Staples Must Pay $26 million for Age Discrimination

A Los Angeles Superior Court jury  hit the “Easy” button and ordered Staples, Inc., the office supply chain, to pay  $26 million in damages in an age discrimination case.

Bobby Nickel., 66, was hired in 2002 to work as a facilities manager for Corporate Express. He had positive employment evaluations until 2008, when the company was purchased by Staples Inc.  Nickel said Corporate Express’ pay scale was higher than the pay scale for employees hired by Staples.

Nickel said he was a  victim of age discrimination and wrongful termination by Staples managers who were intent upon pushing out older workers who earned higher salaries.

The jury deliberated for two days before awarding Nickel $22.8 million in punitive damage and $3.2 million in compensatory damages on February 27.

Nickel alleged that Staple’s used the following  tactics to run him out of his job as a facilities manager:

  • A supervisor prompted  Nickel  to resign.
  •  Nickel said he was disciplined for a series of minor infractions.
  • He suffered increasing levels of harassment from co-workers and a manager;  was the regular butt of jokes at staff meetings;  and was referred to as “old coot” and “old goat.”
  • A receptionist  told Nickel that she was ordered by management to provide a false statement about Nickel’s conduct but that she refused to do so.

Nickel was suspended and  fired in 2011 when he was 64 years of age for allegedly stealing a 68-cent bell pepper from the Staples cafeteria.  Nickel said he intended to pay for the bell pepper through an honor system set up by the cafeteria vendor. However,  Staples said the  taking of the bell pepper violated the company’s zero-tolerance policy when it came to “dishonesty of any kind, including theft or misappropriation of company property.”

A Staples spokesman said the company disagrees with the verdict and plans to appeal.

Minnesota Ct Enshrines Employment-at-Will Rule

The Minnesota Supreme Court has upheld the dismissal of a worker who was fired by her employer because she applied for unemployment compensation during a period in which the company failed to assign her work.

This would seem to be incongruous, given that the state of Minnesota has granted workers the right to file for unemployment compensation benefits.  However,in a harsh and divided decision. Minnesota’s Supreme Court said the state’s “employment at will” rule trumps a workers right to be free from wrongful discharge for having invoked her right to apply for state unemployment benefits.

The century old  “employment at will” rule is an arcane theory based upon a questionable premise – that employers and employees have equal bargaining power. Under this theory, employers can fire employees “for any reason or no reason” providing it is not an illegal reason, and an employee can quit for no reason.  Of course, in reality, the see-saw tilts heavily toward an employer, especially in an economy where there are three applicants for every job vacancy.

To put this in perspective, the United States is one of only a handful of countries where employment is predominantly at-will.  Most countries throughout the world allow employers to dismiss employees only for cause. Only Montana in the U.S. has rejected the “at-will” doctrine.

Should we ‘term’ her?

Jane Kay Dukowitz  was hired as a security officer in 2005 by Hannon Security Services to work a night shift.  She learned in November 2008 that a temporary daytime position was open for the holiday season, applied and got the position.  She was subsequently informed the position would end on Dec. 31, 2008  and that Hannon had  no work for Dukowitz in the ensuing months.

Dukowitz said she told her supervisor that she would need to apply for unemployment benefits “to make ends meet.” Her supervisor allegedly turned to another supervisor and asked, “should we term her?”— terminate her employment. Dukowitz said she begged them not to fire her and asked to be placed on a “floating shift” so that she could work when shifts became available.

Dukowitz was fired on March 13, 2009 after having applied for unemployment benefits.  Hannon cited her “poor work,”  “unwillingness to work weekends or nights” and the poor local economy. Dukowitz contends that she received positive performance reviews and never refused to work weekends or nights.

The dispute boiled down to the scope of the public-policy exception to Minnesota’s employment-at-will rule. Dukowitz argued that legal precedent established  a cause of action for wrongful discharge if an employee can identify a clear mandate of public policy that the employer violated when it discharged the employee.

