Personnel Practices to Add Value

• An Introduction to the Structured Interviewing Method
• The Where's and Why's of Personnel Records
• Personnel Records Retention Chart
• New Ergonomics Law Takes Effect
• Ergonomics Checklist and Safety Suggestion

How to Hire the Right People:
A Guide to the Structured Interviewing Method

There are not many things that are more important to a successful operation than the staff, both year-round and seasonal employees. All of your hard work in creating a high quality product through field planning, discing, pruning, spraying, fertilizing, irrigating, hoeing, or thinning will be for nothing if competent, hard-working labor is not obtained to maintain, harvest, transport, or process the product for market. Even at lower pay rates, hiring decisions represent a major investment in both time and money. The costs are true whether you hire a top performer or a poor one; they're basically processing costs and have nothing to do with the quality of your hiring decisions.

What's the Cost of a Bad Hire?

Whether the employer is hiring a machine operator, mechanic, packing inspector, dairyman, or farm supervisor the cost can be enormous. Consider lost productivity causing an increase in your labor expenses and lessening the grade quality of your product, damaged or stolen equipment and produce, company reputation, poor morale among existing employees, and the oppressively high costs of unemployment insurance and workers' compensation. Poor hiring decisions result in higher turnover and require additional workloads on those remaining as well as increased recruiting, screening, and interviewing expenses. It means additional time and expense for training the newly hired and lost production during the time the inferior employee worked, during the time the position was vacant, and while bringing the new employee up to speed. Also, given today's high level of employment-related lawsuits, a single legal challenge by an aggrieved applicant or former employee can cost thousands of dollars in government fines and tort liability. A startling fact is that since 1972, when many of the current employment laws were enacted, lawsuits have risen by 2,166%. A similar increase would yield another 125 million such suits by the year 2050. In view of all of the above, why don't we pay more attention to our hiring decisions?

The purpose of the selection interview is to pick the candidate(s) with the highest likelihood of being successful on the job, the assessment of both the ability and the motivation of the individual. Some of the job skills will be best assessed in the interview, while others, such as manual dexterity, are better demonstrated in a simple job sample test (which is a separate topic that I will cover at a later time). However, almost everyone uses the interview to hire personnel. How well is it usually done? Not very well by most people. Countless research studies have shown that traditional interviewing techniques result in an average of only 14% better than chance accuracy in predicting future job success. So why do so many people use this method to hire people? If your pesticide application only reduced pests by 14% or if your inertia trunk shaker effectively loosened only 14% of the tree crops would you continue to use them? I think not. This program is intended to help you beat those odds and raise your predictive accuracy to the 50% to 60% levels that many businesses have shown to be possible with good structured interviewing. In short, we are trying to do away with hiring people who perform below expectations.

The agricultural employer must complete the hiring process without illegally discriminating against applicants based on race, gender, or age and should evaluate the applicant's skills, knowledge, and abilities as they relate to the actual requirements of the position. This is exactly what structured interviewing does in its use of carefully planned job-related questions. Applicants always know when their job-related weaknesses and strengths have been uncovered and they generally leave the interview with a clearer picture in their minds about getting the job or not and also with the feeling that the process was fair. In the future even more applicants may apply, feeling that with you, they are given a "fair shake." Should a legal problem arise, the employer will be fully prepared to defend the decision. On the other hand, traditional interviews which are unstructured reveal few, if any, true strengths and weaknesses of the applicants. As a result, people leave the interview feeling unsure about the assessment, and this attitude increases the possibility of legal actions should they fail to get the job. The traditional interview leaves little or no basis to stand up to such actions as there is often no record of what was discussed in the interview to merit the decision.

One of the best examples of the structured interviewing approach was reported by a large central California agribusiness. In this organization, both structured and traditional approaches were used separately in comparable units of the company and then evaluated. The results dramatically favored the structured approach; with those hired under the structured method having much lower turnover and higher performance evaluations. It is estimated that within four years, the company would save $2 million in turnover costs along with the value of having more productive employees. How is the company doing? In 1996 their sales growth exceeded that of their competition by 25%.

