Questions For Andrew Puzder, Trump Nominee for Labor Secretary

 

(Post by Rick Dacri, January 12, 2017)

President-Elect Trump has nominated Andrew Puzder for Secretary of Labor. Puzder is a successful businessperson, lawyer, and CEO of CKE Restaurants, the parent company of fast food chain’s Hardee’s and Carl’s Jr.

The mission of Labor is “to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights.” They are also responsible for investigating minimum wage violations, overtime infractions, and worker safety laws.

Puzder has taken positions in opposition to many of the regulations the DOL oversees, including the federal minimum wage, worker eligibility for overtime, the Affordable Care Act (Obamacare) and sick leave polices.

The U.S. Senate is scheduled to begin confirmation hearings on Puzder in February.

I have put together 18 questions that I believe the Senate should ask the nominee:

1. What qualifies you to be the next Secretary of Labor?
2. You have opposed the raising of the federal minimum wage. Why? What do you believe is an adequate minimum wage?
3. You indicated a proposed $15 minimum wage would force businesses to automate their operations and thereby eliminate jobs. Do you believe that a minimum wage increase drives the need for automation or is automation a tool for productivity? If wages collapsed, would businesses stop automating?
4. According to the Economic Policy Institute, CEO pay has grown 90 times faster than the typical worker pay since 1978. Due to this unequal growth, average top CEOs now make over 300 times what typical workers earn. Do believe wage disparity is a problem in this country and what, if anything, should Labor or the Trump administration do about this?
5. The Department of Labor oversees the federal wage and hour division, which ensures that workers are paid for all the hours they work. Yet in California, your franchise restaurants have been fined over $20 million for wage and hour violations. Can you address this issue and what steps did you take to remedy this problem in franchises you control. Secondly, what steps will the DOL take, under your reign, to enforce wage and hour laws?
6. A Roc United survey given to your franchise store employees in California, found that a third of those employees were not given meal breaks after working at least 5 hours, in violation of the state’s worker break laws. 79% said they also served or prepared food while they were sick. Can you address these issues and what steps did you take to remedy these problems in franchises you control. Secondly, what steps will the DOL take, under your reign, to enforce break laws?
7. You are also on record opposing sick leave policies, yet many workers in your franchise restaurants are preparing and serving food while sick. Are you concerned about endangering both your customers and employees? Should sick leave laws be mandated?
8. Bloomberg did an investigation of your company’s franchises. They found that in 60% of the DOL investigations in your restaurants, there were minimum wage and overtime violations. Again, can you address this issue and what steps did you take to remedy this problem? Secondly, what steps will the DOL take, under your reign, to enforce wage and hour laws?
9. President-Elect Trump has indicated he supports 6 weeks of paid maternity leave. You have stated that mandatory leave creates undue burdens on business. How directly do leaves create a burden, and as Labor Secretary, will you support or ignore the President-Elect’s initiative?
10. According to a review of inspection records with the Occupational Safety and Health Administration since 2000, the year your took over as chief executive of CKE, Hardee’s and Carl’s Jr. locations have incurred at least 98 safety violations, 36 of them listed as serious. OSHA defines a “serious” violation as one that could result in death or grave physical harm that the employer should have been aware of. Can you address this issue and what steps did you take to remedy this problem in franchises you control? Secondly, since OSHA and worker safety fall under DOL’s responsibility, what steps will the DOL take to enforce these laws?
11. Your company has introduced commercials that include women wearing skimpy bikinis and lingerie while eating burgers. In response, you stated in a 2015 Entrepreneur interview, “I like our ads. I like beautiful women eating burgers in bikinis. I think it’s very American. I used to hear, brands take on the personality of the CEO. And I rarely thought that was true, but I think this one, in this case, it kind of did take on my personality.” My questions, is this your personality, as you stated? Do you believe these ads objectify women? What kind of tone does this set in your workplaces?
12. 2/3 of female workers in restaurants operated by you, claim that they have been sexually harassed by your customers. Many employees indicated that these customers mentioned those ads. Were you aware of this and what is your plan to address this?
13. Do you believe that sexual harassment in the workplace is a legitimate issue and what steps should employers take to eradicate it?
14. Are there any federal labor laws that you would eliminate and if so, which ones and why?
15. Do you believe there are any new labor laws that should be initiated? What are they and why are they needed?
16. President-Elect Trump stated that he would like to eliminate unemployment compensation fraud. How big a problem is it and how could you eliminate it? Please be specific.
17. You have opposed the Affordable Care Act. What specifically is the problem with the Act? Are their components of it that you would like to keep? What would you replace the Act with, what would it cover and not cover, and will it be cheaper than the current ACA?
18. You have stated that we should cut government benefit programs because workers turn down promotions to keep such benefits, such as food stamps. Please explain this and tell us how wide-spread a problem this is?

