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On June 18, 2009, the Ontario Superior Court of Justice dismissed a motion for a proposed class action brought by Dara Fresco on behalf of current and former employees in the retail branches of the Canadian Imperial Bank of Commerce (CIBC).  The claim alleged unpaid overtime wages.  Now before assumptions are made, don’t do what I did and only read the headline!  Let’s look at the details.  

It is important to note that the court didn’t rule on whether CIBC paid or didn’t pay overtime wages.  The motion was dismissed because the action lacked the requirements necessary under the Canada Labour Code for a class action lawsuit.   (Banks are federally regulated, not provincially regulated).  The plaintiff (Dara Fresco) in the class action law suit claimed that CIBC’s overtime policy was illegal and that the provision for time in lieu, which was an option in the overtime policy, was also not allowed under the Canada Labour Code.  The claim further stipulated that the pre-approval requirement was especially illegal.

The courts found that CIBC’s Overtime Policy was not illegal.   The courts found that the preapproval requirement in particular ensured that the employer complied with the labour code.   They also found that the provision for time in lieu at a rate of time and a half was also legal and in fact, CIBC’s overtime policy provided a better lower total weekly threshold of 37.5 hours before overtime was triggered, rather than 40 hours under the Canada Labour Code.

The court did not rule on whether Dara Fresco and individuals at CIBC were paid appropriately for overtime.   The dismissal only verifies that this particular class action motion could not proceed because it didn’t match the criteria needed to be a lawsuit.  In essence, Dara Fresco could have brought this case to court as an individual.   But with the costs involved, would she?  There are several other class action law suits concerning overtime that may be affected by this ruling.

In any case, a properly crafted overtime policy is important to ensure it is accurate and complies with the appropriate federal or provincial legislation.  Policies and procedures should be reviewed by an employment lawyer to ensure compliance, however, preparing a draft policy for review will reduce legal costs.  

Tips for Creating an Overtime Policy

1. Include a statement that overtime must be pre-approved by a manager.
2. Explain the options for overtime (i.e. overtime pay, or pay in lieu).
3. Provide a better lower weekly threshold if possible, or at the very least, be compliant to the labour code requirements.
4. Confirm the labour code that regulates your industry.
5. If you obtain conflicting opinions obtain a ruling on what code applies.
6. Include guidelines about keeping accurate records.
7. Make sure you understand who qualifies for overtime.  Certain positions don’t qualify for overtime, some salaried employees qualify for overtime and some managers may qualify for overtime.
8. If you have a complaint about overtime, deal with it quickly and transparently and make revisions to your policy so that it won’t happen again.   Don’t try to “sweep it under the carpet” because people have a way of finding out and then you’ll have a difficult time rebuilding trust.
9. Train managers and employees on the policy and how to handle any disputes before they escalate to a lawsuit.
10. Get expert help when you need it.  Getting help before you need it is even better!

 

Best regards,

Joanne

Joanne Royce is the Founder of Royce & Associates, a Human Resources and Training Solutions consulting company.   She designs policies and procedures, Creating Happy, Healthy and Productive Workplaces.   www.royceassociates.com

Many small businesses are hesitant about implementing a formal human resource (HR) system. An HR system is not a set of policies that sit on a shelf to gather dust. A HR system is an organized and coordinated method and/or interrelated methods that make up a whole; it is the organized ideas and principles around the people that staff and operate an organization, as contrasted with the financial and material resources of an organization. Its objective is to help an organization achieve results and ensure everyone is working towards the same goal. A properly created and implemented HR system will be used daily and will save the company time and money.

I’ve heard comments like:

• I don’t want anything written down. It will restrict my decision making.
• My freedom (to do what I want) will be severely limited.
• Policies are for the 20% of employees who are the troublemakers.
• I don’t need a system because I have everything in my head.
• It’s too expensive.
• It’s too complicated and difficult to maintain.

The thinking here is that a system will restrict and limit the entrepreneurial spirit of the organization. The perception is that the system will cost too much, be difficult to use, and will bog things down with bureaucracy and paper work. This doesn’t have to be the case.

A properly designed and implemented HR system will save the company money and time and be easy to use. It will ensure consistent messages about how things are done. It will reinforce the vision, mission and values of the organization. It will provide important information that can be accessed by both managers and employees. It will prevent the company from complaints and law suits because the HR system presents equitable and fair processes that are legally compliant. It will allow a company to respond quickly to external factors such as changes in the labour market, legislation, competition, and economy, and for internal factors such as a change in leadership or product line in the organization. In short, an easy to use HR system will help managers find more time in their day, it will save the company money with reduced turnover, decreased complaints and lawsuits and improved productivity, and it will allow the organization to respond quickly to change.

