Category Archives: Best Practices

Still Using Old F.M.L.A. Forms?

Many employers covered by the federal Family and Medical Leave Act are still using forms from the U.S. Department of Labor that expired in 2012. Newer forms, which are good through May 31, 2018, are available from Labor’s web site.

There are several reasons to use the current forms. Perhaps the most important reason is that the current F.M.L.A.-related forms include “safe harbor” text to avoid inadvertently violating the Genetic Information Nondisclosure Act (“GINA”). That law prohibits an employer’s discriminating against an employee “because of genetic information with respect to the employee….” The safe harbor text, incorporated into the newer F.M.L.A. forms, precludes liability under GINA from an employer’s unintential receipt of an employee’s genetic information during the interactive process or other F.M.L.A.-related activities.

If you’re not already using the current Department of Labor forms or other forms revised to include the GINA safe harbor provided at 29 C.F.R. §1635.8(b)(1)(i)(B), it would be prudent to update soon.

Guidance on Implementing the New Overtime Salary Threshold

When a new development arises in employment or labor law, our clients often learn about it from their newsletter subscriptions. Then they come to us for guidance on implementation: the implications of various options, managing conflicts with other policies or procedures, harmonious drafting, etc. That pattern does not appear to be working for the recent change in federal overtime regulations.

While the newsletters did a good job of announcing the change, our clients and others have been left asking many questions. Fortunately, those questions have answers.

How Should the Rule Change Be Implemented?

One of the questions concerns the fundamental issue of how to implement the change for currently exempt employees whose compensation is below the new threshold. In Minnesota there are four ways to manage this, when increasing the worker’s salary to retain the exemption is not practical. Some states do not allow all of these options.

The simplest way is to compute the person’s average hourly wage based on their current schedule and compensation; work backward to determine what the hourly rate should be, given the specific frequency of overtime hours; pay them as nonexempt, including overtime at the 1.5 rate. This approach, which would work in most situations, entails the least disruption.

A second way is to continue paying them a fixed salary, which would compensate them for a workweek of fluctuating hours. This approach still requires that overtime be paid, but at the reduced rate of 0.5 their regular rate. Again, there should be a preliminary computation of the current average hourly rate, factor in the frequency of overtime, and calculate a new weekly salary. The regular rate in these cases must be recalculated weekly, and there are several preconditions necessary for this approach to be lawful.

The third approach is still to pay a fixed salary for a fluctuating workweek, but the salary includes all overtime (up to an aggregate of sixty hours worked per workweek). This third approach requires more preconditions in place than the second approach, and therefore applies to the fewest situations.

Finally, the only approach which does not involve overtime is to reduce the affected employee’s hours to forty per week, and to hire or assign a different person to work the balance of hours necessary to accomplish the job’s requirements. This approach is the most disruptive, because it reduces the affected employee’s compensation, inserts an additional person into the mix, and risks increasing the employer’s non-wage benefit costs.

Selecting which approach to use in restructuring an affected employee’s compensation depends on several factors, including the requirements of the specific jobs; the employer’s budget, in terms of both dollars and flexibility; the terms of any applicable contracts; retention issues; and the employer’s objectives. Implementing the first and fourth approaches may not require an attorney’s assistance. The second and third approaches should be undertaken only after consulting with a knowledgeable attorney or other specialist in wage and hour law.

What Effect Will the Rule Change Have On Labor Costs?

Another concern being voiced frequently is how to fit the rule change into an existing personnel cost structure. The budget is one of the drivers in selecting one of the four options above. If the appropriate preconditions exist, implementing the rule change could be cost-neutral; otherwise, there will be a change to the labor cost. Selecting an implementation option, therefore, involves understanding the alternatives, defining the relevant factors noted above, and ranking them.

How Can These Changes Be Communicated With Least Disruption?

Another question heard frequently is how to communicate these changes. The first step in addressing this issue is to determine whether the possible problem is one of prestige or money. Some employees may bristle at no longer being considered exempt. Most employees would bristle at a decrease in compensation, particularly if their overtime hours and associated wages will be given to a different person. Changes in label from exempt to nonexempt are easier to manage, although the emotional aspect of a classification change should not be underestimated. Communicating financial changes is more difficult. In those cases, it is often advisable to explain the problem with the affected employee and to solicit ideas; again, the emotional piece is important.

