The purpose of this blog is to be a resource for HR and labor relations professionals. It will give you an opportunity to become familiar with F&H Solutions Group, stay abreast of changes related to the human capital industry and develop a better understanding of the attitudes of employees and supervisors. Our blog posts are designed to be thought provoking, educational, and interactive. Things are changing very rapidly in this industry and we hope you can rely on us to be a source of information. We look forward to your comments and hope you find our content helpful. Please feel free to pass the blog link on to others who might be interested.

A “TEACHABLE MOMENT” FOR CORPORATE AMERICA

On July 16, 2009, Professor Henry Louis Gates, Jr., 58, the world-renowned Alphonse Fletcher University Professor of Harvard University became a statistic -- one of a million Black men in the prison system today. Professor Gates had just arrived home from a trip to China, where he was filming his latest PBS documentary entitled, “Faces of America.” Upon attempting to enter his rental home in Harvard Square, he found that his front door had jammed. Professor Gates and his cabbie together successfully released the door and carried the luggage into the home. Minutes later, Professor Gates was approached by uniformed Cambridge police officers responding to a neighbor’s 911 call about a possible breaking and entering in progress.

One of the officers that immediately arrived on the scene, later identified as Cambridge Police Sgt. James Crowley, asked Professor Gates for proof of identification. Professor Gates informed the officer that he lived there and was a faculty member at Harvard University and presented his Harvard University identification and valid Massachusetts driver’s license to the officer. Both of these documents included his photograph and current address. As Professor Gates stepped onto the front porch of the home, he asked one of Sgt. Crowley’s colleagues the officer’s name and badge number. No information was offered to Professor Gates. After repeated inquiries by Professor Gates, coupled with significant verbal exchanges between the two individuals, Sgt. Crowley, a Caucasian male, handcuffed Professor Gates and placed him under arrest for disorderly conduct. News reports indicate that Professor Gates was not even read his Miranda rights until after he arrived at the Cambridge Police Station to be fingerprinted and fully processed.

On Tuesday, July 21, 2009, prosecutors dropped the disorderly conduct charge against Professor Gates. The city of Cambridge called the arrest, “regrettable and unfortunate.” During his news conference on health care reform, President Obama stated that the Cambridge police “acted stupidly” in handling the situation with Professor Gates, whom he has known for many years. I call it an undeniable debacle, to say the least.

Here we stand in the 21st Century, the year 2009. We as a nation are still struggling with the very same stereotypes and prejudices that have plagued our society for decades. Despite the tragic incidents involving police and African-American victims like Rodney King, Amadou Diallo and the innocent 92 year-old Atlanta shooting victim, Kathryn Johnson – we have not yet learned any lessons. Even given historic decisions such as Brown v. Board of Education and Roe v. Wade, we are regrettably poor students.

Similarly, those of us who work in Corporate America should view the Gates controversy as a real “wake-up call” and utilize it as an impetus for change in our respective working environments. The successful implementation of any diversity initiative requires a changing of the mindset. Lacking that, the biases that continue to permeate our organizations (whether conscious or unconscious) will take control and override any finely scripted diversity initiative. We have to ensure that our hiring practices are focused on being all-inclusive, with equitable representation across all levels of the organization. We need to be consistent in the implementation of company policies and procedures, as well as in each of our employment decisions.

Most importantly, we as professionals have to strategically reinforce one of the basic requirements of diversity: understanding and embracing differences. We are not a “melting pot” - a term commonly used to describe our society, but rather, a mosaic of individuals, who are each derived from different races, educational and socio-economic backgrounds, religions, marital status, work experiences, etc. These differences are significant to the organization and, regardless of size or industry, can dramatically impact a company’s bottom line.

Statistically, discrimination charges filed each year with the EEOC are at record high levels. This means that employment-related issues are not going to somehow disappear on their own. It also means that the supervisors and managers who work directly on the front line need to be properly trained in the EEO laws and work as a team to enhance the multi-cultural and social awareness among their constituents.

Let’s be honest. The election of President Obama was a truly historic moment – the first Black African-American man to be elected to serve as the 44th President of the United States. The same holds true in regards to the appointment of Judge Sonia Sotomayor as the first Hispanic female to serve as the 11th Court Justice to the U.S. Supreme Court. These events have provided a new platform for which we as a society can again talk openly about the importance of diversity in America and all over the world. What these events have not done, however, is completely eradicate the “-isms.” Ostensibly, the overall concept of embracing diversity has evolved and race relations have progressed over the years. But as evidenced by the Gates incident, we have yet to attain the level of acceptance that Dr. Martin Luther King Jr. and other civil rights activists envisioned.

