listening to our monthly podcast. It’s not as fancy as the big guys’ podcast, but the information is there. I would then make sure all my managers listen to the Harvard Business Review podcasts, which provide an MBA-level education. They’re excellent — and they’re free. I would encourage you to consider TED videos and audios, which are outstanding. Pick out a few you think might apply to your business and encourage your team to watch them. They are 15 minutes long. Start one of your business meetings with one of them (maybe even every business meeting).

I also like the Stanford Entrepreneurial School podcasts. The Stanford graduate network has started more entrepreneurial businesses than anywhere else. Tap into this wisdom, even if you have a 50-year-old business. Podcast learning can stimulate thought and innovation at any company.

I’m most familiar with iTunes. Go there and check out all of their free podcasts. You can hire a high school intern to download about 20 podcasts each into a $50 player, so your employees can listen to them in their cars or at the gym. In the end, they will thank you for it.

Here are the links to the podcasts:

• HBR
• TED
• Stanford
• HR That Works

P.S. You can also develop a comprehensive leadership training program by taking advantage of the more than a dozen leadership webinars and podcasts stored on HR That Works. If you haven’t checked these out yet, do yourself a favor.

I-9 Employer Handbook

The government has an excellent publication covering everything about I-9s that all employers should know about. Here’s what it covers:

• Obtaining Forms and Updates
• Part One — Why Employers Must Verify Employment Authorization and Identity of New Employees
• Part Two — Completing Form I-9
• Part Four — Unlawful Discrimination and Penalties for Prohibited Practices=
• Part Five — Instructions for Recruiters and Referrers for a Fee
• Part Six — E-Verify: The Web-based Verification Companion to Form I-9
• Part Seven — Some Questions You May Have About Form I-9

Click here to access the handbook.

How Companies Get Busted for Independent Contractor Violations

Business owners love the idea of independent contractors. They afford flexibility, expertise, outside perspective, and of course, reduced insurance, benefit and tax burdens. Unfortunately, for these same owners, the Federal and state authorities are coming down big time on what they claim are independent contractor misclassification schemes. They don’t like the idea of you not collecting payroll taxes and not providing employees with Workers Comp, healthcare, and other benefits they might otherwise enjoy. Here are four of the more common ways employers get into trouble when they misclassify employees:

1. They get hurt on the job– Guess what? Since these people are not considered employees, your Workers Comp policy doesn’t cover them; which means they can sue you directly for negligence, expanding their recovery potential dramatically. What’s more, you might face a fine for not treating them as employees and providing them with Work Comp coverage.
2. They file for unemployment– A number of HR That Works Members have told us that because one person filed for unemployment, the authorities are trying to attack their independent contractor relationship with dozens of people. If a company in this situation comes out on the wrong side of a misclassification judgment, it could go out of business. Part of the thinking involved is that you can somehow “control” employees, but not independent contractors. For example, when I hire an independent contractor to paint my house, I pay them to get the job done and I don’t tell them how to apply the paint.
3. They didn’t pay self-employment taxes– When the IRS comes knocking on an independent contractor’s door and asks them about their tax payments and the work they did, they tend to conclude that they were an employee and you should have been withholding that 14% annually. If they can’t collect this from the independent contractor, they’ll try to collect it from you — not to mention fines and penalties. Some states, such as California, have kicked this up a notch and are making it a criminal offense to engage in intentional misclassification. Unsurprisingly, these bills are introduced into the legislature by the plaintiffs’ bar, which makes sure that the legislation includes handsome attorneys’ fees for enforcement.
4. Finally, the NLRB is getting interested too — Independent contractors don’t have the ability to organize the workplace, only employees do. This means that the National Labor Relations Board, which is very pro-union, doesn’t like it when you classify folks as independent contractors. Recently, because of one or two disgruntled employees, they ruled that independent contractors from a small orchestra were really employees, which will probably end up shutting down that business. I wrote an article about this called “The Day the Music Died.”