Additional issues are discussed in another article on this site. See “Trade Secrets, Overtime, and Other Priority Developments.”

Do you have questions or solutions not discussed above? We’re interested to hear them. You can add a Comment or send us an e-mail. And, of course, we’re available to answer questions and to assist with the transition.

Trade Secrets, Overtime, and Other Priority Developments

It’s been a busy time in the world of employment law. A few recent developments have particular priority for human resources managers and general business lawyers. This post concerns three of those developments: trade secrets, overtime exemptions, and changes to the E.E.O.-1 form.

New Trade Secret Protections and Requirements

One development concerns proprietary and confidential information. A new law offers the first federal protections for trade secrets. It’s an important law. Part of it authorizes the seizure of things that were used in the process of allegedly diverting trade secrets, such as computers and storage media. That’s an important contingency that should be considered when provisioning critical hardware, proprietary software, and network access.

Another part of the law requires the supplementation of all agreements with employees and contractors which addresses confidential information or trade secrets. Those materials must now contain a notice to employees (or reference to a separate, available document) to the effect that trade secrets may be used in a limited fashion to engage in whistleblowing activity or in employment litigation alleging whistleblower retaliation.

In light of the Defend Trade Secrets Act, employee agreements, handbook policies, and other materials which contain provisions on trade secrets should be reviewed and supplemented with appropriate text as soon as possible. (And, of course, this is a good opportunity to be sure that other developments from the past few years are properly implemented, such as Minnesota’s Women’s Economic Security Act and the N.L.R.B.’s application of Section 7 to handbook and other employee policies.)

New Overtime Eligibility Rule, Pay Equity, and the E.E.O.-1

Most employers by now have received multiple announcements of the final rule issued last month by the U.S. Department of Labor concerning the increased salary threshold required to be exempt from overtime. Organizations should review their options on classifying and compensating affected employees. There are several ways to proceed in compliance with the regulation, depending on employer objectives.

Just complying with the new rule, though, could leave an organization vulnerable to adverse assessments in the near future, assuming that the categories of data required for the E.E.O.-1 form expand as planned. Here’s why, and what to do:

All organizations with 100 employees and many smaller organizations must file an E.E.O.-1 annually with the U.S. Equal Employment Opportunity Commission. The form includes information on current employees by job category, ethnicity, and sex. If the current rulemaking proceeds as planned, the form will also include twelve compensation bands. Now hold that thought….

There’s been a resumption in the discussions among some circles about comparable worth analyses. The comparable worth approach seeks to close the gender-based pay gap by comparing compensation by gender within “comparable,” but not “equal,” jobs. Minnesota and California have long required comparable pay assessments in the public sector. Minnesota now also requires comparable pay for private and third sector employers with at least forty employees having government contracts of at least a half-million dollars. There is an increased focus, and in some areas also legislative activity, around employee protections for discussing compensation issues. Add in the increase in data collection, analysis, and dissemination that current technologies and vendors are providing, and it seems likely that there will be an increase in lawsuits attempting to prove sex discrimination through a deep analysis of how employers have arrived at gender disparities in the compensation of comparable, but not equal, jobs. Let’s go back to those E.E.O.-1 changes.

The new form will funnel multiple jobs and job categories into a dozen compensation-based bands for employers (and sufficiently related employer groups) having 100 employees. By doing so, the information will help the government to assess the distribution of jobs by compensation level as well as by the various other attributes entered into the form.

The information should also help employers to smooth out gender- (and other non-job-) based inequities, whether derived from bias, history, or other sources. Smoothing out those arguable inequities would minimize exposure to a range of problems based on a comparable worth analysis, including investor inquiries, government contract compliance, and even discrimination claims, which have generally been unsuccessful but are showing signs of making a comeback. And what might happen if the EEO-1 shows inequities that are not self-remedied? In litigation, the information would likely become available (from the employer, not the government) to plaintiffs challenging job bias.

Now let’s go back to that new F.L.S.A. regulation. Employers should review the overtime classifications of currently exempt workers who make less than the new salary threshold. They could take this opportunity to review, as well, their other employees’ overtime classifications. But any adjustments employers make—e.g., to classification, compensation levels, compensation mechanisms, reporting lines—should anticipate the forthcoming E.E.O.-1 requirements. This is a good time to rationalize classifications and compensation, and to develop a plan to squeeze out any vestige of bias in the way that employees are compensated and assigned. More guidance on ways to implement the new rule will appear in a later post.

