[RootRot]

SCENARIO:

Hired an employee with no experience 2 years ago. He is the brother of a good friend of my family. My company was very new and he and another guy were my only two guys at the time. I needed him desperately at the time and I hired him about 3 dollars an hour over what I would now pay a laborer to start. He turned out to be a VERY hard worker and VERY reliable and the pay was not an issue for him or me for a long time. I let him know early on that he has a good opportunity being in a position to learn and hopefully take on a crew some day soon.

Over the 2 years he has had no progression in knowledge. His experience is still only as a laborer with no signs of plant knowledge (very little plant I.D., plant habits, deciduous or evergreen, bloom times, or sun/shade requirements, blah blah blah). Nor can he stack stone. He has military experience and held a position of managing others in the military. There have been no signs of being able to manage a crew in the landscaping field (primarily because his knowledge is still that of a laborer). He has had two (dollar) raises in the last two years, honestly, just to keep him because I have always enjoyed him as a person and he has a good attitude and strong work ethic.

PROBLEM:

I was approached by him last week asking for another raise. This time he wanted a "significant raise" as he put it. He would not tell me how much he thought a significant raise was but he said that because of what I pay him he was not able to do the things he wanted to do or "move out of his parents house." Now mind you, he also has a night job on Fridays and Saturdays and makes about $150+/- a night doing that. Because he has to be in early to his night job on Fridays he is basically of no value to me on that day so I give him Fridays off. He makes around $30,000-35,000 a year with my job and his night job combined in a good cost of living market here in N.C.

I didn't give him a raise and had to tactfully let him know he was already overpaid and had no chance of any raises in the near future because of his lack of knowledge. I tried to give him incentives for increasing his knowledge and showing me motivation for learning.

Over the weekend I started to actually get angry about the situation. Without getting too detailed about exact words my biggest problem was the fact that he basically blamed me for not being able to "do the things he wanted to" or "not being able to move out of his parents house" (he's 33 years old for God's sake). I was also very upset that he has shown no signs of increased knowledge or motivation to learn more over the last 2 years. All that said the "overpaid" issue started to upset me and I was insulted that I was to blame for his personal issues.

I talked to him on Tuesday (Monday was Labor Day) and basically gave him 2 weeks to find another job thinking it was a decent gesture instead of firing him on the spot. I feel bad because he is a family friend and I know "business is business" but I can't help to feel that he either should have been fired a long time ago to dull the future pains or because he is a family friend to give him further opportunity to show me a motivation to learn more.

I am now worried about having trouble finding a replacement, of course! We are still a very small company and I am starting to freak out about my decision.

Whew! Feel better at least getting all that off my chest and I am sure I am just a big sap for not letting him go earlier. Have any of you dealt with friends and/or family and having to let them go? How has it affected your relationships with them later on after the fact?

Hope it wasn't too long of a post, and I hope somebody actually got through it all.

Thanks guys/gals....

[Stuck in NH]

Wow, it's amazing how parallel lives become.

In my situation, as possibly in yours, I was at fault for the impending doom.

I was at fault because;

I never let him "hang himself" on a job because he was a FOF.

I never asked him his opinion because he was FOF.

I never made him come back on sat & sun to fix his screwup because he was FOF.

I never sent him home because he was just screwing off or doing it the wrong way.

Sound familiar?? maybe not.

I have never seen my friend again. 13 years now. Think about your choices & apologize as necessary.

My.02 -Stuck

BTW I did your math in my head let me see if I get this right.

150/night X 2 nights @ other job = 15600

Minus your 35000 combined(as per post) = 20000/52= 385 wk for 4 days 8 hr days = 12 clams an hour.

Wow your cost of living must be low, what's an apartment, 350/ month down there?

[Dale Wiley]

One of the best things a small company can have is an established Human Resources program. This spells out very clearly what one needs to do to progress in a company. Learn to earn. Very simple.

Wage increase are based upon an individuals value to the company, and without that individual increasing his value to the company, one will not advance.

I have people in my business who are not willing to take that extra step to increase their value to the company, and therefore warrant an increase in their compensation level. I also have people, who are increasing their value to the company in several different ways, and are recieving the corrosponding increase in their compensation levels. These individuals are creeping up on the ones who are NOT increasing their value and will soon pass them by.

There always be a normal and natural level of attrition in any company, and it is a good thing. If the company establish's the opportunity and training for an individual to advance and learn more, the individual should take advantage of that chance,and just not expect wage increases based upon time with company, personal income needs, local conditions, or any other factors that do not increase their value to the company. It has to go both ways for the employee / company partnership to exisit succesfully and to benifit both parties.

Marty Grunder says that no one person is greater than the company, and that is very true. You cannot allow one person to dictate or determine how you increase wages, otherwise that mindset becomes company culture and that can be difficult to over come if it is allowed to become established as a standard operating procedure.

You own the company, you sign the checks, therefore you make the rules.

[RootRot]

Hmmmm...

He's making $14.50 an hour with me. I took a stab at a total for yearly income, now I suppose he is making more than that. Guessing around $39,000. I am not truly sure what apartments are running around here. Probably more like $400-600 a month, depending on where of course maybe more or much less.

