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Category: Commentary & Opinion

Posted on June 20, 2017June 29, 2023

To Encourage Health, You Just Need a Little Nudge

SHRM New Orleans 2017 Exposition Hall

Another day at the Society for Human Resource Management’s 2017 conference in New Orleans. Day 2 brought me a lot of opportunities to speak to HR professionals about everything from the skills gap to benefits strategy to financial wellness. Tropical Storm #Cindy is also coming in, so potentially we’ll all be stuck together for a much, much longer time. We’ll see!

These are some of the ideas I’ve come across day 2:

Financial Wellness Over 20 Years: I spoke with Jeff Tulloch, vice president of MetLife’s PlanSmart program. MetLife has been developing this financial wellness platform over the past 20 years, and just in the past three years, they’ve seen a large spike in interest in this area, Tulloch said. What’s caused this spike, he added, is that employees are stressed and employers have realized that stress is a drain for everyone.

What companies have been doing well with financial wellness is education, he said, but there are two more important areas that we’ll need to see moving forward: motivation and access. By motivation, he meant that HR practitioners could “be more courageous endorsers of what they offer and help their employees take the next steps.”

By access, he meant a wide range of access points for information and advice, not only digital. There’s also human interaction, like an on-site financial adviser or a call center someone can access during open enrollment.

“When we get those three things, education, motivation and access, we see that people are in the position to act,” said Tulloch.

A Little Nudge: Lazlo Bock, former senior vice president of people operations at Google/Alphabet gave a speech that, although not about health/wellness, did offer one tidbit of advice on wellness. He called it “nudging.” The idea behind it is that a small change in the work environment can make a larger impact and that businesses can nudge employees in the right direction. The trick is to not get too into micro-managing. You can’t remove employee choice, but you can lightly nudge them to make a choice that’s better for them.

Bock gave an example of an office based in New York. It offered healthy (nuts, fruit, etc.) and unhealthy snacks (M&M’s), all in opaque containers. The company made a small change in presentation and began putting the unhealthy snacks in yellow containers. The result was that employees consumed a significantly smaller number of calories in the following weeks. They were less likely to dig into the M&M’s in the differentiated, yellow containers than the opaque ones. The choice was still there, but perhaps they began thinking about their choice more when the healthy and unhealthy options looked different.

I don’t know if this same result would happen to any company who uses this exact opaque container/ yellow container model, but the idea behind it is solid.

New Legislation: Lisa Horn, director of congressional affairs and leader of SHRM’s Workplace Flexibility Initiative, spoke about a new work-flex bill being introduced to Congress. They worked with U.S. Rep. Mimi Walters, R-California, to craft it.

The bill is still being changed and tweaked, so I won’t go into specifics. Here’s the gist, though. It’s a workplace flexibility bill that does something about both paid leave and flexibility in the workplace. Currently, there is nothing on a national level addressing these, but many states and cities have their own individual rules, which causes problems for national companies with a presence in multiple cities or states.

In this bill, if an employer voluntarily chooses to adopt these standards, they will be deemed to have satisfied their state and local mandates. The idea behind the bill, Horn added, is that it would be more generous for employees than the state/local mandates.

I’ll be interested to see what happens with this and how far it gets. Also, what those TBD details are like how many days of paid leave an employee would get.

SHRM hopes to officially introduce it after Congress’ July 4 recess.

“HR is Like Golf”: I found this entertaining and something that honestly could apply to any job. This is what one man said when he was asked what he does when things get hard in HR. You can take 99 bad shots and one good shot, he said, and it’s that one good one that keeps you coming back to play golf.

Moving Forward from a Bad Rep: In one session, a woman said the hardest part of HR is overcoming a bad reputation, like with the bad press HR got in the Uber sexual harassment fiasco. She added that as an HR practitioner, every new organization she works at is an opportunity to tell a new HR story and change what HR looks like. Then the employees who work there will have a different impression and HR and carry that with them where they go next. “I can only control what my HR world looks like and what my people experience,” she said, mentioning the importance of starting small, focusing on your own organization and letting other proactive HR people do the same at their own company.

Related Content: SHRM 2017 Conference Kicks Off in New Orleans

Related Content: An Understandable Understated Farewell from SHRM’s CEO Hank Jackson

Related Content: Benefits Are a Large, Important Part of Total Compensation

Andie Burjek is a Workforce associate editor. Comment below or email editors@workforce.com. Follow Workforce on Twitter at @workforcenews.

Posted on June 20, 2017June 29, 2023

SHRM17: It’s All About #Cindy, Funerals and Shoes

SHRM attendees are bracing for Tropical Storm Cindy.