A comprehensive approach to these issues also answers one of the common questions raised by the new F.L.S.A. regulation: “How do I communicate the effects of the rule change to my workforce?” Communicating a systematic review of compensation to make the process more transparent and more equitable can increase an employee’s perception of fairness; and research indicates that increased perceptions of fairness result in a decreased litigation risk. (Other elements to communicate in the course of implementing the regulation depend on employer objectives and choices, but the message to employees need not be negative and the effect on employer budgets need not be extreme.) More information on the subject of communication will appear in a later post.

Note that employers are likely to have an obligation to bargain over one or more aspects of compensation adjustments for unionized employees. The scope of the bargaining duty will depend on the specific collective bargaining relationship, including both contract language and past practice.

A careful implementation of the new overtime salary rule could be an affordable opportunity to improve morale, enhance recruiting and retention, minimize bias-related exposure to liability, and promote regulatory compliance. Let us know if we can help.

Workplace Speech: What is Permitted, and What is Prohibited

Employee speech is a complex and developing area. The rules are scattered among otherwise unrelated laws, enforcement guidelines, and employer policies. The reputational, morale, and financial consequences of noncompliance can be significant.

Employers are expected to comply with laws affecting speech in the workplace, but they have few helpful resources. The professional and lay resources that are available tend to focus on single areas such as free speech rights for public employees or protected concerted action in the context of social media. In contrast, the laws governing speech in the workplace derive from many sources, including constitutional and statutory restrictions on a government’s use or disclosure of data; Section 7 of the National Labor Relations Act (N.L.R.A.), which applies to many nonunion as well as unionized workplaces; the Privacy and Security Rules of the Health Insurance Portability and Accountability Act (HIPAA); Title VII (of the Civil Rights Act of 1964); Title IX (of the Education Amendments of 1972); and many other sources.

Assisting employers to navigate these waters, Joe Nierenberg delivered a presentation on the topic to the 2015 Minnesota conference of the Society of Human Resources Managers (MN SHRM). The session addressed the types of employee speech that an employer must allow and the types of speech that an employer can restrict. Attendees learned the general principles that apply, and discussed specific policies that had been ruled lawful or unlawful. The presentation wove together the most common rules on workplace speech, and assessed them under four principles: what speech is prohibited; what speech is permitted; when the allowance or proscription is mandatory; and when the allowance or proscription depends on context. The session objectives included more compliant and confident management of policies, procedures, training, and discipline.

Presentation slides never tell the whole story of a live training program with audience discussion, but here’s the deck that was part of the session. Please note that all rights are reserved to Nierenberg Employment Law; that, because viewing alone is an incomplete experience, the slides alone should not be relied upon as legal advice; and that the slides are current only as of October 13, 2015.

You can view or download the slides here.

If you are interested in training your executives or managers to comply with workplace speech rules, or wish to discuss other available topics, please contact us.

Preparing for the Flu

The influenza season approaches. This year the several seasonal virus varieties are joined by a new strain that requires planning and preparation. Previously called “swine flu” and now sometimes known as Pandemic H1N1, the new strain combines the familiar symptoms and dangers of influenza with the concerning prospect of mutation into more severe forms that could spread quickly.

Summary

Employers of all sizes in all industries should prepare now for Pandemic H1N1 influenza outbreaks in their communities. Some preparations are common to all grades of potential outbreak, from mild to severe, and require some thought but limited advance planning. Other preparations, more appropriate for a severe outbreak, require advance planning. The time to develop those plans is now.

Prepare for increased absences. Sending sick workers home and keeping them there until they are better will control the spread of the disease and limit operational interruptions. Family-related leave policies should be reviewed and, if necessary, modified in order to accommodate the likely prospect of schools’ dismissing students and child care programs’ closing.

Encourage relevant hygiene. Post notices about covering coughing mouths and sneezing noses. Ensure availability of soap and tissue. Increase the frequency of surface cleaning.

Plan now for steps that will become necessary if an outbreak becomes more severe. Work environments and processes may need modification to increase distances between workers. Health screening that complies with state and federal law may be advisable in some circumstances.