All your examples of "not letting him" or "not asking him" etc.. hit home hard, and I definitely consider this to be my fault for those reasons too. I am sorry about you and your friend, NH. I hope that this doesn't affect my relationship with his brother most of all but I like to consider myself a nice guy and never like to lose any type of friendship. Good or bad thing, however, I have two other guys with me that I would consider friends and that would also consider the guy I let go a friend. We'll see how that works out soon I suppose.

Shortly after hiring him and seeing him not increase his value to us, I began hiring new employees differently and informing them of the standards for increases in pay and they basically follow your advice given, Dale.

[RootRot]

I have even considered, and this may be totally drastic and way premature but I have thought about starting over completely with new employees. I just think that my procedures for pay raises are like you said Dale a bit hard to change at this point with some employees. GRRRRrrrrrr!!!

I just don't see myself getting out of the field anytime in the near or not so distant future with the way things are now and ultimately that is what I want.

[Dale Wiley]

You should probably check with a labor lawyer as to the exact limitations and what you can acutally do, but :

You can institute a new Human resources program and a new company handbook at any time in your companys business. You assemble the programs, have a company meeting and explain the NEW compaqny handbook and the NEW human resources program. These can be as little or as much as you desire. Add drug testing with a 45 day notice. Freeze wages and promotions until the new program is instituted. Change operating procedures. Amend the handbook or operating procedures at any time.

You will need to provide a one time financial consideration to the employees to accept the new program, AS A CONDITION OF CONTINUTED EMPLOYMENT. Give every one a $ 100 check upon siging the acceptance of the new program. Failure to accept the new company human resources program and the new company handbook or operating procedures, frezzes the employee at that level until they accept or move on. However, the employee will be subject to the same disciplinary policys, rules and regulations that the other employees that accept the new program, because, that is the new company program.

[bigviclbi]

Did you ever tell him that his performance was tied to his pay or did you just "hope" he would understand that.

[RootRot]

I here where you are coming from, bigvic, and I know I am not dealing with a pro athlete here but in my experience in any job, military or civilian workforce, performance has always been tied to pay. Increased knowledge of his field, however, was explained to him would increase his value to me as well as his pay. What is sinking in more and more now is that it is totally my fault in the past for not making it clear enough to him he wasn't advancing in the knowledge department. I let things go too far and for that I am a jerk.

[Mark Oomkes]

Just goes to show almost all the problems we have as business owners are experienced by someone or other at one point in time.

I have a somewhat similar situation, just not a friend or friend of a friend. We had gone through a period of time with quite a few less than desirable employees. Had an applicant come along that really seemed to know what the business was all about; mowing, repairs, plowing, etc. Over time I have had issues with him, mainly attitude. (Dale and Bill have heard about these problems before.) I didn't think I was doing the best job as a manager as I could\should have so I did not let him go, yet. He isn't willing to go to any continuing education programs either, on his last 'self-review' (I have my employees fill out a self appraisal which has the same questions, comments, etc on that I fill out for their review and then compare what they say to what I say) his comment on Job Knowledge was "16 years says it all". I had to keep myself from laughing in his face. I wish I knew everything there is to know about this industry and I've been in it since I was 10. (That gives me about 10 years on him). It was at this point that his fate was decided. I found another employee that is way more knowledgeable (sp?) than he is and actually knows how to maintain equipment, rather than just fix it after it broke. So far has not shown any atitude problems. Actually met him at a leadership development class put on by our local association. I trust the new employee more than the other that has been with me for 4 years.

I know, I've already waited too long. I can make an excuse for this. The employee I had in mind to take over this position this spring had to leave our employ for a problem he had.

Anyways, my advice after all that, you made the correct decision, he doesn't want to learn even if you haven't come right out and told him he ought to be able to figure it out at 30+ years old. Like Dale\Marty Grunder says, no one individual is greater than the company.

[Noël]

Hi Root,

Your situation reminded me of an article we wrote in PRO last September. We talked with a business coach named Dan Kohler, who specializes in landscape industry owners and their issues. Under the subhead "The art of managing people," he paints a very similar picture to yours -- which he says is very common in the industry -- and gives advice on what you should do.

Employees often develop a sense of entitlement because they think they've given you years of loyalty. And that should be enough. Dan's point is that you, as the owner, never clearly conveyed your expectations to that person. But he tells you how to correct the situation and prevent it from happening again.

I've tried to attach the article here, but it wasn't working. I will post it directly after this. Take a look at the "art of managing people" section.

On a separate note, MY personal opinion on the subject comes from many interviews and stories over the years. So many contractors will put up with sub-par performance for years because they feel that they (the owners) are at fault for not giving better direction. Owners tend to beat themselves up and then keep the mediocre employee as some sort of penalty for their shortcomings in people management.

You know what? Regardless of whether your management skills can improve (which realizing that will insure that you DO improve them), you are not to blame for someone else's lackadaisical approach to their job. The only blame you can take is for putting up with it way too long. Quit punishing yourself, your company and your other employees by keeping the inferior employee. I've never heard a contractor say, "I should have kept him. He would have turned around." However, MANY times I've heard, "I should have let him go years ago. What was I thinking???"