Walking through New Orleans’ Ernest N. Morial Convention Center as SHRM’s annual conference stretched into Day Two on Tuesday morning, I spent my time navigating through a sea of HR folks whose heads were down.

Searching for that one piece of swag to fill a third bag slung over their shoulder? Nope. They were anxiously checking the weather, which went from a passing comment on Sunday to full-fledged topic of conversation as Tropical Storm Cindy developed in the Gulf and approached the Crescent City. I mean, when the hotel’s housekeeping staff is telling you about it, time to get concerned.

Depending on the source we’re about to get anywhere from 6 to 12 inches of rain Tuesday and Wednesday — the days most folks are planning to head home.

Guess I better alert my dog-sitter.

…

In Other News: Believe it or not there is news here besides the pending Gulf storm blowin’ into town tonight (hat tip, Mary Chapin-Carpenter).

News of CareerBuilder’s acquisition came down Monday during the first full day of the conference. Parent company Tegna sold the venerable job board to private equity firm Apollo Global Management and the Ontario Teachers’ Pension Plan Board for a reported $250 million.

“We are excited about the new ownership structure,” said CareerBuilder CEO Matt Ferguson in a statement issued to the media. “Apollo and Ontario Teachers are powerhouses that invest in many of the largest B2B and consumer brands in the world. They can help us take our business to the next level. CareerBuilder has transformed into an end-to-end human capital solutions company. We have built a fully integrated platform for finding, hiring and managing employees. With Apollo and Ontario Teachers’, there is a great opportunity to accelerate our growth and innovation.”

The news didn’t generate a buzz around the conference but that evening there was some chatter about it during the Nexxt happy hour session. The talk wasn’t so much about who was acquiring it but in which direction CareerBuilder will go.

“We all know what happens when private equity buys you,” said one person at the event.

Beyond Beyond.com: I spent a good half hour searching for Beyond.com Inc.’s booth Monday afternoon after hearing about some news they were releasing. Because I hate to ask for directions I thought I’d hunt around. No luck. I finally consulted a booth guide and headed for space 738. Not there, I must have misread the guide. Find another guidebook. Yep, 738. I circled again; still not there. Now I’m getting frustrated. I’m checking out the booth at 738 and notice a portion of the Beyond logo in one corner. The news? Besides me spending 30 minutes looking for a booth, Beyond.com rebranded to Nexxt.

…

I Love a Parade: Speaking of Nexxt, congrats are in order to CEO Rich Milgram and his people for the clever rebrand from Beyond.com to Nexxt. Being in New Orleans, the recruitment media company on Sunday brought a dirge complete with a brass band playing somber songs into the convention center for Beyond.com’s funeral.

Which, naturally, I missed since I was covering the SHRM press conference. But the festivities — if you can call a dirge festive — are available on Nexxt’s Facebook page.

…

CareerBuilder
CareerBuilder was giving out some sweet customized kicks at #SHRM17.

Get Your Kicks: Swag remains a huge draw at SHRM. From Apple TV giveaways to squeezy balls to photos with world-famous zookeepers, it’s all about the tchotchkes.

Give CareerBuilder the swag-of-the-conference honors. Those lucky enough to spin the giant wheel at CareerBuilder’s booth and land on big winner got a pair of customized Bucket Feet shoes.

In years past the company’s booth workers wore colorful Converse Chuck Taylors. This year they apparently decided to … wait for it … put the shoe on the other foot.

Rick Bell is Workforce’s editorial director. Comment below or email editors@workforce.com.

 

 

Posted on June 19, 2017June 29, 2023

Benefits Are a Large, Important Part of Total Compensation 

The view of New Orleans from the SHRM conference.

The 2017 Society for Human Resource Management conference is in New Orleans this year, which I love. I got to stay with my sister and her 60-pound pit bull for a couple of days before entering Conference-land. We went on long walks in the heat, took a yoga class and ate some good food. We spent one Friday evening at a small Irish pub, where none of these non-HR professionals knew much about HR at all — but it still came up in conversation.

This is going to be really obvious, but benefits truly impact people’s lives, even if people don’t regularly think about HR. One person I talked to that night is using his unlimited PTO to take a motorcycle trip across the country. Another person got to leave work early that afternoon and have some Abita beers/frozen Irish coffees with us because of a policy at her office; take shorter lunch breaks throughout the week and you can leave early Friday. We didn’t mean to have this conversation about workplace benefits, but there it was.

This first night of SHRM’s conference, the HR association released its 2017 “Employee Benefits” survey, which cemented this feeling that benefits really do make up a large part of the employee value proposition.