From the Centers for Disease Control:

Actions Employers Should Take Now

* Review or establish a flexible influenza pandemic plan and involve your employees in developing and reviewing your plan;

* Conduct a focused discussion or exercise using your plan, to find out ahead of time whether the plan has gaps or problems that need to be corrected before flu season;

* Have an understanding of your organization’s normal seasonal absenteeism rates and know how to monitor your personnel for any unusual increases in absenteeism through the fall and winter.

* Engage state and local health department to confirm channels of communication and methods for dissemination of local outbreak information;

* Allow sick workers to stay home without fear of losing their jobs;

* Develop other flexible leave policies to allow workers to stay home to care for sick family members or for children if schools dismiss students or child care programs close;

* Share your influenza pandemic plan with employees and explain what human resources policies, workplace and leave flexibilities, and pay and benefits will be available to them;

* Share best practices with other businesses in your communities (especially those in your supply chain), chambers of commerce, and associations to improve community response efforts; and

* Add a “widget” or “button” to your company Web page or employee Web sites so employees can access the latest information on influenza: www.cdc.gov/widgets/ and www.cdc.gov/SocialMedia/Campaigns/H1N1/buttons.html

Important Components of an Influenza Pandemic Plan

* Be prepared to implement multiple measures to protect workers and ensure business continuity. A layered approach will likely work better than using just one measure.

* Identify possible work-related exposure and health risks to your employees. The Occupational Safety and Health Administration (OSHA) has developed tools to determine if your employees are at risk of work-related exposures and, if so, how to respond (see www.osha.gov/dsg/topics/pandemicflu/index.html).

* Review human resources policies to make sure that policies and practices are consistent with public health recommendations and are consistent with existing state and federal workplace laws (for more information on employer responsibilities, employers should visit the Department of Labor’s and the Equal Employment Opportunity Commission’s websites at www.dol.gov and www.eeoc.gov).

* Allow employees to stay home if they are ill, have to care for ill family members, or must watch their children if schools or childcare facilities close.

* Explore whether you can establish policies and practices, such as flexible worksites (e.g., telecommuting) and flexible work hours (e.g., staggered shifts), when possible, to increased the physical distance among employees and between employees and others if local public health authorities recommend the use of social distancing strategies. Ensure that you have the information technology and infrastructure needed to support multiple workers who may be able to work from home.

* Identify essential business functions, essential jobs or roles, and critical elements within your supply chains (e.g., raw materials, suppliers, subcontractor services/products, and logistics) required to maintain business operations. Plan for how your business will operate if there is increasing absenteeism or these supply chains are interrupted.

* Set up authorities, triggers, and procedures for activating and terminating the company’s response plan, altering business operations (e.g., possibly changing or closing operations in affected areas), and transferring business knowledge to key employees. Work closely with your local health officials to identify these triggers.

* Plan to minimize exposure to fellow employees or the public if public health officials call for social distancing.

* Establish a process to communicate information to workers and business partners on your 2009 H1N1 influenza response plans and latest 2009 H1N1 influenza information. Anticipate employee fear, anxiety, rumors, and misinformation, and plan communications accordingly.

Resources

The following bulletins should be distributed to managers with relevant responsibilities:

Limitations on Vacation Leave Payouts

Minnesota’s highest court has issued its opinion in Lee v. Fresenius Medical Care, Inc. This case addresses the question of whether an employer can attach conditions to an employee’s being paid for accrued but unused vacation leave.

Susan Lee worked for Fresenius Medical Care, and had accrued unused paid time off. Fresenius terminated Lee for alleged misconduct. The Fresenius employee handbook provided:

Unless otherwise required by state law, if you do not give acceptable notice, you may not be paid for earned but unused PTO, and you may not be considered eligible for re-employment. In addition, if your employment is terminated for misconduct, you will not be eligible for pay in lieu of notice or payment of earned but unused PTO unless required by state law.

Fresenius denied Lee payment for her unused PTO; Lee sued, arguing that, because she had earned the PTO under the employer’s policy and because accrued PTO is a type of wage, Fresenius violated a Minnesota wage payment statute by refusing to pay for the unused time.

The Minnesota Supreme Court ruled that employers are not required to offer vacation leave or pay in lieu of leave. If they do extend such an offer, they can define eligibility for the leave or payments as they wish, so long as the policy does not violate any law. For example, an employer could offer vacation leave so that it accrues at a certain rate each month, but condition the use of the leave on approval by a manager; or an employer could limit the carryover of leave from one year to the next and require that most or all of an employee’s available leave be taken within some period of time; or—as in the Lee case—an employer could require a minimum notice of termination before the employee is entitled to be paid for accrued but unused leave, or even prohibit such payments completely if the employee is terminated for cause.