The majority ruled that it is up to Minnesota’s legislature to “balance the competing interests of employers, employees, and the public to determine whether, and when, an employer violates the public policy of the state by discharging an employee.”  The majority noted that under  Minn. Stat. § 268.192, subd. 1 (2012) it is already a misdemeanor for an employer interfere with an employee’s application for unemployment benefits.

The majority also ordered Dukowitz to pay Hannon $1,361.35 in costs and fees, despite Dukowitz’ objection on the grounds of indigency.

Justice Wilhemina Wright, joined by Justice Alan Page, filed a dissent  in which they argued that “[a] common-law wrongful-discharge claim . . . would advance [Minnesota’s] public policy by fostering additional deterrence” of employers who decline to follow the requirements of Minnesota’s unemployment-compensation.”  She also argued that the legislature’s role in policy-making is “not exclusive” and the court has the power to both recognize and abolish common law doctrines. Justice Wright also noted most states  have expanded the public-policy exception to the employment-at-will rule to include both refusals to violate the law and reports of violations of law.

The majority’s decision in   Dukowitz v. Hannon  Security Services, No. A11-1481 (Minn. Jan. 2, 2014), was written by Associate Justice David R. Stras.

Ray Dalio: “Firing People is Not a Big Deal”

You gotta give this guy some guy credit.

Ray Dalio, the founder of Bridgewater Associates, LP, a global investment management firm, lets you know what to expect if you want to or if you do work  at the firm.

 Don’t expect much in the way of human kindness.

 Dalio has published a 123-page document  entitled “Principles” on the firm’s web site outlining his management beliefs.  To put it kindly, Dalio’s principles reflect the outsized ego of a captain of industry who seems to have little patience for any human frailty that might get between Bridgewater and a buck.

What is particularly interesting about the document is Dalio’s obvious disdain for Human Resources personnel.  One  might imagine some hapless HR Director, long since fired, suggesting that Dalio’s management principles could be… uh … more humane.  (“Sir, Mr. Dalio, Sir …  might I suggest that firing people is a big deal to the people being fired?”)

There’s no doubt that Dalio’s principles work for him. According to Forbes he is the 44th richest person in America and the 88th richest person in the world with a net worth of $10 billion as of March 2012.  But God help you if you are an employee who happens to be a single mom with urgent childcare demands; a worker whose ‘game’ is thrown off by divorce, sickness, death of a loved one; or if you just can’t take the stress of being evaluated like a micro-circuit board on an assembly line.

 So on this Labor Day 2013, it is without pleasure that I present some excerpts from  Ray Dalio’s “Principles”:

  • Evaluate people accurately, not “Kindly.” 
  • Maintain “baseball cards” and/or “believability matrixes” for your people. Imagine if you had baseball cards that showed all the performance stats for your people: batting averages, home runs, errors, ERAs, win/loss records … You can and should keep such records of your people … . I use ratings, forced rankings, metrics, results, and credentials.
  • Remember that convincing people of their strengths is generally much easier than convincing them of their weaknesses … At Bridgewater, because we always seek excellence, more time is spent discussing weaknesses. … . This is great because we focus on improving, not celebrating how great we are, which is in fact how we get to be great. For people who don’t understand this fact, the environment can be difficult. 
  • Don’t collect people. Firing people is not a big deal—certainly nowhere near as big a deal as keeping badly performing people, because keeping a person in a job they are not suited for is terrible both for the person (because it prevents personal evolution) and our community (because we all bear the consequences and it erodes meritocracy). 
  • When people are “without a box,” consider whether there is an open box at Bridgewater that would be a better fit. If not, fire them. Remember that we hire people not to fill their first job at Bridgewater nor primarily for their skills. We are trying to select people with whom we’d like to share our lives. We expect everyone to evolve here.
  • It is your job as a manager to get at truth and excellence, not to make people happy. For example, the correct path might be to fire some people and replace them with better people, or to put people in jobs they might not want, etc.
  • It is far better to find a few smart people and give them the best technology than to have a greater number of ordinary and less well-equipped people …  Usually it is the person’s capacity that limits the scope of his understanding and control.
  • A higher percentage of the population than you might imagine will cheat if given an opportunity, and most people who are given the choice of being “fair” with you and taking more for themselves will choose taking more for themselves.
  • Use “double-do” rather than “double-check” to make sure mission-critical tasks are done correctly. When people double-check someone else’s work, there is a much lower rate of catching errors than when two parties independently do the work and the results are compared. Double-doing is having two different people doing the same task on the same job so that two independent answers are derived.
  • I  often hear people say, “It’s getting better,” as though that is good enough when “it” is both below that bar and improving at an inadequate rate. That isn’t good enough.  Everything important you manage has to be on a trajectory to be “above the bar” and headed for “excellent” at an acceptable pace.
  • Don’t try to please everyone. Not everyone is going to be happy about every decision you make, especially the decisions that say they can’t do something.

