Copyright © 2010 by Ethan A. Winning
The following introduction to the latest edition of Labor Pains: Employer and Employee Rights and Obligations is presented to give the reader a sense of the flavor and style of the book and the topics within human resources and employee relations. If you don't like candor, don't buy this book.
Footnotes are italicized and bracketed since they can't be adequately represented in html.
Note that this book is sold in .pdf format only. Of course, because of the nature of the book and the Q&A format, .pdf is ideal for a desktop reference.
Introduction to the 15th Edition of Labor Pains
[Footnotes in Italics]
This book was written for the smaller business, i.e., under a thousand employees, and for the most part those with under 100 employees. Not that the principles stated can’t be used by all companies, but those same principles that are the foundation of “the psychological contract,” the give and take between management and the worker, have been discarded in the past decade by the largest companies. Companies that downsize by the thousands won’t pay much attention to the inequities that exist between the most senior management and middle management down to the lowest level employee.
Labor Pains is a reference book that answers questions that business owners and employees continue to have even in this changing working environment and business climate. What truly worries me is that we have become accustomed to poor customer service, and if we can get used to that, we can get used to all manner of negative changes in the world around us. The next generation of workers will not be able to comprehend what our generation (those over the age of 50) enjoyed for a time at least in terms of mental, physical, and work security. The first edition of Labor Pains was published in 1995. Fourteen years later - nothing really changed in 2008 when referencing labor codes - here’s what has changed in the U.S.
• The federal minimum wage has remained almost constant while the cost of living has risen by 31 percent (DOL, Nov, 21, 2008).
• Real income has declined by between 15 and 22 percent depending upon which survey you use, and whether you have kids, and whether all your meals are made with stuff that has "Helper" in the name.
• The top one percent of executives earn 30 percent of corporate income.
• The percentage of workers without health insurance has risen from 14 percent to 49 percent as pf late 2008.
• The percentage of workers who used to pay between nothing and 20 percent of premiums and now pay half or more has gone from nine percent to 75 percent with a rise in just the past year of 15 percent.
• The number of persons downsized since 1995 is in the millions. Exact numbers are impossible. Some people were downsized more than once. I know one guy who was downsized so often, he's only three feet tall and he used to be six-two.
• The number of jobs outsourced to three countries is around 10 million. Now, what with a true global economy, even India and Japan are outsourcing jobs. Given enough time, maybe some will come back here. Oh, wait, in 2007 the Bureau of Labor Statistics actually said that 25,000 jobs did come back to the U.S.
• The number of jobs replaced at the same or a higher level of income as those lost is somewhere around 17 percent.
The worst thing that happened was that the Millennium Generation, the twenty-somethings don't know that that is not the way things have always been, and the thirty-somethings have gotten used to it. Generalization though it may be, both groups accept it, proudly waving their Blackberries and telling us older employees how they can multitask all the while being taken advantage of because if they can do two jobs at once, it becomes the norm for "satisfactory" performance. Of course, these are the same people who have accidents in their cars while talking on their phones and - I swear I saw this just last week - walk into a shopping cart because, truth be told, they can only multitask if one or all tasks suffer in quality.
All the while, the U.S. Department of Labor under Elaine Chao has done nothing, well nothing to write home about. To show just how ineffectual the DOL has been, other than gutting the FLSA and making it more confusing, excluding the usual and easy targets like Wal-Mart, GM, and other huge companies that should and probably do know better, enforcement of existing legislation has been halved. What has the DOL been up to? Well, along with SHRM, they did sponsor the week of October 16-22, 2006 as the first-ever Drug-Free Work Week! The absurdity of that should be apparent. It so absurd, I'm surprised they didn't have it return in 2007.
The DOL and SHRM which now lobbies for the DOL can’t be solely responsible. No, by and large the lack of action is due to Congress which, by the way, took (yes, took) a 28 percent increase in salaries while leaving the minimum wage at a paltry $5.85 an hour. The Members of Congress make $168,500 as of January 1, 2007. So, 168.5k isn’t that great, right? Yeah, but they’re only in session 113 days a year! It was 185 days in 1995. At this rate, we should be paying them not to work by 2015. Hmmmmm....maybe we should speed up the process.
Of course, we could take a rational approach to this by not paying attention to the headlines that the minimum wage and other economic factors get. After all, 20 states' minimum wages are at least a buck more than the fed, and 117 cities have a living wage that is at least five dollars more. But even with that approach, because we are rational beings, we know that there is indeed a disconnect between Washington, D.C. and the realities of work, the workplace, the individual and the corporation. Who can live on $10,712 a year?
In this book, I am not dispassionate but I do make the book positive and incisive, albeit at times barbed. The disconnect that drives me nuts is lampooned simply because the changes that the past decade has brought about need to be discussed for they affect HR; they affect work; they affect our lives.