A couple of statistics stuck out to me at first: one-third of surveyed organizations have increased their benefits offerings in the past year in an effort to be an employer of choice and attract the best people. Not surprising, of course. What interested me was that the value of benefits accounted for, on average, about 30 percent of an employee’s total compensation (30 percent in private industry; 37 percent in state and local government).

This was relevant because of an article I read about how employees shouldn’t just negotiate for a higher salary. Negotiating for alternative forms of compensation like benefits is just as important. This article pointed out areas like flex time, transportation and student loan repayment, which an employee can ask for if, for example, the company is not in the financial situation to offer a raise.

Wellness was a benefit that saw a large increase in the survey. A quarter of these companies have increased their wellness benefits, and three-quarters said their wellness program was “somewhat to very effective on reducing health care costs.”

I’ve seen statistics like this a lot, and they disagree greatly with other stats that say wellness programs don’t save money at all. There are very logical arguments on both sides of this wellness coin. From what I can tell, employee wellness programs aren’t going anywhere, whether they notably reduce employers’ and employees’ health care costs or not. What they do is help give people resources to make healthy changes in their lives.

Interestingly, in the wellness space, fewer employers offer smoking cessation programs than before. The person presenting this information, SHRM Vice President of Research Shonna Waters, did mention that “sitting is the new standing” line we’ve been hearing about so much. While smoking cessation programs are in the decline in the employer space, sit-stand desks are spiking upward, from 13 percent in 2013 to 44 percent in 2017.

My take on this? Since the “Mad Men” era 50 years ago, smoking’s prevalence in, well, everywhere has declined. People are also much more educated on the health risks of smoking. No one can pretend it’s harmless anymore.

In an employer wellness program, wouldn’t it be more valuable to focus on a problem that’s less understood and more prevalent in 2017? Even though people still smoke, other harmful habits are growing in prevalence. Those problems deserve a little attention, too, and many people could use the educational opportunity.

Three more days of the conference and so many more benefits related sessions to go! I’ll be sharing my takeaways from sessions on this Workforce blog and at my twitter handle @andie_burjek. Any questions in the benefits/wellness space, comment or tweet at me and I’ll scope out the answer in this room of an estimated 15k HR professionals.

Andie Burjek is a Workforce associate editor. Comment below or email editors@workforce.com. Follow Workforce on Twitter at @workforcenews.

Posted on June 19, 2017June 29, 2023

An Understandably Understated Farewell from SHRM’s CEO Hank Jackson

SHRM’s Society for Human Resource Management’s CEO and President Hank Jackson is winding down at his last SHRM conference.

I wasn’t necessarily expecting a first-line parade to recognize Hank Jackson as he winds down his decade-long tenure as the Society for Human Resource Management’s CEO and president. But we are in New Orleans for SHRM’s annual expo and conference after all, and a hint of excess and pomp would have been absolutely acceptable.

But then considering Jackson has been rather reclusive — at least to the media — and the fact he’s a finance guy, personal indulgences likely aren’t his modus operandi.

But on the conference’s opening afternoon Jackson talked to HR practitioners from around the globe in a two-thirds full hall before Kat Cole delivered her warm, engaging opening keynote address.

His 15-minute talk touched briefly on his tenure as SHRM’s boss, but focused heavily on what awaits his successor, Johnny C. Taylor, who was in attendance. (We were told he was only there for the afternoon and would not address the crowd or the media during the annual State of SHRM.)

“We have changed the conversation on what HR leadership looks like,” Jackson said. “Our focus shifted from process to problem solving.”

HR is ready to lead during this decade of human capital, Jackson said. “Business now understands human resource management as driver of success.

“Throughout my career, I’ve been aware of having right people in the right place at the right time, and I knew HR was responsible for that. And I think most CEOs understand that now.”

Toward the end of his talk, Jackson took a moment to reflect on his tenure.

“I made a commitment to you,” he said. “I’m pleased to be part of transformation from partner to leader. Let’s make sure to lead rather than adapt, lead and shape our organizations.”

Later at the afternoon press briefing, a relaxed Jackson made just his second appearance before the assembled media at SHRM. He joked with SHRM colleague Wayne Cascio and reflected on the controversial and surprising decision to initiate SHRM’s certification.

Jackson also recalled his initial forays into political circles.

“When I first took the job, I went to the Labor Department representing SHRM, and they said, ‘Who?’ Now they know who we are.”

And for the first time Jackson took questions.

I asked him about SHRM’s decision to pull their advertising off Fox News in the wake of the Bill O’Reilly scandal.

