Favorite Firing: When a Customer Harasses an Employee

adult-15814_1280The usual adage in American businesses is “the customer is always right.” And usually that is true. I’ve posted on a few occasions about the need for many organizations to improve their customer service. But it isn’t always true. Sometimes the customer is dead wrong. Today’s “favorite firing” is about a case where the customer was wrong, and then an employee alleged she was treated improperly when she complained about the customer’s behavior. After the alleged retaliation, the employee quit. So strictly speaking, this is a constructive discharge case, not a firing.

The Facts: In Prager v. Joyce Honda, Inc. (Aug. 22, 2016), Nicole Prager, a 20-year-old receptionist at the Joyce Honda dealership, complained to her managers that a high-profile customer pulled on her shirt and revealed her bra. There was no doubt as to what had happened, because the incident was caught on the dealership’s surveillance tape.

Her managers discouraged her from filing charges against the customer because he was a really good customer who had purchased 20 cars over the years and regularly had his cars serviced at the dealership. Despite her managers’ cautions, Ms. Prager did file charges. In fact, once she made the decision to file, the dealership managers called the police and provided an office at the dealership where she could talk to the police. (Later, the customer pleaded guilty to offensive touching and paid a fine.)

After she filed the charges, Ms. Prager alleges that some of her her co-workers began behaving coldly toward her. In addition, she received two written warnings for leaving work early on two occasions. One of these occasions occurred prior to filing the complaint against the customer and the other was an incident after she filed the charges. She objected to the reprimands, saying they were retaliatory and that she had left work early before without being disciplined. Her managers said they reprimanded her because she had not communicated about her leaving early on these occasions, as she had in the past. Nevertheless, the employer offered to rescind the disciplinary warnings, but Ms. Prager resigned instead.

In her lawsuit claiming retaliation and constructive discharge, Ms. Prager alleged that the dealership had become a hostile workplace environment for her, which justified her resignation. The trial court dismissed Ms. Prager’s lawsuit, saying that employers were not responsible for the conduct of customers in the workplace. Ms. Prager appealed.

The Appellate Division in the New Jersey courts also rejected her complaint, although the Appellate Division said that filing a police report against the employer’s customer was a protected act. However, though she could state a claim for retaliation, she had not sufficiently alleged a retaliatory consequence in her complaint—she had resigned immediately after receiving the reprimand and the dealership had offered to make the reprimands go away. The court said

“no reasonable juror could find that conduct ‘so intolerable that a reasonable person would be forced to resign rather than continue to endure it.’”

The Moral: Any complaint of harassing behavior by an employee should be taken seriously. And once an employee complains, the employer must be careful not to retaliate. Those are givens. Moreover, managers should be supportive of employees who complain and who decide to take their complaints to higher authorities, whether those authorities be internal company investigators, administrative agencies, or external law enforcement.

In this case, reading the Appellate Division’s opinion is instructive. It is clear from what the court says that part of the problem was that this employee was young and inexperienced in dealing with harassment and the follow-up complaint process. Her managers did not help the situation—they did pressure Ms. Prager not to complain about a valued customer, though they ultimately did support her. This case is a good reminder that we take our employees as they are, and must adapt our responses in some respects to their unique circumstances.

The timing of the warnings to Ms. Prager was unfortunate at best, and possibly retaliatory, though the court held that the two warnings in this situation were not sufficiently retaliatory to support constructive discharge. The management rationale for the warnings—that Ms. Prager was not communicating with them—probably should have been dealt with through a verbal discussion, at least initially, saving the heavier discipline of a written warning for a later occasion more distant from the harassment.

Nevertheless, there is good news for employers in this case, namely that constructive discharge is difficult to prove. If managers show an ongoing willingness to work with an employee in reasonable ways, it will be hard for the employee to prove that the workplace is so intolerable that he or she must resign. While any disciplinary action against an employee who has complained of discrimination or harassment should be carefully considered, it is appropriate to hold employees accountable for their performance and for following reasonable company policies.

When have you dealt with allegations of constructive discharge?

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What To Do When You Don’t Get to Choose Your Boss

boss-454867_1920For the first twenty years or so of my career, I was fortunate to be able to pick my boss. By that I mean, I knew who I would report to when I took the job.