I began writing Labor Pains about 35 years ago: I just didn’t know it. In the early years of my consulting practice, long before e-mail which could be used as a database, each question a client would ask and the answer given would be noted in a three-ring binder. In this litigious world, it was basically a move designed to cover my rear, but it also turned out to be one of the best ways to ensure my continuing education in laws, court rulings, and the general principles of human resources and management.
During much of this time, I also taught personnel administration at a community college, an endeavor which also contributed to my continuing education. Almost all of the more than 500 students who took the class each semester were employed, as opposed to being full-time students. Although the course was a requirement for the management certificate, most students were there every Monday night to find out more about their rights at work and the employers’ obligations to them. There were a few who were personnel (now HR) managers, and some who owned their own businesses, and it is a fact that they were present to learn enough in our sue-happy society to cover their own posteriors. Anyway, in addition to calls from my clients, I also get calls from past students wanting advice on one employment situation or another.
In the past decade, I have written another book on employer-employee relations, have appeared on many radio call-in talk shows, have been a regular on the JobNet and Voice of the (Silicon) Valley television programs, became the Consulting Associate Editor of The Personnel News, began writing a monthly Q&A column for both The California Job Journal, our Internet Web site, Disgruntled Magazine, as well as the books Disgruntled and the 2006 Small Business Book of Lists. I also started a real-time employee relations forum on the Internet but, unfortunately, gained more attention from employees than employers and it was the latter group for whom the chat group was intended. I have also maintained my consulting practice, currently with clients in nine states.
[Over the years, my practice has had clients in 34 states (and six countries) including Arizona, California, Florida, Georgia, Idaho, Illinois, Kentucky, Massachusetts, Minnesota, Missouri, Nevada, New Jersey, New York, Oregon, and Washington. These states’ labor codes — if any — are fairly representative of the country as a whole. For this reason, we maintain an extensive library of both state and federal labor codes and regulations all of which are reflected in the answers in this book.]
Through these activities and sources, I’ve received over 10,000 thousand questions...well, five questions asked 2,000 times. (In pre-spam days, our Web site alone generated more than 75 e-mail questions a day.) However, taking the overlapping into consideration, and the fact that there was considerable selectivity in choosing which questions to use, there are no more than one hundred and eighty that have gone into the writing this edition of this book.
Most of the questions which are included in this edition were received within the past five years. When older but quite relevant questions are used, changes in the labor code, the law, or court decisions which have been handed down or overturned in the interim are footnoted. When a law or regulation is part of the answer, the reader can be assured that the answers were reliable and factual as of this writing.
The reader will note that there are quite a few references to the California Labor Code. With a majority of my clients in a state that represents one-eighth of the country in terms of population, this simply could not be avoided. But it should not deter readers from any other states. If one is an employer, it is almost a certainty that if you follow California codes, you will not go wrong in the majority of states. (You may pay more, but you won’t be wrong.) Further, laws which pass in California seem to traverse the country with the jet stream and sometimes as quickly.
[Six years ago, California passed a law, the so-called “kin care” law, which allows employees to use up to half of their accrued sick leave or PTO to care for other members of the family who are ill or need care. I predicted, in writing no less, that other states would follow suit within a year and that this would l become part of federal law for employers not covered by the Family Medical Leave Act (FMLA). By 2005, 21states had adopted similar regulations. The fed has been slower, but it will happen.]
Whenever possible, I have noted other states’ differences. Whether the topic is wrongful discharge, unemployment compensation, harassment, or just hiring and disciplinary policies, the bases for the answers are federal law as much as state, and the policies written do apply in all states except as specifically noted. Various codes have been listed from Washington, Illinois, Minnesota, Oregon, New York, Rhode Island, South Carolina and Michigan. Most states rely on federal law rather than having state codes. (See charts throughout listing various regulations by state.)
[In 1980 I called the State of Nevada and asked that they send me their labor code, stating that I was willing to pay the going rate. I was told that that was no problem and that they’d send it out free of charge. Two days later I received a one page “code” which had as its only state labor law a statement about minors working in the gaming industry. Now Nevada has at least 200 pages and, as with most states, has their labor code on the Internet. Note that labor codes are not always called “labor codes.”
The same was true for Arizona, Colorado, Texas, and especially Florida. These are not lawless states; rather, they depended entirely on federal codes, court decisions, and laws.. Note that as of 2005, of these states only Florida still has a very limited labor code, and Colorado has a very extensive one.
Having been forced to learn labor codes from more than twenty states, it is my opinion that the most stringent and often difficult to understand states’ codes come from New York, Minnesota, Colorado, DC, Maryland, and Massachusetts — but California still takes the prize. With a labor code, administrative code, government code, and business and professions codes of more than four thousand pages (abbreviated form), I often have to rely heavily on my friends in the legal profession for an opinion of my opinion. But I also subscribe to three legal services which provide me with changes to labor codes sometimes daily, usually monthly.]