In Lee, the Court ruled:

[W]hen employers choose to offer paid time off as a benefit, employers and employees can contract for the circumstances under which employees are entitled to paid time off and payment in lieu of paid time off, so long as the contract provisions are not prohibited by or otherwise in conflict with a statute.

The Court essentially adopted its now-familiar analysis of how an employee handbook can become a binding contract. If the policy text is sufficiently clear, if the employee has sufficient notice of the policy, and if the employee thereafter signifies his or her acceptance of the policy by continuing to work for the employer, then the policy may be contractually binding.

Since the Supreme Court announced this “unilateral contract” approach to employee handbooks in 1983, most employers with handbooks have attempted to avoid any potentially binding effect by plainly stating that the provisions of the handbook are not intended to form a contract. The Lee case, however, supports the better practice of disclaiming the contractual effect of only some provisions while emphasizing that certain other provisions are binding, including for example the limitations on vacation leave or pay.

The Lee case had a strenuously argued dissent. The dissenting judge wrote that, if an employer’s policies define how vacation leave is earned, then once it has been earned it cannot be taken away without constituting an unlawful forfeiture. The majority rejected that analysis, finding instead:

[E]mployers may offer, and employees may accept, a contract provision that attaches conditions to the right to accrued vacation “wages,” whether in the form of actual paid time off or payment in lieu of paid time off…. [S]uch conditions define what has been earned.

The principles of the Lee case apply to vacation, paid time off, non-statutory sick leave, and a range of other benefits that are not mandated by law. Most vacation leave or paid time off policies that were written or revised by Nierenberg Employment Law have been carefully drafted to provide a benefit of time off only, and not payment in lieu of leave; those policies are consistent with this new case and should not need revision. However, all employers should nevertheless review their vacation, sick leave, and paid time off policies to be sure that they reflect the policies and values of the organization and that, if desired, they take advantage of the opportunities presented by this case.

Preserving Electronic and Other Evidence

An increasing amount of an organization’s information is recorded electronically. Electronically stored data is as important as any other form of information to assessing, pursuing, or defending employment claims. There are, however, some unique legal issues that arise due to the specific nature of electronic data. In an effort to manage the production and use of such data, the federal rules governing civil proceedings have recently been modified. It is likely that state rules around the country will soon be modified to reflect the federal changes.

In order to implement the newly amended rules, it is critical that organizations understand their data management practices and review or institute certain controls. The process is complicated and time-consuming, so the time to begin preparing is now, before the inevitable need actually arises.

When it appears that a dispute may wind up before an arbitrator or judge, it will be important that all relevant data is preserved. It will become common for parties to send and receive letters similar to the following edited excerpt from the standard letter that I send:

Please take affirmative steps to preserve without alteration all records and tangible things of whatever type and form that are in the possession, custody, or control of you or an agent and that relate in any manner to any of the following: [the allegations, claims, and defenses of all parties; the statements made by witnesses; relevant conduct of parties or witnesses; previous allegations of a substantially similar nature regardless of who made them or when they were made]. The records and things to preserve include without limitation analog recordings of images, sounds, or other data; digital recordings of images, sounds, or other data; notes, reports, letters, drafts, e-mail, and memoranda; database components, including tables, indices, memos, and queries; electronically created or stored files; electronically created or stored backup files and electronically created or stored backup fragments; all logs related to all such documents; and all other material that is likely to be within the scope of [federal and state rules allowing liberal discovery of documents and things that may lead to relevant information, even if the initially discovered documents and things are not themselves relevant to the matter] regardless of whether the material is available from more easily accessible sources. The preserved material should be maintained in its native format as well as in all currently existing usable formats. PLEASE BE AWARE THAT, IN VIEW OF THIS HOLD LETTER, NO INFORMATION THAT IS SUBSEQUENTLY DELETED, LOST, OVERWRITTEN, OR OTHERWISE ALTERED AS A RESULT OF THE OPERATION OF YOUR INFORMATION SYSTEMS OR DATA RETENTION POLICIES WILL BE CONSIDERED TO HAVE BEEN COMPROMISED IN GOOD FAITH.