In my first corporate assignment, I didn’t know what I didn’t know about my supervisor. I knew who he was and what his credentials were, but frankly I was clueless as to how much a manager’s personality impacts the workplace environment. I worked for this man for many years, and I learned his strengths and weaknesses, as well as experiencing first hand the benefits and pitfalls of his characteristics as a manager.

On my next few assignments, I knew something more about the individuals I went to work for, though I didn’t know these individuals well. Still, I chose the jobs knowing who I would report to. I went into the jobs knowing something about them, and had colleagues who had worked for them longer to whom I could talk. And I had enough experience to know myself and how I liked to work, as well as how to be flexible and adapt to new managerial expectations.

Then, in the last few years of my corporate career, I twice had managers foisted on me. My former managers left their roles (and one left the company), and new people were assigned to the positions that I reported to. I had no control over my reporting relationships. It was a disconcerting experience to be in my forties and suddenly have to change how I related to my boss with very little warning.

Even though it was difficult, I was fortunate to know who these people were, and I had worked with them before in previous assignments. Reporting to these individuals was far different than working as peers with them, but I knew the importance of building a relationship with one’s manager and in addressing their priorities. Many people do not have the benefit of knowing the boss that is foisted on them.

So here are my tips for how to deal with a boss you didn’t choose:

1. Analyze the situation

The first thing to do is to understand the organizational issues that led to you having a new manager. Did your old boss retire after a laudable career or was he or she fired? These circumstances will lead to different dynamics as your new manager comes into the workplace.

Even if you don’t know the particulars, you probably have some idea as to what the expectations for change are in your department. Spend some time thinking about the situation you find yourself in.

2. Gather information

As you analyze the situation, gather additional information where you can. Maybe you know your new boss, as I did mine. But if not, you should see what you can find out about his or her work styles, what the higher executives’ expectations are for change in your department, and anything else that can help you fit into the organization as it is evolving.

Do a little research on what executives in your field (or managers generally) should do in their first 90 days in a new role. That will help you assess what your new boss is probably thinking about and where he or she might focus attention first. If you can address your boss’s priorities, or even help determine those priorities, you will be in a better position to be successful.

3. Determine your loyalties

You may have loved working for your old manager. You may have strong friendships with co-workers that might now be upset if the department reorganizes. You might be close to retirement yourself and just want to lay low. Whatever your situation, decide in your own mind where your loyalties lie.

I’m not suggesting that you turn into a back-stabber, but you should give some thought to who else might get caught up in the changes and how they will react. Think about whom you want to help and about where you would ideally end up in relation to others in the organization.

And I suggest that, if your old boss was fired and the new manager is expected to make significant changes, taking the attitude that “that’s how things have always been” is not going to get you very far.

Simply because he or she is your supervisor, the new person to whom you report is deserving of respect and loyalty. Others also deserve your respect and loyalty, and that is why I recommend you consider how all the new relationships you will have after the change will impact your role.

4. Decide what you bring to the table

It’s a cliché, but you want to be part of the solution, not part of the problem. You want your new manager to see you as a resource. So think about what you can do to help your new boss.

Do you have specialized skills or experience that the boss does not have—how can you diplomatically make your abilities known and available to your manager? Do you have relationships with others or insights into the industry that could benefit the new boss? Again, where can you help fill gaps?

5. Provide assistance to your new manager

After you’ve analyzed the situation, gleaned what you can about your new supervisor, thought about the loyalties and responsibilities you will have in the future, and assessed where you fit in, then make a sincere offer to assist your boss where you can. If you’ve done this analysis, you’ll have some specific suggestions of how your skills and background can help your new manager where he or she is most likely to need help.

You will have positioned yourself to address his or her needs and priorities, and you will be appreciated for it. Yes, it’s office politics, but it’s also common sense to try to make yourself useful in a new environment.

What additional tips do you have for dealing with a boss you didn’t choose?


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How Realistic Do You Want Your Fiction To Be?

I don’t post much about my novel, Playing the Game, but I thought it would make a nice Labor Day diversion.

Recently I was asked whether the book is true to life. My answer: Yes and no.

