Arthur G. Sharp
Some business owners think of OSHA (Occupational Safety and Health Administration) as a four-letter word denoting a bureaucratic entity that makes its own arcane rules as it goes along and unjustly punishes companies that run afoul of them. In reality, OSHA plays a vital roll in overseeing the health and safety of workers in virtually all businesses. Business owners often overlook that role. Their misconceptions often derive from their unfamiliarity with OSHA’s mission, standards and organization. Business owners who learn to work with OSHA might ultimately find that it can actually help them protect their employees from the dangers of the workplace and save them time and money.
Smart Business spoke with George R. Carlton, Jr., of Godwin Pappas Ronquillo LLP to learn how companies can interact with OSHA, what resources are available to them to help them do so and how they will benefit in the process.
Who comes under OSHA’s jurisdiction?
OSHA covers just about every type of business and employee in the United States. There are a few exceptions, such as miners, some public employees, self-employed people and businesses that fall into the U.S. Coast Guard’s jurisdiction. OSHA’s wide jurisdiction means that most companies should be knowledgeable about its standards, regulatory procedures and inspection programs. It is important for companies to recognize that individual state OSHA programs have their own sets of standards, procedures and levels of compliance. In any case, waiting for OSHA inspectors to show up at a company’s door in response to a death or accident is not an advisable business strategy.
How can companies prepare to work with OSHA?
There are several steps they can take on their own or with partners. For example, they can take advantage of OSHA’s training and education programs, consult with health care specialists and other professionals such as engineers to develop and implement workplace safety and first aid training programs, and stay updated on new and revised OSHA procedures and standards. Attorneys can be valuable partners in several of these efforts.
What can attorneys do to help employers?
One primary service that attorneys can provide is legal assistance if a company is faced with an OSHA-initiated action. For example, an attorney can accompany OSHA personnel during their inspections, which can be critical if a company has experienced a fatality on its premises.
Attorneys can be helpful in court proceedings as well. Few people may know it, but OSHA has its own judicial system. Relatively few attorneys are familiar with the system, so it behooves companies to partner with law firms and attorneys that specialize in OSHA cases. If a citation is received by a company, it is important to get an attorney involved as soon as possible. If there is a workplace fatality or serious injury where OSHA shows up for an inspection, it is vital to have an attorney involved as soon as possible. It is at the initial inspection that OSHA begins to gather information that can lead to the issuance of citations. The information gathered by OSHA can also come into play in any subsequent civil lawsuit for damages arising out of the accident.
Attorneys can also explain to companies how OSHA works; define the different types of violations and the fines for each and issues regarding abatement of the alleged hazard; research OSHA-related case law, which is not always easy to find; help develop workplace safety programs; and assist in maintaining and completing the required logs and other paperwork. They can also specify what specific requirements companies have to follow. For instance, construction companies have to adhere to standards contained in volume 29 Code of Federal Regulations Part 1926, which can be complex, whereas other companies in different types of businesses may not.
The key to all this assistance is for companies to start working with attorneys before they are subjected to OSHA intervention involuntarily due to workplace violations.
How do companies benefit from working with attorneys?
They can save themselves time and money. OSHA inspections and paperwork requirements can fill up a lot of time, which employees might be able to use for productivity. Fines for OSHA violations can be hefty and can range from zero to $70,000, depending on whether violations fall into an ‘Other-than-serious,’ ‘Serious,’ ‘Repeat’ or willful violation’ category. In some cases, where violations that OSHA classifies as ‘willful’ lead to workers’ deaths, jail terms can be assessed. That is not common, though. These fines and penalties often can be avoided or reduced if companies are prepared to eliminate the work-place safety hazards that led to them in the first place.
GEORGE R. CARLTON, JR. is partner and chair, Mass Tort Litigation Practice with Godwin Pappas Ronquillo LLP’s Dallas office. Reach him at firstname.lastname@example.org or (214) 939-4421.
Receiving a paycheck each period is not enough to bond today’s employees to a company. So finding the creativity to connect employees with their companies for long-term relationships is vital in today’s work force management.
Smart Business spoke with the vice president of Delta Dallas Staffing, Kim Follis, to gain some insights into how corporations can attract and retain employees as one way to strengthen their competitive edge in today’s complex business environment.
How do employers create an atmosphere that helps retain top talent for the long haul?
Employers need to evaluate five critical factors when attracting and retaining top talent for their company: culture, empowerment, appreciation, communication and goals/direction.