“It wasn’t much of a decision,” he responded. “There are certain values we adhere to, and we have to live up to those values. It was an easy call. It didn’t even get to me.”

Jackson was visibly frustrated by the political gridlock in Washington, noting that the pressure will fall on states to take action on workplace issues if Washington doesn’t become more productive, which would “be bad for business.” Reading between the lines, Jackson does not appear to be a fan of the current administration.

Finally, he was also asked to reflect on his tenure.

“I believe we changed the conversation of what HR is. We’ve become leaders in business. I’m asked to speak around the world. There is respect for what the U.S. does. Whether or not you want to be a leader, we are.”

And with that Jackson was off to preside over his final SHRM conference. No first-line procession, no pomp, not fanfare.

Maybe the second line will follow Jackson out the door when the conference closes Wednesday.

Then again, probably not.

…

Odds and Ends: In 2009, the last time SHRM was in New Orleans, the Crescent City was still reeling from the effects of Hurricane Katrina four years before. That year SHRM participated in a volunteer day to help rebuild the city. As I recall there were 50 or so SHRM members who participated the day before the conference kicked off. It remains one of my greatest memories from SHRM.

…

Kat Cole, the CEO of Cinnabon, was the opening general sessions speaker for the conference.

Surprise Hit: Kat Cole is the best opening keynote speaker SHRM has had in the years I’ve attended. While others gave boilerplate, and frankly, boring talks, Cole was engaging, warm and tremendously personal.

She talked honestly of growing up with an alcoholic father, and after her mother left him they survived on a grocery budget of $10 a week.

Her mantra as CEO of Cinnabon was, “If you want to win the war on talent look in unexpected places.” As a college dropout, former employee of Hooters and child of a broken household she honestly said that she would have never gotten through the screening process of most HR departments sitting in the SHRM hall.

“But one company looked past that and I became their president at 31 years old,” she said.

And, she added after a round of applause, the clapping “should be for the progressive HR team that looked for someone different.”

Finally, some advice from her mother (ironically, on Father’s Day): “Don’t forget where you came from but don’t you dare let it solely define you.”

…

Do This: Trumpeter Irvin Mayfield kicked off the conference with his list of do’s and don’ts in New Orleans (I never knew there were don’ts in this city, but OK …). My favorite: “Do fight the urge to count calories.”

I heeded his advice several hours later. To great extent and enjoyment.

…

Heard in the Hall: 

Woman One: “Are you going to the concert tomorrow?”

Woman Two: “Absolutely. Harry Connick is so cute.”

And I thought it was about the music. Silly me.

Rick Bell is editorial director for Workforce. Comment below or email editors@workforce.com. 

Posted on June 6, 2017June 29, 2023

Fight Unemployment Claims at Your Own Peril

Jon Hyman The Practical Employer

My friend and fellow blogger (with whom I tend to agree most of the time), Suzanne Lucas (aka Evil HR Lady), recently posted an article about which I could not agree more, Why You Should Rarely Fight an Unemployment Claim.

Her argument (which she agrees runs counter to most employers’ conventional wisdom that says, “I must fight each unemployment claim an employee files because successful unemployment claims cost money, and I do not like spending money”):

When you fire an employee, for whatever reason, they are likely to be angry. Most likely they think you were unfair. While you followed procedures and made decisions by the book, all it takes is this employee convincing an attorney that he was treated differently than other employees who were a different race, gender, religion, or other protected class, and you’re on the hook for thousands of dollars—not because you’re guilty of illegal discrimination. But, even responding to the attorney will cost you money, and it could cost you your reputation if the employee can garner public support. Cutting someone off from employment and unemployment makes people angry—and angry people will be far more likely to retaliate in court.

Let me give you a real-life example to support Suzanne’s astute argument that employers who fight unemployment claims create unhappy and angry ex-employees, which helps breed the right environment for lawsuits.

At the conclusion of a day-long plaintiff’s deposition in an FMLA and disability discrimination lawsuit, it was clear to me that my client had not only not violated any laws, but bent over backwards to do everything possible to accommodate the plaintiff. The company had treated this employee so well, I asked a question that I had never asked in another deposition — why are you suing?

It seems to me that they treated you fairly. They gave you an initial medical leave of more than 12 weeks, they provided you every accommodation you requested for your medical conditions, they provided you a second medical leave of more than 12 weeks, and you received several raises during your employment. Why are you suing this company?

The answer she gave floored me — not because it was damaging to my case, but because something that seemed so trifling caused the lawsuit. Her answer: “They fought my unemployment.”