I had originally subtitled this book, “The Employment Cycle,” because that’s what employment has always been. One gets hired and one gets fired or laid off, or retires, rare though that might have become. Questions arise about hiring and termination and everything in between, but mostly about hiring and firing. Employment has changed. Just thirty years ago, one started with a company with the thought that one would retire with that company; it may not have worked out that way, but that was the thought. Of course, it was just 30 years ago that lifelong employment was a guarantee to any Japanese worker. That’s as dead as security in retirement is in the U.S.
The average length of employment with one company in the 70s was six years. Twenty years ago, that average had dropped to three years. Ten years ago, it was eighteen months. Today, while reliable figures aren’t in, and while employees are the ones trying to hang onto what little stability and security there remains in American industry, employers are the ones who terminate so readily. (See page 15.) “Many New Executives Are Being Discharged With Stunning Speed; Fired Before Starting Work,” was the headline in the March 4, 1994 Wall Street Journal. And who can speak of stability when, after laying off 100,000 employees in the previous 12 years, AT&T announced a mass layoff of 40,000 in 1996, or AMD laying off 4,000 in 1998, or IBM 4,000 in 1999? Even those pale in comparison to the more than a million in 2001, and another four million in 2002 and the first six months of 2003. Lest you think that employees escaped unscathed, downsizing continued at a rapid pace 2004 and 2005. The difference was that hiring increased and offset some of those losses. While hiring statistics are suspect, terminations are reported by large companies, and not unwillingly because stock holders seem to love the apparent cost savings.
Employment has changed simply because the world has changed. We’ve entered a new era, an era where I sometimes question the work ethic of employees, and often question the thinking and ethics of (the largest) employers. More of that later. Suffice it to say that unemployment will rise again, that downsizing has become a norm, and that we are in for a marketplace that few could have imagined five years ago, and still fewer can predict. Who would have predicted outsourcing to India and China and the Philippines and South America? And not just by the United States. European countries do so as well, but also send jobs here. It has truly become a global job market and economy.
[Do not judge me as being overly negative in what is considered an upturn in the economy and job picture or jobless picture. The Department of Labor’s Bureau of Labor Statistics produces the hidden unemployment stats every month. In July 2004, the actual unemployment rate was 9.7%, almost four points higher than the published figures. The 2005 figure of 5.1% did not take into consideration those who have given up, run out of UIC benefits, or who work part-time or temp jobs. Unemployment and other government figures are often a joke, only proving whatever the current administration wants to prove. But I’m not negative. I’m just very positive about things I don’t like.]
But the reader should note that there is great danger in being suckered in by media hype or, perhaps more accurately stated, media attention. In 1998 and 1999, two articles in the Wall Street Journal suggested that up to 30 percent of the workforce would be working out of their homes by 2005, 50 percent by 2010. Video conferencing notwithstanding, I didn’t believe the premise or conclusion. There may have been compelling logic to think that that could happen. In 2005, no one could afford a home in the hottest economic sectors and the four-hour commute dictated that more employees will work from their homes, but perhaps only on a sporadic basis.
In 2008, with unemployment creeping higher, home prices lower, and some large companies actually finding that it’s cheaper to have employees working at home, I was proved wrong – temporarily. As the economy picks up by 2010, 2011, or whenever, we may well revert to my original premise.
Plus there are the legal ramifications of telecommuting such as time and record keeping and workers’ compensation insurance. I wouldn’t count on telecommuting as a norm in our lifetimes: even Robert Reich, Secretary of Labor in the Clinton Administration, said that it was a “fraud,” his term not mine. The mental gymnastics that the fortune tellers use would have been more accurate if they had prognosticated that 30 percent of the workforce will be working from their cars. (If interested, see article in Archives on my Web site.)
The employment process used to be cyclical. Downturns in the market have been followed by upswings. It is still true, but the cycle seems longer. Come to think of it, it is longer because we lost millions of jobs, jobs that may never return. This was a revolution, and this time the creation of new jobs won’t necessarily be in manufacturing.
One wit has written that executives of large industrial firms are looking for men between twenty-five and thirty with forty years of experience. Employers are just beginning to figure out that their companies are short on the skills, depth, and maturity needed to meet the goals of the enterprise.
One day we will return to a semblance of normalcy — “virtually normal” in our cyberworld. It will only resemble what we think of as “normal” because some changes have had and will have a lasting impact on the way people are hired and fired. For example, there is no question but that mutual trust has been undermined...at least in larger companies. We will all suffer because of this. It may take another generation to reestablish those basic trusts and the attendant loyalties or they may never be reestablished. I cannot even guess at what the employment process will be like in ten years, but there will probably still exist some basically antagonistic relationship between employer and employee with everyone signing non-compete and non-disclosure agreements. (I get a mental image of everyone frozen in time and space, not being able to move because they’ve agreed to a restrictive covenant at one time or another in their employment. Non-competes aren’t called “restrictive” for nothing.)