Culture is the environment that represents the people, ideals, personality and overall style of the company. Empowerment is the ability for employees to impact the business, make decisions and take the initiative in solving problems or creating new ideas. Appreciation is the ability and desire to convey among employees the feeling that they are appreciated, needed and valued. Communication should be open, valued, candid, respected and welcomed. Goals/direction is the idea that the company and the employees know who they are and what they are striving for.
Recently, at an event sponsored by SMU Cox School of Business, a new topic was added, ‘Implementing Innovative Talent Management Strategies.’ Discussions included the process of horizontal and vertical alignment in hiring congruently with companies’ strategies. Additional areas that need to be addressed in attracting and retaining top talent were defining clear expectations, opportunities for development, talent fit, recognition and having committed co-workers.
Does addressing those five critical factors help employers retain their employees?
Once management ensures that the factors are in place, it should address them on a quarterly basis. Doing so opens communication and confirms that the parties are on the same page. It’s the role of the organization’s executives, management and leaders to have these conversations and to be in tune with their employees’ thoughts, ideas and feelings. Executives and HR personnel have to be conscientious about and hold true to those ideals and implement them in their hiring process.
Many times companies settle for a hire to fill a specific job rather than taking a look at the long-term effect of the hire and how this potential employee can help build a stronger business. In such cases, they do not share the expectations and goals that they have for this person. Consequently, they do not get a buy-in from the employee, who may have the abilities and skill sets required to do the job, yet is way off base from the other critical factors. They understand what they are to do and how to contribute, but the ‘fit factor’ is not there.
How do employers benefit from retaining their employees?
Employers benefit in tangible and intangible ways. For example, they foster a sense of stability among customers.
Employees feel that they do not have to tell their story over and over again, that the company knows them and that the people there have ‘company intelligence.’ That stability is complemented by ‘branding,’ which results in constancy in message, goals, direction, policies and procedures.
Another employer benefit is the sense of knowledge and confidence that employees develop in themselves and their employer regarding policies, business practices and decision-making, which contributes to a positive work environment.
Finally, financial benefits are derived from reduced costs of training, hiring and loss of business when transition occurs. Research from the Human Capital Institute suggests that corporate market value is increasingly defined as the sum of human intangibles, ranging from public perception of a company's intellectual capacity to its perceived ability to create new solutions, enter new markets and respond to change.
What benefits do employees accrue from staying with their employers?
Employees gain better senses of history, empowerment and accountability. They earn more leadership opportunities through training, mentoring, management and leading by example. All these factors create more personal and professional growth.
These benefits are made possible when the five critical factors mentioned earlier are in alignment with the personal and professional goals of employees. When this happens, employees and companies benefit, which refutes the idea that neither employer loyalty nor tenure exists in today’s world of business.
KIM FOLLIS, CPC/CTS, is a vice president with Delta Dallas Staffing. Reach her at email@example.com or (972) 788-2300.
Fortunately, companies can avoid technology train wrecks if they work with the proper mix of internal and external business and information technology (IT) specialists to design, install, implement, enhance and maintain state-of-the-art systems that are within their budgets and on schedule. Companies should recognize that it is communications, issues handling and conflict resolution that dictate the success or failure of a project.
Smart Business spoke with Paul Kanneman of Grant Thornton LLP to learn how companies can avoid technology train wrecks and keep their IT systems on track without hurting their bottom lines.
Are technology train wrecks more likely or less likely to occur in today’s sophisticated IT environment?
About 20 years ago, the failure rate of all technology projects was around 80-plus percent, which means that they missed on both budget and schedule. Since then, we have had a whole industry created around project management of large technology initiatives. But, depending on which survey you look at now, today’s failure rate is somewhere between 70 and 75 percent, with about 45 percent failing outright.
So we are not that much better off than we were 20 years ago when it comes to developing technology initiatives. The potential for technology train wrecks still exists.
What causes the disconnect between technology and business needs that leads to train wrecks?
We are dealing with two competing trends. Technology is getting more complicated, and the need for the rapid integration between it and different pieces of a business is growing more and more necessary. The problem causing train wrecks, however, may not be the technology. It is because all too often managers don’t have the discipline to answer up front before they even acquire the hardware and software components the necessary questions about what the technology can really do for their business. They should be asking questions like whether the technology is even required to do what they want and how it can do it. Answering those questions before acquiring the technology components goes a long way to help prevent technology train wrecks.
What else can help?
