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Posted on May 29, 2004July 10, 2018

Prescription for a Lawsuit

File this report under “Inalienable Rights” or “No Good Deed Goes Unpunished.” Wherever it goes, the fact remains that when a company becomes involved with an employee’s health risks, size and/or personal habits, the employer runs the risk of getting entangled in a web of vague, often conflicting state and federal statutes. “We’re very, very careful about getting involved in this,” says Barbara Schaefer, Union Pacific’s senior vice president for human resources.



    When UP recently instituted a policy of not hiring smokers, it had to carve out exceptions in the 13 states across its route system that have “smokers’ rights” statutes on the books. These laws prohibit discrimination against employees and applicants on the basis of off-duty smoking. Thirty states in all, says an American Lung Association survey, currently have similar laws. Two states, Wyoming and Montana, say that off-duty smoking cannot be a disqualifying factor for employment, but allow employers to charge smokers extra for including them in their health coverage. The Commonwealth of Virginia’s smokers’ rights statute applies only to public employees.


    While the issue of the right to refuse to hire or fire smokers hasn’t moved into the federal courts, the Department of Labor offers some guidelines on the question of whether a smoking habit is considered an addiction to nicotine. If it is, it might someday be considered a drug addiction under the Americans with Disabilities Act. “It’s very unclear. They [the bureaucrats] tend to flip-flop on the issue,” says Lori Shapiro, general counsel with Employee Learning and Innovations Inc. in Atlanta.


    In many states it is within the law to fire or refuse to hire people who indulge in off-duty consumption of another legal product, alcohol. This is illegal, however, in Colorado, Illinois, Minnesota, Montana, Nevada, New York, North Carolina, North Dakota and Wisconsin.


    Another major issue is the right of employers to fire or refuse to hire, for reasons of cost or safety, people whom they deem to be unhealthily or dangerously overweight. Union Pacific had a serious encounter with the court system on this topic 20 years ago. In Greene v. Union Pacific Railroad, a U.S. District Court found that the state of Washington didn’t intend to include obesity in its statute prohibiting discrimination against disabled individuals. However, similar suits brought in other states, including New Jersey and California, have produced the opposite result.


    To add to the confusion, only one state, Michigan, and three cities, Washington, D.C., Santa Cruz, California, and San Francisco, specifically prohibit job discrimination based on weight. But a number of lawyers and advocacy organizations feel that all overweight and obese American adults should be covered by either the Civil Rights Act of 1964 or the Americans with Disabilities Act of 1990. “These are emerging issues,” says Sondra Solovay, an Oakland lawyer and the author of Tipping the Scales of Justice: Fighting Weight-Based Discrimination. So far, however, while she contends that obesity is a chronic health problem rather than a lack of self-control and that women, African-Americans and Latinos, who tend to be overweight in greater numbers than the population as a whole, are being unduly penalized, no case brought by an overweight employee has held up in federal court.


    John Pearce thinks that trouble for employers might arrive from the opposite direction. A professor of strategic management and entrepreneurship at Villanova University, Pearce recently studied an initiative by the California Department of Health Services to encourage programs promoting better health and nutrition in the state’s workplaces. Pearce was impressed enough to comment, “Maybe employees of companies who aren’t offered these types of programs will begin suing.”


Workforce Management, July 2004, p. 33 —Subscribe Now!

Posted on May 29, 2004July 10, 2018

At Costco, Treating Workers Well

At Costco, Treating Workers Well


Costco Wholesale Corp.’s reputation for top pay is borne out by the numbers. Average hourly pay at Costco is 45 percent higher than the U.S. retail industry average of $10.99, and the company also offers other generous benefits.


Company U.S. and total employees Average workers per U.S. location; percent FT Hourly wages for U.S. workers Average hourly wage Health care insurance Retirement
Costco 83,700 U.S.
110,000 total
200-250; at least 50 percent FT $10-$18.03 $16.72 Insures 58.8 percent of U.S. workers 401(k) with up to 9 percent match of eligible annual pay after one year and 1,000 hours; company also matches 50 cents per dollar for first $,000 employee invests annually
Wal-Mart 1.2 million U.S.
1.6 million total
350-450; about 74 percent FT (Sam’s Club figures not included) Not disclosed $9.68; higher in some urban areas Insures 41.6 percent of U.S. hourly workers (Sam’s Club figures not given) 401(k) with 4 percent match of eligible annual pay after one year, 1,000 hours
Source: Costco, Wal-Mart, and U.S. Bureau of Labor Statistics

Posted on May 29, 2004July 10, 2018

Highest-Paid Human Resources Executives

Here is a link to a chart showing the highest-paid human resources executives.