The structured interview ensures that the interview discussion focuses on and accurately measures the applicant's qualifications. Having a large set of common questions helps to eliminate biases of the interviewer and builds confidence in evaluating applicants. It also provides a record of how and why decisions were made. Furthermore, such a standardized evaluation system leads more easily to a final decision, and as evidenced by the example above, it works. The informational guide is divided into five modules or programs: An Overview, What to Ask, How to Ask It, Planning and Conducting, and Legal Considerations. The guide will help you learn to develop and administer interviews which are:

• Valid: Measure competencies or skills, which translate into improved job performance.
• Reliable: Accurate and consistent.
• Fair: All applicants are treated equally and the interview is seen as fair.
• Practical: Minimize labor and other costs while helping to increase your return on investment for every hire.

Why settle for less? For further information or to order a free copy of the guide, call or leave a message at the Butte County Cooperative Extension office.

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The Where's and Why's of Personnel Records

Although they are often the cause of many administrative headaches, a chief perpetrator in absorbing what seems like many unproductive hours, and one of the major reasons why many small to moderate sized farms utilize labor contractors, the use of thorough documentation and the knowledge of how long to keep and who has access to personnel records is necessary both as a legal defense against lawsuits and for greater efficiency in your operations. Both state and federal laws include mandatory retention times for certain personnel records, and privacy issues play an important role in record retention methods and access.

How Long to Keep Records

A good rule of thumb is to keep the bulk of most employees' personnel files for the duration of employment plus four years. This will cover the critical period for almost every law with the exception of three types of records which should be separated and retained for a longer period of time if possible and applicable to your situation:

1. First-aid records of job injuries causing loss of work time -- should be kept for five (5) years.
2. Pension and welfare plan information - -six (6) years.
3. Safety and toxic/chemical exposure records, including Material Safety Data Sheets (MSDS)--thirty (30) years.

Where to Keep Records

Employment records should be kept in individual files and always locked in a cabinet with access controlled by one or two individuals from whom authorization must be gained before others may see the records. Most personnel records may be kept together in a personnel file; however, certain types of documents should be kept separately.

Medical records -- California law mandates that all employers have procedures to ensure that records remain protected and confidential. Failure to do so exposes one to a misdemeanor and allows employees to collect damages and attorney fees. It is best to simply create a second confidential personnel file, if possible, where access is even more difficult to attain and granted only to those with a legitimate need to know; i.e., if a change in jobs now requires heavy lifting, it would be appropriate for the supervisor to look at an employee's pre-employment physical to see if any problems existed that could hamper future performance. The following documents should be included under medical records: Workers' Compensation records, return-to-work releases, information about accommodated disabilities under the Americans with Disabilities Act, Family and Medical leave request forms if applicable, and any other record that relates to an employee's medical history.

Employment Eligibility or I-9 Form and photocopied verification documents -- These should be kept in a common I-9 file separate from individual personnel records to allow accessibility to INS officials and to keep them out of your other personnel matters.

Equal Employment Opportunity Classification -- Under Title VII and the EEO Act of 1972 employers of 15 or more workers or 5 or more workers under California's Fair Employment and Housing Act, are required to maintain a record of the sex, race, and national origin of applicants and employees apart from personnel files -- in a common EEO file, not in each of the worker's own personnel files. Additionally, records involving investigations of discrimination and sexual harassment should be maintained in a separate folder.

Employee Access

Under Labor Code Section 1198.5, employees must have access to and be allowed to take notes of their own personnel files while employed and after termination until the statute of limitations runs out on any possible legal claims. However, inspection may be limited to one time per year, unless the employee has a reasonable cause to look through the file, and may be required to be done only during the employee's free time and with the employer monitoring. Additionally, employees may not inspect certain records such as letters of reference and any pending criminal investigations.

The employee does have a right, however, to a copy of any documents that he/she has signed relating to employment such as: applications, wage stubs, change in compensation, payroll authorizations, records of grievances, production quality and performance appraisal records, promotion recommendations, attendance and absence records, discipline and termination, and medical records. The penalty for denying an employee access to his/her records is a misdemeanor offense and a $100 fine plus damages and attorney fees.

According to the now de-funded Industrial Welfare Commission's Wage Orders (8, 13, and 14 affecting ag employers), employers must also maintain comprehensive records showing workers' names, addresses, titles, and Social Security numbers as well as hours worked, birth date, pay rate -- including any incentive or piece work plans in effect, and the value of meals and lodging. At the time of payment, the employer should give a statement of deductions to the employee and the dates for which he/she is being paid.

