In a high-stakes hiring situation, it’s common to invite the finalist to interview with an objective external expert. In our searches for top financial executives, the CEO often wants the finalist to meet the chair of their Finance Committee. When the board is not involved, the CEO might want the candidate to interview with the company’s outside auditors.
The key is to be sure you don’t hire a CFO with skills like this guy.
The same due diligence occurs when hiring the top job in most other functional areas. In searches for top executives in marketing, development and IT, our clients often arrange time for the finalists to meet with their trusted outside advisors. Familiar with the needs of the organization, these advisors serve to fairly and objectively evaluate a candidate's subject matter expertise.
But in dozens of searches for top HR executives, not once has a CEO asked me to run the finalists past outside legal counsel.
I find that odd. Because more than any other person in your firm, your top HR executive determines how courageously your managers can manage. When things with an employee go sideways, HR helps to evaluate the potential legal risk of ushering someone out the door before they cause even more damage.
I discussed how HR helps manage legal risk with my own lawyer, employment super lawyerRick Vernon. Rick is onvirtually every listof Washington's legal elite, and as an employment attorney, he deals first-hand with the staggering costs of employers failing to properly manage risk. Here’s how Rick puts it:
“HR guards the back door and prevents the lawsuits from sneaking in. A good HR person holds a double allegiance. He or she fervently represents the employer and defends its interests, and simultaneously lends an understanding ear to disgruntled employees. The latter characteristic prevents many issues, because disgruntled employees are the ones that file suits and claims for wrongful termination.”
Great HR buffers your legal risk so that you can manage with courage. Ineffective HR fails to properly assess legal risk.
Ineffective HR both makes you unduly afraid of small risks and unaware of larger risks. Most employment attorneys earn their smallest fees from the employers who involve them early and earn their largest fees from the employers who wait too long to call. And who is the gatekeeper who decides when to bring in the lawyers? HR.
According to Vernon, his role is, “To empower employers to take the actions necessary to make their businesses operate well so someone who is not doing their job can be terminated with minimal hassle. People typically get fired for behavior, performance, or both.”
To help evaluate legal risks before attorneys get involved, HR needs a solid understanding of the laws that commonly get businesses in trouble.
“A good HR Person has to know a ton of federal, state and even local employment laws and regulations, and for a government contractor, there are more,” says Vernon. “They also have to know the applicable common-law (or judge-made principles) in case someone sues because of a common-law tort. And there are a number of protections in the workplace for that.”
Obviously HR does far more than just help to reduce your legal risk, (seeWhen You Undervalue HR, You Undercut Your Managers’ Effectiveness). But when you are interviewing, consider involving your employment attorney in the selection process. Because with a properly vetted HR pro at the helm, you can be more confident in the advice you will get in the complicated, gray-area elements of employment law. You will also be sure you have an HR representative who will be effective in mediating difficult situations.
“If you have someone who is a keen student of the law and knows their stuff, they can better advise your managers when to be more confident in firing vs. not,” says Vernon.