Going The Extra Mile

The Platinum Rule

Labor law is not all about legalities, policies and procedures. Often, it comes down to some very fundamental people-management principles. In fact, say Vistage speakers Michael Lotito, Don Phin and Hunter Lott, your ability to avoid major employment problems often depends on how you treat people over and above what the law requires.

To improve employee morale and get the most out of your workforce, our experts recommend the following:

• Communicate expectations. Tell employees exactly (and tell them often) what you expect in terms of performance and behavior. When people don’t know what to expect, poor performance, plunging morale and lack of focus can run rampant in your organization.

  “Try this simple exercise,” suggests Lott. “Have every employee write down three main goals for their department and the company as a whole. Then do the same for yourself. Collect all the responses and compare them. You’ll be amazed at the wide disparity of goals you get back. Even when you think you’re communicating expectations, don’t assume the message is getting through. The last thing you want is people saying they didn’t know anything was wrong and that they didn’t get a chance to fix it. Those kinds of attitudes lead to lawsuits.”

• Help your people feel good about themselves. To instill a positive work environment, focus on helping people feel good about themselves. How do you accomplish this? According to Phin:
• Ask questions. Don’t assume you know what makes someone feel good.
• Listen to the answers. Give people your undivided attention.
• Take appropriate action with the response.

• Treat people with dignity and respect.

  “This approach goes far beyond the workplace,” notes Phin. “If you want better relationships with your wife, your children or anybody you come in contact with, give them five minutes of your complete, undivided attention. Nothing makes people feel better about themselves than having someone be present and just listen.”

• Strive to become an employer of choice. Hiring people who share the same cultural values will lead to a more productive and less litigious workplace. Attracting and retaining those kinds of people requires distinguishing yourself in the marketplace by becoming an employer of choice. That, says Lotito, requires offering more than just competitive pay and benefits, giving people a voice on the job or a grievance process. It also includes training and mentoring programs, meaningful work, promotions and opportunities for advancement, work/family balance, employee assistance programs and more.

  “More than anything, becoming an employer of choice is a cultural issue,” states Lotito. “Who are you? What do you stand for? Why would people want to work for you? What advantages do you offer outside the basic pay and benefits? How you answer these questions has a lot to do with the workforce you attract and the ultimate success of your business.”

• Go beyond what the law requires. When first confronted with a labor-related problem, the immediate response from most employers is, “What does the law require me to do?” Phin recommends a higher-level approach.

  “The law represents the first floor, the ground level. It says what you must do, but it doesn’t say what you should do,” notes Phin. “I always counsel business owners to go above the law and do what is right for the employee and the company, not just what is required by state or federal regulations. Some recommend using the golden rule. I prefer the platinum rule: Treat others better than you treat yourself. In the business world, success starts and ends with the strength of your relationships.”

Avoiding the Killer Mistakes

In most cases, employee lawsuits stem more from inattention to one or more key areas than from lack of good intentions on the part of management or a deliberate desire to do harm. To minimize the risk to your company, our experts recommend keeping an eye on the following problem areas:

• Lack of documentation. In a lawsuit, it’s basically your word against the employee’s, and guess who the jury is going to believe? In the courtroom, a properly executed paper trail is your best friend.
• Lack of consistency. According to Lott, the law does not mandate consistent behavior on your part. However, when you treat people differently, they automatically assume it’s because they belong to a protected class. When you treat everyone the same, claims of preferential treatment lose their credibility.
• Failure to train. As CEO, it’s your responsibility to give supervisors the knowledge, tools and skills to properly manage their people. If you won’t train them, then don’t expect them to document correctly, act consistently, or do the other things that will keep you out of the courtroom.
• Poorly written policies, procedures and employee handbooks. Consult with the experts and invest the time and money to do the handbook right. This is not an area in which to pinch pennies.
• Lack of HR infrastructure. Whether internal (a dedicated HR person or staff) or external (HR consultant, professional employer organizations, HR outsourcing firm, etc.), you must have someone paying attention to these issues on a daily basis.
• Failure to investigate properly. Investigate every claim, not matter how trivial it may seem. Always give employees an opportunity to tell their side of the story, even if you disagree with them. Doing so can go a long way toward disposing of potential claims.
• Failure to hold people accountable for values transgressions. Do not tolerate good performers who undermine your company’s values — for example, the top salesman who sexually harasses female customers or the superstar manager who engages in discriminatory hiring practices. “People may make positive contributions to your bottom line,” notes Lotito, “but they can also destroy it through their actions.”
• Failure to fire quickly. Most companies have at least one person whom everyone (including you) knows should get fired. The longer you tolerate poor performance or bad attitude, the stronger the case against you should you wind up in court. How do you identify who should go? Phin suggests an easy litmus test. Ask yourself, “If this employee voluntarily left the organization today, would I be sorry to see them go? Would I hire them back?” Your answer tells you everything you need to know.

Staying in Control

Ultimately, all your employment-related practices should work together to support three critical strategies:

• Keep complaints internal.
• Get complaints dismissed before they get to court.
• Have proof of your defense if you do end up in court. To ensure the right level of support, ask yourself two critical questions:
• What mechanisms do I currently have in place for employees to resolve grievances within the organization?

• What steps have I taken to ensure that my managers and supervisors follow those procedures every time?

  If you can’t answer these questions in a satisfactory manner, say our experts, don’t be surprised to find yourself standing in front of a judge and jury.

  “The key to avoiding lawsuits is staying in control,” concludes Lotito. “As long as employees keep their complaints inside the organization, you have the opportunity to maintain control. Once they go outside, you lose control. At that point, you might as well pull out your checkbook because it will cost you money, either in attorney’s fees, damages or both.”