Minimum Wage Hikes Force Businesses to Automate. Bull!

(Post by Rick Dacri, January 10, 2017)

Minimum wage increases force businesses to automate, killing jobs. Nonsense. McDonald’s and Wendy’s announce self-serve kiosks to replace low paying workers in response to threatened legislative wage hikes. Designated Labor Secretary Puzder criticizes minimum wage hikes saying they threaten the restaurant industry. It all makes good headlines, but the reality is businesses primarily automate to improve productivity and efficiency. It is smart business and while jobs may be lost, it is a natural evolutionary process and not a direct response to increased minimum wages.

Back in the 1970’s, when I first began my professional career (yes, I am that old), I watched how a three person manufacturing process was automated using robots and conveyors, eliminating all 3 of those jobs. While that may seem devastating to these workers, no one lost their job as the CEO realized he needed those people. We retrained those displaced workers (that was my job) to do higher skilled, better paying jobs. That was a better, more cost-effective way to operate the business. And it paid long-term dividends.

Automation is not new and not a direct response to minimum wage hikes. Do you think employers simply respond to that? Think back to the advent of self-serve gas pumps (can you even remember when that began?), ATMs, self-serve grocery checkouts and airline ticketing, automated phone sales and telephone operators, travel agents, data entry operators and clerk typists, to name just a few. These respective industries eliminated jobs, not in response to minimum wage hikes, but to upgrade operations. This is the reality of the modern economy.

Good companies continuously seek ways to reduce costs, while improving operations. Labor costs is a favorites and easy target and when wages go up, sometimes layoffs happen. But in a tight labor market, frankly any market, it isn’t always the best route.

Business should focus on their bottom line and wages do impact that. But a well trained, adequately paid, and engaged workforce yields better results, at less cost.

Other Posts You May Want To Read:

Drugs, Talent, and the Law: Confusion Reigns in2017

When Competitive Pay Is Not Enough

 

 

Drugs, Talent, and the Law: Confusion Reigns in 2017

(A post by Rick Dacri, January 5, 2017)

Some days it feels like you just can’t win. Our 4 year old (puppy?) golden retriever, Bailey, woke us up with his usual pre-5 AM whimper, reminding us that his stomach and other urges needed to be met. Our cat, Maggie, also decided to join the choir. It was raining, so we passed on the walk and let Bailey out into his pen. Mistake! You see, rain makes mud, which means Bailey’s earlier $60 spa treatment was now for naught. Spending your early, pre-coffee morning, cleaning up a muddy dog, and house, was not in the plan. Finally, semi-cleaned, it was time to sit and enjoy a nice cup of coffee—that is until Bailey decided to join me on my lap and the coffee was now airborne. And the day had not yet even begun.

Many employers are feeling the same way. Finding and keeping talent, post election uncertainties, opioids in the workplace are all flying at you, preventing you from running your business. And it isn’t likely to get any easier.

Here are just 4 huge issues you will be facing in 2017.