Employees sue when they feel disrespected or when they perceive unfair treatment. It is not simply enough for an employer to treat employees well during their tenure. Employers should also strive to treat employees well in conjunction with their terminations and even thereafter. Sure, there are exceptions. I would never suggest that a serial harasser deserves a pass, or that the employee who stole from you should receive unemployment. If you don’t want to be sued, though, don’t make a terminated employee feel like a common criminal by having security escort them to the door (unless you legitimately and reasonably perceive a safety risk). It’s okay not to give a glowing recommendation to a marginal ex-employee, but resist the urge to trash him or her to a prospective employer. And, don’t fight unemployment except in the most clear-cut cases of cause. These little things could go a long way to an ex-employee reaching the decision to let bygones be bygones and not to sue you.

So think before filing that challenge to your ex-employee’s unemployment claim. It may be the smartest decision you can make.

Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. Comment below or email editors@workforce.com. Follow Hyman’s blog at Workforce.com/PracticalEmployer.

Posted on June 5, 2017June 29, 2023

A Contrary (and Common Sense) Appellate View on Rude Employees and the NLRA

Jon Hyman The Practical Employer
It’s been six weeks since I reported on NLRB v. Pier Sixty, in which the 2nd Circuit Court of Appeals held that the National Labor Relations Act protected the profanity-laced Facebook rant of a disgruntled employee.
I have hoped that Pier Sixty is an aberration. Thankfully, last week the 1st Circuit came along with a well reasoned contrarian view in a case in which the alleged employee misconduct was much less severe.
In Good Samaritan Med. Ctr. v. NLRB [pdf], the employer fired Camille Legley, a new probationary employee, who, in an employee orientation meeting, become increasingly contentious over the issue of whether he needed to join the union in order to work at the facility. Various employer witnesses described Legley’s conduct during the meeting-in-question as “irritated,” “talking loudly,” “consuming the room,” “rude,” and “overbearing.” Good Samaritan fired Legley the following day for violating its civility policy.

No one in the case disputed that Legley was engaging in protected activity under the NLRA in asserting a right not to join the union. The issue was whether his (mis)conduct crossed the line, and whether some reason other than his union opposition motivated Good Samaritan’s decision to fire him. On this issue, the 1st Circuit sided with the employer:

[W]e do not believe that the NLRB has established substantial evidence on the record as a whole that Good Samaritan would not have made its decision to discharge Legley despite the protected activity. Here, the NLRB simply stated that Good Samaritan failed to prove that it would have discharged Legley in the absence of his protected activity. At most this can be read to assert that Good Samaritan’s proffered reasons for discharging Legley were insufficient. … In the absence of an adverse credibility finding or a finding of pretext, the fair inference to be drawn from these statements is that Good Samaritan discharged Legley because of how it reasonably perceived his behavior not because of his protected conduct.

In other words, if an employer has a good faith belief that an employee’s conduct violates a policy, absent a finding that someone material to that decision is lying, or absent a finding of pretext, the NLRB cannot overturn the employer’s good faith decision.

Is it me, or did the 1st Circuit just incorporate the honest belief rule into NLRA jurisprudence? And, if that is, in fact, what just happened (and it sure looks that way), then bravo 1st Circuit. I stand up and applaud you. Because if a client called me with the facts of Good Samaritan, or, worse yet, Pier Sixty, and asked, “Can I fire this employee,” this is what I’d say:

I’m glad you called, because you are right to have concerns. Yes, this employee did mention a labor union, and he generally made his rude/insubordinate/offensive comments in the context of those union-related comments. The National Labor Relations Act has a concept called “protected concerted activity,” which grants all employees (whether in a labor union or not) the right, between and among themselves, to discuss wages, hours, and other terms and conditions of employment. That right certain protects comments relating to union elections and whether a new employee must join a union upon hiring. It does not, however, mean that employees check their dignity at the door. You should still have the right to fire or otherwise discipline a rude/insubordinate/offensive employee, even if the rude/insubordinate/offensive comments were made in context of otherwise protected concerted activity, as it appears is the case here.

Now, understand that the NLRB, as currently composed, takes a different view, as have some courts that have also examined this issue. But, also understand that the NLRB’s composition will change under President Trump, and it’s safe to assume that Trump’s NLRB will be less sympathetic to the argument that the NLRA protects employee comments and conduct such as those which you described to me. Would a decision to fire or otherwise discipline this employee be risk-proof or litigation-proof? Absolutely not; no decision ever is. But, you need to ask yourself, “Is this the type of employee I want working for me? Does this employee embody the values and exhibit the type of behavior that I want my employees to model?” If the answer is “no” (and I suspect it is, or you wouldn’t be calling me), and I was in your shoes, I know what decision I would make, as long as I understand that risks that may follow.

