Managing in the mid-size market: tips on using employees as resources in smaller companies.

Almost every issue of a company immediately calls for an assessment of the available resources to address the problem. When offering litigation avoidance planning, counseling and training to mid-size and smaller employers, lawyers receive a common response: "We don't have the resources." Of course, the word "resources" covers a broad range of company concerns, including budget, an "if it ain't broke don't fix it" mentality, and even a belief that such programs are suited for larger corporate entities.

The legal community often accepts these limitations, working with smaller employers only when there is immediate litigation or an issue that needs immediate attention or representation. So, even in the wake of very public and very costly corporate governance scandals that have dramatically affected the need for internal counseling and programming in large corporations, the approach to representing mid-size firms has seen little change. With a panel of liability experts reporting in publications like Crain's Business Insurance (October 13, 2003 edition) that mid-size companies are likely to see the next big wave of external lawsuits, the status quo approach to preparing for internal concerns seems questionable for midsize corporate decision makers and their counsel.

Even if resources are the bottom line, which they certainly are, this should only mean that good counsel must find ways for mid-size companies to deploy and maximize limited assets. In this vein, counsel to every mid-size to small company should be attentive to the fact that size lends itself to a precious resource that is simply lost to larger outfits; namely, communication with and broader use of the employee base. This resource, coupled with strategic counsel that recognizes opportunities to effectively tap into it, will reap huge benefits for thoughtful employers.

Some tips to consider, which are more effective and more manageable within mid-size organizational structures:

Create Employee Policy Committees--This is more than just a morale/social events committee, although they can certainly serve dual functions. This policy committee can be used as the tester group to measure the likely employee reaction or response to policies, programs, trainings and communications. The goal is to give the committee well defined boundaries and responsibilities and use them as an initial filter, refiner and/or mechanism for input. It should be composed of managers as well as a group of trustworthy line-employees.

Use Plain English--People often break the rules, because they simply don't understand them. Rules, polices, handbooks and other forms of communicating what's acceptable in the workplace need a drastic overhaul. Managers and trustworthy line-employees (Policy committee) need to work with counsel to retool and redraft communications so that they are phrased in a manner that's comprehensible and ultimately reaches its intended audience.

Know Your Leave Policies--if 10% of a mega corporation's workforce is out on a given day, it can cause some small issues. For small to mid-size employers, employee absences can devastate the bottom line. It certainly is not helpful that human resource personnel and mangers at large and small companies report that they are confused by leave and time-off policies. In California, there are more than 20 mandated leave policies; some overlap and interlock; some do or don't apply to all employers; and there are policies that employers create under a mistaken belief that they are mandated by law. More than any other policies, understanding the forms of leave is critical. Because 80% of small to mid-size companies fail within the first 5 years, they must know, above all other policies, when they can and cannot require their employees to work. Without the staff to produce, there is no ability to compete.

Train Employees to Train--It can be costly, both in terms of paid time when employees are not actually producing and costs associated with counsel's time and preparation, for a mid-size employers to conduct training sessions for all its employees. One way to cut back on some of these costs is to have counsel train and supervise a group of employees (policy committee) to conduct training sessions. The goal is not just to have managers, but trustworthy line-employees at different levels communicate the rules to their co-workers. It not only demonstrates and reinforces knowledge of the rules at different employee levels, but compliance is less an issue and less combative when employees at every level espouse the rules.

Go Beyond the Legal Justification--Although "It's the law" or "We have the legal right" is certainly enough to justify a rule, it doesn't do much for the morale and comfort level of employees who question if there are other motives at play. A mid-size employer, who often works side-by-side with his workforce, has an ability to drive home the point by taking the time to clearly explain the business case, or explain why an act is necessary and furthers the business goal. Often, there is an employee benefit to a rule that may not be readily identifiable. Highlighting how an action serves the interest of employees, as well as the business goal, furthers good employee relations and common understanding.

Work with Attorneys who can Consult--The economics of small to mid-size employers are better served by those who can offer a "one-stop shopping" consultants approach. Labor & Employment attorneys offer a bigger bang for the client buck, by giving advice on intersecting areas of their fields. For instance, an attorney who invests the time to learn the client's business and approaches the tasks with a law/human resources/communications/public relations/business case view will help a client further their goals, than one who steps in after the other 5 areas have taken a stab at the issue. Not only is a well-rounded attorney more cost effective, but this analytical view on several fronts advocates for a more speedy resolution of the problem.

Innovation and ingenuity are the only constants for success. Counsel who advise imaginative, preventive and solution-oriented approaches are better aligned to assist the midsize employer. Employees in mid-size organizations can be an undiscovered treasure trove of value, with precise direction and responsibility. Resources are only as valuable as the ability to effectively use them to your advantage.

L. Julius Turman is a Labor and Employment Partner in Haight Brown & Bonesteel's San Francisco and Los Angeles offices, specializing in aft areas of representing mid-size employers.