Three critical components for alleviating train wrecks are a much tighter integration between the business and technology communities, a focus on the organizational changes requiring IT initiatives, and an emphasis on project participants’ soft skills.
For example, closing the ‘air gap’ between the business and IT sides in a technology initiative is essential. IT people may not truly understand business needs, and the business people don’t grasp the technology and what it can and cannot do. They look at IT as a world of wizards who can make business solutions just happen. Misconceptions like that have to be eliminated.
Who should be working on technology initiative projects?
Companies that want to develop cost-effective, state-of-the-art information technology systems have to commit their top business talent to a project. Those people know what needs to be done and have the credibility and credentials to make the decisions required to make sure that it is. If management does not make that commitment, it is abrogating business decisions to IT specialists who may not be fully versed in the company’s business side.
Conversely, the best-qualified IT people should be assigned as well and they should have the required hard and soft business skills. Overall, IT experts are getting better at understanding the business side, but letting them make all the decisions can be a sure way to derail a project, if not to cause an all-out train wreck.
Do soft skills play any role in keeping a project on track?
Yes. Everybody involved in a technology initiative project should have two of the most important soft skills: conflict resolution and issue communications. They have to be able to resolve the inevitable conflicts that will arise on projects. If project members cannot communicate and resolve problems, all the well-designed project plans available will be useless. What gets projects completed successfully is communication and action, not plans. If the soft skills are not present on the project, all the bad assumptions, disagreements and conflicts will get put on the back burner just so everyone can make progress. More often than not, those issues never get resolved, progress becomes an illusion, and the project fails.
The success or failure of a technology initiative project does not rest on what a computer can or cannot do. Rather, it depends on defining what a computer can do, and that can only be done through clear, concise and consistent communications.
PAUL KANNEMAN is regional principal in charge of business advisory services with Grant Thornton LLP. Reach him at (214) 561-2256 or Paul.Kanneman@gt.com.
Identifying and hiring the best qualified staff-level executive assistant is not something that most employers should do on their own. Rather, the process should be facilitated by an executive search firm, preferably one that specializes in hiring candidates who best meet the specified criteria.
Smart Business spoke with Andra Staggs, a customer development manager at Delta Dallas Staffing, about the value of a staff-level executive assistant to a company, why the selection of that person should not be left to chance and how an executive search firm can help in the process.
What should be considered when hiring an executive assistant for senior staff?
Tenure, experience and skill sets are all important factors to consider in the search process.
Hands-on experience supporting the same or higher-level executive helps provide the knowledge that would be difficult for an inexperienced assistant to possess. Most executive assistants at this level have advanced skills in office programs such as Word, Excel, PowerPoint and typing. Testing these skills and checking references provided by applicants are mandatory. A credit check should be done as well.
Those types of tasks are second nature to executive search consultants, whereas they might not be for employers.
What are some standard character traits sought in staff-level executive assistants?
Client relations skills are very important. Many executive assistants at this level have heavy contact with external clients, internal employees and community organization leaders.
Staff-level executive assistants often compose complex correspondence. For this reason, they should have strong writing skills.
Another important consideration is mastery of industry-specific skill set requirements. Most standard responsibilities involve heavy calendar management, meeting coordination, event planning and travel coordination.
Strong proficiency in technology such as trouble-shooting computer issues and working with mobile devices are important considerations.
Possibly the most important criterion is the need for confidentiality, since executive assistants may be entrusted with trade secrets, critical financial data and other classified information.
How do clients benefit from retaining executive search firms in hiring these positions?
One of the main objectives with any new hire is to have the relationship start off on the right foot. Executive recruiters help ensure a good start because they are responsible for the due diligence and negotiations that involve areas of sensitivity for both the company and the candidate.
Pre-screening of candidates is obviously big, because only the top two to three candidates have to be interviewed by the executive. All should have the experience, skill and personality that match the company’s and executive’s needs.
Another advantage of using executive recruiters is that they have access to candidates who are employed and who do not have their résumés posted on the Internet.
Another important benefit is that most good executive recruiters guarantee the skills and qualifications of the candidates they identify and present.
Is every search for a staff-level executive assistant treated as a new search?
Each search should be geared specifically toward a particular individual who is best suited for the client’s unique corporate culture. Ideally, the executive search consultant meets in person with each client to find out what is important to them. This meeting allows the consultant to take the specifics of the job and get an idea of intangible qualities that are also important in the search, such as personality traits.
What criteria should a company apply when retaining an executive search firm?
