5 Critical Human Resources Mistakes That Can Cost Your Company a LOT of Money & Time – Here’s Why! – Wendy Ferguson (CPHR) – Ferguson HR Consulting
By Wendy Ferguson – BHRLR, CPHR – Ferguson HR Consulting
Many companies within the energy industry, and those associated with the industry, remain vulnerable to costly HR mistakes often because their owners or leaders simply do not have the time, possess the knowledge or expertise, or employ functioning human resources departments to ensure protection from such risks. Taking preventative measures to avoid the following “5” common mistakes will help your company avoid expensive lawsuits and other unnecessary costs.
1) Failing to Document Performance Issues
Worst case scenario – expensive wrongful dismissal lawsuit
Documenting performance issues can feel like one of the most burdensome managerial duties and unfortunately it is often put off or ignored completely. Most managers acknowledge that they do not document everything they should, but often at some point wish they had.
If an employee’s performance is deteriorating, an employer may be required to take disciplinary action – whether that requires issuing a warning, developing a performance improvement plan, or terminating an employee. In order to reach any of these outcomes there must be appropriate documentation in place in order to protect the organization by having documented proof, provide information regarding employees to future managers and to assess ongoing performance and improvement.
Managers and supervisors should be documenting all performance issues and conversations on the same day they take place – including dates, names and titles and quoting as much of the conversation as possible. Written records should also include the action plan that was agreed upon between the manager and the employee. Of course these records must remain confidential at all times. Emails are fine to summarize actual conversations, but there is no substitute for a face-to-face conversation and then documenting the conversation immediately afterwards. Understand that any documentation placed in an employee’s personnel file may be accessed if it is reasonable for the purposes of an investigation or legal proceeding or in order to comply with a subpoena or warrant.
2) Not Implementing a Sexual Harassment Policy
Worst case scenario – costly sexual harassment lawsuit, low morale, toxic work environment, turnover (resulting in more hiring & training costs)
The subject is inescapable. Just in the past year I can think of several high-profile sexual harassment lawsuits or allegations including a large municipal police force, a couple of high profile MPs, an Olympic Committee Executive, a celebrated radio host…the list goes on. It also happens in the energy industry and more frequently than you’d think. I can guarantee it has occurred in your workplace at one time or another.
A 2014 Angus Reid survey reported that 28% of Canadians have indicated they have been sexually harassed at work or at work related functions. A similar 2014 Queen’s University survey had a similar result, reporting 23% (the majority of those being women). The most recent federal government survey was conducted 24 years ago by Statistics Canada and at that time it indicated that 6% of Canadian women had reported being sexually harassed in the workplace. Let’s put that into perspective…today approximately 8 million women work in Canada. That is anywhere from 480,000 to 2,240,000 victims in Canada each year, depending on what study you rely on.
Employers have an obligation to provide a workplace that is free of discrimination and are therefore liable for sexual harassment that occurs at work or is work related.
Limit your organization’s liability by:
- Implementing and enforcing an effective policy prohibiting harassment in the workplace
- Encouraging employees to come forward with complaints and educate them on how to seek advice about making a complaint
- Maintaining confidentiality to protect complainants from retaliation
- Providing an investigation procedure
- Treating the complainant and the alleged harasser fairly and sensitively in any investigation and advise them of their right to retain legal counsel
Simply having a policy is not enough. There must be communication and training of the policy and procedures for all employees, particularly for those in supervisory roles. The policy should form part of the employer’s personnel policies and be posted in the workplace. If there are complaints, the organization must deal with the matter promptly and must conduct a thorough and fair investigation. In some cases, it may be advisable to hire an independent investigator to conduct the investigation to provide the employer with a report and recommendations.