The bottom line: This fight is not about common sense or economics. It’s about political power, plain and simple. The pendulum has swung and employers have been pushed up against a wall. The problem is that they’re powerless to do anything about this situation and have to change the way they do business, even when they don’t think it makes sense to do so. That’s the beauty of living in a democracy.

Questions for Leaders

The quality of our lives and of our companies depends on the questions we ask and the challenges we set for ourselves. For example, you might ask yourself “Do I dare to be great?” That’s a good question. You can also ask yourself what kind of nonsense would get in the way of believing that you can be great. That’s a good question, too! With this spirit in mind, here are questions that could open you up to higher thoughts.

1. How clear is the vision for your company? Does everyone at the company know what it is? Have you branded it in your employee literature, on your intranet, on your walls, and so on? Would I know it simply by walking into your place or visiting your website?
2. Is your vision for your company a big, hairy, audacious one? It’s better to really go for it and succeed at 50% than to shoot for average — and end up average.
3. Have you played the movie forward to the end? If you got everything you had hoped for, what would it look like? How would it feel? How would your life be different?
4. What personal sacrifices are you willing to make to create a great company or career?
5. What personal sacrifices are you willing to ask others to make to build a great company or career?
6. What effort have you made to guarantee you bring the right people on every seat of the bus?
7. How do you stimulate your workforce to think for itself?
8. How do you create an employee suggestion system that works?
9. What have you done to eliminate the possibility of people making unnecessary mistakes?
10. What “one big thing” could wipe out your business tomorrow?
11. How could your business die from a series of 1,000 cuts?
12. Do you really want to do this anymore? If not, what would you rather be doing instead?
13. How could you stay in your business/career and reinvent how you work in it?

Have fun with the answers!

Benefits and the Social Contract

In his book Predictably Irrational, Dan Ariely provided two interesting observations related to employee benefits. First, he pointed out that benefits are more of a social contract than an economic one. The distinction between the two is very powerful. For example, if you have a department with 15 employees and someone walks in with a tray of 15 cookies and says that she baked cookies for the department today, under a social contract analysis, most employees would realize quickly that they should take one cookie each. However, if that was now turned into an economic arrangement in which the person stated that those cookies were baked for her child’s fundraiser, there would be no guilt or judgment associated with someone who proceeded to gobble up half the tray. Ariely reminds us that social contracts are much more powerful than economic ones.

Second, Ariely argues that asking employees to chip in for the payment of benefits or providing total compensation statements (something that we’ve recommended for years) diminishes the cohesiveness of the social contract.

These are provocative thoughts — and surveys about employee motivators mirror them to a certain degree. Although book after book after book talks about the “work experience,” in reality, most people go to work to be paid. The other motivational factors kick only after they feel they’re being paid a fair days’ wage. In today’s economy, employees rank benefits over compensation as their top concern. Benefits fulfill a security need more than does straight compensation. In a sense, the workforce is telling us that a dollar spent on benefits (which is a tax-free payment) is worth more than a dollar spent on straight compensation. Consider this if you’re considering a cut in benefits.

Inviting Employees to Leave

During the past year, I’ve read at least a dozen articles citing statistics that anywhere from a quarter to 42% of employees intend to look for new jobs once the economy recovers. My reaction to these articles: Seriously? Where are these folks going to go? To the companies where one-third of their employees are leaving? I wonder how much energy employees who plan on leaving are putting into their current job. My bet is that if they took the energy they’re using to think about employment elsewhere and applied it in their current job, they wouldn’t need to go anywhere!

Management should take these surveys as a sign of dissatisfaction — which shouldn’t come as a surprise. By definition, half of your employees are always happier in their jobs than the other half. The solution: Try to limit your hiring to these happy folks and to do everything possible to keep them that way.