Companies should look for a search firm with a track record of success in identifying and placing the best qualified candidates. Ask for references.
Good recruiters will request a face-to-face meeting. Recruiters are able to make much better matches when they have met the executive and seen the environment. Have someone visit the recruiter’s office to verify the level of professionalism necessary to attract the type of individual you need.
Choosing the right executive search firm is as important as choosing the right person for the position.
ANDRA STAGGS is a customer development manager specializing in executive administrative assistant placement with Delta Dallas Staffing. Reach her at firstname.lastname@example.org or (972) 788-2300.
Smart Business spoke with Paul Etzler, a senior manager with Skoda, Minotti & Co., to learn more about FIN No. 48 and its effects on corporate tax positions.
Who must comply with FIN No. 48?
Every organization that issues financial statements in accordance with U.S. generally accepted accounting principles (GAAP) must consider the impact of FIN No. 48 for disclosure, and possibly adjustment, to their financial statements. Nonprofits, regulated industries and pass-through entities are not exempt. The same standards for considering and reporting FIN No. 48 apply to public and nonpublic companies. Moreover, subsidiaries that do not file a separate federal return but issue a GAAP financial statement need to comply with FIN No. 48 requirements.
What taxes must be considered?
FIN No. 48 includes all taxes levied on income for any jurisdiction — local, state, federal or international. However, FIN No. 48 does not include consideration of other taxes that the organization may pay, such as taxes on net worth, activity or privilege taxes, sales, and real and personal property taxes. The organization must still be cognizant of potential liability and uncertainty related to such taxes, in accordance with existing guidelines.
The potential effect of complying with FIN No. 48 is a liability on the balance sheet. How is this calculated?
Once all tax positions are identified and analyzed, then a mathematical calculation determines the amount of liability; that is, an estimate of the amount that the organization would need to raise if the taxing authority won and it lost. In addition to this estimate of potential liability, the organization must calculate penalties and interest on the liability and add that to the total. Thankfully, litigation costs and professional fees need not be estimated and added to the liability.
How does FIN No. 48 affect state tax issues?
FIN No. 48 forces the organization to evaluate tax positions taken on its tax returns for all ‘open years.’ The statute of limitations is generally three years. However, the statute of limitations clock does not start ticking until the tax return is filed. Therefore, nonfiling in a particular jurisdiction may go back several years (or decades, for that matter). This causes the organization to take another hard look at ‘nexus’ issues, that is, the organization’s activity in each state.
What is the effect of these disclosures in an organization's financial statements when dealing with the IRS?
FIN No. 48 has been called the ‘roadmap for the IRS.’ Whether due to errors, poor judgment or aggressive tax planning, the accountant must assess — and the independent auditor audit — the possibility that a tax position will be challenged by the taxing authority and the probability of losing the battle. This assessment and auditing of the assessment needs to be fully disclosed on the organization’s financial statements.
How often does the organization need to assess its tax positions?
Commensurate with issuing each financial statement, the organization must address any changes to the circumstances surrounding a tax position. Any change must be new information, not a reconsideration of old information. The most likely reasons for having new information include a settlement with a taxing authority, expiration of statute of limitations related to the return or the increase in the certainty that a tax position will be upheld. It is important to remember that case law and interpretations change all the time. The organization is responsible for addressing such changes as they pertain to its tax positions.
What can a business owner do to understand and comply with these new guidelines?
As with most new pronouncements or regulations, the first year of implementation is the most difficult, but help is available. Public accountants and consultants have put together several Q&As and have addressed a multitude of scenarios to help small business owners.
We suggest beginning the investigatory process now. Any interim and quarterly financial reporting must include the full impact of FIN No. 48. Additionally, if certain tax positions are evaluated as uncertain, then the organization can act now to avoid potential liability from the taxing authority.
PAUL ETZLER, CPA, is a senior manager with Skoda, Minotti & Co., a CPA, business and financial advisory firm, based in Mayfield Village. Reach him at email@example.com or (440) 605-7150.
Identifying and protecting trade secrets is a perplexing, but necessary, task for employers. Yet some employers may not understand what constitutes a trade secret, how trade secret is defined legally, what courts interpret as a misappropriation of trade secrets, or who to work with to protect them. Often, safeguarding trade secrets is not a key issue for them. They may feel that it is unnecessary to protect their proprietary information due to common misperceptions about trade secrets, or that only large corporations have to be concerned about them.
