Professional Service Agreement

The SESCO Report – August 2008

The Perfect Storm is Brewing

Currently, unions only represent about 9% of the private workforce. The percentage is a little higher when considering federal, state and "local" public workers. As such, the AFL-CIO is desperate. Subsequently, they have approved $53 million to support some 200,000 union members who will be working in the Obama campaign. Other individual unions have pledged another $200 million. The teachers union (National Education Association) has committed $50 million; the Service Employees International Union (SEIU) has committed $100 million and says it will pay 2,000 of its members their full salary to work full-time for the Obama campaign and to support other Democrats. Total union spending on Democrats this fall could easily top $1 billion. If elected, Obama and the Democrats have promised "big labor" the following:

? The Employee Free Choice Act (EFCA-HR800) was sponsored by Rep. Miller (CA) and introduced in February 2007. With 233 co-sponsors in the House, it eventually failed in the Senate by a very close margin of 51 to 48. Now in this election year and with prospects of the Democrats picking up seats both in the House and Senate and potentially a Democratic President, the Employee Free Choice Act appears to be a strong possibility.

As reported in 2007, it is critical that the business community understand the implications of the EFCA which aims to amend the National Labor Relations Act. Its bottom line intent is to do away with secret ballot elections. Under the proposed EFCA, a union would be recognized if a majority of employees (51%) signed authorization cards. Not only is doing away with secret ballot elections un-American, unions will make promises and strong arm employees into signing cards and have their union recognized without the facts or the opportunity for employees to have an up or down vote on whether or not they want to be represented by the union.

? Remove U.S. Government supervision of the Teamsters Union. The Teamsters Union was kicked out of the ALF-CIO in the 1950's for corruption, flagrant involvement with organized crime and taking bribes from management, among other illegal acts. In 1989, the Teamsters had to accept U.S. Government supervision of their union as part of a settlement of a racketeering lawsuit. Since 1989 the Teamsters have been under government supervision. Obama has pledged to remove this oversight.

? Obama has also committed to signing a bill that would make unions the collective bargaining agent (as a matter of law) for all public safety officers in any city with a population of 5,000 or higher. While some states and political subdivisions currently permit collective bargaining for public safety officers (EMS, police and firefighters), many do not. Even if such a law contained a no strike provision, we all know how likely this provision would be enforced. These bands of strikes never work placing citizens within these defined towns and cities in jeopardy should public safety officers be allowed to strike holding the towns and cities hostage.

? Section 14(b) of the Taft Heartly Act would likely be repealed meaning mandatory union membership in all 50 states, not just with the current 28. There would be no more "right to work" states. A "right to work" state allows employees not to join a union even if the business is unionized. Obama would force all employees to join whether or not they want representation and to pay dues.

? The definition of a "supervisor" as defined by the National Labor Relations Act would likely be written to bring more members of management under union jurisdiction. Strikes and threats of strikes would be more effective when members of a management team must honor the picket lines.

We at SESCO are not anti-Democrat, but we are pro business. Clearly under a Democratic controlled government with the threat of higher taxes, increased union support, increased federal and state legislation, business and industry may be facing some of the toughest challenges we've seen since the Great Depression.

by D. Paul Sommerville, Sr. Vice President of Labor Relations

Customer Service ? Making a Difference

Customer Service ? Making a Difference

Customer service is critical in any business's success. However, when businesses experience tough times as we all are now, effective and professional customer service can be the difference in a positive or negative bottom line.

The following are excerpts from SESCO's Customer Service Training Program which are designed to help employees put into practice concepts that are more likely to help them personally move up in the organization and gain recognition as a valued employee or even better, as a "Difference Maker." This provides long-term job security and certainly helps the business succeed. It creates a win-win for both business and employee. So how can an employee create for theirself job security and long-term success?

? Become a difference maker ? Every employee has the power to decide if you are going to be an average employee just doing enough to get by or if you go to work each day with the goal to serve your customers and make a difference. Good employees choose to be a difference maker!

? Serve your fellow team members ? You can have everything in life you want, if you will just help enough other people get what they want.

? When no one is watching ? Most employees are good at doing a good job when someone is watching, but the best team members are going to do the right thing even when no one is looking over their shoulder.

? Leave it at the door ? Everyone should try to make it a practice to leave their personal issues and stories at the door, and only share in very selective conversation when it is not distracting from meeting your customers' needs.

? Service recovery ? Those employees who view customer problems as a challenge to be conquered rather than an annoyance, interruption or just that the customer is wrong are the ones who enjoy their jobs and become valuable employees within any organization.

? A sense of urgency ? It is critical that every member of the team understand that delivering your service or product in a safe but quick manner is the key to pleasing your customers.

? Engage the customer ? One of the skills or traits that separates an average employee from the best is learning to be sensitive to a customer's needs. Often this means anticipating what their customers want or need. Customers are less likely to get upset if you engage them rather than ignore them.

? Remember your grandma ? For the next 30 days, make it a habit to find two (2) people to help or compliment during your normal daily routine. If you treat people with kindness often enough, it will have an impact on your own attitude and behavior as you interact with your customers and co-workers.

? Pick your battles wisely ? The real art of conversation is not only to say the right thing in the right place, but to leave unsaid the wrong thing at the tempting moment. Remember, success in life and work is not always about being "right."