In order to manage the information necessary to promote your organization’s own interests while also complying with the type of “hold letter” quoted above, I recommend that you take the following steps:

  • Assemble your information systems managers. Include outside consultants if you do not have the human resources in house. Managers of other functional divisions will also need to be part of the process.
  • Determine what types of data your organization creates.
  • Determine where all information resides, including old paper and old electronic data.
  • Determine what types of backup operations are in place or contemplated, and where the backup data is located. Note whether the backup data are complete or fragmentary, i.e., incremental.
  • Determine what your actual information retention policies are. Then determine what you want them to be. (Note that overwriting an existing file with new or adjusted information is generally equivalent to destroying the previous version.)
  • Document and control:
    – Where and how information is recorded;
    – Where, how, and for how long information is stored;
    – When, how, and what information is destroyed.
  • Determine now what procedures will be necessary for the following:
    – To produce data on any particular topic
    – To discontinue normal overwrite and destruction procedures
  • Maintain the ability to extract information from your data, which will mean either:
    – Preserving hardware and software capable of reading various types of files in their native format, or
    – Converting electronic data to a commonly accessible format other than its native format as part of the archiving process.
  • Ensure that all affected persons are aware of the policies and procedures.

The question is not whether undertaking this process will be helpful, but how soon it will prove itself to be helpful. The need sooner or later for an organization to control its electronic data in order to comply with the new rules of litigation is inevitable. Taking these steps now, and ensuring that the policies and procedures are implemented throughout the organization, will make a substantial difference in the cost and effectiveness of pursuing and defending legal claims in the future.

Proving Compliance with COBRA

COBRA, the federal Consolidated Omnibus Budget Reconciliation Act, requires that administrators of covered health plans notify their terminated employees of a limited option to continue the group health benefits they had before termination. Substantial liability can be at risk if the employee asserts that he or she never received this “COBRA notice” and the plan administrator has inadequate records to satisfy its burden of proof. A recent case will help employers and administrators know what types of records should be created and retained.

The Eighth Circuit of the United States Court of Appeals has ruled that administrators, to carry their burden of proof that a COBRA notice was mailed to an employee, must have “evidence that the employer had a system for sending out the required notices [and] that the system was in fact followed with respect to the person in question.” Crotty v. Dakotacare Administrative Services (8th Cir. 2006) (No. 05-3798).

The Court held that COBRA administrators “must provide something that indicates that its mailing system was reliable and that the system was followed in the relevant instance.” Examples of the records that the administrator in that case did not have are “any evidence that [the contested] letter was printed out, placed in a properly addressed envelope, or sent through the mail.” Examples of records that, in other cases, were sufficient were a photocopy of the addressed envelope, a report stamped with the date of mailing, and an affidavit from the person who recalled mailing the notice.

Employers should be sure that they or their contracted COBRA administrators are creating and retaining the appropriate records. The records should reflect (a) a well-planned and well-executed system for tracking and notifying eligible former employees and also (b) contemporaneous records of the actual mailing to specifically identified recipients.

It Only Seems To Be All In The Family

A pattern became apparent recently as I was listening to clients in a mediation session. Over the past several years, many of my clients—mostly organizations but occasionally individuals—have described their working environments as “like family.” That feeling, of course, predated the sudden turn of events that caused these “family” members to become estranged and to start litigating against each other.

However, as anyone deeply involved in workplace consulting or litigation knows, there are few sudden turns of events. More often, there is a long arc of linked events which lead to intractable conflict. A family workplace atmosphere has several problems, including making that road to conflict more difficult to perceive and difficult to remedy.

By a “family” workplace atmosphere, I do not mean a place where family members work; although places where family members work together have the same issues as discussed here, plus some others. And I do not mean a place where workers collaborate freely or where traditional hierarchies are absent; if done well, there can be great creativity and energy in such places.

By a “family” workplace atmosphere, I mean a place where topics that are not related to work become appropriate and customary to discuss during working hours; where supervisors and subordinates feel they can slide comfortably from working professionally with external vendors or customers, to talking with coworkers about the sweet and the sour of their personal lives, to palling around with supervisors and subordinates; where they are able to laugh a little loud or drink a little much or be sarcastic with the boss; a place where managers know more about the private lives of employees than they let on, and sometimes are a little extra accommodating because of it.