That is not the case, however. Safeguarding trade secrets is a concern for virtually all employers, ranging from those with one employee to multinational conglomerates.
Smart Business talked with Anne Marie Finch, a partner with Godwin Pappas Langley Ronquillo LLP, to learn more about how business owners can identify and safeguard their trade secrets and strengthen their competitive advantages, and how doing so can benefit them.
What constitutes a trade secret?
There is no clear-cut legal definition according to Texas law. There are only ‘factors to be considered.’ They include the extent to which the information is known outside the employer’s business and by employees and others involved in his business; the extent of measures taken by the employer to protect the secrecy of the information; the value of the information to the employer and his competitors; the amount of effort or money expended by the employer in developing the information; and the ease or difficulty with which the information could be properly acquired or duplicated by others.
Why should employers consult attorneys to safeguard their trade secrets?
Often, employers do not have a clear idea about the definition of a trade secret. The lack of a definition and the vagueness of the factors make it difficult for some employers to identify their trade secrets, let alone protect them. As a result, some employers try to protect things that really are not trade secrets and do not bother trying to protect the actual secrets.
Either strategy can be a waste of time and energy, unless the employers are focused enough to recognize the exact issue. Attorneys can help clients identify and protect their true trade secrets, and save them valuable time and money in the process.
How do attorneys help clients identify and safeguard their trade secrets?
In essence, they provide a plan for clients in the area of safeguarding their trade secrets. For example, they can develop appropriate confidentiality agreements that impress upon employees the seriousness of protecting trade secrets and the need for keeping such matters confidential even after they leave their employment.
Attorneys can identify areas in which courts have confirmed that a valid trade secret exists, refine those areas, advise clients on the appropriate methods for protecting their trade secrets, and devise strategies to prevent them from getting into the public domain.
It is important for employers to remember that if they have a trade secret and they do not safeguard it, once it gets into the public domain, it may lose its protection. If that happens, it is very difficult for employers to put the ‘egg’ back together.
In addition to the steps mentioned above, attorneys can help employers protect against trade secret espionage techniques such as computer hacking, software code-cracking and reverse engineering.
Do tactics such as trade secret espionage and reverse engineering affect multinational corporations more than they do small employers?
They can affect any employer, from a company with just one employee to an international conglomerate. As long as an employer has a trade secret that gives it a competitive advantage in its market, it can be susceptible to trade secret espionage and reverse engineering. That is a point that employers of all sizes should take into consideration when evaluating whether it is worth investing their time, effort and resources into identifying and protecting their trade secrets.
What are the most expeditious ways for employers to protect their trade secrets?
The most common safeguards can be found in the form of a properly drafted noncompete clause coupled with a confidentiality agreement, both of which are binding in Texas.
A noncompete agreement has to be reasonable in terms of geographic area and narrowly defined to balance the employer’s interests with the employee’s right to secure some type of livelihood. A confidentiality agreement is binding as long as the information the employer seeks to protect truly is confidential.
ANNE MARIE FINCH is a partner with Godwin Pappas Langley Ronquillo LLP in its Houston office. She is chair of the firm's Labor and Employment Section and vice-chair of its Intellectual Property Section. Reach her at firstname.lastname@example.org or (713) 425-7437.
Afilm actress in the 1920s named Clara Bow was known as the “It Girl.” Audiences loved her. She had many qualities, but the ones that made her most captivating were simply indefinable. She was charismatic and a thorough professional, but more precisely she had “It.”
Executive search consultants find themselves constantly in pursuit of “It” when executing projects for their clients. As important as finding “It” is in the search process, though, it is not easy to identify.
Montana had “It” on the football field. Patton had “It” on the battlefield. John Wayne had “It” on the big screen. Warren Buffet has “It” in the boardroom. But what is “It”?
Smart Business spoke with Brian Trueblood, a search consultant for TNS Partners Inc., to get a feel for what “It” is, how it is identified, and what role “It” plays in the executive search process.
What is ‘It’?
‘It’ is that something special that an individual has that transcends normal skill sets and qualifications. By definition, it is difficult to describe.
‘It’ is a combination of personality and intangibles that fit a particular organization. Clearly, ‘It’ can be different for each leadership team, functional area and company. When a consultant sits down with a candidate, the ‘It’ factor is as important as any other element.
How does an executive search consultant recognize ‘It’?
It is an intuitive skill often honed through experience. ‘It’ is seldom revealed in phone interviews or written documents. In the face-to-face environment of a personal interview, the experienced consultant can uncover ‘It.’