Contact SESCO for a free copy of these reminders to handout to employees and to schedule your in-house customer service training program.

CCH Survey Finds Most Employees Call In "Sick" For Other Reasons

Two-thirds (66%) of U.S. workers who call in sick at the last minute do so for reasons other than physical illness according to a recent CCH survey. Employers have failed to make significant headway against this costly absenteeism problem that takes billions of dollars off the bottom line for U.S. businesses. Unscheduled absenteeism costs businesses more than $760,000 per year in direct payroll cost and even more when lower productivity, lost revenue and the effects or poor morale are considered.

The survey found that personal illness accounts for only 34% of unscheduled absences while 66% of absences are due to other reasons including: family issues ? 22%, personal needs ? 18%, entitlement mentality ? 13%, and stress ? 13%.

Unscheduled absenteeism is a problem that no organization can afford to ignore ? either from a cost or productivity standpoint. With the appropriate programs in place, businesses can significantly reduce the number of last minute no shows, improve the work environment for all employees and realize substantial savings.

SESCO recommends:

? Thorough policy with specific disciplinary action articulated for excessive absenteeism and hold employees accountable.

? Tying an employee's annual increase into not only productivity but also their absenteeism.

? Active verification of illnesses to include "return to work" and other documentation provided by physicians and healthcare providers.

Of course, it is widely known that low morale leads to higher unscheduled absences. One of the obvious solutions for organizations is to employ more "happy" employees. Employers with a good to very good morale report only experience a 2% unscheduled absence rate. Hire the right employee the first time using behavioral interviewing techniques, background checks, applicant and skills testing (see SESCO's website for these and other tools).

Human Resource Strategies in "Hard" Times

While there is debate as to whether we're in a true recession, few would argue that some sectors of the economy are performing poorly. As a result, employers should be proactive in human resource management when business is in a downturn.

Recessions, (or whatever term you use) occur during the "down" or contraction phase of business cycles. Since World War II, the U. S. has experienced 10 recessions, most recently between September 1990 and March 1991 and from January to November 2001. Formally defined as two or more consecutive quarters of falling Gross National Product, the last 10 recessions averaged 2.6%.

As we know from experience, consumer spending and business investment follow similar patterns of decline. Sales fall and loans become harder to obtain as banks become stingy with their business loans as they seek to improve the quality of their portfolios. All this is worsened by daily reports of the mortgage industry crisis and news of $4.00 per gallon gasoline at the pump. The jury is still out on how long the current economic downturn will last. However, regardless of how your business in particular is impacted, your employees are likely nervous about their future. In addition to being concerned by the continuous stream of bad economic news, many employees may be experiencing the stress of extra duties if you have had to resort to downsizing your workforce. Here are some suggestions to help maintain morale and productivity during a prolonged slowdown in business activity:

? Increase communication — This will enhance management credibility. Explaining to employees your plan(s) to get through tough times can demonstrate that you are prepared to survive and even thrive. However, if news is bad, don't try to soft sell it. Trust will be lost that will be very difficult to gain back when conditions improve.

? Continue your investment in organizational development — Though easier said than done, failure to continue to develop your organization and your people can have severe repercussions when the economy improves. You may not be prepared to serve customers if your organization cannot quickly come out of a retrenched mode. This includes, inasmuch as possible, continuing training to keep employees current on skills and knowledge necessary to be competitive.

? Promote from within if at all possible — When jobs, particularly high level staff or management positions come open during tough times, think long and hard before hiring outside candidates. Inside candidates usually know your company and experience less of an unproductive learning curve, a luxury that most companies can ill afford when times are hard. Promotion from within can also enhance morale by demonstrating your commitment to your employees.

? Seek alternatives to extensive layoffs — Many employers struggle when the economy rebounds if they have let go large numbers of experienced people. While reducing your workforce may be financially necessary, consider other ways to reduce costs before laying off employees. This might be accomplished by temporarily reducing employee hours. If layoffs are necessary, sometimes asking for those wishing take a voluntary layoff helps reduce employee anxiety. For example, some employees in two income families may be able to get by financially for a short period of time. Others, dependent on your company for their sole source of income, will experience extreme financial hardship if they lose their job. By letting these employees go first, you may help alleviate fear by making every effort to preserve the jobs of those who must have a paycheck from you to pay their bills.

If you must resort to a reduction in force other than voluntary layoffs, ensure there is a plan. Employees confronted with job loss are often quick to bring a charge of discrimination against their employer. If your reduction in force will impact 33% of your workforce, you must follow the notification requirements contained in the WARN Act. Contact SESCO for additional information on how to manage human resources in difficult times and receive SESCO's layoff/ reduction in force manual. SESCO also provides outplacement services and training.

SESCO Client Inquiry ? Staff Response

Question: When an employee is terminated, how soon must we provide the final paycheck?

Answer: The requirements for final compensation to a terminated employee vary from state to state. Some states require that a final paycheck be issued on the last day worked, while others allow up to one month for final compensation. In situations where commissions or incentives are part of the compensation, the time requirement is normally extended. Some states make a distinction as to the circumstances for the employee's separation. Generally speaking, the employer may be required to issue final pay sooner to an employee who is discharged, compared to an employee who resigns. Also, be aware that some states require that unused vacation or paid-time-off be included in the final pay. For questions about a specific situation, contact SESCO Management Consultants.