And I sure wouldn’t want the NLRB or a court second-guessing my client’s good faith business judgment in reaching its final decision.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. Comment below or email editors@workforce.com. Follow Hyman’s blog at Workforce.com/PracticalEmployer.
Posted on June 1, 2017June 29, 2023

The Importance of an Anti-Harassment Culture

Jon Hyman The Practical Employer
I came across an interesting article at the Harvard Business Review — The Omissions That Make So Many Sexual Harassment Policies Ineffective.
The article starts with a simple question. “If 98 percent of organizations in the United States have a sexual harassment policy, why does sexual harassment continue to be such a persistent and devastating problem in the American workplace?”
The article suggests the answer lies in corporate and cultural norms that such policies fail to address — that sexual harassment is embedded in organizational culture, which in turn are embedded in a larger national culture in which men have traditionally been granted privileges over women. As a result, sexual harassment policies focus on the behaviors of harassment and victims perceptions of those behaviors (which one can marginalize, ignore, or blame on the victim).

The article goes on to suggest two related solutions to this harassment-policy drafting problem:

  • “Include culturally appropriate, emotion-laden language in sexual harassment policies. For example, language such as ‘Sexual harassment is a form of predatory sexual behavior in which a person targets other employees.’ Using terms such as ‘predatory’ instead of ‘perpetrator’ and ‘target’ instead of ‘victim’ can shape how organizational members interpret the policy.
  • “Sexual harassment policies should include bystander interventions as a required response to predatory sexual behavior. Most policies place responsibility for reporting harassment exclusively on the target, which puts them in a vulnerable position. If they report the behavior, then they are likely to be viewed with suspicion by their colleagues, often becoming socially isolated from their coworkers. On the other hand, if they do not report the sexual harassment, then it is likely to continue unabated, creating harm for the targeted employee, and wider organizational ills, too. Mandating bystander intervention can relieve the target of their sole responsibility for reporting and stopping predatory sexual behavior, and rightly puts the responsibility of creating a healthier organizational culture on all members of the organization.”
This all makes for a very interesting read, but I don’t think it goes far enough. Any anti-harassment policy, no matter how drafted, is not be worth the paper on which it’s written unless the company has an overall culture that abhors harassment.
In other words, an employer must take all complaints seriously. Taking complaints seriously includes ensuring that all employees understand the harassment policy, that employees have more than one avenue to make complaints, that investigators are properly trained, that the company regularly reviews its policies and procedures for compliance and effectiveness, and that no one ever suffers retaliation.
No anti-harassment program is perfect, but you must have one that’s effective. Otherwise, no matter where the he-said/she-said pendulum swings, you will start every harassment case at a disadvantage.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. Comment below or email editors@workforce.com. Follow Hyman’s blog at Workforce.com/PracticalEmployer.
Posted on May 31, 2017June 29, 2023

When Is a Settlement not a Settlement? When FLSA Is Involved

Jon Hyman The Practical Employer

When you settle a lawsuit with an employee, you are bargaining for finality. You are paying that employee to resolve all disputes between you, whether asserted or unasserted. You want to be done with that individual forever.

Except that is not always the case.

An employer cannot release or otherwise waive one’s FLSA rights by contract without a court-approved stipulation or settlement, or a DOL-supervised settlement. Which is why, in Nasrallah v. Lakefront Lines, an Ohio federal court recently permitted a plaintiff to continue with her FLSA lawsuit for unpaid overtime despite her signing a general release and waiver in a prior discrimination case.

When Tamara Nasrallah settled her discrimination claim, she and Lakefront Lines signed a settlement agreement, under which Lakefront paid her $40,000, and for which she agreed to a general release “of and from any claims … and expenses (including attorneys’ fees and costs) of any nature whatsoever, whether known or unknown, against [Lakefront] which Nasrallah ever had, now has or asserts or which she … shall or may have or may assert, for any reason whatsoever from the beginning of the world to the date hereof.” The release is “unrestricted in any way by the nature of the claim including, … all matters which were asserted or could have been asserted in the Charge, including, but not limited to, matters arising out of Nasrallah’s employment with the company, and any other state or federal statutory … claims, including, … all statutory claims under federal [and] state laws regulating employment, including …the Fair Labor Standards Act [and] any and all Ohio Wage and Hour Laws.”