Playing the Game is fiction. None of the events in the book happened—at least not the way they are depicted. The facts and faces have been changed to protect the innocent. But the plot is realistic. It deals with issues that many corporate executives face, such as managing budgets and people, planning new product lines, deciding who will succeed departing key personnel, and integrating work and family time. And, of course, dealing with the personal peccadilloes of the colleagues we encounter in the hallways every day.

But the plot is realistic. It deals with issues that many corporate executives face, such as managing budgets and people, planning new product lines, deciding who will succeed departing key personnel, and integrating work and family time. And, of course, dealing with the personal peccadilloes of the colleagues we encounter in the hallways every day.

One reader told me after reading the book, “I know these people.” This reader and I have never worked together, and we have only a few common acquaintances. In other words, the characters are like co-workers we have all known, with common foibles and insecurities.

I market Playing the Game as a thriller, but it isn’t a thriller like Dan Brown’s or Brad Thor’s novels. It is a thriller in the same way that Arthur Hailey’s books such as Hotel or Airport were thrillers. The business is going through a make-or-break time, and the question is whether it can be saved. There are criminal activities in the book, but the thrill is not from solving the crime but from the highs and lows of living through difficult circumstances.

Michael Crichton, author of Jurassic Park and other far-out thrillers also wrote Disclosure, which dealt with sexual harassment in the workplace in a very realistic setting. While I enjoyed Jurassic Park and his other fantasies, I was captivated by Disclosure, because “I knew those people.” I had dealt with similar situations in my job. That’s the kind of fiction I aspired to write in Playing the Game.

So, as a writer, my question to readers is:

How realistic do you like your fiction? Do you want to read books that deal with things you know, or do you want to explore worlds of fantasy to escape your daily routine?

Happy Labor Day


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Performance Management Isn’t About Deadwood

MP900341467I recently wrote about performance management and the abolition of performance reviews at certain companies. Then I read a Wall Street Journal article last week stating that one of Kimberly-Clark’s goals is “managing out deadwood.” So much for doing away with performance reviews at that company.

The article states that Kimberly-Clark has about a 10% total turnover (voluntary and involuntary), and that employees are expected to “keep improving—or else.” I don’t disagree with a focus on continuous improvement, and a 10% turnover is not excessive. Still, performance management and “managing out deadwood” are two different things in concept, if not always in the end result. And they have different consequences both from a legal and from an employee relations perspective.

From the legal perspective, talking about employees as “deadwood” can lead to complaints of age discrimination. See Herr v. Nestlé U.S.A., 2003 Cal. App. LEXIS 855 (June 12, 2003), described here.

Any indication that an employee over age 40 is past his or her usefulness is problematic. Of course, employees can be ineffective performers at any age, but the tendency at many companies that initiate performance improvement drives is to focus on employees who have been sitting around for awhile—and who tend to be in the protected age group.

From the employee relations perspective, it can be demoralizing to adequate performers to know that managers are snapping at their heels, that as soon as the worst performers are out, a continuous improvement drive will mean employees who are in the lower mid-tier are now at the bottom.

Yet a true continuous improvement program means there is always someone at the bottom. It’s not like one manager told me once, “We’re done—we fired all our poor performers last year.”

Despite my quip above (“so much for doing away with performance reviews . . .”), there actually is no disconnect between abandoning annual reviews and an emphasis on performance improvement. In fact, it may be easier to focus on performance issues with the more regular discussions between managers and employees advocated by such companies as General Electric, Adobe Systems, and others.

Whatever performance culture a company decides to adopt, the important thing is to train managers to handle it well, to avoid the legal pitfalls of only focusing on older low performers or others in certain protected groups, and to keep the emphasis both encouraging and disciplined.

Performance management isn’t about getting rid of deadwood. It’s about improving every employee’s performance—including that of managers.

When in your experience has a performance management emphasis caused legal or employee relations problems?

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Obamacare Today: Falling Apart Before It’s Fully Implemented

TPI078T0ISIt’s been almost six and a half years since the Affordable Care Act (known as the ACA or Obamacare) passed with only Democratic votes. The roll-out of this complicated statute took several years to implement. Some provisions (such as the Cadillac tax on generous employer plans) still haven’t been implemented. Yet the statute’s complex redesign of our health care system is already unraveling before it has been fully knitted.