Professor Gates is now considering filing a lawsuit against Sgt. Crowley, the city and/or the Cambridge Police Department on the basis of what constitutes racial profiling. President Obama has offered to step in and extend an invitation to the two to share a beer with him at the White House, representing a symbolic conciliatory summit. According to the President, the controversy over the Gates issue is a “teachable moment.” There are some who argue that perhaps each party simply overreacted to the situation, stating that had Crowley and Gates engaged in a more civil communication with each other on that front porch, we would not be talking about this travesty today. Hindsight is 20/20. Speculation aside, what we do know for sure is that it is imperative that we as business leaders get our arms around these issues before too long. The “teachable moment” for us today should be crystal clear.



Written by: Jennifer Melton, EEO/Diversity Management Consultant & Certified Facilitator - Leadership Development, F&H Solutions Group

ARE YOU VIOLATING THE LAW, INCREASING UNION VULNERABILITY AND WASTING PAYROLL DOLLARS?

Most employers, even during this economic period, must pay a competitive rate relative to the market place in order to attract quality people. However, once they are your employee, their attitudes are affected by the fairness of pay among jobs within the company. Thus, the concept of internal equity of pay will affect the company's exposure to discrimination lawsuits, union vulnerability, and productivity.

Properly managing pay is not a new phenomenon. However, with the recently passed pay discrimination law called the Ledbetter Act and the proposed Fair Pay Act of 2009, companies need to assess their compensation plans to avoid more law suits. Such an assessment will also help counter employee complaints regarding favoritism relative to pay which often can spark a union organizing attempt. Furthermore, a sound compensation plan will save the company money and increase productivity by paying jobs what they are truly worth relative to one another.

Various types of assessments can be done, but one that should occur is an objective analysis of internal equity of pay. Such an assessment will help companies address whether:
  • The Marketing Assistant's job should be in the same pay range as the Engineering Assistant's;
  • The Assembler's job should be paid the same, more or less than the Fork Lift Operator's; or
  • The Production Supervisor’s job should be in the same pay grade as a Warehouse Supervisor.

The most common objective method of assessment is the point system job evaluation process. This process determines if jobs are paid fairly based on the required skills, responsibilities and working conditions of the job. This is not an individual performance evaluation and it is sex, age, race, etc. neutral. We have assisted companies in all types of industries evaluate jobs using such a procedure. This course of action helps companies avoid pay discrimination issues addressed by the Ledbetter Act. Equally important, it will reduce union vulnerability and help control labor costs.

Where have you gone, Joe DiMaggio…..?

Is there a more recognizable set of lyrics then those from one of the most popular songs ever written by Simon and Garfunkel, “Mrs. Robinson”?

Where have you gone, Joe DiMaggio?
(A nation turns its lonely eyes to you )
What's that you say, Mrs. Robinson
Joltin' Joe has left and gone away
(Hey, hey, hey...hey, hey, hey)

We appear to be a nation in search of a leader we can look up to, whether it be in sports, politics, or business, as so many people did of Joe DiMaggio. Even going back to the 1970s, those of us old enough to remember still recall the leadership showed by Lee Iaccoca, the former head of Chrysler, who helped the company through some very though times by securing government loans and even agreeing to take an annual salary of one dollar.

Now, when I watch television, pick up the newspaper, or read something online about a misstep at a particular organization, whether it is a corporation, non-profit, politician, or public sector entity, I shake my head and ask myself, where has the leadership gone in this country? Our new President is doing his best to lead by example, but what will it take to develop a new set of leaders in this country and how are we going to achieve that goal?

The problem is too many organizations are cutting back on critical training needs. We keep hearing, “the training budget is being cut,” or “It’s not in the budget at all.”

There is a widely held view that training is “soft” and it doesn’t provide any real return to an organization. Nothing could be further from the truth.

Think about this:

· No money for supervisor training, diversity training, sexual harassment or discrimination training?
· Can’t afford to send someone to learn about the alphabet soup of laws and regulations affecting employees like ADA, FLSA, FMLA, OSHA, and many, many more?
· Can’t retain someone because there is no career development plan, succession plan, or his or her boss is dysfunctional?