Suppose you were bold enough to invite your dissatisfied employees to quit? Zappos does this with its new trainees. After they complete training, the company offers them a $3,000 bonus if they decide to quit. Zappos CEO Tony Hsieh believes that he’s better off giving an employee who has only one foot in the door $3,000 to leave, rather than keeping them. Even if these dissatisfied workers were only 10% less productive than the other Zappos’ employees, this loss of productivity would cost the company far more than the $3,000 “quitting bonus,” over the long run.

Invite your employees to one-on-one conversations about job satisfaction. Chances are, if an employee believes something feels “unfair” in the relationship, you can deal with the situation like two adults who don’t need unnecessary dramas. If the employee would feel better leaving, that’s their choice. However, if they’d like to feel better about their job, and you want them to stay, make it clear that you’re willing to work with them.

As I discuss in the Victims, Villains and Heroes book, even though there are few real workplace victims today, there’s a growing victim mentality. Anyone who wishes to educate themselves and work hard can enjoy employment opportunities; your job is to keep only the best on the bus.

IRAC – A Lawyer’s Way of Thinking

At the beginning of law school, every student learns “the method” used to help clients solve problems. IRAC stands for Issue, Rule, Analysis, and Conclusion.

• Issue: Issue spotting is a lawyer’s tool in trade. Never assume you know what the issues are without changing viewpoints or getting outside input. For example, HR executives not highly experienced in the law might assume the issue might relate to a Workers Comp return-to-work situation when in fact it’s also related to both the ADA and the FMLA. They might assume that the issue is getting rid of a poor performing employee when the real issue is what the manager did to create this poor performance. One reason that appellate tribunals consist of multiple judges is so that there can be a variety of viewpoints, especially when establishing the true issue. The ability to spot issues is one reason you should have a lawyer check your head when you have a serious problem.
• Rule: Rules come in many forms. There are hard and fast rules, such as those promulgated by legislatures and the court system. Then there are softer ones, such as those that relate to culture or values. In many cases, a whole host of rules can apply to a situation. You might have a contract, policy, procedure, habit, government requirement, vendor requirement, or some other rule that applies.
• Analysis: Now that you know what the issues are, as well as the rules, it’s time to do your analysis. As lawyers know, tough facts make for tough cases. There are times when applying a rule is not in your best interest. For example, the normal rule of the road is that you walk facing traffic; however, there might be a situation in which it’s safer to walk with traffic. In this case, complying with the law would generate an unsafe outcome. Experts make their money by knowing how to judge a situation for what it is, and not for what you’d like it to be. Their detached analysis is your best friend.
• Conclusion: Last, but not least, you need to make a decision. Of course, doing nothing is a decision in itself (sometimes this is the best course of action). In other cases, you need to take swift and immediate action. One of the main questions in deciding what path to take is to ask “Is there a way to get to the outcome we’re seeking that benefits all parties?” When we come to a conclusion, we must consider all stakeholders to a situation.

After answering questions from professors and law school exams for three straight years, IRAC becomes part of who lawyers are. There are many ways to “frame” a situation; IRAC adds one more arrow in your problem-solving quiver. May you use it well!

EEOC Sues Trucking Company for Improper Pre-Hire Testing

According to the EEOC’s suit, Celadon, a trucking company headquartered in Indianapolis, performed medical examinations on applicants for driving positions before making conditional offers of employment to them. The agency alleged that Celadon conducted these examinations in a manner inconsistent with the standards set by the U.S. Department of Transportation / Federal Motor Carriers Administration, and then used the results of those non-compliant examinations to reject qualified applicants Celadon thought were disabled.

Such alleged conduct violates the ADA, which prohibits employers from subjecting applicants to medical examinations before making a conditional offer of employment, and also prohibits discrimination based on disability or perceived disability. The EEOC filed suit (EEOC v. Celadon Trucking Services, Inc., Cause No. 1:12-cv-0275-SEB-TAB) in U.S. District Court for the Southern District of Indiana, Indianapolis Division, after first attempting to reach a pre-litigation settlement through its conciliation process.