1. Opioids epidemic: Drugs on the streets means drugs in the workplace. More employees are coming to work addicted. And many are using hard drugs. Yesterday’s street junkies are today’s nurses and executives. While this may shock you, our society is openly welcoming the legalization of medical marijuana and now recreational marijuana. Society’s drug problem is only going to get worse and now it is your problem to solve.
2. Losing good people: Poaching is now an acceptable sport. Good people are leaving and heading to your competition. And it is just not the rank and file. Managers and executives are going just as fast. Why? 3%-4% merit just doesn’t it cut it anymore. Limited opportunities, I’m out of here; bad boss, well, you can “take this job and shove it.” When all employers are scrambling for help, employees look for greener pastures. Loyalty is dead.
3. Hiring is impossible: Finding good talent is becoming harder and harder. And with experienced workers retiring out, shortages are growing. The numbers are just not working. It is going to get bad…very bad.
4. Employment law chaos: You heard it (by me and others), the Fair Labor Standards Act updates are going to radically change how you need to pay your people, so get your systems updated before the implementation date. Ready? Never mind, it’s now on hold and may be permanently delayed. What? How in the world do you get that Jeanie back in the bottle? Finally figured out Obamacare? Hold! The new Congress and Administration are going to scrap it and start all over again—at least that’s what they claim. Your state has legalized medical marijuana or maybe even recreational use of marijuana. How do you handle that? Wait, the feds still say its illegal. Your state has just passed an increase in minimum wage, but you’re a multi-state employer and each state has a different rate…and the feds have a totally different one. Yikes! What can you do? Best bet, become an employment attorney, as you’ll have plenty of work. In the mean time, you’ll need to do some juggling to figure these out.

It is going to be a challenging 2017 and frankly, I could have addressed several other issues. While it seems to be going from bad to worse, as an employer, you need to address these issues and find solutions…and fast.

Let’s take a deep breath first. I’ve got to give Bailey a bath, but I need another coffee first. Maybe you should join me.

New White Collar Federal Regulations Blocked

(Post by Rick Dacri, November 28, 2016)

Time to take a deep breadth.

By now you know that a federal judge in Texas has put on hold the implementation of the changes to the Fair Labor Standards Act. The law, with a scheduled December 1 effective date, would have increased the salary level to qualify for overtime, virtually doubling the existing rate to $913 per week.

The overtime rate (“means test”) needed adjusting, but the Department of Labor’s proposal was excessive, so a hold is a good thing, albeit a bit last-minute. If Labor had asked me (they didn’t) I would have suggested a modest adjustment, along with a closer look at modifying the “duties test,” which many employers do not fully understand. It was the biggest area of misunderstanding from employers who called into my HR HelpLine.

Now that the law is on hold, what should employers do? Unfortunately, since the enforcement was enjoined at the last minute, most employers have either put the changes in place or at least announced the changes. And, Labor is likely to appeal the ruling, so an implementation of the law may still happen. So, here is what I suggest:

1. If in the course of your review you found positions that did not meet the duties test, implement those changes.
2. If you have not put in place compensation changes based on the new means test (raised salaries to meet the threshold and/or reclassified positions), you may want to put these on hold until we get clarity on Labor’s next move. Keep in mind, if you announced the changes, you will need to address the employee’s potential expectations.
3. If you implemented salary changes and reclassified employees, it would be hard to pull these back. Besides it being an employee relations nightmare to do so and because you could still be in violation of some state laws, if the law is finally implemented, it could requires restoring them again.
4. Communicate your plans to your employees. They may not know that the law is on hold and clearly do not know your plans. Be open and frank.

Employers have been put into a box with these actions. Consider what I have suggested above and put together your new plan. You may also want to seek professional legal guidance before you take any action.

I’m Test Driving Retirement

(Post by Rick Dacri, September 8, 2016)

It’s time for a new adventure.

I’ve decided to try something new. What, I am not sure. What I do know is that I am closing my firm, Dacri & Associates. After 21 years in my consulting business and nearly 40 years in the HR profession, I am ending this chapter to begin exploring other options.

In the interim, I am, as my wife has aptly described it, test-driving retirement.