A family is ultimately defined by its members’ roles in it. In contrast, a family atmosphere in a workplace occurs despite its members’ roles in it. A workplace might seem like a family sometimes, but only during the good times. When there is a serious problem, a workplace does not function like a family, and the appearance—or community mythology—of a family atmosphere keeps a workplace from resolving problems on its own terms.

The Problem

Unlike most workplaces, families provide extensive opportunities to see their members in different lights as time goes by and circumstances change. Roles and expectations have more room to change—and there are more factors bearing on those changes—in families than in workplaces. And, whether one family member accepts another unconditionally or conditionally, there are not layers of laws enforcing behavior as there are in the workplace.

A workplace has fewer opportunities to remedy bad behavior, with graver downside consequences. In both workplaces and families, offenses add up until they reach a threshold. Both provide some opportunities over time to remedy the adversely felt consequences of bad behavior. And, if the individual who is offended by the bad behavior does not accept or forgive it, both the workplace and the family offer alternatives. Only the workplace, however, includes among the alternatives a range of legal actions that could target not only the employer but also the individuals engaging in the bad behavior.

Promoting or allowing a family atmosphere in the workplace invariably interferes with a clear evaluation of employees by their supervisors. In part that is because the focus of the supervisors becomes diffuse, distracted. From the perspective of the organization’s mission and effectiveness, that means that the subordinates’ role in the organization—good or bad—cannot be adequately assessed. It also means that the manager’s own performance as a supervisor is less productive.

From the perspective of the employees, it means that individual expectations of what a person should contribute and how the organization will respond are not clear. In the best of times, organizations risk having the expectations of an employee not aligned with the expectations of that employee’s manager, but the risk increases dramatically when other factors intervene, such as confusion over the supervisor’s focus, or concerns about what is private and what is appropriate to discuss at work.

The Fix

  • Recognize this fundamental truth about employees:

Generally, employees do not care about whether a workplace is lax or strict as much as they care about whether a workplace is fair and predictable.

  • Draw a line between your employees’ private lives and their work lives.

You can send the message that you are receptive to discussing the situation when an employee’s personal life affects work. You can offer an employee assistance plan, available from your benefits broker, that provides counseling for a range of issues, including those pertaining to family, finances, dependency, and violence. You can convert sick leave and vacation plans to paid time off plans, which is a win-win for employers and employees alike. Note, however, that discussions of privacy should be carefully tailored and reviewed to ensure that you are not engendering unintended employee expectations of privacy in organizational assets such as computer and communication systems, common areas, personal work spaces, etc.

  • Reassess what your employees should be accomplishing.

Their job descriptions and performance appraisals should be linked. Not only the subordinates themselves but also their supervisors should be held accountable for how well the subordinates are performing. Supervisors should be held accountable for incidents of employee complaints, and they should be given tools and training to help them minimize the conditions for such complaints. It may or may not be appropriate in each particular case to factor in personal issues when responding to an employee’s performance problems, but, if it is appropriate, a plan should be developed which addresses the work issues and not the personal issues.

  • Align the expectations of your employees with your new approach.

Announce that you want to be sure your employees feel secure in the privacy of their personal lives; that there are channels to raise those issues if they affect the workplace; that there are confidential resources to provide assistance with personal issues; but that, in the workplace, you are all there to work.

Controlling Abuse in the Workplace

The Case

A recent case from Alaska and the Ninth Circuit illustrates the importance of detecting and eliminating bullying behavior in the workplace. It also offers guidance on how to minimize the risk of harassment claims.

The executive director of a teachers’ union was abusive toward both male and female employees. The testimony indicated that his conduct was more abusive toward women and that his behavior, which he argued was gender-neutral, was more objectionable to women. The court ruled on whether, in a sexual harassment case, it was relevant that conduct which was not itself about sex had a more objectionable effect on women than on men. The court ruled that it was, that a case of sexual harassment could be based in part on whether non-sexual conduct affected women adversely more than men.

By highlighting the sex-based effect of conduct that was not itself sex-based, the court’s decision provides a guide to minimizing the risk of such claims. Additionally, because the court had to mold sexual harassment principles around a fact situation that was in large part a case of workplace bullying, the decision illustrates the consequences of failing to shut down bullying behavior.