Obamacare was not fully debated before it was passed. The Senate passed one version, and the House passed another version. No reconciliation of these bills ever occurred. But because the Democrats in the Senate lost their filibuster-proof majority in early 2010, the House had to adopt the previously passed Senate version to get any health care bill onto President Obama’s desk. Thus, the nation has been stuck with the Senate’s early version of health care reform, warts and all.

Since then, a flurry of regulations has fleshed out the statutory provisions on several fronts—on employer-sponsored plans, Medicaid, health care exchanges, to name a few.

  • Regulations permitted only narrow grandfathering of employer health care plans. Only minor changes were permitted to these plans. Greater changes meant that employer plans would have to comply with all of the Obamacare requirements for employee coverage, benefits, and cost-sharing with employees. (See here.) As health care costs continued to rise, few employers could continue to offer their old plans without modification. Thus, employer plans changed, probably more than Congress or President Obama had anticipated. No, employees could not keep the plans they liked. Those plans were gone, and employer plans incorporated expensive mandated minimum benefits and other provisions that drove up costs.
  • Obamacare offered subsidies to states that expanded Medicaid coverage for those slightly above the poverty level. But many states feared the future costs and refused to adopt expansions to Medicaid, so Medicaid did not cover as many people as expected.
  • For people who did not have the option of employer coverage or Medicaid, health care exchanges provided federal subsidies up to 400% of the poverty level. As we all recall, the exchanges had systems problems during the initial enrollment period, which meant their plans were selected more slowly than anticipated. Yet almost from the beginning of the exchanges—and accelerating this year—insurers have opted out because they have lost money on these plans.

Meanwhile, costs continue to rise under almost all health care coverages. Granted, costs are not rising as fast as they had been prior to passage of the ACA, but they are still rising faster than wages or inflation. So health care continues to take a bigger and bigger chunk of family income.

It is becoming increasingly clear that Obamacare is not sustainable without change. Yet the political standoff does not seem able to address this need for change. And any revisions the two parties propose are likely to be diametrically opposed—Democrats urging the addition of a public option and Republicans seeking more market-based solutions.

I am not arguing that the health care system before Obamacare was in good shape. It, too, lacked transparency and increased consumers’ demand for health care by transferring costs to employers and the government. But every system is perfectly designed to get the result it gets. Today, we’ve got Obamacare, and the results are not satisfactory to anyone. We need to examine the root causes of the problem and change the system.

The basic problem we face is that—despite promises to the contrary by the Democrats who passed Obamacare—health care cannot increase in both quantity and quality and at the same time reduce costs. We are trying for a Cadillac in every consumer’s garage at a Fiat price to the consumer and a Ford price to the government. But if consumers can get a Cadillac for a Fiat price, they will want two Cadillacs. Demand increases to an unsustainable level when the price paid is less than the service received. It shouldn’t surprise anyone that the number of insurers willing to offer coverage on the exchanges  is decreasing and premium costs are rising.

As Greg Ip wrote in the Wall Street Journal on August 17, 2016,

“Selling mispriced insurance is a precarious business model.”

The exchanges are becoming unsustainable, and the fiscal problems of Medicaid and Medicare will have to be addressed at some point. Moreover, employers won’t continue to provide health insurance to workers if the costs continue to rise faster than wages and prices.

As stated above, our health care system includes problems of quantity, quality and cost. At most, we can work on two of these issues, and maybe only one of them at a time. This will require hard choices. To make choices that stick, we will have to consider all viewpoints. For some of my thoughts on how to improve health care in the U.S., see here.

There was a reason our founders designed two houses of Congress and a President to be checks and balances on each other. The Democratic cram-down of Obamacare in 2010 prevented those checks and balances from working, which resulted in what we have today. Until Congress and the White House work together on mutually acceptable changes to the ACA, we are unlikely to improve health care in this nation.

How do you think the U.S. can best improve its health care system?

