When HR Files Suit

An attorney once told me that organizations should be very wary of adverse-job actions involving HR or finance professionals — because they know where all the dirt is.

Evidently, no one ever mentioned that to Medtronic, which was sued recently by David Ness, its former vice president of global rewards and human resources.  Ness alleges in the age-bias complaint that the company pushed him out to replace him with a younger version. He’s 61.

According to the suit, Ness says he not only was pushed out, he was forced to train his replacement. And when the company offered him a severance package that the lawsuit notes was much lower than that offered to other executives who were forced out, he was fired instead.

Ness had been with the company for 36 years. Medtronic, of course, denies it engaged in age discrimination.

Might be interesting to see some of the discovery that takes place as this lawsuit winds its way through the court system.

Maligning vs. Pitying Micromanagers

I noticed a couple of mentions over the last few days about the evils of micromanagement and how this horrible and uninhibited trait can impact a workplace.

One, from Beeson Consulting, warns that this obsession with every little thing that every single person under you is doing can, and will, prevent you from becoming the senior leader you’re trying to be. “Managers who are perceived by their troops as meddlesome micromanagers,” it reads, “are probably, in turn, viewed by senior executives as not having the bandwidth to step up to higher-level positions and handle greater responsibilities.”

Another, by Suzanne Lucas, a.k.a. the Evil HR Lady, questions why more companies don’t just fire the poor (anti-)slobs. The reason, she suggests, is that they’re still stupidly promoting non-leadership behaviors such as “attention to detail” and failing to promote (literally) their “self-motivated, results-oriented” employees.

The key for those suffering from this malady is to learn to delegate, obviously. The key for companies, writes Lucas, lies in implementing a results-oriented workplace environment (ROWE), where “managers let people do their work without hovering.” (We’re actually focusing on that very approach in Human Resource Executive®‘s August cover story.)

Personally, I’m wondering if more companies shouldn’t be training and coaching their micromanagers away from their addictions, or maybe directing them to their employee-assistance programs … or maybe we should all consider them disabled and in a protected class??!!

OK, I jest … well, mostly. As a parent, wife and manager, I’m here to tell you it’s damn hard to break out of the “If I want it done right, I have to do it myself” cycle. Or the killer mind-set of “If I don’t ask him about his progress, he won’t make any.” Thankfully, I’m getting better. But for some, it might take a 12-step program to overcome.

A Goliath Gets Even Bigger

ADP’s recently announced acquisition of Workscape, a provider of compensation-planning tools, will be “hugely disruptive” to the talent management marketplace, says Josh Bersin, CEO of Bersin Associates, who was briefed on the deal by ADP earlier today.

The acquisition will enable ADP, the $9 billion provider of HR, payroll and ben. admin. services to 570,000 clients throughout the U.S. and the world, to offer Workscape’s world-class compensation planning tools to the thousands upon thousands of small-to-medium-sized companies that already use ADP for payroll processing.

ADP already distributes Cornerstone OnDemand’s suite of performance management and succession planning tools. The Workscape acquisition (ADP did not disclose the terms of the deal) will enable the Roseland, N.J.-based behemoth to gobble up an even bigger share of the TM marketplace by reaching out to the vast number of mid-sized firms that are just starting to focus on talent management, he says.

“The compensation-management platform from Workscape is the most sophisticated of its kind out there,” says Bersin. “If ADP is already providing payroll services, not to mention performance management [through Cornerstone] to these companies, and now they can sell comp planning as well, they’re going to have a huge leg up on other TM vendors. ”

ADP may also be able to differentiate itself from other software vendors through its  pricing, says Bersin.

“They get paid by their clients via a monthly charge, on a per-employee, per-check basis,” he says. “My guess is, they’ll embed the Workscape services into that monthly charge, just adding to it slightly, which will enable them to price it in a way that a typical software company could never price it. This will help them gain a lot of market share.”

“The big question is how aggressive ADP will get with it–how well will they train their salesforce and how heavily they’ll promote it,” says Bersin.

