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March 2008

Wal-Mart Asks Former Employee for $471M for Past Medical Claims...

One thing that most HR people aren't aware of is that medical plans can ask for documentation from any third party action (that's a lawsuit for all my plain English friends), related to settlements that might be used to pay medical expenses.

Why?  Let's say you are involved in a crash with a drunk driver, and as part of the insurance settlement,Walmart2 the drunk driver's insurance provides a settlement that includes $$ for your medical care. From the insurers point of view, if there are other funds available to pay your claims, it's in their best interest to force you to utilize those funds.

I see requests for documentation flowing through our plans at least once a month.  That type of process is alive and well in plans that are self insured, as well as fully insured. 

Of course, it's best to ask for clarification before the claim is paid.  If you try and go back after the claim is paid, it's like asking someone to dig into their own wallet to pay the claim, regardless of the terms of the settlement.  The Blue Cross networks I've worked with are pretty sensitive to the negative press that can go along with this.

Then there's Wal-Mart - for every step it takes forward to repair its image, it seems like it takes two steps back.  Like this one, where the big retailer is seeking 470K from a brain-damaged ex-employee's trust fund.  CNN.com has the details:

"Debbie Shank suffered severe brain damage after a traffic accident nearly eight years ago that robbed her of much of her short-term memory and left her in a wheelchair and living in a nursing home.

It was the beginning of a series of battles -- both personal and legal -- that loomed for Shank and her family. One of their biggest was with Wal-Mart's health plan.

Eight years ago, Shank was stocking shelves for the retail giant and signed up for Wal-Mart's health and benefits plan.

Two years after the accident, Shank and her husband, Jim, were awarded about $1 million in a lawsuit against the trucking company involved in the crash. After legal fees were paid, $417,000 was placed in a trust to pay for Debbie Shank's long-term care.

Wal-Mart had paid out about $470,000 for Shank's medical expenses and later sued for the same amount. However, the court ruled it can only recoup what is left in the family's trust.

The Shanks didn't notice in the fine print of Wal-Mart's health plan policy that the company has the right to recoup medical expenses if an employee collects damages in a lawsuit."

Good call on Wal-Mart's part?  I report, you decide.  Here's one stat I'll provide.  Wal-Mart earned about 348 billion in revenue in 2007.  So what's 470K come to as a percentage of revenue?  Maybe some of my economics friends can run the numbers in the comments. 

Now say you are running a HR shop at a company with 100M in revenue.   What would a proportional claim be to your plan? 

I'd say most of us would walk away from that because of the internal PR damage alone.... Especially if we had to go back to the employee after the fact, once the claim had already been paid...

Evaluate Your Street Cred at Work By the Size of Your Birthday Party...

Do your co-workers celebrate your birthday with the intensity of Mardi Gras?  Or do they mumble the birthday song in the morning and tell you they need to get back to the Penske file as you offer them cake?

According to this video by CareerBuilder, if the latter is true, your street cred in the workplace is at an all-time low....

Nice recovery on the promotional front by CareerBuilder after the Super Bowl ads that totally blew....

Hat Tip to Cheezhead...

Do HR People Need a Resume?

The answer, unless you are some type of Tony Robbins wonder-kin, is yes...

Still, the question is an interesting one.  In a heavily linked post, Seth Godin recently presented a take that the best candidates shouldn't be concerned with having a resume.  Here's part of Seth's take on how top talent can differentiate themselves by not having a CV:

"This is controversial, but here goes: I think if you're remarkable, amazing or just plainBullhorn spectacular, you probably shouldn't have a resume at all.

Here's why: A resume is an excuse to reject you. Once you send me your resume, I can say, "oh, they're missing this or they're missing that," and boom, you're out.

If you don't have a resume, what do you have?

How about three extraordinary letters of recommendation from people the employer knows or respects?
-Or a sophisticated project they can see or touch?
-Or a reputation that precedes you?
-Or a blog that is so compelling and insightful that they have no choice but to follow up?

Some say, "well, that's fine, but I don't have those."

Yeah, that's my point. If you don't have those, why do you think you are remarkable, amazing or just plain spectacular? It sounds to me like if you don't have those, you've been brainwashed into acting like you're sort of ordinary."

So what does the star HR Director/Manager use to market themselves if they aren't aren't using a resume?  Great question.  We aren't graphic designers, so we don't have items that seamlessly build portfolios.  Still, the portfolio model makes the most sense.   Some of the strongest candidates I have interviewed across all functional areas used the concept of a "leave behind" to win the job.