A consultant can identify multiple candidates for an opportunity, all equally qualified on paper. But what separates them ultimately is ‘It.’ Significantly, ‘It’ defines why one candidate might become wildly successful while others will not.
Is ‘It’ by itself a viable criterion on which to base a hiring?
No. A candidate still has to demonstrate the range of skills and attributes that are part of the evaluation process. Just as individuals who look appropriate on paper may not be an overall fit, those who have ‘It’ but do not demonstrate enough of the other skills and attributes will likely not be successful. Clearly, most clients would rather have someone who was lacking in a more tangible experience or skill set than one who had all the boxes checked, but missed on the intangibles. Having ‘It’ can help compensate for a lack of specific assets and skills.
Some readers may confuse ‘It’ with other qualities often associated with dynamic, engaging people. ‘It’ does not mean the most charismatic or polished individual; it is more than pizzazz. ‘It’ is deeper and less obvious than simply the boardroom presence people often use as a definition. While sometimes ‘It’ is apparent in an individual in the first moments of an interview, many times it is a function of a longer, deeper evaluation and assessment.
Is the ability to identify ‘It’ a special gift that executive search consultants possess?
It is a skill that executives involved in the recruiting process, both internally and externally, develop over time.
Inexperienced consultants confuse sizzle, personality and charisma with ‘It.’ The confusion is easy to understand. People want to define ‘It’ as smooth, or gregarious, or someone who lights up the room. We aren’t picking class presidents. ‘It’ is the set of qualities that transcends functional areas. ‘It’ defines why some ‘non-salesy’ people make great salesmen. ‘It’ explains why the introverted technical expert leads the next IT revolution. ‘It’ exposes the reality that the smartest, smoothest and most polished people don’t always end up successful. ‘It’ is what is behind the individual’s ability to accomplish the mission, regardless of the adversity.
The best consultants learn to identify this intangible through the experience gained meeting with hundreds of executives over time.
How hard is it to convince clients that the candidate presented has ‘It’?
Generally, that is not a problem. Clients learn to trust their executive search partners’ abilities to select the best-qualified executives for an opportunity and they willingly meet them. Consultants prepare a comprehensive profile that goes beyond the typical rsum or curriculum vitae and helps define the person and his or her intangible qualities. This report assists the client in understanding the total person and what intangible qualities are apparent. Obviously, ‘It’ cannot be defined on the report, but most clients recognize ‘It’ in their own face-to-face meetings.
BRIAN TRUEBLOOD is vice president of TNS Partners Inc. Reach him at email@example.com or (214) 369-3565, ext. 114.
No business owner wants to be sued. Being sued is bad enough. But being sued in an unfriendly venue could be worse. There are times when plaintiffs file suits deliberately in courts that put the defendants in a disadvantageous position. Venues can sometimes be changed, however.
“Defendants do have a say in where or in what type of court a lawsuit is adjudicated, although their choice is not unlimited,” says Darrell R. Greer, a partner with Godwin Pappas Langley Ronquillo LLP. “They have to make their preferences known well before the venue is finalized.”
Smart Business spoke with Greer to learn more about the importance of venues for trials, the types of courts in which trials are held, and how defendants can protect themselves from ending up in courtrooms in which they might be at decided disadvantages.
Does it make a difference what court a client ends up in?
It does. There are numerous factors that clients must take into account. One is the specific type of court. For example, it makes a big difference as to whether clients are in a federal court as opposed to a state court, or a state district court as opposed to a county court of law. Or clients may find themselves in Justice of Peace (JP) courts or probate courts.
The type of court impacts the strategy an attorney uses and can affect the costs associated with the case. The costs in federal courts tend to be much higher than those in state courts, for instance. In some venues, the verdicts are traditionally much higher than in other areas. Attorneys can help defendants sort out these differences.
What are some of the major differences between types of courts?
Two significant differences are the number of jurors and the judge’s status as a lawyer. If it is the type of case where a defendant might want a jury, the venue is important. District courts have 12 jurors, while county courts of law have six. In JP courts the defendant might get a jury, or might not. In the latter case, the judge might be a lawyer, or might not, depending on where the court is.
It is in the defendants’ best interests to know about these factors when planning legal strategy. After all, whenever business owners are in court, they and their attorneys must have as much information as possible about every aspect of the case in order to make intelligent decisions about how to conduct their defense.
Does the location of the court have an impact as well?