Posted on May 29, 2004June 29, 2023

Who’s Who in Relocation

Who’s Who in Relocation


The relocation sector consists of firms specializing in employee relocation assistance as well as spinoffs of holding companies that are primarily household goods movers and real estate brokerage firms. Most offer a full cafeteria of services from transportation to intercultural training and spouse/partner assistance. These services may be arranged for in-house or subcontracted.


Company Core Business Revenue for most recent four quarters No of moves (2004 unless noted) Percentage of moves that are domestic
Global mobility solutions for companies and military (subsidiaryof Cendant Corporation, travel and real estate service providers) $468 million 115,000 78%
Transportation, relocation, record management and logistics specialists
 
$300 million 46,859 49%
Global relocation and assignment management $45.4 million 29,163 80%
Global mobility management for companies and military (subsidiary disclose disclose of Prudential Financial Services) Would not disclose 45,000 Would not disclose
Relocation, delivery network and transportation services (2003) $1.6 billion 224,626 (2003) 89%
Relocations, household moving, warehouse and logistics management and transportation services for companies and military $174 million 48,000 63%
Transportation and relocation $1.9 billion 374,075 93%
Relocation, assignment management, related finance services, business process outsourcing (part of the Weichert group of real estate and finance companies) $70 million 26,000 80%
Source: Companies

Posted on May 29, 2004June 29, 2023

UPS and FedEx Two Ways to Drive Business

Two ways to drive business


FedEx, which dominates air package delivery, is trying to grab a bigger share of the ground business, which is controlled by UPS. The key difference: FedEx drivers are independent contractors, while UPS drivers are company employees. Here’s how the two companies stack up:


FedEx Ground
(A division of FedEx Corp.)
Headquarters: Pittsburgh
United Parcel Service Headquarters: Atlanta
Drivers: 17,000
U.S. drivers: 74,000 (60,000 drive package delivery trucks)
Driver annual pay: $40,000 to $70,000 Driver annual pay: $50,000 (up to $70,000 with overtime)
Workday: 10 to 12 hours Workday: Eight hours plus up to two hours overtime
Advancement: Contractors can own up to four routes, which can boost their annual income to $130,000 or more. Are not FedEx employees. Not eligible for promotions. Advancement: UPS policy stresses promoting from within. It draws management candidates from the driver ranks.
Benefits: None. Contract drivers have the option of buying into a FedEx-run retirement plan. Benefits: Health insurance (company pays 100 percent of premiums for drivers), pension, company-match 401(k), stock-purchase discount, holiday and vacation pay, overtime pay
Other employee costs to company: None Other employee costs to company: Workers’ compensation insurance, unemployment insurance
Cost of truck leasing/purchase, fuel, maintenance, uniforms,
equipment:
Paid by contract drivers
Cost of trucks, fuel, maintenance, uniforms, equipment: Paid by UPS
Contracting process: Apply to company for a contract on a new or open route or buy an existing contract from another contractor. Existing routes can cost a few thousand dollars to more than $30,000. Company must approve contract transfers. Hiring process: Employees typically start in part-time or package sorting jobs and apply for full-time driving jobs. The waiting list for a driving job is four to 12 years.
Initial training: Two-week course run by FedEx Ground includes safe driving, logistics, package handling, customer service and maintenance. Drivers paid to attend the course. Most contractors also ride along on a route with a veteran contractor before starting. Initial training: Drivers undergo a month of instruction that
includes 20 hours of computer-based and on-road training, simulated deliveries in a mock city, tests and evaluations by instructors. Drivers also face three safety-ride evaluations during the first 22 days on the job.
Ongoing training: Monthly Saturday-morning forums at FedEx
Ground hubs to update contractors on safety, company operations and other developments. Attendance is optional. Billboard postings on safety at FedEx Ground hubs and newsletters also update contractors.
Ongoing training: Drivers are part of an extensive UPS safety training program that spends $38 million annually giving employees 1.3 million hours of safety training each year. There are 350 employees assigned to safety and training activities as well as 2,400 safety committees.
Sources: FedEx and UPS

Posted on May 29, 2004July 10, 2018

U.S. Providers Lead Ranks of Customer Executive Education Providers

—[EXECUTIVE EDUCATION]—
SNAPSHOT


U.S. Providers Lead Ranks of Custom
Executive Education Providers


American schools lead their European and Asian counterparts in both the Financial Times’ and BusinessWeek’s list of top custom executive education providers. On the Financial Times listing, 11 out of the top 20 providers are based in the U.S., while from Business-Week’s list, 15 out of the 20 top-ranked custom executive education programs are located here.