Good luck to you!

Noël

[Noël]

Here is the section of the story that pertains to this thread. It's from the September 2004 issue, story: From "Mow & Blow" to CEO: Changes in Mindset Give Contractors the Tools to Run a Successful Business.


The ‘art’ of managing people
Contractors will say that the people side of the business is the most difficult to manage. Dan says that by putting the concept into perspective, you can save many head¬aches.

“When you manage people, you are using applied psychology. All that comes down to is using tools to read people well and know what motivates them. It is the art of getting results through others.”

While learning about the psychology of your employees may take a little research, it does not mean you have to get a master's degree in the subject. “The term ‘applied psychology’ scares contractors. But in reality, it is a technical skill like any other,” says Dan. “Most anyone can learn to do it.

“Think of managing people as having a contract with each one,” says Dan. “The contract covers two areas. One is performance. This area is usually pretty well spelled-out as you describe what you want your employee to do on the job.

“The other aspect of the contract deals with the relationship between you two,” says Dan. “This part of the contract is usually unspoken, but is supposedly understood between parties. But often this part of the contract is vague. Employees don’t know what they are dealing with, and neither does the employer. This area is often where problems arise.”

Dan gives an example: Say you’ve had an employee for 12 years. This employee stayed with you through the hard times, working hard along side you as you built the company. Now the company is suc¬cessful, and suddenly the employee is beginning to slack off. Productivity dips and you’re losing money with an employee who was always a high-performer.

Because the terms of the relationship contract are vague, each party begins to resent the attitude of the other. The employee thinks that he should be able to coast after all he’s done for you. On the other hand, you’re wondering why this employee is slacking off on your dime. Furthermore, the employee’s “After all I did for you” attitude is beginning to poison the crew and affect morale. So what do you do?

It’s human nature to avoid the situation and hope it takes care of itself. By doing that, however, you are endorsing and renewing this employee’s perception of the contract. Nothing will change aside from the fact that it might get a lot worse.

Instead, you have to hold the employee accountable, but do it in a contractual sense. “You have to make sure you both understand the personal contract,” says Dan. “Use this opportunity to renegotiate it. But before you do, be sure that you are holding up your end of the contract.” Dan suggests doing a little exercise before you talk with a problem employee:

Step 1) Identify the terms of the contract.
Step 2) Ask yourself, “Am I holding up my end of the bargain?”
Step 3) Take action to change the behavior by first clearly communicating the contract and making sure the employee signs on.

“This process is as concrete as learning how to plant a tree,” says Dan. “There’s a sequence and a pro¬cess you have to go by. Think of it this way: would you take a job and complete it without a clear contract with your customer? Of course not. Contractors seem to feel there are hidden rules to management,” says Dan. “It’s all a big mystery. But it really isn’t.”

[GLAN]

" Quit punishing yourself, your company and your other employees by keeping the inferior employee. "



I took that from Noel's first post.

That sentence right there pretty much sums it up. Especialy where it concerns your company and the other employees.

One bad egg can ruin the whole bowl of potato salad.

But that realy isn't so much the case in your situation....You had a good employee......did his job, worked hard, showed up every day. But he wasn't learning anything....wasn't advancing. In some ways kinda holding you back, not only you but the company as well.

And yet continued to want more and more money.

I think we all have been there. More than once and will no doubt again.

You did the right thing.

Not easy drawing the line between friendship and business. But it must be done.

[HardDaysKnight]

We had an employee, my brother in law and best friend. He was
paid extermely well and deserved it. He continued to learn, ask,
extend himself and was very reliable. He got me off my knees
and was doing the work that I taught him for me not with me and freeing me up to do other things. We were knocking work out
left and right. Suddenly he didn't show up for work one day
and no return phone calls for days. Then we see his AD in the local paper for his new landscaping business. It's been 4 years
now and I haven't heard from him. YES! You did the right thing!
It's all about you, your future, and that of your immediate
family ( wife and children ). Good Luck, Johnny

[cutntrim]

I had a former friend that I fired years ago, he wasn't a "former" friend until I fired him. Never exchanged a word with him after that day. Sometimes being "friends" with employees is part of the problem. Also, in a very small business there is only so much advancement that can be had...whether they're ambitious or not. Which also means there is a ceiling to how much per-hour you can pay guys. That puts a limit on the number of years an employee is likely to hang around. I've got two full-time seasonal employees right now that have indicated they cannot live on snowplowing income alone this winter. They're in their twenties now, and require steady income year-round. I can work a salary-type income arrangement for them, but it's still not as much as they need to live on their own in this area. Short of massive expansion there isn't much I can do. I'm gonna lose them and that's just the way it goes.

[RootRot]

Well, I appreciate all the feedback. You guys have all helped out a lot and I have completely learned my lesson for the future. While I am truly sorry about all the stories about friends and family but I have to admit that I am glad I am not the only one that has been in this or a similar situation.

It never ends well when someone gets fired I guess. Now matter how you try to soften the blow the person being fired will always think they are in the right and/or end up hating their previous employer, friend/family or not. No different in this case.

Thanks for the feedback