“I like to think of ADP as the General Electric of the software industry–they don’t think of it as tools, but as a business,” he adds. “When they buy a company, they look at how rapidly they can integrate it into their sales organization and sell it. I think they’re going to get a lot of traction, and other vendors–especially in the mid-sized market that ADP sells into–they’re going to have to deal with ADP.”

Some Final Thoughts on SHRM

As the 2010 SHRM conference draws to a close, here are a few final (and random) thoughts about the event (and my first blog post filed from an airplane).

Best news coming out of the conference: 11,000+ attendees! After a couple of years of major belt tightening, companies appear to be spending once again.

Most discouraging observation: On day one, folks stuck around to hear Steve Forbes pretty much until the end, even though he had little to share on the topic of HR strategy. In contrast, on day two, I’m told they left in droves soon after a panel of senior HR executives began to tackle some of the profession’s more pressing challenges. What gives?

Best performance by a ’70s band: Hall and Oates (so what if they were the only ’70s band to perform).

Most popular show giveaway: You guessed it, the iPad. (If you want to know what next year’s big giveaway will be, just check out Apple’s product pipeline.)

Longest line for a  ’70s celebrity on the expo floor: Attendees (mostly women) who were eager to meet and greet Erik Estrada (of CHiPs fame) at the Columbia Southern University booth. (Didn’t personally see, but was told he looks the same.)

Worst part about the venue: Overcast skies pretty much the entire time, with cooler than usual temps for San Diego.

Best part of the venue: It wasn’t 95-degree, 90-percent humidity New Orleans! (Remember last year?)

 

A Brighter Job Outlook

The Bureau of Labor Statistics may not show it yet, but companies that deal with hiring are seeing a definite uptick in job searches. During the SHRM convention, I’ve had the chance to meet with several of those companies and they were sounding pretty positive.

Kurt Ronn, president of HRWorks, which offers executive search as well as RPO on a project basis, says he has seen “a very big uptick in the market” over the past six months.

Rich Milgram, CEO and founder of Beyond.com, which provides thousands of niche job sites, agrees, noting that Q1 was when he first saw hiring take off. In Q4, however, he expects a “big pick up.”

“Last year this time,” says Alex Douzet, president and co-founder of The Ladders, “[hiring] really hit bottom between May and August. September, we started to see the market coming back. Now, it’s more similar to second half of 2008.”

Sectors ahead of the curve, he says, are in financial services, technology, aerospace, pharmaceutical, engineering and the service industry. The “very slow” sectors are construction, real estate and manufacturing, while on the cusp are consumer goods and logistics.

So, maybe Little Orphan Annie was right. But let’s hope tomorrow comes sooner, rather than later.

Lessons in HR Transformation

As I prepare for the SHRM conference each year, I often lament that there aren’t more HR executives presenting.  Personally, more often than not, I much rather hear what they have to say about a particular issue or topic, rather than a consultant or vendor.

That’s why I was pleased to see the Tuesday morning program open with a General Session panel featuring senior HR executives. (Hopefully we’ll see more sessions like this in the future.) It’s also why I set aside some time later that morning to catch a Mega Session entitled “HR Transformation: What Comes Next” by one of the opening-session panelists.

Conrad Venter, global head of HR for Deutsche Bank AG, detailed some of the steps taken by the bank to transform its HR function. Deutsche began its HR transformation efforts in 2005, during a period when the firm was facing some formidable global challenges.

In response, Venter said, Deutsche set out to restructure HR, putting “the right work in the right place.” Those efforts included moving much of the transactional work outside of HR.

What were some of the lessons that were learned along the way? First, he said, “we learned that one size doesn’t fit all.” He also noticed the importance of being “fluid” and continuing to “tweak things” long after they’ve been implemented.

“The soft stuff is really the hard stuff,” he said.

Repeating a comment he made during the opening panel, Venter also suggested that HR leaders might want to describe what they do as “people strategy” rather than “HR strategy,” to create more buy-in and less finger pointing.

Risks of the Recovery

Better times are coming. More people are looking for work. Wages are thawing out. Defined-contribution employer matches are returning.

But before your workforce rebuilding goes full bore, consider the landmines of the recovery, Matthew S. Effland, employment lawyer with Olgetree Deakins, told attendees at the Society for Human Resource Management’s 2010 conference.