3) Not Having Relevant Job Descriptions
Worst case scenario – wrongful dismissal claim, inefficient or ineffective workforce, unclear roles, turnover, reduced productivity
Job descriptions are written statements detailing the responsibilities, working conditions, skills and education requirements and any other relevant aspects of a specified job and they are an employer’s first line of legal defense. They ensure both supervisors and employees have a clear understanding of the major functions of the job and how an individual fits within the organization. They serve as a foundation for performance management as well as provide HR with an effective recruitment tool to attract the best candidates for the position. Job descriptions usually change and evolve, so it is a great idea to update them annually (even if it is time consuming) because without them both employees and supervisors may not have a clear understanding of the purpose and duties involved in the role or the boundaries of the job within the organization.
4) Not Understanding What Is and Is Not Legally Permitted to Ask in an Interview
Worst case scenario – Human Rights Commission complaint and a high-priced discrimination lawsuit
Before anyone within your company performs an interview it is essential that they fully understand Alberta Human Rights legislation. Many managers are not well informed about our legislation and often ask questions that are illegal under the Act. It is acceptable for employers to ask:
- about a candidate’s ability to do the actual job
- for any names you have used (maiden/former) only if the information is needed to complete a reference check or verify your past employment or education
- if you are legally permitted to work in Canada or if you are a Canadian citizen or a permanent resident
- education institutions attended and level of education received
It is unacceptable for employers to ask anything that could be used to discriminate against an applicant or restrict them from employment. Just a few examples include asking questions pertaining to: age, religion, race, ancestry, sexual orientation; disabilities; plans for marriage/family/childcare.
In many small to mid-sized organizations, it is common for managers and supervisors to interview staff. I recommend an interview training session for all interviewing managers to protect your organization.
5) Terminating an Employee without a Plan or Proper HR/Legal Advice
Worst case scenario – wrongful dismissal/constructive dismissal lawsuit, poor internal/external publicity, low morale, turnover
Unfortunately terminations are often necessary for companies for a number of reasons. In fact there are exactly 30 reasons for dismissal on our Canadian Record of Employment form, from which the employer must select one before filing with the Government of Canada.
Terminating staff properly and legally is something that HR and/or external legal counsel is relied upon in most organizations, yet I’ve heard of many instances where terminations have gone wrong. The process is one of the most difficult tasks a manager will face.
Employers must be extra vigilant about how they handle the termination process because everyone is watching from within the organization and guaranteed it will trickle outside of the organization in a flash. It is the responsibility of employers and HR to ensure employees are terminated within the boundaries of the law, treated fairly, equally and with empathy and respect during this process and there should never be an instance where an employee departs an organization without their dignity.
To eliminate the risk in your organization, I advise that before terminating an employee always obtain advice from an HR professional or legal counsel with respect to termination notice, termination pay, reason for termination, employer and employee responsibilities, required documentation, meeting strategy, removal of personal effects, severance of benefits, etc.
Losing one’s job is always devastating, no matter the circumstances, but by treating employees like people rather than commodities, we show them that their contribution actually mattered to our organizations and they continue to be valued individuals.
I would like to note that the actual cost of avoiding these risks is not limited to just pricey lawsuits, but also may put your company’s reputation at stake, reduce productivity, affect the ability for the company to attract future quality talent and affect business revenue. It may cost you a little more to employ or hire a contracted HR professional to document things properly or develop proper procedures, but the alternative costs can be far worse. I look forward to further exploring these and other important subjects with you over the coming months.
About Wendy Ferguson
Wendy Ferguson is an Alberta based Human Resources Generalist and Consultant with over 15 years of combined experience in the areas of HR, Business Administrative Management and Marketing.
She has worked within a broad range of industries, including: oil & gas, architecture, law, information technology, engineering, accounting and business consulting firms. She works with companies on both a full time and part time consulting basis to help them address their HR management, recruitment and policy needs.
She is also a Chartered Professional in Human Resources (CPHR). CPHRs are uniquely qualified to help you achieve your business goals. With proven expertise across nine key business metrics, a CPHR has the knowledge and the experience to address the factors that underpin the degree of your immediate and long term success.
For your HR requirements contact Wendy at [email protected]
Senior Management HR Advisory
Alberta Employment Standards