The leave behind is a portfolio of projects/initiatives that shows the depth of who you are professionally.  It transcends a resume.  Put together the right way (it's all marketing, all the time in the job hunt, my friend), the leave behind portfolio hits the hot buttons you want to hit (think employment branding, retention, development) by presenting the best of your work.  It might include project plans, presentations, recommendations/reactions, etc.

The goal?  To make those considering hiring you see that you are one DEEP personnel HR Talent Management professional.  In my experience, interviewing candidates for manager/Director level positions, about 1 out of 100 candidates brings a leave behind like this.  So if you do it, you're already seen as different.

You should create one the next time you're looking for a HR job.  Can't think of what to put in it?  Think of what you would like to have in it. 

Now you just figured out what to do at work for the next year...

Lose 2.7 Billion, Get a Bonus?

I'm just sayin.... You lose 2.7 Billion and give out bonuses?  From Workforce:

"Ford Motor Co. is paying every U.S.and Canadian employee a $1,000 bonus even though the automaker lost $2.7 billion last year.

In a company wide e-mail to all employees on Wednesday, March 5, CEO Alan Mulally said that although Ford fell short of its sales goals for 2007, the automaker “met or exceeded” its objectives in every other category.

The bonus also will be paid to managers outside the U.S. and Canada. Mulally said the “performance awards” are based on improvements in cost performance, quality, automotive cash flow and financial results."

I know the cash isn't a lot on the individual level but it's a nice gesture.  Still - bonuses when the loss is 2.7 Billion?   From where I come from, we'd be rallying around the barrel for heat, so we could save on the energy bill.

For my Austin Powers peeps out there - that's Billion, not Million.  Perhaps a recap is in order.....  Feedburner or Reader subscribers click through for the video tutorial...

Only in Cali - Hourly Team Leads at Starbucks Get Jobbed Out of Tips...

You know what's cool about having this site?  When readers, who could write for this site, chime in with more information than I can find in the mainstream media.

A great example?  The Starbucks article I posted from yesterday on the 100 Million Dollar tip judgment.  I struggled to find deeper information on the exact classification of the workers judged to have been taking tips illegally.  No sweat - because an attorney who is a reader of The Capitalist in SoCal pitched in to drop the following science/knowledge:

"Chou v. Starbucks is a great example of why no one would do business in California if theBabybarista4 market weren't so darn large.  The class at issue are shift leads.  These are the folks who are responsible for making sure everyone shows up for their shift, calling the manager or assistant manager if there are any problems, making bank drops if the managers can't do so, and handling other administrative duties in addition to providing direct customer service.  Starbucks classifies these employees as non-exempt because they have no authority to do anything: they can't hire, fire, promote, or demote employees.  They spend most of their time making 1000 varieties of coffee, just like the baristas (some baristas are even paid more than shift leads). 

But the law regarding tip pooling in California says that "agents" cannot participate in tip pooling.  Judge Cowett decided, without legal, historical, or factual support, that if a store is open, someone at the store must be (sic) Starbucks's agent.  And because the leads were sometimes the highest ranking individuals, they must have been the agents.  So now, Judge Cowett has created a weird class of non-exempt employees who service customers but cannot share in tips.  They aren't managers, so they don't get the full manager perks or responsibility.  But at times they have more responsibility than Baristas so they can't be tipped. 

My bet is Starbucks and other coffee shops will do away with the "shift lead" title all together and assign administrative tasks based on seniority.  How Judge Cowett's ruling works in that case, I have no idea.  Either that, or Coffee shops will ban the tip jars (probably the safest way to go).  Also, Starbucks didn't get any advantages from allowing all their non-exempt employees from sharing in the tips.  Starbucks Corporate didn't see a dime, and neither did the store managers or assistant managers.  But the Judge has now ordered Starbucks to pay over $100 million dollars!  Only in California."

So here's the three possible outcomes I see regarding what Starbucks and others might do in the face of this strange, but true, court decision:

1.  Let the "leads" suck it up with no tips and watch this class of workers fade over the next three years as leads leave the company and no one will accept a promotion into this classification...

2.  Move the leads to exempt status, along with some type of adjustment (typically not dollar for dollar) to appease the group regarding the change.

3.  Eliminate tips altogether, which would be a stange outcome to all the baristas who were cheering on Friday.

#3 is unlikely since an uprising would result.  No one wants to see suburbia without their latte.  I'm guessing #2 is the play, if the ruling stands, since operationally you'll need the same approximate number of folks to get the administrative work done...

Only in California... Tips taken away from hourly workers!!