As far as being too expensive, take a look at these examples and think about the financial cost to the organization:

• a small company of 100 employees has a turnover rate of 10% a year – that’s 10 people leaving in one year!
• a small organization of 50 employees has one manager who is abusive and controlling resulting in negative morale and productivity.
• an organization of 150 employees has a management team that doesn’t speak up about issues – instead they have email and telephone discussions “underground” creating a political environment that under minds the effectiveness of the organization.
• an organization with 30 employees has a sexual harassment complaint logged against an employee because management didn’t know how to deal with uncomfortable situations in the workplace.
• an organization with 75 employees hires employees without proper interviews and reference checks and has to fire employees because they “don’t work out.”

A small company has many of the same issues as a larger organization. However, a larger organization has the benefit of an HR professional on-staff with the expertise to deal with the situations. A larger organization has sheer volume of employees to hide behind – one bad apple in the barrel has little impact. A small company doesn’t have HR expertise on staff, PLUS every incident is magnified ten-fold because of their size. The impact of any of the situations outlined above is worse because a small company needs everyone working efficiently and effectively as a team even more so, some would argue, than larger companies. There is no one to fill in when things don’t work out. When incidents occur and there is no system in place to assist, the consequences cost the company.

Small companies do need HR just as much, if not more so, then large organizations! What is it that prevents many small businesses from investing in HR?

For more details about creating a cost effective HR system, check out our website – www.royceassociates.com – to be launched shortly!

Kind regards,

Joanne Royce

Joanne Royce is the Founder of Royce & Associates, a Human Resources and Training Solutions consulting company. She is passionate about Creating Happy, Healthy and Productive Workplaces. Joanne implements easy to use, cost effective HR systems for small to medium companies operating without an HR department. www.royceassociates.com

On April 7, 2009, I was honoured to be invited to facilitate a round table discussion at the monthly Human Resource Professional Association of Halton (HRPAH) regarding Trying To Do More With Less – Human Resource’s Role During Uncertain Times. I facilitated lively and participative discussions with three different groups of HR professionals over the course of the evening. A summary of the topic and discussion follows.

HR professionals stated that a variety of cost cutting initiatives have been put in place due to the economy, but that communication was key to ensure that false preconceived assumptions were dealt with in an open and transparent way. They also noted that cost cutting undermined employee’s confidence and trust resulting in decreased productivity, increased absenteeism, and “killing” the company culture. The role of HR during uncertain times included being strategic and proactive, communicating often, being an employee champion, participating at the executive level, and not becoming a “Yes” person.

What are your company’s actions and thoughts regarding HR’s role during uncertain times? Is HR’s role simply to complete lay off letters and directives from the executive team or is HR actively involved in planning how to weather economic uncertainty?

Topic: When the economy is challenging, organizations understandably have to look for efficiencies and reduce costs. Many areas of cost reduction affect employees either directly or indirectly, and some cost reductions erode employee confidence in the organization’s values and long-term competitiveness.

1. What are some of the typical areas of cost-cutting during tough times that affect employees directly and indirectly? What are some examples that you are experiencing in your workplace?

• Lay offs
• Salary reductions or freezes
• Work Share program through EI
• Summer forced shut down
• Voluntary time off
• Voluntarily giving up company car
• Benefits scaled back or more cost sharing with employees
• Job sharing
• Shortened work week (4 days)
• Less number of shifts, shifts reduced to one shift
• Hiring freeze
• No travel
• Reduction in training and conferences
• Local sales conference versus an exotic locale
• No bonus
• No carry over vacations
• Job sabbaticals
• Reduced or no golf memberships
• Using technology to reduce recruiting costs
• Going green, not printing on paper
• Social programs cut or reduced – no spouses/guests, smaller events

2. What are the impacts of cost cutting on employee trust and confidence in the organization?

• Changing (killing) the culture of the organization
• Increased absenteeism
• Increased WSIB / LTD claims
• Negative chatter, gossip, rumours
• Less focus on doing the job, just doing the minimum or less
• Scepticism with employees wondering if the changes are fair and if executives are impacted like they are
• Decrease in morale
• Decrease in productivity
• Worry about self versus common good
• Increased stress and burnout
• Decrease in effectiveness and efficiency
• Assumptions and perception that executive are using the economy as an excuse to cut back when things aren’t that bad
• Fear
• Opportunity for unions to come into workplace