The Department of Labor has recently issued a Spanish version of the WH-516 form that incorporates Workers' Compensation and Migrant and Seasonal Agricultural Worker Protection Act (MSPA) disclosures. All employers and farm labor contractors required to make MSPA disclosures must complete the amended form or a comparable one providing additional information regarding Workers' Compensation. I have additional information and copies of this and many other forms if interested.

Maintaining proper employment documentation is often an unpleasant chore that is made even worse by being required to create and track certain records. However, a comprehensive and efficient system can go a long way towards allowing an organization to run more smoothly and to evaluate itself as far as what is and is not effective business practice. Accurate records can aid in recruitment, retention, training, promotion, compensation, quality and cost control, and are probably the best defense for any legal problems which may arise in the future. Given the environment in which we live today, having pro-active business practices may cost a little more initially, but will likely reduce many more costs down the road. Below is a record retention chart organized by the suggested length of time needed to retain documents against possible employment law liability. I hope that you find it to be somewhat helpful.

Personnel Records Retention Chart

NOTES:
Title VII -- Title VII of the Civil Rights Act of 1964, Federal Discrimination Laws
FLSA -- Fair Labor Standards Act of 1938
ADEA -- Age Discrimination in Employment Act of 1967, protects individuals over age 40
FEHA -- California Fair Employment and Housing Act, state discrimination law
ADA -- Americans with Disabilities Act of 1990
EDD -- Employment Development Department, Unemployment Insurance Code
IRCA -- Immigration Reform and Control Act of 1986.

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New Ergonomics Law Went into Effect July 3

An appearance is scheduled for September 5, 1997, in Sacramento Superior Court to hear labor and employer lawsuits challenging the new standard, 5110: Ergonomics. In the meanwhile, employers are required to comply with the new state regulation enforced by Cal/OSHA. As currently adopted, the standard applies to employers with ten (10) or more workers who have had two or more repetitive motion (RMI) or cumulative trauma injuries diagnosed by a physician as being predominantly caused by work-related activities within the last twelve months. RMI's are muscular-skeletal injuries such as carpal tunnel syndrome or tendonitis that most commonly affect the wrists, back, and knees of individuals. Employers who fall within this category must develop and evaluate a training program, similar to SB 198's Injury and Illness Prevention Program enacted since 1989, to help minimize RMI's in the future. Job restructuring such as increasing work breaks, using job rotation, or modifying the actual task may be used. Modifying work sites or accommodating to eliminate possible RMI prone activities is not necessary when, similar to the Americans with Disabilities Act (ADA), the accommodation causes the employer undue economic hardship. However proving hardship, as some employers can attest to, is not an easy thing to do. Only the workers who have developed RMI's or others doing similar work must be provided with the training.

The effect that this new standard will have on agricultural employers is still somewhat unclear at present and will likely remain so for some time while further hearings and possible litigation takes place. Ergonomics, the study of man-machine interaction, is a relatively young and dynamic field. Scientifically, the validity of chronic, long-term, "wear and tear" type injuries that are involved in the standard are difficult to either prove or disprove, leaving both employers and workers in an unsettling situation. Fraud may therefore become problematic with some individuals. From the hiring process on down, the best way to combat fraud is through effective labor management and adequate personnel documentation. For instance, if an employee has recently been disciplined with a written warning for excessive absences and suddenly that employee files a repetitive motion injury claim, the employer may have some possible evidence to refute the claim if the discipline action was documented.

In the meanwhile, Cal/OSHA consultation service has prepared a four-step ergonomics program handout for interested employers with clerical staff and others that work with computer display terminals. The consultation service can be reached at:

Additionally, below is a general Ergonomic Assessment Checklist, which may be useful for agricultural employers who want to pro-actively assess their own situation in hopes of possibly reducing RMI type injuries down the road.

Ergonomic Assessment Checklist

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Safety Suggestion

Know the difference between first aid and recordable illnesses or injuries. If an incident only requires first aid, as defined by Cal/OSHA's record-keeping requirements, and you have an agreement with your physician, you may pay the medical provider directly and the incident need not be reported to your insurance provider. This may help to save you a significant amount of money in Workers' Comp premium charges down the road.

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