“Celadon and all motor carriers must conduct medical examinations in accordance with the ADA,” said Laurie Young, regional attorney for the Indianapolis District Office of the EEOC. “Under the ADA, an employer cannot conduct a medical examination of a job applicant until the employer has given the applicant a job offer conditioned upon the applicant passing the examination. The EEOC will enforce these obligations.”

The EEOC is seeking compensatory and punitive damages against the company, as well as other relief, including a permanent injunction to prevent Celadon from engaging in any further employment practice that violates the ADA.

Lesson to employers: If you’re going to do pre-hire physicals make sure to do so only after you make a conditional job offer. See the report and forms in HR That Works.

Form of the Month

Sage Advice for Managers and Leaders (PDF) – An issue of Volleyball USA shared sage advice from 12 of the top volleyball minds in the nation. As someone who has coached not only kids’ teams, but also many executives, I found valuable guidelines in this article that have helped me be a better manager and leader.

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Our good partner, Scott Addis, posted a great article I think all of you should read.

Click here to continue reading…

1. Make sure you hire from the bottom of the barrel – Bad employees are great! They will all but guarantee you a life full of drama. Why be on easy street when you can have a work force run amuck with whiners, thieves, liars and con-artists? Besides, who wants to spend the time and money necessary to do extensive interviews, skill tests, background checks and character assessments?

2. Over promise and under deliver – Tell people what you think they want to hear. It’s a lot more expedient than radical honesty. The fun thing is there is absolutely no limit on the amount of promises you can make. If somebody complains about the last promise you made then make him or her a new one. The fact is people want to be lied to. This “walk your talk” integrity stuff is strictly for amateurs.

3. Keep your business plans to yourself – All this talk about sharing your vision, mission and goals is pure bologna. People like to be kept in the dark. Besides, if mushrooms can thrive in that environment why can’t your employees?

4. Control as much as you can – Spending your time trying to empower other people is just so exhausting. Better off engaging in control and manipulation so that they don’t dare think for themselves. If they try to revolt, then bring in the heavy artillery.

5. Give them all 2s – Everybody knows that the way to motivate people is to scare the “you know what” out of them. One of the best ways of doing that is to give them poor performance evaluations. They will be fearful for their jobs and be motivated to work like crazy just to survive. In fact, it’s probably a good idea to give them disciplinary notices on a regular basis whether they deserve them or not.

6. Create internal competition – Ever see rats climb all over each other in order to get at a piece of cheese? Don’t think this doesn’t work with your employees too. Make it very clear there can only be one good employee every month. This is a particularly appropriate strategy in the sales area. Make sure only one person in your sales organization gets that trip to Hawaii every year. The less in the way of best practices they share with each other, the better your odds of motivating them out of a scarcity mentality.

7. Bag the meetings – This business about holding team meetings is highly overrated. Besides, it just takes people away from doing their jobs. The last thing you want to do is give people another excuse not to do their work.

8. Work ‘em ‘til they drop – Squeeze every ounce out of your employees every chance you get. Never mind that you have to pay them overtime or that they may burn out and make tons of mistakes. There’s plenty more bodies where they came from.

9. Ignore today’s compliance obligations – There are so many personnel law obligations that trying to reach the “Golden Shores of Compliance” is a futile effort at best. Better off letting your exposures run rampant and deal with them in the courtroom. Besides, we just love our lawyers.

10. Train solely from within – Or, forget training altogether! Better off recycling ignorance than employing profound knowledge – which can only be gathered from outside of a system.
SPECIAL BONUS SECRET:

11. Forget your commitments – This bonus secret is a real powerful one and brings us full circle. Besides, your workforce probably isn’t very committed to you. They say they want to work for you for years and then they quit after only a couple of months. What’s up with that?

These secrets will all but guarantee your business failure. One last note: Just make sure you bleed the company to a point of extinction before you employ these powerful secrets.