Quality or Quantity? Finding the Right Number of HR Contacts on LinkedIn

A couple of months ago, I profiled what appeared to be a LinkedIn recruiting spam campaign by Wachovia Bank.  As a part of that post, we talked a little bit about the "promiscuous" LinkedIn user, a person looking to get as many contacts as possible, to expand the power of their network, regardless of whether they knew you or not.

How many contacts are the right number to have in a social networking tool like LinkedIn or Facebook?  InFacebook2 the comments of that post, recruiting source Simon Meth from SittingXLegged correctly points out that the more contacts you have, the better your reach to find candidates in recruiting.  Hard to argue with that logic.

Other professionals who have dived into the social networking area, via LinkedIn and Facebook, appear to be in danger of becoming overwhelmed and disconnected from the tools, especially in the face of "requests" to introduce others to someone in their network.  From an article in the Washington Post titled "An Unmanageble Circle of Friends":

"Jason Calacanis wishes he could be your Facebook friend, but he just can't. The Internet entrepreneur loves networking; the New Yorker magazine once wrote a profile of him called "The Connector." When people want to get from point A to point B, he's A and a half. But Calacanis now has several thousand friends, with more requests streaming in daily. He's tired. So on his blog this summer, Calacanis, 37, declared a Facebook moratorium. In the future he'll outsource his friend management to an intern.

While Calacanis may have burned out early, he predicts he won't be alone: "Everyone's going to face a level of this, too."

And then . . . chaos? Isolation? Abject misery? When we each reach that point where a utility that is supposed to bring us closer to our friends actually makes us hate our friends -- and the death grip that managing them has on our time -- where will we go from there?"

If there is a critical mass to your LinkedIn and Facebook that makes you give up, the secret is probably figuring out the max number you can do while remaining engaged and stopping there.  The Post article cites anthropology wisdom as the key:

"Part of the problem is a numbers game. Oft-cited anthropological research puts the maximum effective group size at 150, known as the Dunbar number. Some groups -- religious congregations, book clubs -- splinter off when their numbers get too high for members to bond. Facebook does not. Facebook allows its users to spread their time and energy, like butter covering an increasingly larger piece of friend-network toast. Do you want a lot of toast? Or do you want a lot of butter on normal-size bread?"

Simon Meth can probably handle 1000+ contacts doing what he does for a living.  But, to maximize the power of his network (and yours), he and everyone else need you engaged.   So, figure out your appetite for invites and requests and manage your LinkedIn or Facebook account accordingly.

What's your number?  100?  1000?  10?

Valuing Human Capital - Do You Tip at Starbucks?

From the jump, allow me to reassure you that I am a pretty good tipper.  Rarely when I get good service do I lay down the minimum 15%.  Always more - that's me - gracious like the Dali Lama...

That said, one tipping situation gives me cause for pause.  Do you tip at Starbucks?  Even if you areStarbucks just dropping by for a brewed coffee? 

Really?  Even for a brewed coffee?  Why don't you tip at McDonalds?  Or at Taco Bell?

Apparently, the tips you are laying down at Starbucks are incorrectly going to support the rich lifestyles of Starbucks supervisors, if you believe a recent court decision in that always interesting state of California... From the LA Times:

"Starbucks got caught with its hand in the tip jar and was ordered Thursday to pay California baristas more than $100 million.

In a San Diego County class-action lawsuit, a judge ordered the coffee giant to pay back tips, with interest, that the company had handed over to shift supervisors. Some baristas could receive more than $10,000, according to their attorney.

The ruling was met with cheers by California baristas. "I'm stoked," said Leekeisha Smith, who makes coffee drinks in the Starbucks at Sunset Boulevard and La Brea Avenue in Los Angeles.

Starbucks Corp. said it was outraged and vowed to appeal. In a statement, the company said the decision "is not only contrary to law, it is fundamentally unfair and beyond all common sense and reason.

Money collected in tip jars was put into safes at each Starbucks and apportioned weekly to each employee based on the number of hours they worked, said attorney Terry Chapko, who represented the plaintiffs. The average tip distributed to baristas and supervisors was $1.71 an hour, San Diego County Superior Court Judge Patricia Cowett said.

Cowett's ruling said Starbucks' practice was a violation of a state law that prohibits managers and supervisors from sharing in employee tips. Her ruling Thursday on penalties followed her Feb. 28 decision in favor of the baristas in the class-action lawsuit."

