Hired guns | Your company's personnel files can make or break a disgruntled employee's claim
"Advice Squad" is written by members of the Maine chapter of the Association for Consulting Expertise, a trade organization of 88 consultants around the state.
Warren Buffet once said: "It's only when the tide goes out, you find out who's been swimming naked." The saying applies to business - if your personnel files are in terrible shape, no one may know until a disgruntled employee sues. Over the last 25 years, I have seen the following scenario play out in many ways:
You have a disagreeable hourly employee, Jane, who is technically competent but intimidates and verbally abuses co-workers and her supervisor, Tom. When Tom attempts to confront her, she manipulates him, exploiting his timid nature and lack of confidence. Over the last five years, Jane's performance evaluations have focused on her technical skills and are fairly positive. About a year ago, Jane began working more than 40 hours a week, even though overtime must be approved by the supervisor in advance. When confronted, she manipulates Tom into allowing her to "volunteer" for a few hours each week. Meanwhile, hardly a month goes by without a department employee in Tom's office crying about something Jane has said or done.
Unexpectedly, Tom gives his notice and leaves. A new hire, Sally, comes into the supervisory position and is taken aback by Jane's behavior. Jane's peers sense that Sally is receptive so they unload all the negative information about how Jane treats them. Sally meets with Jane and puts a stop to the extra hours each week. Then she confronts Jane about her negative relations with peers. Jane then confronts her co-workers who, because of their fears, don't have the courage to confirm that they have complained. Using proper human resource procedures, Sally documents the issues and about a month later, fires Jane. The office rejoices.
About a week later, Sally gets a letter from Jane's attorney alleging wrongful discharge of a longtime, competent employee and failure to pay overtime every week for a year. Further, Jane asserts that the performance counseling over the last three months was conducted by an abusive supervisor unfamiliar with company practices. The letter includes a settlement offer of $30,000 plus the $3,000 owed in overtime pay, and requests a copy of the personnel file.
Preventive measures
There are several problems here. The employee is clearly owed overtime. Sally's conduct, while proper, represented a drastic shift from the old protocols without any advance notice of the change in direction. When supervisor Tom failed to confront Jane, he sanctioned a company atmosphere where Jane's behavior seemed acceptable and that new supervisor, Sally was "too hard" on Jane. Jane's peers who were unprepared for her confrontation seem to bolster the idea that Sally was in the wrong. Jane's personnel file contains five years of positive evaluations, no documentation of the numrous, objectionable behaviors, nothing about Tom's confrontation regarding extra hours and then, good documentation of the last three months of counselings by Sally.
The moment a copy of the personnel file is requested, you can't go back and add new "historical" material. You may be able to add a report dated today with historical information, but this will be seen as self-serving and viewed with suspicion. There isn't much of a defense here. Jane is likely to get some settlement from you. If that isn't bad enough, her allegations may encourage other employees to look at their overtime, so if your practices aren't sound, there may be additional fallout.
Some basic preventive strategies will protect you from this outcome and create a healthier, more productive work atmosphere. First, acknowledge when you are shifting the work culture, why and specifically how it will change. Document the date and content of this meeting and who attended to help support supervisor interventions and forestall employee complaints. Monitor the competence of all supervisory staff, gathering periodic input from supervisees in a confidential manner. Always evaluate and document both technical results and work approaches. When an employee disrupts the workplace, address it promptly and calmly with warnings and frank discussion of the possible consequence of termination. Document abusive or intimidating behavior patterns. Never allow an hourly employee to "volunteer" their time. Make sure your human resource policies are complete, sound and followed consistently by every supervisor in every division. Keep your personnel files up to date and make sure the story they tell is accurate.
During my career, I have worked on 26 serious terminations where employee performance clearly warranted dismissal. Six of the worst cases of poor performance, bad attitude and ethical violations sued their employers. Four of these resulted in employer settlement payouts. Of the two employees who sued but did not get settlements, the bases of the employers' defense were sound management practices and excellent documentation - a good personnel file is a very strong defense.
Suzanne Benoit can be reached at svbenoit@maine.rr.com. Read more Advice Squad at www.mainebiz.biz.
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