When Pinching an Employee Penny Costs So Much More
Topics to Explore
Team Relationship Building
Improve Employee Engagement
Organizational Development Process
Leadership & Management Skills
Organizational Culture Management
Recruitment & Retention Strategies
Recently a good friend of mine gave 5 weeks notice at a small business where she’s worked 4 years. She gave ample notice because she enjoyed where she worked, respected her employer, and knew that her skills were ones that would not be easily replaced. She knew she would be needed to train the new hire. (You might ask, if she was a “happy employee” why did she leave? She left to pursue a life dream which can trump even happy employment.)
She noticed about a week in after having given notice that her vacation hours had been reduced from 52 hours to 26 hours without any explanation. Somewhat shocked and very concerned that there was no communication around this reduction in hours, she approached her boss. These were vacation hours she had legitimately accumulated per the vacation policy of the company.
Her boss was a bit sheepish and tried to explain some funny math. But in the end, there really was no explaining, as there was nothing to explain. This was an outright attempt to take back something that was given and earned. My friend went home angered and hurt. She went from being a loyal advocate for this company who brought many customers in the front door through her connections, to one who would never again recommend their services, and perhaps actively discourage patronizing this business. She couldn’t believe that she was willing to go above and beyond for this company, as she had many times in the past, only to feel slapped in the face as she walked out the door.
The next day my friend confronted her boss with labor laws. Her boss said that she simply could not afford to pay all of the vacation hours in one lump sum. My friend gave her boss the option to pay over a period of time, and her boss still shirked, saying she wanted to make everything right, but wasn’t willing to sign a payment agreement. Now my friend doesn’t make hundreds of dollars an hour, more like 15, so we’re talking 26 hours of discrepancy, or $390 plus payroll taxes etc.
Needless to say, my friend chose not to train the new hire, and the boss doesn’t know the program at the center of the administrative portion of her company.
For $390 this boss lost:
good karma and the valuable trust of a loyal employee and advocate
many referrals as my friend is well connected in the community where she lives, had brought in much business and will continue to be in an affiliate industry
transfer of important company knowledge (which she can now pay $25/hour for technical support from the company who provides the program)
delayed A/R as this program was connected to billing
the mind space and guilt of having ruined a good working relationship over a small sum of money
And chances are this boss will have to pay $390 + lawyer fees anyway as the labor laws do require her to pay earned vacation.
Sometimes cash flow can be crazy scary in a business, and at the end of the day you still have to have integrity – not only with your clients and vendors, but also and perhaps foremost, with your employees.