Why do we still see corporations as the lead story in the newspaper, online, or on television under negative publicity? It costs those companies tens of millions of dollars in revenue fighting the negative publicity.

It is still hard to believe that we see adverse court decisions being issued because of discrimination or harassment convictions that it costs corporations millions, or worse yet.

At some point, one hopes the light bulb will go off and executives will realize that training isn’t “soft” at all and that a sound training program is one of the smartest investments an organization can make.

The perception of training is all wrong. It can’t be viewed as a luxury item for organizations to use only when times are good. If you think about the examples I have used, you would agree it is one of the wisest investments an organization can make in its employees. Would a corporation ever think about not investing its cash reserves, or not having the necessary D&O liability coverage? Would any organization want to see its best and brightest people leave because they cannot get the support needed to nurture and grow the people who work for them?

Organizations have never needed training more. There are way too many managers who fly off the handle at the smallest thing and berate their co-workers or subordinates. There are too many analytic types that barely show any emotion and who their co-workers or subordinates barely know are alive.

It is time we teach the proper balance between emotion and process, how to get organized in your day to day work activities, make a meeting on time, accept others who are different than us, communicate better, put together a business plan, conduct a meeting so people aren’t nodding off or reading their BlackBerrys, and most importantly, how to inspire others to be great.

Until organizations commit to these goals, we are going to keep hearing about the dysfunctional organization.

There is the view that leaders are born and cannot be taught. Sure, there are a few people so gifted that they don’t need any training, but the bulk of managers learn their skills from people they worked for and all that does is perpetuate a lot of very poor management skills and habits. Leaders learn to lead by being taught or mentored, not by happenstance.

It is time for the private and public sector organizations to wake up. Let’s not keep having our nation turn its lonely eyes to someone who doesn’t exist any longer. There is no Joltin’ Joe to save us.

What are “market based wages anyway?”

Whether you are negotiating a collective bargaining agreement with unions or conducting an annual review of compensation plans at your company or organization, one of the first things you hear is the phrase “market based wages.”

In a unionized environment, labor wants management to believe that market based wages mean wages higher than the most recent settlement reached for a particular work group. In other words, classic pattern bargaining. The relative cost of living where your employees live does not matter to the union. Neither does the company’s financial performance. It is all about an ever escalation of wages with little regard for internal or external conditions.

On the flip side, the conventional view of market based wages by management is far more complex than just looking at the most recent settlement. One factor that always comes into play is answering the question -- How much do I need to pay to attract and retain a qualified person to do the job being recruited for?

If I want to review a pay scale or a salary range for a teacher in Columbus, Ohio, will I look at what teachers are being paid in Los Angeles? Highly doubtful. Will I look at what other teachers in comparably sized cities are paid? Yes. Will I look at what increases other public sector employees received in the same city? Absolutely.

If I am considering pay increases for the accountants at my mid-sized firm in Louisville, Kentucky, will I be interested in knowing what KPMG is paying its accountants? I may be interested, but since I cannot compete for that talent, it is not very relevant.

Identifying the critical business characteristics for determining what can and should be paid is a key component in establishing your market based wages.

The bottom line is that companies and organizations cannot ignore competitive, market, and financial conditions. If companies allow themselves to be swayed by pattern bargaining or comparing themselves to jobs in other cities with different demographics or financial situations, they will be doomed to fail in having real market based wages.

The case for keeping bonus and retention plans

In the wake of recent disclosures about bonus and retention payments being made at AIG and other larger companies that have received financial assistance from the federal government, a number of corporate boards at public companies are reviewing the compensation plans they have in place for their own management teams.

Sound corporate governance dictates that boards should periodically review compensation programs to make sure they are reflective of the marketplace and competition.

Given all the negative publicity surrounding this issue, should companies be running scared? Absolutely not! The number one concern should always be to attract and retain your high achievers and future stars in an organization.

When determining whether someone should be receiving a bonus and/or retention payment, one needs to ask the following questions:

· How critical is this person to the success of the organization?
· Are other people dependent on this person for their own success?
· What would happen if this person leaves? Is there someone who can take his/her place?
· Is this person a serious risk to leave?
· Do you know if the person is satisfied in the job?
· Are you working on a realistic career development path with this person?

