Proving Compliance with COBRA

Joe Nierenberg / August 08th 2006 / No Comments

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

Joe Nierenberg / April 04th 2006 / No Comments

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.

Investigating Employee Complaints: Avoiding Common Missteps

Fran Sepler / October 29th 2005 / No Comments

An employee has come to you with a complaint of possible illegal or inappropriate conduct. You have considered the important question, “If everything this employee alleged is true, what would we do?” and answered that the response would be significant enough that facts are needed (in other words, you can’t just do some training or send out a general warning to address it.) Now you must investigate.

Investigating a complaint should be done with an open mind, a commitment of a concentrated period of time and some good forethought. The goal of an investigation is to determine what happened. It will, hopefully, result in good information upon which the organization can base good decisions.

As simple and straightforward as an investigation might seem, the most common missteps are also the most damaging to the efficiency and effectiveness of investigations. This article will examine the most common missteps by investigators and provide some tips on good investigative practice.

Know what you are investigating

A good investigation starts with an excellent intake process. Someone has raised an issue, and someone has determined that were the issues substantially as reported it might be a violation of policy or law. The investigation, then, should determine whether the behavior alleged transpired, what the context of the behavior was, if relevant, and other information that would clarify the event or events in question. (One example of such additional, clarifying information is material that is necessary to assess the credibility of important but conflicting witnesses.) This is called the “scope” of your investigation, and you should maintain a clear line of sight to that “scope” throughout. This means:

Avoid “fishing” for unrelated facts or issues.
When new allegations are made, determine whether they are related to the scope of the investigation, and, if not, put them aside.
Remember that you are investigating events, not people. Focus on what happened.

There is no such thing as too much planning

Inexperienced investigators tend to “dive in” to an investigation, following their nose from witness to witness. One good way to plan your investigation is to list those individuals that you think you want to speak with and make a note about what information you think that they will be able to provide. You might also create a list of “investigative questions.” These are questions you need answered in order to complete the investigation. For instance, if there is an allegation of theft from a drawer, some investigative questions might be “who had access to the drawer?” “Have there been similar thefts?” and “What was the time period during which the theft took place?” These questions about context, circumstance and facts will help you plan to get the information you need.

Make a plan and revise it as necessary.
Consider logistical or practical things that might interfere with your investigation.
Make sure that the right people have been notified of a need to interview people.

Absolutely, without exception, apply “need to know” to your investigations

Investigations are truly bound by the simple adage that “loose lips sink ships.” The rule you must apply is that NO ONE who does not need information gets the information. That means standing up to managers who feel they are entitled to details of the allegations, or who wish “updates” during the course of the investigation. While managers or executives may feel that the investigative status is their business, discussing the investigation with them could compromise, or appear to compromise, your neutrality. If someone does not need the information to advance the investigation, they should not be provided any details. Most of the time, managers will need to know only allegations that call for an immediate response. Witnesses and respondents need to know enough to provide complete statements, but no more than that.

Make sure that complainants know that the respondent is likely to know who they are, since they have the opportunity to respond to the specific allegations against them.
Never provide information that does not immediately contribute to the investigation.
Tell witnesses that, if they are asked about the subject of the interview, they should respond by stating, “I have been instructed not to discuss it.”

Take notes that help you remember what was said

Don’t rely on written statements without also noting the questions you asked and any instructions that you gave. It is perfectly okay to “clean up” your notes, as long as you maintain the original notes in your file. The notes are a tool for you, and should allow you to reconstruct what was said to you in the months following the interview.

There is no one right way to take notes. The hallmark of a good note taker is that they can reconstruct what was said with a high degree of accuracy.
Do not put subjective information in your notes. Use a separate document to make credibility observations.

Never skip the response

No matter how clearly it appears that the accused has behaved badly, never skip a responsive interview. Too many “smoking guns” have turned out to be mere illusions once all of the facts were in. There is simply no down side to letting someone give you their perspective on what happened, and you could avoid wrongful punitive responses by taking the time to offer due process.

Doing investigations is complex work. In highly complicated or politically-charged complaints, consider using outside investigators. The matrix accompanying this article can assist in the process of deciding whether to use outside resources.

Contributed by Fran Sepler

Do You Need an Outside Investigator?

Fran Sepler / October 29th 2005 / 2 Comments

No one can absolutely answer that question for you, but here is a tool to help you make your decision.

Look at the matter	(1 point)	(2 points)	(3 points)
The matter to be investigated is	Simple, involving two parties and one or two incidents	Moderate in Complexity, involving more than two parties or multiple incidents	High in complexity, involving multiple parties and multiple incidents, or allegations of hostile environment
The person(s) accused of misconduct	Are non managerial and at the same rank as the complainant	Are middle management and higher in rank than the complainant	Are senior managers or executives
The complaints involve	Inappropriate language, jokes or simple misconduct	A combination of inappropriate language and multiple acts of misconduct	Extreme racial, sexual or threatening/harassing behavior
The person to do the investigating	Is extremely experienced and confident	Has some experience, but is uncertain about the best way to proceed	Is inexperienced OR is in a reporting relationship to a party in the investigation

1-4: Almost certainly manageable internally
5-9: Consider using outside investigator
10: Recommend outside investigator

Controlling Abuse in the Workplace

Joe Nierenberg / September 25th 2005 / No Comments

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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