NOTE: If management failure is not your bag, then take full advantage of the HR That Works website!

Don Phin goes over Transitioning Employees to Managers in this short video.

Many times we run so hard, we fail to step back and take a 50-foot view of our company. Here is a baker’s dozen “head check” questions you and your managers should be asking yourself: 

1. Who are we? Just what is our story? Whether you call it brand, story, culture, it’s about self-definition. Two great examples are Southwest Airlines and Virgin Air. Their story is branded externally with customers and internally with personnel. Of course, every company has a story—what’s yours? If you’re not sure, ask a third party to come in and take a walk around. Then have them take a look at your website. If they have trouble defining it, you’ve missed a great marketing opportunity. To customers and employees.
2. What do we value most? Certainly the answer to this question should be identified in your brand, culture, etc. Is it hidden or stated? Is everybody on board with these values? Where are there conflicts? Is have a life competing with being the top grossing firm? Is executive pay strangling the ability to hire new talent?
3. Where are we going? As the saying goes, “If you don’t know where you’re going, any road will get you there.” How articulate has management been in defining the company’s vision, mission or goals? How articulate are your company’s managers in defining these for their teams? How articulate are each of your employees in defining these for their careers? Do you folks really know where you’re going? Don’t guess at it, ask a few folks. Survey them even!
4. Where do we need to improve integrity? We had a great Webinar guest, Tony Simons, a Cornell University professor who wrote a great book on integrity. In their studies, it is the single factor driving profitability in corporate life. High integrity companies out earn low integrity ones. So, where do you or your company over-promise and fail to walk your talk? Another way to language the concept is that of trust. What makes someone trustworthy is that they have the skills and the desire to be successful. Where can trust or integrity be compromised? Do you have checks and balances to prevent that poor conduct? Are you making a proactive effort to increase trust and integrity or do you fantasize that it will happen naturally?
5. Are we communicating? In the surveys I’ve done with companies, communication is one of the top three challenges faced by every organization. Remember this: the greatest form of communication is dialogue because it creates a “safe place” for communicating. Unfortunately, much of the workforce sits in what I’ve coined “the Culture of Silence.” This means they are far more concerned about judgment from management and peers than they are motivated to contribute a new idea. There will always be communication in an organization, it’s leadership’s choice to make it proactive and positive or allow it to wallow and become reactive and negative.
6. Do we have a standard operating procedure for doing absolutely everything? If not, what’s the excuse? Chances are if you’re an entrepreneur, you’ve read Michael Gerber’s book eMyth. The revelation is to build a business as if we were going to franchise it. Then we know we have our act together. An easy way to generate SOPs is to give people dictation equipment, talk about what and how they do things, have it typed it out, tweak it, and voila, you have a standard operating procedure for everything—from answering the phones to post-purchase reassurance.
7. Who is responsible for what? In another excellent HR That Works Webinar, the presenters talked about the Results-Only Work Environment (ROWE). In order to have that type of high-performing organization, everybody has to be very clear about their responsibilities. If you were to ask the people you manage “What are the three most important things you are responsible for every day?” would their answers match what you expected? Unless they do you have opened up a gap in performance management.