Separately in the agreement, Nasrallah waived “any claims for additional compensation and acknowledges that she has been appropriately compensated for all hours worked,” that Lakefront has “paid all sums owed to [her] as a result of her employment with the Company (including all wages),” and that “she is not entitled to anything separate from this Agreement.”
Her justification for her after-the-settlement FLSA lawsuit?

I signed the Settlement Agreement based on my understanding it was unlawful to compromise my overtime claims without Department of Labor or court approval in any manner and that any attempt to do so—including by any “representations” made therein—was legally null and void. Thus, when I entered the Settlement Agreement and made the “representations” therein, I believed my representations about being paid in full and being owed no wages were ONLY representation for purposes of my non-overtime claims (e.g., contract claims for claims for discriminatory pay).

The court agreed:

According to Lakefront, a private settlement agreement can preclude a future FLSA claim as long as the underlying dispute did not involve a FLSA dispute. In other words, the only time an employee can waive a FLSA claim is when there is no bona fide dispute over hours worked, and therefore, likely no discussion or negotiation over compensation due. This is precisely the opposite of what the case law holds. … [S]uch a situation clearly implicates Congress’s concerns about unequal bargaining power between an employer and employee and undermines FLSA’s goals. Rather, … even the most liberal interpretation of the ability to privately compromise FLSA claims only allows such compromises when they are reached due to a bona fide FLSA dispute over hours worked or compensation owed. … [T]he prior dispute between the parties did not involve the FLSA and there is no evidence that the parties ever discussed overtime compensation or the FLSA in their settlement negotiations. Thus, while the Settlement Agreement contains a general statement that Nasrallah was paid for all hours worked, there was no factual development of the number of unpaid overtime hours nor of compensation due for unpaid overtime.

So what is an employer to do?
If you are engaged in litigation, the answer is simple. Ask the court to approve the FLSA portion of the settlement agreement.
If, however, there is not active litigation (e.g., severance or pre-lawsuit negotiations), the issue is much thornier.
I do not recommend that you contact the DOL for its supervision of the settlement. That is a radar that you do not want to be on. The supervised settlement may (will?) beget a full-blown wage and hour audit, which leads to an OSHA on-site, which leads to an ERISA audit…. You get the picture. There is no need to throw yourself in front of this regulatory steamroller.

You could file a lawsuit that simply asks the court to approve the settlement, but that seems likes overkill in almost all situations (even though it is the safest court of action under the strictest interpretation of the FLSA’s requirements for waivers).

A reasonable middle ground? Develop a bargaining history with the employee’s attorney that the employee may have an FLSA claim for unpaid wages, and that you are specifically bargaining for the release and waiver of that claim.
If you can develop a record that overtime pay was specifically negotiated, you will be in a much better position to assure a court in later FLSA litigation that the plaintiff has been compensated for the overtime wages later claimed to be owed. In other words, you almost need to create a claim that does not exist to then bargain that claim away. While this route seems highly inefficient, it may be the only way to protect yourself from a later FLSA claim.
Otherwise, you have zero certainty that the certainty for which you think you have bargained and paid actually exists.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. Comment below or email editors@workforce.com. Follow Hyman’s blog at Workforce.com/PracticalEmployer.
Posted on May 31, 2017June 29, 2023

Google, Just Come Clean Already

There’s nothing worse than a leader who refuses to admit when he or she is wrong. That goes for companies too. If you’re a leader in your industry, a household name, whatever, that does not make you perfect. That just makes you popular.

Therefore, if you do something wrong, own up to it already. Why drag out the suffering? Eventually, we’re going to figure out everything anyway. Why not set yourself, or your company up for a comeback, and let the healing begin? Why not embrace those teachable moments, push forward with integrity?

But that’s what happens in a perfect world. I get it. I understand why Google, currently being sued by the U.S. Department of Labor over possible widespread gender pay discrimination, doesn’t want to go the mea culpa route given what’s at stake.

Even though I’m pleased as punch the tech giant is in the hot seat — and other women should be too, given what the right outcome could mean for women in tech and elsewhere — some part of me feels a vague, nonsensical kind of pity because this is no little mistake. This isn’t even an FCC nipplegate fine type mistake. If the DoL finds that Google has been systemically underpaying women, not only will its salary band stretch beyond all recognition, it will be ripe for lawsuits from past employees and who knows what else. With the wrong damage control strategy, Google could conceivably hit the skids. But I’m getting ahead of myself.

Google
Tech giant Google is being sued by the Department of Labor over possible widespread gender pay discrimination.

This is going to be one of those deny, deny, it wasn’t me, deny to the last breath scenarios because a guilty verdict here would COST, and I do mean dearly. There would be serious damage to Google’s brand reputation. There likely would be government sanctions, and the internal cost of fixing a broken pay system — and I’m not even talking about pay reparations, but how the company would proceed going forward — would certainly not be cheap.