Despite the name of his session, “And the Tide Rolls Back In — Legal Issues in Rebuilding Your Workforce Post-Recession,” Effland’s warnings were not confined to the law. He spoke a lot about “survivor anger” spreading through corporate America right now — among people who’ve been working on frozen wages, doing the jobs of laid-off former co-workers as well as their own, and feeling minimized by their companies’ efforts to infuse new blood into the organization by recruiting outsiders and paying them higher salaries than their own.

“Think about what you can do to make sure you’re taking care of the survivors,” said Effland. “Their disgruntlement can lead to litigation if you’re recruiting from outside to replace a position equal to theirs at a higher wage.”

Also be careful not to “give into the pressure” to selectively re-hire laid-off employees, those problem workers you were able to let go of in the name of hard times. Those who are not re-hired when others are, or who are told to reapply for the same position, “will feel some sense of entitlement, and may sue, and may have a case” if they fall under a protected class, he said.

“Avoid the shortcuts and the push for speed-hiring,” Effland said. “And make sure you fully document your hiring process. When you decide not to hire someone back, you better be able to justify it and explain it in a court of law.”

Some Disquieting — and Costly — Facts

Every 1.5 percent increase in unemployment equals a 21 percent increase in employee lawsuits, said Shanti Atkins, president and CEO of ELT in a standing-room-only session on “2010 EEO Trends” at the SHRM convention in San Diego.

She also noted that corporate spending on legal fees and costs to defend employment cases jumped 54 percent from 2008, and that 2009 saw the second highest number of discrimination claims filed with the U.S. Equal Employment Opportunity Commission in U.S. history.

Retaliation is now the most common claim filed, followed by race discrimination and sex bias.

What many front-line managers don’t know — and it is they who “are the ones creating the risk, she said” — is that a retaliation claim can succeed whether or not the underlying discrimination claim has any basis in fact.

Another thing managers don’t understand, she said, is that no “incredibly dramatic” actions are required to show that retaliation has occurred. It can be a cold shoulder, poor work assignments, a series of minor events.

And the average jury verdict for a retaliation claim? $200,000.

Facilitating Age-Bias Suits

Proposed federal legislation that would overturn a U.S. Supreme Court decision last year has a “real good chance of becoming law,” said Mike Aitken, SHRM’s director of government affairs.

The Protecting Older Workers Against Discrimination Act would not only overturn Gross vs. FBL Financial Services, but would go beyond it, he said during the organization’s annual conference.

In a 5-4 vote, the justices ruled that employees must show age discrimination was the direct cause of an adverse employment decision, and was not just one of the factors playing a role in that decision.

The proposed law would find it unlawful if age was “a” motivating factor. In addition, that standard — known as a mixed-motive standard — would also be applied to all federal discrimination, retaliation and whistleblower suits.

So, HR beware: With the aging of the workforce, it may be hard for companies to avoid age being a factor in employment decisions.

Experimental HR

Vineet Nayar, CEO of HCL Technologies, a global IT services company headquartered in Noida, India, urged the SHRM audience to treat HR “as an experimental journey,” and to consider follow his example of treating the employee first, the customer second.

Management doesn’t create value, he said. It can only “induce, encourage [and] enable the creation of value by the employees.”

HR leaders, he said, should consider the leadership of Ghandi, MLK and Nelson Mandela. What they did, he said, was create dissatisfaction with today and develop a romance among their followers with tomorrow.

Autocracy doesn’t work, he said. Democratize the workplace. Managers need to be answerable to employees instead of just the other way around. And the result of treating employees first is that customers will be served better.

To create an environment conducive to change, however, requires trust. In his company, Nayar facilitated that trust by providing an environment of 100 percent total transparency. His 360-degree assessment is posted on the company intranet. If an employee asks him a question — and 99 percent of the questions are negative, he said — his answers are sent to all employees.  (The questioners must also reveal who they are.)

His $2.3 billion company continues to grow rapidly — without new services, new products, new locations. It’s due to placing trust in his employees.

“Transfer the problem to them. They create magic in the interface of customers and employees,” he said.