There are plenty of reasons not to want to let a valuable manager leave. That person has important institutional knowledge and could end up at a competitor. You make a big investment in this person’s success. And it can be very expensive to replace someone.

It can cost a company up to 100 percent of salary to replace a mid to senior level manager. Hiring an executive search firm is about 30 percent of the first year’s salary and bonus. Relocation of an executive can add another 10 to 20 percent of salary. Then, add a signing bonus and possibly a higher salary than the person they are replacing, and lo and behold, it cost you a fortune to replace the person you let leave. This doesn’t even take into account the time it takes for the new hire to “get up to speed.”

Of course, there are times when it is fine to let someone leave. But compensation structures that exist in American business are built on variable compensation. Base salary, short and long term incentive compensation plans, equity, and other forms of compensation are all part of the package. That is how managers and executives get paid.

The trick is to makes sure that your plans make sense and are not in such bad taste as to offend one’s sensibilities.

Come up with a well thought out plan to identify who is worth keeping and who you let leave. When you are trying to figure all of this out, ask yourself these two questions: Will my world end of this person is no longer with my organization, and how difficult will it be to replace them?

Design your compensation plan with enough flexibility in it to reward the solid achievers, but don’t be forced to dole out money to people who don’t deserve it.

Is your compensation program designed this way?

Be Careful, Or I May Shoot Myself!

A major airline and its pilots are in contract negotiations. The union is demanding increases of more than 50 percent. So it caught my attention when I read an article about how this airline’s pilots are telling the public that they don’t intend to shut down their company if they fail to get an agreement, but rather, they plan on canceling selected flights or delaying others by 3 or 4 hours at times and locations unknown to the passenger in what has been dubbed by another airline union as CHAOS (Create Havoc Around Our System).

This kind of rhetoric is nothing new in the airline industry. Airline unions call for the resignations of their CEOs. They tell passengers that it may not be safe to fly their airline. Informational picketing is quite common with leaflets saying unflattering things about their company and its executives. They even go as far as renting billboards that are designed to publicly embarrass the company and undermine customer confidence in them.

This type of behavior begs the question, what are these people thinking? Name another industry where unions go out of their way to drive customers away, all but daring them to travel on a competitor. Who pays the employee’s salaries? The passenger! And how does airline labor say thank you? They try to drive them to the competition.

Of course, this is all done in the name of creating leverage in contract negotiations so they can get their members more money, better working conditions, and improved benefits. How can they achieve those goals if their company is being hurt financially by union corporate campaigns? The only way to make sure employees can earn more money and have a secure future is for their company to have a growing stream of revenue and be profitable. If your union is driving away its customers, it is going to be pretty hard to increase your revenues. Their behavior is completely counterintuitive to the stated goals of the union. Make your company more profitable so you can get a bigger piece of the pie, don’t kill the goose that laid the golden egg.

Can you imagine the UAW telling the public not to buy one of their cars? Yeah, let’s get more people to buy Japanese or German cars. That will surely help our plight!!

How about nurse’s unions saying you don’t want to be in our hospital? How about a passenger railroad union telling its customers they’d be better off driving instead of riding the rails? Talk about cutting off your nose to spite your face!!

So what can management do in the face of these tactics? Well, the only sensible thing to do is to talk to your employees in a very straightforward way and get them to understand this isn’t a game of chicken. People’s livelihoods are at stake and behavior designed to drive any customers is just plain dumb as it has consequences on the business and the people who are employed by their company.

Unions have done some wonderful things for the American worker in the past, but if labor wants to be relevant in today’s tough economic environment, this sure isn’t the way to do it.

Give us your thoughts on this matter or any of the other postings we have made.

Why won’t we invest in our managers?

This is not a fun time to be a corporate manager. Even if you aren’t worried about losing your own job, you’re probably concerned about laying people off who work for you.

You start thinking to yourself, “No one ever trained me for this. What do I say? How do I act when I have to break the news to them? Can I answer their questions? How will they react? What happens if someone ‘loses it’ during our conversation?”

Too often, a manager’s own leadership development skills are based on the behaviors of people they worked for at one time in their careers. While it may not be totally analogous to the child who grows up in a dysfunctional family and then mimics their parent’s behavior as an adult, I think you get the picture.