8. How does the cash flow? Are your managers and rank and file aware of how the cash flows in your organization? Fact is, the most dropped and failed course in college is accounting. Fact is, Americans are in a financial mess because they don’t manage money properly. Fact is, those people bring those habits to your workplace every day. In another excellent Webinar we did, Coach George from Dave Ramsey’s organization talked about the importance of bringing financial peace to your company. This does not just include the company’s bottom line, but the impact that financial stress has on each and every one of your employees. Smart companies will educate their employees about dollars and sense. They will be able to read a cash flow statement. They will understand how and where your company makes money so they can do a better job contributing to that effort.
9. What’s the work environment like? The work environment is always communicating. Fact is, it’s never not communicating. I remember one time trying to help out what was, at that time, a Fortune 500 company that brought together a highly skilled group of engineers and had them work on a highly secretive project. Unfortunately, this high-performing team was breaking down and many were ready to quit and go back to where they came from. When I went to go visit them, they literally worked in an office environment with nothing but gray walls as if it were some top secret Manhattan Project. How ridiculous. When I was a kid, if you were surrounded by grey walls, it meant you were in a basement throwing out the garbage or waiting for the bomb drill to end. What did that environment say to these men who were already in a stressed state? What does your environment say to your employees? Is it energizing or something else? Does it reinforce your brand or do something else? Do employees see the difference their work does every day?
10. How do we define success? How do we keep score? What’s it mean to be a winner? Does everybody know the rules to the game? Are some of your employees playing soccer and others playing baseball? In studying companies that won the Baldridge Award, these excellent companies were very good at defining what overall performance meant. Yet, even in those award winning companies, roughly 50% of employees did not know what it meant to succeed on an individual basis. So, has your company done a good job of defining success company-wide and for individual employees?
11. Where are we at risk? Have you done a SWOT analysis lately? Where are your weaknesses and threats? Do you have good risk management to address these issues? Do you have technology vulnerabilities? Turnover problems, offshore competition, outdated machinery, outdated performance management? Talked with your insurance broker about your exposures? Can you insure against these risks or mitigate these risks or mitigate the damages of these risks if they do occur? Obviously, risk exposure is something BP wasn’t very concerned about when building oil platforms in the Gulf.
12. How are we creating great customer experiences? Today is a sound byte instant gratification, what-can-you-do-for-me-now environment. Many products and services are viewed as fungible. What really matters is the “experience” that surrounds them. To me, flying is a fungible product, but I’d much rather fly Southwest than US Air because of the dramatically different customer experience. If your company has any mission statement, it should simply be this: Create great customer/client experiences! What else could be more important in today’s marketplace? What else could better help drive profits? Look at your own personal experience. We love going to Costco, Nordstrom, fly Southwest Airlines, eat at In-n-Out Hamburger. Why? Because of a great experience. Great experiences are addictive. Are clients and customers addicted to a great experience with you?
13. How can we break out of the box? How can we enhance the creativity in our organization? How can we foster new ideas? Do we actually have a process for mining the intelligence of our entire range of stakeholders? See the Creativity Checklist on HR That Works.