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5 Steps to Avoiding Pitfalls of Delegation

delegationMany years ago, when I first began supervising junior employees’ work (I wasn’t even a manager yet, but I was more senior than these employees), I received feedback on my delegation style. The people I supervised complained both that I provided too little direction and also that I micromanaged them.

I wondered how I could commit both errors, but a little deeper review of their comments revealed the problem. Basically, they said I either delegated a project to them and walked away without giving any instruction, or I took their drafts and totally rewrote them.

I had to agree that I both of these descriptions fit what I was doing. While some of the people I supervised were competent, even they could use a little direction. And although some of the output needed editing, I was probably overdoing it.

Over time, I realized how important it is to match one’s management style to the employee being managed. New employees need a lot of direction, but experienced employees should be allowed a lot of leeway in how they do their jobs. Weak employees need constant oversight, strong employees need only to be supported.

A couple of recent articles have made that point to managers.

One article told entrepreneurial managers:

“When delegating goes wrong, it’s often because of you.”

Another article directed at attorney managers said if you’re disappointed in the work your employees do

“it may be that you need to improve your delegating skills.”

Both of these articles make similar points in how to delegate. Here are some pointers on delegation, gleaned from the articles and from my own experience:

1. Set clear expectations and describe the expected outcome

Give your employee some background information so they know why the work is important and give specific deliverables.

“I need a 3-5 page memo describing how we might implement this new compensation program” is much better delegation than “tell me what you think so I can talk to the V-P.” Or “use the structure of the brief I wrote in the last case as a model, but tailor it to the facts of this case,” rather than “just give me something I can use as a first draft.”

Even experienced employees can benefit from knowing the context of the assignment. The more experienced the employee, the more you should focus your direction on showing how the project aligns with organizational objectives, and the less you should give detailed parameters for the deliverable.

2. Set realistic deadlines

If you’ve known a 20-hour project was due for a month, it isn’t fair to the employee to delegate it the Thursday before the Monday it’s due. You’re asking to be an unpopular boss.

On the other hand, part of setting clear expectations is to tell the employee how long the project should take. If it should only take four hours, and you know the employee’s workload, or you can help reprioritize other projects, then maybe giving just a few days for the project is reasonable.

Still, the more control you can give employees over their workload, the better they will accept additional work and will strive to provide good results.

3. Be available, but don’t stand over their shoulder

Make sure employees have the resources they need to handle the project well. That includes not only time, but also access to you and to others in the organization (or clients) that have relevant information that could improve the result.

But don’t ask for daily—or hourly, as one manager I had did on occasion—updates. A couple of check-in points is probably all that is required. One of my early failings was not checking in with employees at all, which was just as bad as checking in too often.

4. Build in review time

Even though you shouldn’t look over employees’ shoulders, you need to reserve time to “inspect what you expect.” That Monday due date I mentioned above shouldn’t mean that the employee brings you their deliverable 15 minutes before you head to the CEO’s office. You’ll want time to put your stamp on the end result, even if the work was done by your strongest employee.

But when you review your employees’ work, only make necessary changes. This is something I still have trouble with today. I tend to want to rewrite any report I receive before passing it on.

Throughout my career, I struggled with the balance between putting my stamp on the work and over-editing minor points. When I over-edited, my staff became demoralized. It also tended to make them sloppier—knowing that I would rewrite what they turned in, they didn’t always submit their best work. It became a vicious circle, because I would rewrite more if I thought they hadn’t been precise.

5. Recognize the work done

Project Done

It’s easy to take the result and move on. But if the end product is strong, let the employee know. If it needed improvement, let the employee know that as well.

Show the employee any changes you made to their work and offer to discuss why you made the changes. Perhaps their work was substantively fine, but might have struck upper management the wrong way. Even good employees can learn from how your style differs from theirs.

If you have micro-managed the project or rewritten more than was necessary, let the employee know that is your failing and not theirs.

What experience have you had with delegation, as both manager and subordinate? What worked? What didn’t?

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Will Mediators Reveal What the Other Side Says in Caucus?

mediation2During most business mediations, the mediator will at some point break the parties into separate rooms and hold private caucuses with each side. Parties often wonder what the mediator tells each side about what the other says in these private caucuses.

