Economic volatility, changing demographics, and employees’ increasing awareness of their rights are fueling a rise in employment practices liability (EPL) claims, says Theran Colwell, director of risk management for CUNA Mutual Group.
As the workforce ages, “more people are falling under certain legislation, such as the Age Discrimination in Employment Act,” he says.
Most EPL claims involve multiple allegations, Colwell adds, namely wrongful termination, retaliation, and discrimination. Such claims expose organizations to a range of potential penalties, such as high-dollar settlements, back pay, state or federal fines, legal costs, or injunctive relief.
“And don’t forget about reputation costs,” he says.
Colwell suggests four steps credit unions can take to help prevent EPL claims:
1. Have up-to-date, board-approved anti-discrimination, anti-harassment, and other personnel policies.
2. Have an expert employment practices attorney review those polices annually.
3. Train employees, board members, and other volunteers on anti-harassment and anti-discrimination behavior. Also, train managers on anti-retaliation.
4. Document employment actions and retain this information.
A challenge has emerged recently in my strategic planning work that has caused me to ask the question in the headline. It seems to be occurring across credit unions of all sizes, and it is serious enough that it can threaten their very existence.
Here’s how it happens.
Someone comes up with an idea that has merit–something innovative that may increase efficiency, reduce costs, improve service or just make people’s leaves easier. Leadership believes it is worth pursuing, so they form a team, create a project, and the process takes over.
The objective is sound–to make sure they are allocating resources effectively, maintaining appropriate controls, and staying abreast of what’s happening within the business. But this reliance on what can become overly cumbersome processes that are applied to even the smallest opportunity can be a serious mistake.
My point: Not every action or idea merits a project and resource allocation plan! Many don’t even require a team, decision tree, or a project plan. They merely require action from an individual or two who focus on getting something done that will create a positive impact.
The real issue is that the aforementioned ‘project approach’ can literally drive innovation out of the organization.
When people realize that any idea big or small is going to create more work for them (and others), they become reluctant to share their ideas. Ultimately, this leads to people withdrawing and giving up because they don’t believe change is actually possible anymore, because the well -intentioned systems are now in the way.
The reality is that innovation is about both big and small changes. If every little action has to be planned, debated, and discussed, nothing ever happens. And if opportunities to take small actions are stifled, then opportunities to take more significant actions will disappear.
So what can you do?
1. Increase the level of authority employees have to make things happen without asking for permission or involving anyone else.
Leverage the talent in the organization and encourage people to act to improve the things they can improve. When Bill Gore built W.L. Gore and Associates, Inc. he implemented two questions that employees should ask if they had a new idea they wanted to pursue: If it works, will it be worthwhile? If it doesn’t work, can the company survive? If the answer to those two questions was yes, then the project could be undertaken. What question(s) would create that level of empowerment and ownership in your credit union?
2. Get serious about breaking down barriers and obstacles to innovation.
Find ways to make it easier for people to take small actions that will accumulate to produce significant impacts. For example, Best Buy uses a system called Twelpforce that empowers employees to see Best Buy-related problems that customers have aired on Twitter and respond to them. More than 2,500 Best Buy employees have signed up for this system, including customer service staff, in-store sales associates and Geek Squad, the people who make has calls for technical service. Instead of losing ground to complaints on social media, it has empowered its employees to rescue the brand.
3. Create an idea bank and facilitate the ideation process every day.
Develop a place where ideas are gathered, shared, and enhanced. Set up a few whiteboards where people can debate options and explore ways to do things differently. Schedule regular meetings to discuss the ideas in the bank with a focus on refining them, enhancing them, and, most importantly, acting upon them. Better yet, cover a few walls with white board laminate or paint, invest in a few colored pens, and encourage people to invest time in developing and sharing ideas for improving things. Celebrate the process and encourage participation, change the conversation from why things don’t work to how you can make them work, and make it easy to put the ideas that emerge into action.
Action advice: Create an environment for sharing ideas within your credit union with no strings attached. Empower your employees to research and give them the tools they need so they can develop the potential of their ideas. Find ways to make innovation part of every day, not something that is done only as part of a project or process that feels burdensome and limiting.