From what I know about the restaurant industry, pooling tips is a common practice, but the real issue here seems to be classification.  Who are the hourly workers?  Can hourly workers be supervisors?   My guess is that Starbucks crossed the invisible line based on classification issues that are, at least, indirectly related to that statute you know and love - FLSA....

Here's my take - I know who the supervisors are at the 3 Starbucks I frequent, and they seem to be very active from a service perspective.  They work the register, they make drinks, they work the drive thru.  They need a piece of the pie, whether it is tips, an advanced wage compared to the other workers, or some type of bonus plan.  Since I don't know and can't seem to find out what they make on the base rate compared to other workers, I don't know if I support pulling tips from them.  It all depends on the differential of what they make versus the barista... 

As for the need to tip at Starbucks, I think I have figured it out.  The tips are the grease in the system that prevents your local barista from treating you like you just special ordered a Whopper...

Free Agents or Evildoers? Employees Who Post Their Resumes On Monster...

Your employees love you. Except when they don’t.

Like when you're trolling through a Monster or CareerBuilder resume database and there they freakingClint_any_which_way are.  They've posted their resume!!   The gall!  The nerve!

What's up with that?  What should you do?  Confront now?  Take two weeks off and quit?

A younger me would have said confront them all.  Man, would I have been wrong.  Good things weren't nearly as digital when I was coming up and trying to be the Clint Eastwood of HR. 

The old me broke this one down at Workforce in a recent column.  Is the resume poster a Free Agent, Reactionary, Disgrunted or Forgetful Analog?   The profile drives whether you confront, poke around quietly or do nothing.  Check out the article to get a vibe for the profiles and which once I would confront. 

PS - Hey Monster, if you want to carve a little revenue out of the candidate side, offer up a $5 per month service to keep the resume of the employee masked to their current employer.  If you pitch it right, that ought to let you squeeze another 100K a month out of the Matrix easy.... 

How Do You Know When It's Time to Get Out Of HR?

Frank Roche, the brains behind KnowHR, had a romp the other day called "10 Ways to Know When Its Time to Get Out of HR."  Here are my 5 favorites from Frank's list; click through to see the rest.  From Know HR:

  1. You refer to the head of HR as Catbert, and there’s no hint of irony left.
  2. Whenever anyone calls out, you think they’re taking a “psychological sick day”.
  3. You don’t think that anyone can get a 5 in a 5-point rating scale.
  4. You’ve never even seen the table, let alone have a chance of sitting at it.
  5. You think that it’s just a matter of the right forms, no exceptions.

To quote a line from Swingers, Frank's money and he doesn't even know it.  Here's a few I would add to Frank's list:

  1. You think the SHRM periodicals are "best in class".
  2. You use the phrase "best in class".
  3. Your medical plan is self-insured and when someone tells you the procedure they are going in for, you know what the plan will be billed within a $50 margin of error.
  4. You no longer actively interview candidates, you simply "source".
  5. You respond to every performance issue, by quoting, to the manager, your company's Progressive Discipline policy, without questioning whether the manager has tried informal coaching.
  6. You have a prepped speech for why Viagra's not covered by the plan.

Frank - thanks for the great list!

The First One's Free - CBS Offers Equivalent of Crack Pipe to US Productivity....

In 2007, American businesses lost an estimated $1.2 billion in worker productivity during the NCAA tournament, mostly during its first two days.

That's a lot.  But you ain't seen nothing yet.  This year, CBS is streaming video for every game - Free....!Dick_vitale

It starts today.  Your employees, with the best of intentions, are strolling along, and BAM!!! They're hit with this offer from CBS/NCAA:

"NCAA March Madness® on Demand allows you to watch LIVE game broadcasts of CBS Sports television coverage of the NCAA Championship on your computer for FREE!

This year, for the first time ever, you'll be able to watch every game* of the NCAA Championship live online for free. All 63 games, from the First Round through the Final Four including the Championship Game, will be available with NCAA March Madness on Demand — so you'll never have to miss a single shot.

  • NCAA March Madness on Demand is 100% free
  • Live games streaming on your broadband-connected computer
  • Enjoy Championship highlights, recaps, and archived video
  • 640x360 widescreen video player
  • Exclusive halftime show
  • Includes The NCAA Basketball Championship Selection Show
  • Can't watch? Listen to live streaming audio from Westwood One's radio broadcasts of every game."

    You'll need two methodone clinics and a multi-port EAP line to get productivity back to where it belongs. 

    Actually, the hit to productivity is probably overstated.  Whatever happended to shared experiences causing higher level of engagment?

    PS - I've got Kansas.  Or UCLA....