Mediations are confidential proceedings. Except in rare circumstances (such as a party disclosing that he or she intends to commit a crime), the mediator cannot be compelled to disclose what happens during the mediation. So the mediator will not tell anyone outside the mediation about what either party says.

But what about what one party says privately to the mediator? Will that be disclosed to the other side in the dispute?

The answer to this question depends on the ground rules that the parties and the mediator set.

The first place to look is in the mediation agreement that the mediator and the parties typically sign either in advance of the mediation or when the mediation begins. Most mediators will also raise the issue in the opening session, before they start any private caucuses.

But keep in mind that mediators often find that selective disclosure of information from one party to the other will increase the likelihood of settlement. Most mediators have a bias toward wanting to be free to communicate what they think will help resolve the dispute.

There are two general practices:

1. First Approach: The mediator can disclose anything said by one party during a caucus to the other party, unless the disclosing party tells the mediator not to reveal it.

Most mediators tell the parties up front that they will feel free to tell the other side anything that is said in caucus, UNLESS the party tells them not to. If instructed to keep the information confidential, they will do so, until the revealing party says it is all right to reveal the information. That is the easiest practice for the mediator, because they can communicate more freely during private caucuses.

This is the practice that I use, because I believe that full disclosure during a mediation is typically better.

However, it is important to respect the instructions from the revealing party. I mediated one employment case in which the employer had evidence that the employee had breached a company policy (though that wasn’t the reason the employee was fired), but the employer representative wouldn’t let me tell the employee and his attorney about that evidence. I thought this was wrong, because revealing the employer’s knowledge of the employee’s wrongdoing could well have motivated the employee to settle for less. But I followed the employer’s instruction and did not reveal what the employer told me.

I did push back in later caucuses with the employer, but the employer stood firm, so the information was not revealed to the employee during the mediation (which was successful anyway).

2. Second Approach: The mediator will not reveal anything said in caucus to the opposing party unless expressly authorized by the disclosing party to reveal it.

Sometimes mediators tell the parties they will not reveal anything said in caucus without having the express permission of the party revealing the information to disclose it. Some mediators adopt this practice because it is hard to remember what they’ve been instructed not to reveal, so they decide not to reveal anything unless disclosure has been expressly authorized.

Even if the mediator’s practice is not to reveal what the other party said, the mediator remains free to give his or her own interpretation of how the opposing caucus went. So, for example, if the mediator has not been authorized to tell the plaintif that the defendant said this was a final offer, the mediator might still say to the plaintiff that the mediator doesn’t think the defendant has much room to maneuver in reaching a settlement.

Parties should be prepared to explain to the mediator why they don’t want the information revealed. There doesn’t have to be a reason, but a good rationale (e.g., the information is a trade secret, harm to the company if it is revealed would be irreparable, and the opposing party has blabbed inappropriately in the past) might keep the mediator from pushing back in later caucuses with the revealing party, as I did in the employment case described above.

3. The practical result of these two approaches is not that different.

Whichever practice the mediator adopts, the practical result is often the same. Because one issue during the caucus is often deciding how the mediator should approach the next session with the other side—not only the amount of the next settlement proposal, but also the issues that the mediator should stress in making the case to support that offer. This requires a discussion about what should be revealed to the other side. Some mediators will role play how the information might be disclosed to the other side, and the disclosing party agrees with the mediator’s approach.

4. Attorneys and parties should be clear with the mediator about what they do not want communicated.

mediation_7Parties and attorneys who participate in mediations should always feel free to ask the mediator how he or she approaches disclosure of information to the other side.

When they reveal information to the mediator in caucus, if there is any question in a party’s or their attorney’s mind, these participants should raise the issue with the mediator. Ask the mediator what he or she intends to share with the other party. If the party/attorney doesn’t like the mediator’s approach, discuss it. Regardless what the mediator has said up front, the mediator and the disclosing party can and should agree on what will be revealed before each caucus ends.

Mediators are neutrals, which means at the least respecting each party’s desire for circumspection in revealing information to the other side. By discussing the issue openly during a caucus, parties should not later be surprised or upset by what the mediator tells the other side.

What experience do you have with mediators’ use of caucus information in a mediation?

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