costs

Safety Costs

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iQoncept / Shutterstock

There are three key principles in the management of Human Resources. These are, in no particular order, the management of risk, the management of costs and the management of investments. When we apply these three principles to the management of people they help guide our Human Resources practices in a language that non-Human-Resources business leaders can understand.

These same principles apply to the management of Occupational Health and Safety. Risks, costs, and investments are concepts that make sense to business leaders whose main concern is the bottom line. It is our job as Human Resources practitioners to make the connection for business leaders between the bottom line and safe workplace practices. We are responsible for the people who are the resources impacting the fiscal health of every organization.

Nowhere is the need for the diligent Human Resources management of risks, costs, and investments clearer than in the emerging precedent-setting cases linked to workplace harassment. The financial penalties imposed on the employer for failing to providing a safe workplace are significant.

Click here to read about a recent case where an employer was ordered to pay damages as a result of workplace harassment.

If business leaders to do not understand the language used by Human Resources practitioners when we speak to the social need for safe workplaces, free from harassment of any kind, then we need to re-shape the language to get our points across. We need to use the language that makes sense and has an impact on business leaders in order for them to implement what is required by law.

Workplace harassment in Ontario falls under the scope of the Occupational Health and Safety Act in two distinct pieces of legislation. Bill 168 and Bill 132 both impose the legislative requirements for employers to ensure that workplaces are free from harassment of any kind. When the employer fails in these responsibilities, it is a failure of risk and investment management, resulting in significant costs.

Money talks. It is the job of Human Resources to make sure that people are listening.

Discussion Questions:

  1. How does risk management, cost management, and investment management apply to people management?
  2. How could you use these three principles to convince the leader of an organization to implement a harassment free workplace?
  3. What are ‘Wallace damages’? Why would these be a consideration when dealing with the employer’s responsibilities in an allegation of workplace harassment?

Smoky Rewards?

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Lego star wars No Smoking Day.
Bubbers BB / Shutterstock.com

Gone are the days when smoking was an accepted practice in the workplace. In today’s society we see a few solitary figures who take their breaks and smoke outside their workplace during the work day. Employees who smoke are either huddled together in designated smoking areas or forced to stand on the other side of the workplace boundaries in order to have that much needed cigarette. With these visual displays as proof there is no doubt that employees who smoke have a costly impact on workplace productivity.

Everybody knows that smoking is an addiction loaded with severe health-related risks. These risks include the development of heart disease and cancer. Most employers in Canada offer health care benefits to employees to assist them in covering medical costs for these types of catastrophic illnesses.

Should employees who smoke be penalized for increasing group health care costs as a result of developing smoking-related diseases?

Should employees who smoke be penalized for having a negative impact on a productivity-based bottom line?

Both of these questions are loaded with complex and potentially negative consequences for the employer and employees alike.

A company in the United States has implemented a smoking cessation program that rewards employees who stop smoking and penalizes those who enter into the program and fail to quit.

Click here to read the article.

While the intent of this type of reward/punishment-based smoking cessation program may be to encourage a change in employee lifestyle, it is clear that the goal of the program is to reduce productivity losses and health care costs.

These types of programs raise questions about the role of the employer in any employee’s personal lifestyle decisions. Does the employer really want to be monitoring and stepping into an employee’s personal behaviours that extend beyond the boundaries of the workplace?

The answers to all of these questions remain unclear.

These and similar questions will, no doubt, continue to be asked as our social and health-related demographics continue to change into the future.

Discussion Questions:

  1. To what degree do you think the employer should be involved in an employee’s decision to continue or stop smoking?
  2. Who benefits from a reward-based smoking cessation program? Why?
  3. Would you change a health-related behaviour (stop smoking, go on a diet, start exercising) if your employer offered you a financial reward for making that change? Why or why not?
  4. Would you change a health-related behaviour (stop smoking, go on a diet, start exercising) if your employer imposed a financial penalty on you if you did not make that change? Why or why not?

Costly Consequences

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One of the perils of working in Human Resources is getting blamed when things go wrong.  This seems to be the case in a recent costly settlement scandal, unfolding at Concordia University in Montreal.

Man Holding Money
Source: Bacho/Shutterstock

Click Here to Read the Article.

How does one jump to the unfortunate conclusion that the reason for this settlement at termination, comes from a fault in the hiring process?  Before we begin to speculate, let’s be clear in our understanding that none of the facts related to this situation have been acknowledged or identified by the two primary parties in this case.

It does seem evident, however, that there are a few costly lessons to be learned from this case.

First and foremost, no matter how senior the position may be, is the person selected for the role truly skilled and qualified to meet the requirements of both the position and the organization?  Good human resource practices should ensure that hiring decisions are based on more than just professional reputation alone.

Second, are the terms of the employment contract, which solidifies the employment relationships at the time of hiring, reasonable and mutually beneficial? Typically, reasonable termination clauses are included in the employment contract signed and agreed to by both parties at the time of hire.  In this case, it seems that the benefit in the form of the amount of severance, which was provided as a result of the ‘mutually agreed’ termination of the employment relationship, rests with the departing employee.  From the perspective of an outsider to this particular situation, it appears to be out of proportion to the benefit gained by the university based on the amount of time the individual was employed.

Third, what is the organizational risk assessment and risk tolerance for a hiring decision that does not go as planned?  As HR practitioners, we do not spend enough time in the recruitment planning and hiring process to gauge the consequences of poor hiring decisions.  We should definitely be doing our due diligence homework at the time of hiring and include the risk of impact on organizational reputation when these types of situations do not go exactly as planned, especially when they end up in the public domain.

Discussion Questions:

  1. As the HR advisor in this case, what processes or steps would you have put into place to prevent this situation from happening as it did?
  2. Do you think this level of executive severance pay out is appropriate? Why or why not?
  3. Identify three additional lessons learned from this case in relation to employment contracts and the hiring process.