Retirement (having trouble writing that word, never mind doing it) was not part of the original plan—not at least at this point in my life. I had planned to take the summer off from my business (something I have never done before) and while doing it, I decided it was time to consider doing something else. 21 years running a solo consulting business and 40 years in HR is a lot. So while I don’t know what I will be doing next, I know it is time to step away from Dacri & Associates.

The good news is that I am doing it at a time when I am healthy and in a financial position where I do not have to earn a living. My family is supporting my decision, encouraging me to enjoy this time and tolerating some of my doubts and second-guessing.

It has been a great initial few months since I began this venture. I now have a terrific tan from my time at the beach (summers in the Kennebunks are the best); I am learning to play the piano again (after a 50+ year break since the last time I tried); I am gardening for the first time in 25 years (you should see the zucchini, tomatoes and eggplant); I am learning to cook (my wife is thrilled with this…I’m not bad); I am taking much longer walks with my dog, Bailey (he loves it and has lost weight); I am starting my 9th David Baldacci thriller (must reads); and I have found my camera and have begun taking pictures (I may share at some point). I am frankly living the good life.

For those who were planning to call me for help, call anyway. I would like to talk and I am happy to make a referral. For anyone who would like to have coffee or lunch, I have time. My calendar is not that filled.

I’ll continue posting to my blog, though more likely it will be on all things not HR…but they could be. And when I finally decide what I want to be when I grow up, I’ll let you know. It’s a journey, after all.

So, be well, stay in touch; but for now, I’m off to the beach!

Recruitment: When A Candidates Can’t Say “Yes”

Post by By Rick Dacri, Dacri & Associates, LLC; initially published in the July 2016 MTCMA newsletter

Finding the perfect candidate to fill the critical position in your municipality is never easy. Search, interviewing, and reference checking can be draining to you and your staff or board. And once you find the “right” one, you’d like to believe your job is over, but it is not. Getting the candidate to say “yes” is the most important part of the entire recruitment process. Without a “yes” everything else you have done is simply practice.

When a candidate cannot say “yes” to your job offer, you have a problem. Be clear to candidates that they have no more than one week, 10 days at most, to render you an answer. Baring extenuating circumstances, without an affirmative, withdraw the offer and move on. Otherwise, you’ll be left dangling and the candidate will likely reject your offer. In my 30 years of executive recruitment, never have I seen a candidates take an extended time to contemplate an offer and eventually accept it—even during periods of tough negotiations. If they can’t (or won’t) make a decision about a job offer, how can you expect them to make a decision about other aspects of the job? Remember, they either never wanted the job or can’t make up their minds—not very good traits for a new employee.

The Board of a large public organization extended a generous job offer to a highly qualified CEO candidate. The candidate was both surprised and hesitant by the offer (red flags). After one week of negotiations, the candidate asked for additional time to think about it (another red flag). Over the next five weeks, the candidate sought multiple clarifications to the terms of the offer and a delayed starting date before the board ultimately pulled the plug. Even though the board’s executive recruiter recommended withdrawing the offer after 10 days, the board continued the process and was shocked that it came to his point.

What went wrong? Here are 12 tell tale signs that your job offer will likely be rejected:

Final Overtime Rules for Private & Public Sector Employers

 

(Post by Rick Dacri, June 1, 2016)

The Department of Labor’s (U.S. DOL) changes to overtime eligibility have been approved and are scheduled for a December 1, 2016 implementation. The waiting is over and all employers need to immediately prepare. No one will be able to avoid this.

I have outlined below a summary of the changes that apply to both private and public sector employees. Remember, this is a summary and does not constitute a complete review of all the changes to the rules nor should it be considered legal advice.

The Final Rule focuses primarily on updating the salary and compensation levels needed for Executive, Administrative and Professional workers to be exempt. Specifically, the Final Rule:

1. Sets the salary threshold under which employees would be nonexempt—required to receive overtime pay (regular hourly rate x 1.5 for all hours worked beyond 40 hours per week) at $913 per week or $47,476 annually for a full-year worker, more than doubling the salary threshold from the current level of $23,660.
2. Sets the total annual compensation requirement for highly compensated employees (HCE) subject to a minimal duties test, to $134,004; and
3. Establishes a mechanism for automatically updating the salary and compensation levels every three years.
4. Additionally, the Final Rule amends the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level.