Michael Hudson works with credit unions to implement strategies, leadership programs, and culture-building programs. Reprinted with permission from www.creditunionstrategy.com/blog.
Leadership positions at all levels exist to ensure results through the efforts of others. Leadership style and behaviors themselves, however, often create barriers to getting those results.
One non-negotiable for effective leadership is self-awareness. It’s important to be aware of how your leadership style, habits, and attitudes affect others.
An aware leader is one who understands his or her limitations and humbly seeks to remove stumbling blocks caused by natural tendencies and rote management practices.
In my experience, a common thread runs through many of the relationship problems that exist between leaders and employees. Most of the time, leaders are simply unaware that a change in their own personal behavior could result in significant operational and morale improvement.
The problem is not that a leader is inflexible or unwilling to change, it’s that he or she has never been actually told what changes might help.
Here’s a simple exercise that has the potential to radically improve your reporting relationships. I’ve seen this work in organizations of all sizes—even families.
The process is simple. Either one-on-one or in a team setting, ask your employees three questions:
These questions give your employees the permission and opportunity to share what they see as helpful, harmful, or missing behaviors in your personal leadership style and practice.
Afterward, simply walk through the list and get clarification if needed. Don’t be defensive, but rather seek to understand the reasons for the items on the list.
In some cases, the requests may not be feasible at first blush. But resist the temptation to reject ideas right away.
Consider seeking outside help
If your first reaction is a concern about getting honest feedback, consider using a facilitator or employee volunteer to draw out and record the answers to the three questions without you present. This gives the team a bit more anonymity when you return to the room to discuss the comments.
For this process to be helpful, it’s critical how you frame the exercise and what you do with the results.
First, explain that you want the team to be successful and that you want to improve as a leader. It takes humility and courage to admit you need feedback to improve your performance.
Being willing to take on a process like this demonstrates a healthy leadership humility.
Second, prepare yourself to nondefensively review, consider, and act on what you learn from the exercise. If you collect the information and do nothing with it, you will likely do more damage than if you had never asked in the first place.
This is not to say you must implement every suggestion. But you should consider each one seriously, and communicate why certain requests may not be feasible at that time.
When done correctly, this simple leadership feedback process can revolutionize your relationship with your people, create additional trust, and result in improved team performance.
Four in five credit unions with $100 million or more in assets expect to have formal succession plans in place by the end of the year, according to CUNA’s 2014-2015 Staff Salary Report.
Two-thirds of those credit unions already implemented plans.
Completing a CEO search process often takes several months or longer, so credit unions without formal succession plans risk losing valuable time while looking for viable replacement candidates.
A void in leadership can have a detrimental effect on organizational performance.
Fortunately, nearly 75% of CEOs planning to retire before 2016 lead credit unions with active succession plans.
Other highlights of the survey include:
Allowing resignations is on my mind based on news out of Atlanta this weekend, where the owner of the Atlanta Hawks (pro hoops) has agreed to sell the team based on the results of an investigation that showed he had made a bunch of race-based comments related to increasing attendance at Hawks games.
What's interesting to me about this was that Levenson was allowed to proactively announce his decision rather than dig in and face the wrath of the NBA in the aftermath of everything that happened to remove Donald Sterling from owning the Los Angeles Clippers.
Which to me, begs a question—when do you allow someone in your company to resign rather than firing them? I think there are a couple of situations where it's probably always in your interest from an employee relations perspective to allow the resignation rather than firing, including:
What did I miss? Without question, you have to fire people. A lot of times that's good for the organization to see, but at times, you really need to think through whether it might be better to allow certain individuals to resign.
Asking for a resignation is part complete honesty, part negotiation, and part bully activity. It's an art. Allowing people to resign when they need to go should be the exception rather than the rule, but it's a tool in your arsenal that needs to be used.
Kris Dunn is chief human resources officer for Kinetix, an RPO firm for growth companies. Reprinted with permission from his blog at www.hrcapitalist.com.