Hope that was good food for thought. Here’s to your success!

Malcolm Gladwell’s third book, Outliers, focuses on the origins of success. Gladwell brings home lessons that should be remembered. Think about how these factors might apply to you or your company:

1. There’s no substitute for hard work. Although much of the book teaches how circumstance and nurturing have a big impact on success, the one common denominator is willingness to put in the hard work. No athlete, business person, musician, or anyone else succeeds without hard work. One of my favorite sayings in the book is an ancient Chinese one, “No man who rises before dawn 365 days a year fails to make his family rich.” (I can honestly say that I do this at least 300 days per year, so I’m getting close!).
2. The 10,000 Hour Rule. If you want to be great at something, or at least be known as an expert, you need to study this subject for at least 10,000 hours. This holds true whether in business, law, medicine, technology, sports, music, etc. One of the downsides associated with letting more experienced employees go is losing their store of wisdom and expertise. If you’re in a “no choice” situation, at least try to have the departing employees provide you as much of their stored wisdom in writing as possible
3. The importance of cultural norms. For example, many Asians are accomplished in math not because of their IQ — but due to their work ethic: how their numbering system works, the precision required to grow rice, and of course, willingness to attend school an extra 50 days a year. What is the work norm at your company? Punching the clock or making sure things get done?
4. The need for opportunity and encouragement. Many successful people have been in the right place at the right time. Perhaps they were just born at the right time. Perhaps others saw their innate talents and helped to nurture them. The bottom line: no one succeeds alone. We all need encouragement and nurturing. This becomes a real challenge when companies are shutting down on communications and training.
5. Once you’re smart enough — you’re smart enough. As Daniel Goleman wrote in his book about emotional intelligence, “It’s just not IQ that matters.” An individual’s ability to deal with emotions and have practical insight is just as, if not more, important than IQ. After a certain point (roughly 130 IQ), the additional IQ points don’t make folks any more successful. Same would hold true for skill testing. If they are a top 20% user, chances are that’s good enough to make a difference. The rest depends on personal drive, emotional skills, etc
6. Pedigree matters — to a degree. As with IQ, going to good schools matters. Going to top ten schools doesn’t matter nearly as much. Just as opportunity, encouragement, support, and other “external” factors impact on the propensity for success, we should not overlook these factors when assessing someone’s potential. Perhaps there is great potential right under your nose; they just haven’t had the right circumstances to show their true mettle. This is one reason that I stress the importance of character assessment, skill testing, and other tools to get past your initial “impressions” about someone’s potential.
7. The importance of expressing yourself. This discussion first came up in a risk management context in which Korean airline pilots were causing crashes because subordinates were intimidated about contradicting their superiors — even in the face of a disaster. Based on my litigation experience, CEOs are the last ones to know the truth until they’re in the middle of a trial. Here’s the point: we must “invite” subordinates to bring us their ideas, to break past the Culture of Silence. At the same time, subordinates must have the courage to speak up when appropriate.
8. Meaningful work. One of my favorite quotes from the Gladwell book is, “Hard work is a prison sentence only if it doesn’t have meaning.” I work hard, but I love the work that I do. It provides me the three factors that Gladwell says are to essential to our work: autonomy, complexity, and meaning.

• Autonomy gives us a sense of responsibility for the work that we do.
• Complexity allows us to grow and learn.
• Meaning lets us realize the impact of our work.
• Collective learning.

The lack of opportunity for autonomy, complexity, and meaning will continue to deprive employers of excellent workers who find it more meaningful to work for themselves. To what degree are you allowing your employees autonomy, complexity, and meaning in their day-to-day activities? How can they get that from you greater than by working on their own or for someone else?

In conclusion, there’s no substitute for discovering the formula for success at your company!

MANAGING CHANGE

One of my favorite jokes: How many psychiatrists does it take to change a light bulb? Answer: Only one, but the light bulb has to really want to change!

Leaders constantly face the challenge of managing change in their organizations. After having helped facilitate change in hundreds of companies, I’ve found that there are three types of employees:

1. The Resisters – These folks are dead set against any change. Whether it’s because they’ve hit a comfort zone they don’t want to leave or because they don’t want to be “found out” as not being as valuable as everyone thinks they are, they’ll naturally try to sabotage or resist change. When dealing with these employees, the rule is simple: Either they get on board or they find someplace else to work. I can’t tell you how many times I’ve met employers who will allow one group of employees to go in a new direction and another group to stay put, thus creating an incredible division within the company. Either there will be change or there won’t — and these people are either going to get on the bus or they need to find another place to work.
2. The Sheep – You can hear them now, “Baaaaaah.” These folks will go along with anything. The only problem is that they go along with it with only one foot in. This is because they live in what I call “small worlds.” To motivate these employees, you have to make their world bigger. For example, I worked with one company that focused on the internal aspects of change – never allowing the employees to fully understand the impact of this change on its clients. To paint a bigger picture for the staff, we brought in clients to share their stories, which had triggered the need for the change. Now the change has a purpose that motivates these employees to get both feet in.
3. The Champions – These people have been awaiting change for some time, in fact, they might have even prompted it. The challenge with these folks is to keep them focused, remembering that they still have a job to do even though you’re implementing change. Be inclusive with them, but don’t let them get overwhelmed by spending too much time addressing change protocols.

Those are your three basic personality types, and the best ways to deal with each one of them. If you’ve learned any tricks of the change trade, please e-mail them to me at don@hrthatworks.com.