As we begin the new year, it’s a good idea to proactively think about some of the issues that your business may face in 2018. We outline five challenging issues business owners should consider and recommendations on how to address them.
ONE: Finding Talent
With strong economic growth figures closing out 2017, the prospect of a continuing economic upturn is good. Add into the mix a roaring stock market and perceptions of corporate savings from the newest tax code changes, and the struggle to find talent to fill higher paying jobs will only get tougher. And if the theory surrounding the tax law changes comes to fruition, there may be a demand on lower line workers to handle increased orders; this will hit all along the supply chain in your respective industry.
While manufacturers rely on robotics, software, and machinery, they also rely heavily on individuals such as sales people, technical people, logistics and laborers, shippers and haulers, packagers, and “hybrids”—people who perform multiple functions such as HR, sales, admin, RFPs, etc.
OUR RECOMMENDATION? You need a different mindset for these people along with tighter job descriptions, and boundaries on how they’re managed and reviewed to get them and keep them. Contract reviews, Employee Manuals, and policies and procedures are all good things to review and revise in the new year as you bring on new people.
NOTE: With revisions in the Federal Government’s Immigration Policy, also be aware of employees with Temporary Protected Status (TPS). TPS currently applies to people from the following countries: Salvador, Haiti, Honduras, Nepal, Nicaragua, Somalia, Sudan, South Sudan, Syria, and Yemen.
TWO: Sexual Harassment
Around every corner in the news today is a more outrageous story of sexual assault, some of which is clearly criminal conduct! These cases should be pursued by the local police or District Attorney’s Office. Because it’s in the news, it’s easily dismissed as extreme behavior sensationalized and limited to various industries like the government, media, and entertainment. But the truth is that harassment in the work place is still rampant and probably occurring in your facilities. This is in large part because the law is complicated, and the circumstances are generally murky.
Matt Damon stepped in it recently saying something silly like a “pat on the rear” is not rape; but the fact is that in the work place, a “pat on the rear” is outrageous conduct! Pay attention to this in your business. The legal standard is “Are you creating a ‘hostile work environment’ in your facility based upon sexual innuendo, harassment, bad jokes, stupid emails, and pornography?” If you are and you arrogantly shake off or ignore complaints (or worse yet ignore, demote, deflect work, give the cold shoulder, or ostracize them for speaking up), you are in deeper trouble without really knowing it.
Another characteristic we often see in these cases is when management decides to “back up the manager” accused of the behavior because of his or her value to your organization or because of the fear that if you fire them, they may counter-sue for age discrimination or retaliation. Either way, you will likely end up at the courthouse, and plaintiffs’ lawyers are dying to take these cases!
You have to stay on top of this! No more jokes, no more quick dismissals of accusations.
OUR RECOMMENDATION? Hire a third-party independent counsel to interview the parties and make inquiries into the activities. Internally, they’ll be able to fully explore the evidence, the credibility of the claims, and the conduct of the parties. Based on this, independent counsel can make recommendations to management on how the situation should be handled.
Since this is so important we offer a BONUS RECOMMENDATION: The answer to prevent much of the sexual harassment cases is training. Call our office for a training session on the latest sexual harassment cases. From sexual innuendo, to bad jokes commentary, to calendars with half-dressed people, we’ve seen it all and can help address it.
THREE: Government Regulation—Taxes, OSHA EPA, MA DEP, NH DES, NLRB, DOL
The EPA, IRS, OSHA, and DOL are still around, armed with powerful mandates and ready to pounce on any low hanging fruit. They’re looking for easy violations that they can pick on and put your company’s name in the paper! This is their enforcement approach—to embarrass you publicly with an article in the newspaper or online, never mind the fines and penalties.
While there’s been a lot of hype about government cutbacks and tax code changes, federal and state employees are still in the office everyday sending out Notices of Violations and stopping by facilities to do inspections. Managing your environmental impacts and aspects is not hard to do but typically falls way down on the “to do” list because you’re busy trying to meet the demands of customers and the marketplace.
OUR RECOMMENDATION? Prepare an “In-House Prevention Plan” and do an inspection with an independent counsel. They’ll help evaluate your policies and procedures and compliance without any fear of exposure. Why not use the Attorney Client Privilege to your advantage!
FOUR: Contract/Vendor Review and Corporate Status Check
In general, facility owners feel a need to engage an attorney when reviewing and drafting a contract, whether it’s for employment or an agreement with a customer.
But what about existing contracts you have that may have lapsed (e.g. leases)? What about your corporate and LLC documents? Notices of and annual meetings in a close corporation are generally neglected. With deadlines coming and going and business needs constantly changing, owners frequently spend time on business demands and overlook fundamental legal documents and requirements within their organizations.
And are you personally separated from liabilities incurred by your company? You may not be if you don’t fulfill your obligations to maintain your legal entity with the requisite minutes and votes required to insulate you from liability.
OUR RECOMMENDATION? Designate someone in your organization to do this and train that person on the legal requirements and why they’re important. Have that person be the liaison to your counsel to address the many legal details your business faces.
FIVE: Trusted Advisors—Manufacturing Legal Service
Google can’t do it all, you need to build your team in 2018.
As a member of SBANE, I’ve surveyed CEOs and managers of manufacturing businesses specifically about the need for a lawyer and why they do or don’t use a lawyer. My findings were intriguing.
Some manufacturers don’t consult an attorney except for limited transactional purposes—they need someone to review an employment contract, a NDA, or a contract with a vendor. When litigation occurs, they recognize they need an attorney. But otherwise, manufacturers leave lawyers out in the cold largely because lawyers either haven’t performed well, justified their value, or embedded themselves in the organization.
OUR RECOMMENDATION? Hire a manufacturing lawyer. Consider a lawyer like you would an accountant or a coach, as your trusted advisor. A manufacturing lawyer is an advisor with a lot of business experience who can add value to your business by advising you not only about what to avoid but also how you can proactively address issues and increase your profitability.
Regardless of whether one or all of these items apply to you and your company, it’s never too late to start thinking about them. And remember that we’re always willing to answer any questions you have about these topics; don’t be afraid to call us before you have an issue.
Have a Good Year!