Company leaders would have to look perplexed — “We just don’t know how this happened.” — blame some people, point some fingers, fire some folks to show they’re taking it all seriously. The clean out in the wake of being found guilty of a charge like this would naturally bring some hiring, recruitment and replacement-related talent costs, and the legal fees? Good night.

Of course, that’s assuming Google will be found guilty, not that we’ll see a resolution any time soon. I predict I’ll be watching this story unfold over the next few, dare I say, years? Google is going to engage in a gladiator-style fight to the death to keep from admitting wrongdoing here. But if they did own up to their mistake, you know, rather than try to block the media from even covering the lawsuit — good luck with that, by the way — things might not be ruinous for them. At least, not from a brand reputation recovery perspective.

The company would take a significant hit. The issue is too big and involves too many people for them not to get a Floyd Mayweather-style punch to the face on this one. But if they did say, you know what? We screwed up. And then did what was necessary to fix the problem, they could recover. They’d be significantly lighter in the purse, but they could recover.

First, it’s not like we can do without Google. Sure another company could take over or start something similar, but people will still say, “Google it,” when they don’t know something. Second, how stunning would it be if Google’s supposed downfall became its resurrection as a new industry standard with global implications for literally half of the work world? Olivia Pope — or her real-life equivalent — could spin that into comeback company gold.

It could totally happen. If a company as large and well known as Google not only admitted that women get short changed — pun intended — then fixed its pay policies to ensure that women didn’t perennially get the short end of the stick, that we would in fact be paid equitably? *whistles* That’s huge. That’s life-, no, that’s world changing.

But no. Google claims it has eliminated its gender pay gap globally thanks to “innovative compensation models.” Those would be good to share, Mr. Tech Giant. Even if you have to sell them, share.

Yeah, Google’s gonna fight the good fight on this one. I want to say they’ll lose because they should. Women should be paid equitably. Period. But I don’t know.

So far, the DoL hasn’t been able to compel Google, a federal contractor, to reveal salary histories and other documentation for its internal pay practices. This despite having “received compelling evidence of very significant discrimination against women in most common positions at Google headquarters,” according to a Forbes piece I read.

And we all know, what’s right doesn’t always win, does it?

Kellye Whitney is associate editorial director for Workforce. Comment below or email editor@workforce.com.

Posted on May 30, 2017June 29, 2023

Class-action Waivers Remains a Huge Issue for Employers

Jon Hyman The Practical Employer
There has been much judicial and administrative ink spilled over the past few years over whether the National Labor Relations Act permits employers to require employees to give up their rights to litigate or arbitrate class or collective actions.
This is one of the most important issues facing employers, which have looked to class-action and collective-action waivers as an important weapon to fight to scourge of wage and hour litigation.
Last week, in NLRB v. Alternative Entertainment [pdf], the 6th Circuit Court joined the battle.
At issue in this case is the following arbitration provision.

By signing this policy, you and AEI also agree that a claim may not be arbitrated as a class action, also called “representative” or “collective” actions, and that a claim may not otherwise be consolidated or joined with the claims of others.

This 6th Circuit concluded that this provision violates Section 7 of the the NLRA, which guarantees to employees the right to engage in protected concerted activity.

The NLRA prohibits mandatory arbitration provisions barring collective or class action suits because they interfere with employees’ right to engage in concerted activity, not because they mandate arbitration. These are grounds that would apply to any contract. …

Ultimately, we conclude that the NLRA is unambiguous and that the statute itself makes clear that the right to concerted activity is a substantive right.

Checking the scorecards, let’s see where we stand on this issue.
Upholding the legality of class-action waivers:
  • 5th Circuit (and earlier, here)
  • 8th Circuit (and earlier, here)
Concluding that the NLRA invalidates class-action waivers:
  • 6th Circuit
  • 7th Circuit
  • 9th Circuit
  • California Supreme Court
While the “no’s” have it, in reality, this issue is deadlocked, as the SCOTUS has already agreed to decide this dispute and (hopefully) resolve this issue once and for all. This case will be very interesting to watch, as the Court has already upheld class-action waivers in consumer agreements. It remains to be seen whether layering the NLRA on top of this issue will make a difference to SCOTUS, although I have my doubts.
For now, follow the law of your Circuit, and stay tuned, as we should have some much needed clarity on this issue within the year.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. Comment below or email editors@workforce.com. Follow Hyman’s blog at Workforce.com/PracticalEmployer.

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