As you read the questions in this book, it will become evident that employees have bones to pick with employers and employers with employees. It is not simply a matter of being adversarial although many employer-employee relationships are indeed adversarial in nature. (I am not speaking of the old union-management relations. I am addressing the basic relationship which in the good old days always had some basis in trust.)
When I get multiple and somewhat philosophical questions, I truly feel like a live (or at least lifelike) Dear Abby writer for a professional journal. Within each question, however, are usually some specifics which are truly bothering the individual. Those specifics are addressed in this book.
I have attempted to organize the questions in this book into discrete chapters: “The Hiring Process (under ‘Promises, Promises’),” “Time In, Time Out,” “Working Conditions,” and “Disciplinary Actions and Termination.” The attempt was futile. Questions, especially those requiring multiple answers, are almost impossible to categorize in specific chapters. For example, “at-will” employment, which is the basis for most employment, permeates questions about hiring and termination. Therefore, the book begins with a discussion of the concept of at-will employment.
“Termination” is another broad category encompassing firing, layoffs, resignations, retirement, forced retirement, and so on. Employers asked, “How do we terminate?” while employees asked, “Was it legal for my company to terminate my employment the way they did?” But there are also questions such as, “I am being forced to take early retirement. Shouldn’t I still be eligible for the profit-sharing plan through the end of the year?” This last question has to do with termination, compensation, internal policy, and the law. Simply, employment is a process, and processes are difficult to pigeonhole.
Another chapter, “None and All of the Above” was added, and the reader will find short discussions toward the end which are meant to fill in any areas which could not be addressed in the various sections. The reader is therefore asked to make extensive use of the index. Topics have been indexed and cross-referenced as comprehensively as possible.
Questions are most often represented verbatim...although quote marks have not been used. At the same time, some of the questions are paraphrased from much longer letters. I tried to capture the essence of what the employee or employer was saying. Sometimes, just for the sake of continuity, two or three pages of contentious diatribe had to be omitted.
When I wrote the first edition of this book in 1995, there were few persons on the Internet. Now, only one in 1,000 who purchase this book do not have access to the Net. Therefore, I strongly suggest that you read some of the articles that I have posted in the non-subscribers section on our web site which will – I hope – suffice as an adjunct to this book. Direct URLs are listed in some responses to questions regarding many topics.
I am not a lawyer. I say this for one reason: although the bar association is perfectly willing to take money from those of us who want to become associate members, lawyers don’t like laymen practicing law, let alone a layman who understands the law. Although some codes, statutes, regulations, and court cases are cited, I take a common sense approach to the interpretation of these decrees. Many of you have already realized that there is little logic in law, so taking a logical approach doesn’t always work. After all, there are people in San Quentin prison receiving unemployment insurance benefits, and people who, in the process of stealing from their employers become injured and are now collecting Workers’ Compensation benefits. (Yeah, there are!)
It is at this point that I’m supposed to say, “Before taking any action, consult your attorney.” So, okay, before taking any action, consult your attorney. If you do not have an attorney, one will be provided to you for a huge fee. You have the right to remain intransigent. If you want to give up that right, you might want to use some of the answers in this book as a guide. And, by the way, if you find yourself in the predicament of those represented in this book, whether employer or employee, you should find the answers helpful in making certain that you have picked a “good” lawyer whose area of expertise should be labor law.
For employers and employees, sample policy statements have been included throughout the book. Employers may find it useful to include some of these policies in their own manuals. (You may not lift them in their entirety. If you do and I find out about it, you will hear from my attorney, and you really don’t want to deal with her.) Employees will find the policies of use because the answers to questions often refer to policies which their companies may or may not have.
If you have any questions that you would like to ask — whether you read the entire book or not — you can post them to me on our Web site at www.ewin.com, email me at firstname.lastname@example.org or, if you’re in a real bind, and don’t mind paying for good advice, give me a call at 925-944-1034.
Ethan A. Winning
Walnut Creek, California
A note about notes: Throughout this book - now that it is in .pdf format - you will find phrases, sentences, even whole paragraphs in color, usually blue. If I had a one or two page quick reference guide, these are notes that would be included. I’ll guarantee that if you follow the advice in blue, you will save thousands of dollars, at least tremendous potential liability, and tens of hours of worry and work. No matter how much support you may feel the federal government is giving corporate America, remember that “corporate America” from a federal perspective includes less than ten percent of the companies that exist, and two percent of those who have bought this book. Support, under any circumstances, is always fleeting and usually contingent upon something which most small companies don’t have.