Yes. If a business owner in Houston is sued by someone in a remote small town, that can put him at a disadvantage and affect his choice of defense attorney. When a law suit is filed in a small town quite a way from the business owner’s place of business, the plaintiff’s attorney more than likely has a reputation in that town, and probably knows the judge well. That gives the plaintiff the ‘home-town advantage.’ In such cases, the defense attorney might want to hire a defense attorney from that same jurisdiction who also has a good personal relationship with the judge. That levels the playing field somewhat.
The judge-attorney relationship might not be as important in larger cities like Dallas or El Paso, but in some of the smaller venues the relationship between the judge and the attorney outweighs almost every other factor.
Why do plaintiffs’ attorneys choose venues that place hardships on defendants?
It is part of the legal strategy to place defendants at an economic hardship. For example, a plaintiff might file a claim in Dallam County against a business owner in Houston. That creates an economic hardship for the defendant and the attorney, who must traverse the approximate 680 miles between the two locations, pay for travel expenses, accommodations, etc., and spend time in the process. That explains why defendants and their attorneys should seek a change of venue more amenable to their needs.
Are there cases where courts do not have proper jurisdiction?
That does happen. Say a business owner is sued in Midland, but has never done business there, does not intend to do business there and has no office there. The attorney can challenge the court by saying it is the wrong venue. Or perhaps a suit is filed in the wrong type of court, e.g., a criminal case filed in a probate court, which has no jurisdiction in such matters. In situations like these, attorneys can and should file a motion to challenge the court. If this is not done quickly, the parties may lose the opportunity to do it later.
The bottom line is simple: business owners may not be immune to being sued, but they can at least have some say in where they are sued.
DARRELL R. GREER is a partner and vice chair of the Mass Tort Litigation Section for Godwin Pappas Langley Ronquillo LLP in its Houston office. Reach him at (713) 425-7436 or firstname.lastname@example.org.
Identifying and recruiting a top-tier executive for your management team can be problematic and, at times, exhaustive. As with most arduous endeavors, project success makes even the most painful process worthwhile. Closure is the key, however, and the final step of the search process is fraught with pitfalls and hazards. All the efforts of both the search executive and client to recruit the successful candidate hinge on closing the deal with an appropriate offer delivered in the most professional, efficient and effective manner.
Smart Business spoke with Craig C. Neidhart, a partner with TNS Partners Inc., to gain an understanding of the offer process and learn how to achieve a win/win agreement.
What is the executive search firm’s role in making an offer?
Just as in every other step of the process, the search firm is a partner in the offer process. The development, delivery and acceptance of the offer are addressed jointly with the client to ensure successful conclusion.
How does a company get prepared to extend an offer?
First of all, make sure you have gathered all the necessary facts regarding the executive’s current entitlements. You, the HR team, or the executive search firm must have a complete understanding of all critical offer components (see table).
COMPONENTS OF THE OFFER
- current base salary
- bonus opportunity
- date paid
- potential forfeiture
- stock considerations
- options, grants, RSUs
- amount/potential value
- vesting schedule
- losses incurred when resigning
- automobile program
- other perquisites
- LTIP participation
- vacation eligibility
- pension/401(k) benefits
- relocation complexities
- spouse’s career/impact
- special family needs
- severance/change-of-control benefits
Using this information, how do you design an offer?
As the hiring executive, require your HR team or executive search firm to create an ‘Offer Recommendation Summary.’ This ensures that your recruiting partners are doing their due diligence. By understanding all the entitlements that the successful candidate is provided in his or her compensation structure, the search team can assemble a rough blueprint for successful closure.
What is most important to candidates, and how does the hiring executive know what is the right offer?
Cash compensation is a critical component. There should be a significant increase from the candidate’s current package classically, 10 percent to 20 percent greater. But executives are equally concerned about other tangible and intangible elements.
Creating long-term security for their families is extremely important and underscores the need for detailing the other elements within the offer package. Critical intangibles have probably been validated in the interview process, things like how the candidate will make a difference in the new company, challenging and meaningful work, and a leader who the candidate respects and enjoys personally.
Does that mean the hiring executive should be isolated early in the process?
Absolutely. Ideally, the hiring executive’s involvement should be to engage during the final close, address any major needs, demonstrate fairness and balance, and make the final offer. That is the way to build upon integrity and credibility, and to create a critical bond between the candidate and hiring executive. This process is followed by a formal written offer letter that’s accompanied by a benefits summary, relocation plan, bonus plan description, options policy, etc.
