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| First Person |
The Firing Line
Alan L. Sklover
08/02/2004
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While you might think that
legal difficulties such as discrimination, harassment, disability-related claims
and other potential employee actions are your most vexing hiring and firing
risks, these fears are usually exaggerated. They are risks, yes, but not ones
that go to the heart of your business. Lawsuits, labor-board audits and other
manifestations of the ever-more litigious nature of the employer/employee
relationship are both time-consuming and expensive. However, the departure of
your valuable employees truly affects your bottom line over the long
term.
Risk Mismanagement
For more than 20 years, I have been a hired gun
on the frontlines of the intensifying battle for human capital. I have counseled
and represented executives worldwide regarding their employment, compensation
and severance. From their perspective, employment has become a potential
minefield. They have suffered widespread job insecurity, along with growing
distrust and disarray in executive suites. Most of my clients would like to go
back to the good old days when loyalty meant more, and when stability at work
was the norm rather than the exception.
Employers are using more heavy-handed
techniques than ever before to maximize their human assets and minimize hiring
and firing risks. Employers have armed themselves with more sophisticated
defense mechanisms, such as noncompetition agreements. These prohibit former
employees from working for competitors for a set period. Noncompetes are now
nearly universal; even midlevel administrative staffers are often required to
sign them. Employers are also trending toward paying bonuses partly in cash and
partly in restricted stock that vests over a number of years, constituting de
facto golden handcuffs.
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