Financial Times
May 2004


BusinessWeek
October 2003


1. Duke Corporate Education
2. IMD (Switzerland)
3. Columbia
4. London Business School (UK)
5. Harvard
6. IESE (Spain)
7. INSEAD (France/Singapore)
8. Stanford
9. Thunderbird (US/France)
10. Babson
11. UNC: Kenan-Flagler
12. Pennsylvania: Wharton
13. Ashridge (UK)
14. Instituto de Empresa (Spain)
15. Esade (Spain)
16. HEC Paris (France)
17. Virginia: Darden
18. Northwestern: Kellogg
19. Center for Creative Leadership
20. Ipade (Mexico)
1. Duke Corporate Education
2. Harvard
3. IMD (Switzerland)
4. Pennsylvania: Wharton
5. INSEAD (France/Singapore)
6. Virginia: Darden
7. Center for Creative Leadership
8. Northwestern: Kellogg
9. Michigan
10. Babson
11. Columbia
12. Thunderbird (US/France)
13. Stanford
14. London Business School (UK)
15. Dartmouth: Tuck
16. Indiana: Kelley
17. Ashridge (UK)
18. Toronto: Rotman (Canada)
19. Case Western Reserve
20. NYU: Stern

Posted on May 29, 2004July 10, 2018

Collaboration is Key

Workforce Management: Do you think American will avert bankruptcy? Why? What’s your strategy, when it comes to labor-management relations, to do that?


Gerard Arpey: We’re certainly not immune to what is happening in the industry, but we are doing all we can to adapt to changing circumstances.


The good news is that we ended the third quarter with more than $3.5 billion in cash, including $500 million in unrestricted (readily available) cash. The bad news is that record-high fuel prices and a revenue environment that is challenging, to say the least, have overshadowed our tremendous pro-gress. We expect to spend $1.2 billion more for fuel in 2004 than we would have with last year’s already relatively high fuel prices.


But we’re working hard on all fronts to drive improved results. The best way to do that is to continue driving Amer-ican to be more competitive by working together, collaboratively with our union and nonunionized em-ployees, and jointly confront the reality that’s before us.


    WM: Do you foresee a time when there will be no consultants at American dealing with labor relations—just labor and management?


Arpey: We collaboratively decided with union officials to hire Overland Resources Group because of their unique expertise in building stronger relationships between managers and employees. Our strategy is to continue working with Overland, having them serve as a neutral third party in our ongoing discussions, until a permanent structure is fully implemented.


But as this process matures and expands across our company, I expect that we’ll eventually be able to decrease our reliance on Overland as a facilitator.


    WM: Are you optimistic about the progress thus far? If so, why? What will be the ultimate (goal)?


Arpey: The success we’ve achieved thus far is a tribute to our employees and a testament to the power of the changes we are making. Our operational improvement is a direct result of our ongoing efforts to restructure our business and the willingness of everyone at American to accept change as an inevitable fact of life in the airline industry.


But even though we are gratified by the progress we have made and the improvement we have achieved in our cost structure, we know we still have a lot of work to do. We have to continue focusing on finding ways to do our jobs more effectively and efficiently.


The ultimate goal is to emerge from this challenging environment a stronger, leaner and more nimble competitor, creating a stable and successful future for all of us.


Posted on May 29, 2004July 10, 2018

Duke Ventures Far From Campus to Serve Clients

As companies begin demanding more customized executive education programs, universities across the country are responding with new and expanded offerings within their business schools. Duke University is upping the ante.



    Five years ago, the university spun off its non-degree, custom executive education program to a wholly owned for-profit company, Duke Corporate Education Inc., creating a unique approach to executive education. Headquartered in a converted tobacco barn behind a baseball field in Durham, North Carolina, a dozen blocks from campus, Duke CE, as it is known, has been mounting custom executive education programs for corporations since its inception in July 2000. Duke CE draws on its own staff of about 80, along with professors from Duke and other universities and private consultants. It assembled a client list ranging from Bank of America to British Airways.