Earning above the $47,476 annual ($913 per week) salary level do not automatically classify an employee as exempt from mandatory overtime pay, as the duties test still comes into play.

This is a significant change to the law and all employers should review their plans now, before the December 1, 2016 implementation. Don’t wait, as changes will be complex and contain plenty of pitfalls.

To avoid problems with existing exempt workers currently being paid less than the new threshold, your options include:

1. Reclassify affected workers as nonexempt, or
2. Increase the employees’ salaries to at least $47,476, or
3. Reduce the hours of these workers, or
4. Pay a lower hourly rate so that, when multiplied by time-and-one half, weekly compensation remains unchanged

As I have noted in previous posts, none of these steps are ideal and are likely to result in employee relation issues and increased payroll costs. To make matters worse, the DOL has stepped up enforcement, expecting to dole of the law out fines, attorney fees and back pay for violations.

Rules for State and Local Governments:

The FLSA contains several provisions unique to state and local governments, including compensatory time off, under certain provisions.

• Comp Time: State or local government agencies may arrange for their employees to earn comp time instead of cash payment for overtime hours.
• Fire and police small-agency exemption: The FLSA also provides an exemption from overtime protection for fire protection or law enforcement employees, if they are employed by an agency that employs fewer than five fire protection or law enforcement employees, respectively.
• Work periods rather than workweeks for fire protection or law enforcement employees: Employees engaged in fire protections or law enforcement may be paid overtime on a “work week period” basis, rather than the usual 40-hour work week of the FLSA.

Not Affected by Changes:

Many employees won’t be affected by the final rule:

1. Hourly workers: The new threshold will have no impact on the pay of workers paid hourly.
2. Workers with regular workweeks of 40 or fewer hours: To the extent that many salaried white-collar staff have jobs where they work no more than 40 hours, the changes to the overtime rules will have no effect on their pay.
3. Law enforcement and fire protection employees who regularly work hours that conform to the longer work periods permitted for such employees, the changes will also not impact their pay.
4. Workers who fail the duties test: Salaried workers who do not primarily perform executive, administrative, or professional duties are not eligible for the white-collar overtime exemption and therefore are not affected by the final rule.
5. Highly compensated workers: White collar workers who fail the standard duties test but are “highly compensated”—earn more than $134,004 in a year—are almost all ineligible for overtime under the highly compensated employee exemption, which has a minimal duties test.
6. Police and fire employees in small agencies: Fire protection or law enforcement employees in public agencies with fewer than five fire protection or law enforcement employees respectively will continue to be exempt from overtime.
7. Elected officials, their policymaking appointees, and their personal staff and legal advisors who are not subject to civil service laws
8. Public employees who have a comp time arrangement

To avoid problems and lawsuits:

• Audit your compensation program and pay practices for compliance
• Review the classification of all exempt workers, particularly those being paid under $47,476
• Put in place a safe harbor policy, which states that if an employee feels he/she has been incorrectly paid, to bring it to your attention for review.

Develop a plan now to implement before the December 1 deadline. If you have questions, contact the Dacri HR HelpLine.

Six Steps to Recruiting a Great Police or Fire Chief

(This article, written by Rick Dacri, was published New Hampshire Town And City, May/June, 2016 edition)

Police and fire departments help form the fabric of your city or town. From the sounds of the sirens, to the classic blue uniforms, the fire trucks leading the Memorial Day parade, or our first responders’ bravery and strength on the front lines of a tragedy, police and fire represent your municipality’s values, beliefs, and community culture. So, when police or fire leadership must change, a tired recruitment approach and an outdated job description are insufficient to fill such an important role.

Too many personnel searches fail before the recruitment process even begins. In some cases, town managers, eager to quickly fill an opening, begin the process unprepared, without fully thinking through their needs.