And Don’t Listen to HR!

  •  Watch out for “department slip.” This happens when a support department, such as HR or Facilities, mistakes its responsibilities to provide support with a responsibility to determine how the thing they are supporting should be done. An example of this sort of mistake is if  … people in HR think they should determine what our employment policies should be …  While support departments should know the goals of the people they’re supporting and provide feedback regarding possible choices, they are not the ones to determine the vision.
  • Assign responsibilities based on workflow design and people’s abilities, not job titles … .For example, just because someone is responsible for “human resources,” “recruiting,” “legal,” “programming,” etc., doesn’t necessarily mean they are the appropriate person to do everything associated with those functions. For example, though “Human Resources” people help with hiring, firing, and providing benefits, it would be a mistake to give them the responsibility of determining who gets hired and fired and what benefits are provided to employees.

I became aware of Ray Dalio’s management principles in a recent story by Rachel Feintzeig in the Wall Street Journal, about the cost of incivility in the workplace.  The article notes that networking-equipment company Cisco Systems Inc. in 2007 estimated the cost of incivility in its organization topped $8.3 million annually. Costs include account turnover, employees’ weakened commitment to the company and work time that was lost to worrying about future bad behavior.

 

Getting Fired

FIRED!

The capstone of a campaign  of workplace abuse and bullying is often termination from the job.

 And that reality  – or even the fear of being fired  – can be a devastating blow to a worker who has endured months of  abuse that has stripped away his or her sense of mental and physical well-being.

 But today what does it really mean to be fired?

 I know business leaders who were fired  and recovered to achieve impressive new success.

 Sallie Krawcheck, past president of Merrill Lynch, US Trust, Smith Barney, the largest wealth management business in the world, suggests that if you don’t get fired at least once, maybe you’re not trying hard enough?

 She says that as the pace of change in business increases, the chances of having a placid career are receding. And if in this period of rapid change, you’re not making some notable mistakes along the way, you’re certainly not taking enough business and career chances.

 Being fired is not always a reflection of performance.

Research shows that some targets of workplace bullying are dismissed because they are creative, hard-working and well-liked employees who are seen as a threat by a supervisor or co-worker. They may be among the best in their workplace and that is why they are targeted.

 I also know bureaucrats (and I use that term  in the worst sense of the word)  who should be fired but probably never will be, despite their obvious incompetence.  They have managed to insinuate themselves into secure positions, by surrounding themselves with synchophants and/or by avoiding any personal responsibility for anything, except to claim success for others’ work.

Many  employees are fired because  a new supervisor wants to put in his or her own team in place or the worker’s values or vision don’t  comport with that of  the supervisor.

Many workers are fired for illegal reasons –  they are victim of discrimination on the basis of  age, sex, race, religion, etc.  Some are fired because they asked for a legal right – such as the right to be paid overtime under the Fair Labor Standards Act.

 So if you were fired in the past year or expect to be in the year ahead, try to  keep it in perspective. Any employee who was fired can likely think of some things that they could have done better.  Hindsight is 50-50.  Nobody’s perfect.  Etc.   Hopefully, your new and hard-earned  knowledge will help you succeed the next time?

 Ms. Krawcheck also advises:

 I  had a friend tell me shortly after I left “When something like this happens, you think you’re thinking straight, but you’re not. You won’t think straight for at least three months.” If you have the luxury of avoiding any major career decisions that long, the perspective you gain after decompressing can be valuable.