What other helpful hints apply to the offer process based on search firm executives’ experience?
There are many tactics that will work well for the offer team’s members. Be flexible and open to an offer conclusion that may be a little different than originally designed. Sign-on bonuses and assistance with a second career transition are potential closing tools. Don’t hesitate to give an experienced executive the three to four weeks’ vacation benefit he left behind. Remember, these executives are compensated to achieve success requiring 60- to 70-hour weeks, and they often endure global travel. In the big picture, an extra vacation week is negligible.
Lastly, and perhaps most importantly, manage everyone’s expectations and always deliver on time. Nothing can negatively impact an offer process like a disengaged or tardy hiring executive. Do not forget ... the company making an offer is impacting not only the careers of executives, but the lives and futures of their families.
CRAIG C. NEIDHART is a partner with TNS Partners, Inc. Reach him at (214) 369-3565 or email@example.com.
Businesses often retain executive search firms to identify candidates to fill leadership positions. Once the
search firm presents its top candidates, it becomes the client’s responsibility to assess their credentials. The final evaluation of candidates often raises some questions as clients analyze and weigh each individual’s qualifications and assess how well they match the organization’s needs. For example, they must consider how much emphasis to place on a candidate’s ethics, how much faith to put into references, whether to overlook some desired qualifications, or what might be “deal-breakers.” Clients appreciate the value of a well executed “due diligence” and reference report.
Smart Business talked to C. Cable Neidhart, a consultant with TNS Partners Inc., to learn how clients can complete the evaluation process effectively and select the most viable candidate.
What specific criteria are included in a candidate’s background check?
The criteria differs among search firms and clients. Generally, ‘due diligence’ and reference checks are customized based upon a client’s needs and preferences. Due diligence typically includes factors like verification of candidates’ academic and employment backgrounds, references, emotional intelligence, savvy, leadership attributes, relationship skills, change management capabilities, character developmental needs, and the validation of technical skills. Some clients use formalized behavioral testing as a component in the selection process, as well.
At what point in the process are references provided to the client?
Due diligence activities must be completed prior to the candidate meeting the client. This includes all academic and employment verification, thus ensuring the accuracy of duties, titles, etc., as well as one preliminary reference. There is often a direct correlation between the due diligence accuracy and the quality of the can-
didates. Although references can be supplied at any time, they are traditionally performed prior to developing an offer or earlier if the client has some concerns about a particular individual.
How much faith should clients put into references in the background check process?
References play a significant role. But they have to be balanced with other components of the background check. Ideally, search firms will provide a cross-section of references from internal and external sources. Regarding work references, we would talk to one or two of the candidate’s current or former bosses, peers outside his or her functional area of responsibility, and subordinates. Other contacts might include customers, attorneys, auditors or other professionals who can evaluate the candidate’s personal traits, skill sets, ethics, etc.
Another significant role references play is in filling the gaps in candidates’ employment records. A candidate might have a one-year gap as a result of a layoff, acquisition or personal tragedy, and references might be able to validate that gap. Also, search firms and clients must be thoughtful about whom they choose as references.
The references themselves have to be as ethical as the candidates, thus the reason for ideally having at least two at every level.
Should clients take search firms’ background information at face value?
Not necessarily. Remember, the ultimate hiring decision is the client’s responsibility, so it is in the client’s best interest to weigh every factor critically. But it must be flexible in the process. Clients must be willing to trade off some elements of the position requirements. Clients have to weigh one desired attribute/competency against another when the situation dictates that it is prudent to do so.
For instance, the search firm may present a top performer who has an MBA degree for a position in the finance department, but the original position description states that a CPA is required. The client might accept the MBA because the candidate can supplant the CPA requirement with experience. Decisions like these make the due diligence process critical and explain why clients have to be somewhat flexible and open-minded in making the ultimate hiring choice.
What information detected in the due diligence process will most likely lead to being a deal-breaker for the candidate?
There is never any excuse for lying or willful misrepresentations. These are immediate ‘deal-breakers’ as would be a lack of integrity or an inappropriate moral compass. It is critical our candidates’ values are in alignment with our client's commitment to manage its enterprise with the utmost professionalism.
In the final analysis, ethics, emotional intelligence, integrity, personal attributes of a candidate as well as cultural fit are imperative to the overall selection process.
C. CABLE NEIDHART is a consultant with TNS Partners Inc. Reach him at (214) 369-3565 or firstname.lastname@example.org.