Successful recruitment includes six essential elements for hiring the right police or fire chief for your municipality:

Vice President, Human Resources Position Open

Vice President, Human Resources

Carroll Enterprises, Inc.

Carroll Enterprises,headquartered in downtown Worcester, MA, with over 250 employees in multi-state locations, seeks a strong leader to serve as their new Vice President Human Resources. This is an ideal position for a Director of Human Resources or an Assistant VP who is ready to move to a VP-level position.

Since 1968, Carroll Enterprises, Inc. has met the specialized needs of insurance buyers and major corporations in the business-to-business and business-to-consumer markets.  Carroll Enterprises is an entrepreneurial, technology intensive, marketing distribution and services company, serving the retail, wholesale and institutional marketplaces in the insurance and financial services industries.  

Reporting to the CEO, with full responsibility for all aspects of the HR function, the VPHR will be part of the executive committee and will manage a staff of five HR professionals. The ideal candidate will have strong HR generalist skills, demonstrated skills in managing a strategic HR function, and enjoy working as a full business partner in a growing, dynamic organization. You should possess 10 years of progressive HR responsibility, preferably from financial service or technology industry, and have a minimum of a bachelor’s degree. Working within an organization with a call center is ideal. An outgoing, confident, hands-on professional, who is not afraid to make decisions, will thrive in this entrepreneurial environment.

Carroll Enterprises is facing unique challenges in an industry steeped in tradition, while moving to a culture that embraces technology and ecommerce. Carroll needs an individual who can hit the ground running, operate effectively with a highly diverse workforce, and actively contributing to the senior management team.

The next VPHR will enjoy the opportunity to work in a vibrant community, with a supportive management team and staff as well as an experienced and engaged workforce. Carroll Enterprises is a recognized leader and takes pride in being a premier employer and a respected community member.

Located in the heart of Massachusetts, the city of Worcester combines historic New England charm with the conveniences and lively attractions of a bustling metropolis, that includes 10 colleges and universities, world-class medical facilities, a convention center, vibrant arts and other cultural venues, museums, college and professional sports teams, golf courses and many new dining options. For those looking for things to do while escaping traffic and parking problems, Worcester is the place to grow your career.

Carroll Enterprises offers an attractive salary and comprehensive benefit package along with the opportunity to grow your career. To learn more about this position, call Rick Dacri, Dacri & Associates Executive Search, at 207-229-5954 or rick@dacri.com.

To apply, email your resume, cover letter and salary history, in confidence, to:

Rick Dacri

Dacri & Associates, LLC

Executive Search

207-229-5954

rick@dacri.com

 

Carroll Enterprises is an Equal Opportunity Employer

Workers’ Comp: What’s My “Mod”?

(Post by Rick Dacri, April 14, 2016)

When discussing your workers’ compensation premiums, you’ll often hear about the importance of reducing your “mod.” But what is a mod? Your “mod” is your Experience Modification Rating. It is the number used by your insurance company to gauge both the past cost of injuries and the future chance of your risk of additional injuries. The lower the mod, the lower your workers’ comp premiums.

Here is a quick way of looking at it. Ask your insurance carrier what your mod is. If your experience mod is 1.00, you’re doing OK. If it is less than 1.00, that’s great and obviously desirable You’re saving money and running a safe operation. If it is greater than 1.00, you’ve got work to do, as this is costing you.

As an example, if your mod is .90, than you are 10% below your industry standard. If you are at 1.10, you are 10% above the industry standard. In the former case, your premiums will begin to drop. In the latter, you will find you are in a “penalty phase” in you rates will go up.

If you don’t know what your current experience modification rating is, contact your insurance carrier to find out.  If you need help reducing it, call me.

Other Posts you might want to read:

• Workers’ Comp Fraud: The Red Flags
• Workers’ Comp Record Retention
• HR HelpLine: When You Need Expert Advice
• Workers’ Comp, FMLA, & the Critical Avoidance of Staking