The Analysis

To be sexually harassing, conduct must be “because of … sex.” As the court wrote, “[T]here is no legal requirement that hostile acts be overtly sex- or gender-specific in content, whether marked by language, by sex or gender stereotypes, or by sexual overtures….” The court focused first on the nature of the executive director’s conduct, noting, “The ultimate question … is whether ‘members of one sex are exposed to disadvantageous terms or conditions of employment to which members of the other sex are not exposed.'”

The Court then went beyond the conduct itself, to focus on the effects of the conduct: “Title VII is aimed at the consequences or effects of an employment practice and not at the … motivation of coworkers or employers….” [T]he ultimate question … is whether [the executive director’s] behavior affected women more adversely than it affected men.” When determining the differential effect of conduct on men and women, the Court stated that one must “consider what is offensive and hostile to a reasonable woman.” As the court wrote:

[T]his case illustrates an alternative motivational theory in which an abusive bully takes advantage of a traditionally female workplace because he is more comfortable when bullying women than when bullying men. There is no logical reason why such a motive is any less because of sex than a motive involving sexual frustration, desire, or simply a motive to exclude or expel women from the workplace.

Finally, the Court attempted to stitch together the inquiry into whether the allegedly harassing conduct was objectively different toward men and women with the inquiry into whether the conduct had a different effect on men and women: “We now hold that evidence of differences in subjective effects (along with, of course, evidence of differences in objective quality and quantity) is relevant to determining whether or not men and women were treated differently, even where the conduct is not facially sex- or gender-specific.” (Emphasis added.)

The Lessons

There are at least three clusters of lessons in this case for managing the workplace.

1. Curb bullies

If the conduct in this case seems unusual as a claim of sexual harassment, there is nothing unusual about it as a complaint about a bully. Bullying occurs in the workplace just as it does in the schoolyard. At work, the conduct often goes unchecked for a number of reasons, including the status of the bully as a manager or the record of the bully as a high producer. They are, in other words, often high performing, which provides a perceived disincentive for the organization to get tough; and they are also often adept at retaliatory politics, which provides a disincentive for individual managers to get tough.

The consequences of failing to curb bullying behavior, however, are substantial. There are effects on morale and retention with related productivity losses, and, as the case discussed above illustrates, bullies are legal claims waiting to happen. From a financial perspective, they are walking talking contingent liabilities.

  • Organizational policies should be examined and brought up to date, including addressing bullying behavior.
  • The culture of the organization should be reviewed, including how the organization uses rewards and punishments to assign value to different behaviors, and what types of behavior from an employee result in that employee’s manager being held personally—even financially—accountable.
  • Employees who function outside the organization’s acceptable boundaries and behave contrary to legitimate organizational values should be reined in with discipline or discharge.

2. Become aware

Managers should be aware of the experiences of their employees in the workplace. Understanding those experiences can provide information about both the employees and also the employer, including strengths, weaknesses, and areas where energy and attention—of employee or employer—has drifted from the mission. If properly considered, knowledge of employee experience can drive more effective communications, operational processes, and employee relations. It can provide opportunities for an employer to take action before third parties step in.

  • Push supervisors to engage in conversation with their employees. Maintaining boundaries appropriate for the workplace is critical, as is making every effort not to show favoritism. But the importance of keeping communication available, commonplace, and free from retaliation cannot be overstated.
  • Undertake review procedures that allow employees to review their managers, environment, and employer. Then digest that information and act appropriately. See the note above on reviewing the culture of the organization.
  • Put managers occasionally “in the field,” recognizing that they cannot get a realistic view of employee relations when they are holed up in their offices.

3. Be inclusive

Communicating expected standards of behavior is a necessary first step toward implementing organizational values consistently, and a necessary step as well to disciplining an employee for failing to meet those standards. Stereotyping by gender, ethnicity, or any other classification is unlawful, unnecessary, and counterproductive. Appreciating the range of cultural or gender norms can make communications more effective and operations more productive. Moreover, large portions of this nation’s eligible workforce have religious, ethnic, or other cultural backgrounds that differ from the group of white men that dominated the workplace as recently as one generation ago.

There is evidence that employees generally become more productive and flexible when managers have taken their views into account in the creation and implementation of personnel and operational policies that affect the workforce. Managers who have not learned to appreciate workplace diversity risk creating an organization that is out of step with the expectations of their employees, their future applicants, and, increasingly, the courts.

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