3. What do you think HR’s role is during difficult economic times? What should we be focused on?

• Communicate, communicate, communicate
• Educate
• Open door
• Communicate how executive team is working on this issue
• Be honest
• Acknowledge impact on employees and the emotions
• Move on to describe practical, such as telling the facts and the effect
• Think and act strategically
• Be proactive before decisions are made versus being reactive
• Don’t be a “Yes” person, come up with alternatives
• Remain positive, follow and promote the changes to decrease confusion and hostility
• Make sure all the managers are in-sync and communicate the same message
• Be a good role model and leader
• Be the “conscience of the company”
• Be aware of assumptions and preconceived thoughts and redirect and reframe these assumptions
  (i.e. employees think the executives are “just doing this because the economy gives then a good excuse to cut our packages”)
• Ask questions of executive and employees
• Be at the meetings with senior leadership team
• Ask for employee input and suggestions
• Be transparent
• Be an employee champion
• Develop a plan with a strategic focus
• Analyze the situation and the consequences of actions to assist with decisions
• Keep the company values
• Manage changes
• Keep sharing successes
• Be more open with financials
• Don’t be an implementer, be strategic
• Handle the functional tasks such as terminations, layoffs with humanity
• Keep work / life balance to prevent burn out

4. What skills & competencies are critical for HR professionals in this economic climate?

• Communications skills – deliver messages in a clear way
• Trusted advisor, coaching skills
• Analytical
• Knowledge expert
• Financial knowledge
• Listening skills
• Stress resiliency
• Understand the business and human perspective
• Strategic thinking skills
• Negotiation skills
• Leadership skills
• Persuasion and influencing skills
• Empathy
• Change Management skills

5. Who is there for Human Resource professionals during times like this?

• Outsourced professionals / experts in specific fields (i.e. EAP)
• Senior management
• Department heads, sales, operations, general managers
• Employees
• Other HR professionals
• HRPA website
• CFO, Finance Manager
• Resources at home (i.e. family and friends)

Joanne Royce is the Founder of Royce & Associates, a Human Resources and Training Solutions consulting company. She is passionate about Creating Happy, Healthy and Productive Workplaces. Joanne facilitates Management, Communication, and Belbin Team Roles workshops.

Did you see the headlines in the news?

Another untendered contract surfaces at embattled eHealth Ontario

The list of untendered contracts awarded by eHealth Ontario continues to grow, with documents obtained by CBC News revealing yet another contract never opened up to competitive bids.

04/06/2009 CBC News

Sources say eHealth CEO Sarah Kramer signed a contract worth more than $600,000 to headhunting firm Egon Zehnder International to recruit high-ranking employees for the agency.  The letter of agreement is dated Feb. 5, but sources say a verbal deal with Kramer was reached in November, the same month Kramer took office.  The eHealth CEO has defended nearly $5-million in sole-sourced contracts doled out in the agency’s early months as justified due to the urgency of getting the ball rolling on Ontario’s electronic health record system, set for release in 2015.

Is it okay to spend a reported $90,000 for each candidate hired to fill five positions at the Vice President level?   Now I must admit that I don’t know all the services that have been provided by the recruiting firm for this fee, but come on … $90,000 per candidate hired!?   The amount this government agency is spending and the amount this recruiting firm is charging the Canadian tax payer makes me upset.    I know there are highly qualified recruiting firms, consultants (Royce & Associates and many of my HR consultant colleagues included) or recently unemployed HR professionals with recruiting expertise who would charge a more reasonable rate.  

 Ms. Kramer and the recruiting agency could have used a simple technique to determine if their actions were sound and ethical when they discussed the fees last November.  They could have asked themselves this question:

 “If the amount I’m spending (or charging) for the services I’m receiving (giving) is splashed across newspaper tomorrow, would I sign (present) this agreement?  Does it sound reasonable?”

 If the answer is NO, then don’t do it.  So the recruiting firm is getting a lot of press right now, but not the right kind.  How much will that cost them in the long run?   

Successful recruiting follows a systematic approach that results in great hires.  If you would like to learn more, watch for information about our proven recruiting system on our new website to be released in early summer.

Best regards,

Joanne

Joanne Royce is the Founder of Royce & Associates, a Human Resources and Training Solutions consulting company.  She is passionate about Creating Happy, Healthy and Productive Workplaces.   Joanne provides full cycle recruiting services and facilitates “How to Hire the Best” workshops.  www.royceassociates.com