    Duke University owns 85 percent of the company’s stock; the rest is owned by Duke CE staff members. When the new entity spun off, the university was doing about $8 million worth of business each year in custom executive education. Its latest annual sales figure: $42 million. The long-term goal is to increase annual sales to $250 million.


    Few of its programs actually take place in Durham, and Duke professors account for only about 40 percent of those who teach its courses. Its far-flung contracting network includes more than 1,200 professors and professionals around the globe who can mount training seminars or strategic gatherings at corporate meeting rooms or rented conference centers from Asia to North America. Since its launch, Duke CE has delivered programs in 37 countries.


    “Being part of a university is a great thing,” says David Miller, Duke CE vice president of business development. “But there are also some liabilities. One of the liabilities is that university faculty members don’t have the incentive to do high-quality custom executive education. If you go to a faculty member and say, ‘Come work with us for a couple of days to really understand this issue and this company,’ more often than not the answer is, ‘No, I do not want to do that. My job is to do research and teaching. If I don’t, I don’t get tenure. Why would I invest five or six days for something that doesn’t enhance my career?’ “


    Miller says Duke CE tries to track down professors who are interested in and capable of handling custom education and contract with them for specific programs.


    In developing programs, Duke CE strives for results that directly address specific company needs. For example, a training program was designed for top auditors at a major accounting firm that was trying to shake up its systems in response to the accounting scandals at Enron and WorldCom.


    Duke CE’s solution was a series of simulations designed to broaden the way the company’s auditors think about issues and probe for answers. In one simulation, Duke CE hired actors and set up a mock hospital room complete with patients. CPAs donned white coats and tried to diagnose patients, with a real doctor serving as a consultant to help.


    The idea wasn’t to teach accountants how to be doctors but to shake up their approach by encouraging them to ask more questions, even stupid questions, in their quest for answers.


    “If you take someone out of their area of expertise and into an area where they know nothing, they are freed up to ask naïve questions,” Miller says. “For someone to ask a silly question in an auditing case would demonstrate that they don’t know what they are talking about.


    “But for an auditor to ask a silly question as a doctor is OK because they are not doctors. Who cares if they look silly? We got huge results in terms of how they approach their practices.”


    If Duke CE continues to grow, it might consider changing its ownership structure, including a public stock offering, Miller says. For the moment, its goal is simply to sell more programs.


    “Are we the wave of the future? I don’t know,” Miller says. “I do know that we have been successful.”


Workforce Management, March 2005, p. 61 — Subscribe Now!

Posted on May 29, 2004July 10, 2018

Looking for Leaders in All the Right Places

When Schneider Electric needs to find new leaders, the human resources department dips into its database of high-potential employees.



    The records contain the results from the company’s annual human resources review, which identifies the most promising individuals among its 4,000 managers in the United States and the rest of North America. The review is a multi-step process that begins with the company’s 10 functional areas, such as sales, legal, marketing and information technology.


    “For each function, we want to know what competencies each area has today and what gaps in talent have to be filled in the next four to five years,” says Rita Danker, Schneider’s vice president of organizational development and human resources.


    “Looking to the future, that lets us know if we need to recruit talent or develop it in-house.”


    In individual reviews, managers sit down with their bosses to discuss how they’re meeting their personal performance goals. The performance review goes into both the managers’ technical competency and their leadership skills, such as communication ability and talent management.


    All of the managers’ bosses then make a presentation to their supervisor and managerial peers about the leadership potential of their employees.


    Danker, for instance, has eight direct reports. She, her boss and her peers spend a couple of days making these presentations and discussing where the future leaders will come from and what additional training or expertise they need to fulfill their potential.


    The review begins in April, and by June final presentations are sent to the CEO, who spends two days with the most senior executives talking about which individuals they view as future leaders. The results of the annual review are kept in a database, which the human resources department uses when important new positions, such as leading incubator-project teams, open up. —J.M.


Workforce Management, November 2004, p. 66 — Subscribe Now!

Posted on May 29, 2004July 10, 2018

Suns Virtual-Work Program

Thisoverview of Sun’s “iWork at Sun” program explains what drove the development of the program and how the company measures its impact.


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