At this month’s NAHAD Annual Meeting & Convention in Las Vegas, Pamela Krivda presented one of the most interesting sessions on dealing with difficult HR decisions. Many smaller component distributors and manufacturers don’t have the luxury of a large human resource department. What’s more, sometimes they don’t fully understand the legal implications of what they do in situations where employees aren’t performing up to standards.
She implored the audience to keep written records of every time an employee is given a poor review, spoken to about a work incident or anything else that shows they are not meeting expectations. But one of her most compelling arguments was to do something unexpected with poor performers: suspend them with pay.
Krivda said that she doesn’t use it as her first option; this would be after a verbal warning and then a written warning. Then she’d sit down with the employee and first review their prior history — she noted that this is also a way for you to clean up any holes in your documentation.
“If a few things weren’t documented, you can get them down now. So, you review the previous history with the employee … and you write everything down. So even if there was a verbal counseling, if you can make the employee sign for it, you write it down in here,” she said.
Krivda said that the employee is generally relatively happy that although they’re getting suspended, it is with pay, so they’re not overly concerned about what you write on the incident sheet, as far as past notice. Then, you go over the latest incident — say, being rude to a customer. Krivda would explain why the customer is important and why rudeness is never allowable in this sort of situation.
“If you’ve got the complaint from a customer, if the customer comes to you, ask them a lot of questions about it — because they’ll be willing to tell you chapter and verse about it. And that makes them feel like they’re not just taking up your time with nothing to complain to,” she said.
“Then you’re going tell the employee, ‘Here’s what we’re going to do. I want to know what you really think about your job here. Do you want this job or not? Now, if you want the job, you have to have it under the same terms and conditions as everybody else. You don’t get anything special. You have to take it under these same terms and conditions. And the terms and conditions are, you have to be polite and have a can-do attitude toward our customers.’”
Krivda said that the employee should then sign a form acknowledging that they want their job as a counter salesman for ABC Distribution. That the employee acknowledges and accepts his/her responsibility. Their job description should also be attached to it — if you don’t have one, now is the time to write one up.
“Somewhere in your rules, regulations, your handbook, whatever it is, you need to have a rule that says that employees must demonstrate a can-do or constructive attitude. Or, if you prefer, a collaborative attitude,” Krivda said. She loves this term because, she noted, who gets to decide whether or not it’s collaborative? The company does.
“Then you are able to say, ‘Your responsibilities on your job description include demonstrating a constructive attitude or a collaborative attitude, which basically means do what we told you to do.’ That they understand that they have a job under the same circumstances as everybody else, same terms and conditions of employment. They understand and acknowledge that their performance has been unacceptable. They pledge to improve. No time limits on that, immediate and sustained. And they understand that failure will result in termination. Then they sign it,” she said.
“So, the beauty of it is, this doesn’t ask them for a darn thing that every employee in your organization does not have to do,” Krivda said. “Everybody has to abide by this same set of rules and circumstances. It’s just that you don’t have to beat most employees over the head with it — most employees just do it. Now, we have their signature and they have been told, ‘I want you to go home for a couple of days and I want you think over if you want the job or not. If you want the job it’s here, but of course you have to change your attitude. If you don’t want the job, just tell me. We’ll either figure out something or give you a little bit of time to find another job or just release you with no hard feelings.’”
Here are four more best practices from Krivda:
1. Demotion or reassignment is not a good idea. Do not repurpose a problem; all you’ve done is take your headache and moved it to another supervisor. Then, that supervisor will need two years’ time to get rid of this person. And the person you demoted or reassigned is pissed off. Demotion never works. Reassignments usually don’t work because the employee’s embarrassed. And if they don’t want to work, they don’t want to work. They’re not going to want to work for somebody else.
2. There’s no rule of thumb for severance in this or any industry. The number that you offer somebody is something that your company president can decide. Make it an amount of money that will make your employee snatch it out of the air, sign, and leave you alone forever.
3. Set a precedent with last chances. You don’t want to set a precedent that everybody gets 15 last chances. So truly, make it one. It’s like a toothbrush: everybody gets one. That’s all they get. This person must follow the same rules and requirements as everybody else. You’re not asking for anything different. You’re not asking them for any more than all the employees are required to give. You have an opportunity for the employee to read and consider it. Let them go home. Let them go off in a corner and read it for a while and think about it.
4. Instead of a non-competition agreement, she recommends non-solicitation agreements. Most or all states will enforce a non-solicitation agreement because you are only enforcing what you really created. The employee, while working for you, created or maintained these contacts, these personal relationships and you’re only protecting what you really created. Krivda usually recommends figuring out what a decent business cycle is — how often will your salespeople, for example, get around to every customer? Does it take a month to see every customer in the territory? Does it take a year? What is your business cycle? In the case of hose and accessory distribution, it may be how long does it take a hose to wear out? She usually doubles the time that’s really needed, figuring that a judge may come along and split the difference. While non-solicitation agreements are not infallible, they’re pretty valuable and they avoid all the non-compete problems.
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