If this is the way some managers learn to lead, how do we fix it?

In professional sports, athletes spend thousands of hours at their craft away from the playing field. They become better at what they do through arduous training sessions, lots of repetition, studying, and just plain hard work. For every game a professional athlete plays, they practice and train 10 times longer. If we want our corporate managers to be the best at what they do, shouldn’t we be taking a page from professional athletes and invest in our managers through proper training and teaching?

Of course the answer is yes, but the reality is that when corporate budgets are cut, what is one of the first items to get the ax? You’ve got it—management and leadership training. When you take a step back and think about it rationally, the most critical time to invest in your management team is when the business is not going well. That’s the time you need your professionals to lead, manage, and be engaged with other employees. This is when you discover who the real leaders are in an organization.

We go to college and train people to become engineers, teachers, analysts, accountants and scores of other professions. We train people to be firefighters, policemen, mechanics, plumbers and other critical skilled professionals. But we forget that once we become professionals, corporations don’t spend a lot of time training us on how to manage and lead others.

We need to re-think the way we look at managers. No more jokes about the Peter Principle. No more assumptions that just because an employee did a great job in a previous position, that same person will make a great manager.

Corporate America is filled with managers who use their time inefficiently, put themselves before the people they manage, and make decisions that are solely based either on emotion or are so analytical, they fail to consider human emotions at all.

I recently read that corporations spend about $1,000 per employee each year on training management/leadership training. If that is the case, it is no wonder we are having trouble developing leaders. We are spending hundreds of billions of dollars to reinvest in our infrastructure. Isn’t it time to start reinvesting in our future leaders of Corporate America?

I’m calling in sick to play golf

How many people work for companies that allow its employees to accrue sick leave each month, capped at a certain number of days? OK, you can put your hands down. Nearly everyone raised their hands.

Do you know anyone who has called in sick when they were perfectly healthy? Maybe they caught Spring Fever and wanted to play golf, or needed a “mental health day”.

Call me old fashioned, but I was brought up to believe that sick leave was to be used only when you were actually sick. In my book, if you call in sick when otherwise healthy, you’re being dishonest. Sick leave isn’t meant to be used so you can sleep in, get an extra day off before or after the weekend, or maybe even tack on a couple of days to a vacation.

Yes, I know the responses.
“Sick leave is a ‘use or lose it’ benefit, so if I don’t take my sick days, I will lose them when I retire or take another job.”

How about this one?
“If my employer paid me for my sick days when I left, then I wouldn’t have to take them.”

We’ve all heard someone say,
“I had a doctor’s appointment or a parent-teacher conference at school so I needed to use my sick leave because my company doesn’t give me any time off.”

While I would agree that not every employer is always willing to help an employee with taking time off for a doctor’s appointment or a parent-teacher conference, in many instances, it is possible to schedule around someone’s work schedule.

Sick leave is not an entitlement like vacation, it is an insurance policy. Employers provide the benefit so you don’t come to work sick and you get paid for staying home to get healthy.

Think of it like life insurance. Most employers provide you with basic life insurance coverage, but you wouldn’t think of using the benefit, would you? If you do use the benefit, it means you’re dead. In the case of sick leave, shouldn’t you only be using the benefit when you’re actually sick?

Not only is calling in sick when healthy wrong, misuse of sick leave can get you fired. It is also inconsiderate to other collegues. If you are a shift worker, when you are out sick, someone else is going to have to cover your shift, either through mandatory overtime or getting called in on a day off. I am betting that the person calling in sick when healthy doesn’t ever think about the inconvenience to his or her fellow employee.

At most companies, only a small percentage of people who call in sick are being dishonest. The problem is that lost time costs are enormously expensive to the employer. The most conservative estimates of lost time are that for every day someone is not at work, the costs run between 2 and 5 times someone’s pay. If that sounds extreme, think about paying the person who called in sick, the person who had to be called in from home, the overtime, the lost productivity, and the administrative burden on the employer to track the lost time.

Now, let’s say you work for a company with 10,000 employees. The average wage is $15 per hour, and 10 percent of the work force calls in sick each year. Another 20 percent take FMLA, and another 2 percent are out on workers compensation or disability. The average number of days out due to absences are 5 per year. The cost to this employer can run from $4 million to about $20 million a year.

What employee wouldn’t prefer to have at least some of that money in their pocket?