[For more on Policy Governance, see CG #78, Sep.-Oct. 1998 and #59, July-Aug. 1995, as well as “Challenges to the Cooperative Board” and the “”Governance Toolbox.”]
Be Clear About What Is Wanted: Writing The Policies
The board of a co-op has one employee–the general manager. Whatever the board wants for relations with staff in the co-op, it should model in its dealings with the general manager. If the board wants to ensure that employees are treated fairly in a positive work environment, the board must treat the manager fairly and create a positive work environment for the manager. The best starting point for this type of relationship is clarity about what is expected, followed by clarity about how performance will be assessed.
Two types of policies guide the General Manager: Ends and Executive Limitations. Ends policies describe what the co-ops exist to do, for whom and the worth or cost of doing it. Executive Limitations policies allow the board to withdraw safely from most details of operations by telling the manager the limits of acceptable means of achieving those ends. Since the staff are a means by which a consumer co-op achieves its purpose, policies about staff relations fall into the Executive Limitations category. Therefore, the board simply defines what is unacceptable. By setting boundaries, the board empowers the general manager to be creative and effective while ensuring that all management decisions are made within the acceptable boundaries of the policy.
Under Policy Governance, the creation of a policy starts at the broadest, most inclusive level and then continues to narrow the scope and define the broad words until a policy is reached in which any reasonable interpretation is acceptable. An example of a global Executive Limitations policy is “The General Manager shall not cause or allow any practice, activity, decision, or organizational circumstance which is illegal, imprudent, in violation of commonly accepted business and professional ethics, or in violation of the Cooperative Principles.” Most co-op boards would find this statement to be too broad and would define what they mean by “imprudent” or “commonly accepted business and professional ethics” in categories including financial conditions, membership, asset protection, budget/planning, customer relations, compensation, and staff relations.
By more specifically defining and narrowing the policy, the board limits the choices that the manager has in carrying out the policy. Yet the manager retains the authority and is empowered to take all action needed, within the board’s stated limitations.
In the area of staff relations, a board might further limit the managers actions in the following way: “With respect to relations with paid and volunteer staff, the General Manager may not cause or allow conditions which are unsustainable, inhumane, illegal, unfair, or undignified.”
Most boards would still find this too broad and would want to further define what it means by “unsustainable” and “unfair.” However, a board could stop at any point it feels it could accept any reasonable interpretation that the manager would make. In the sample policy (sidebar), we show how a board could get more specific about these values. This sample policy may be too detailed and specific for some co-ops, but we offer it as an example of how a board can give very specific guidance while still leaving the work of implementation appropriately to the manager.
Boards have a legitimate concern with ensuring that the co-op’s work environment is sustainable and fair. But once the board has been clear about what it will accept as a reasonable interpretation of these values, it can safely empower the manager to implement them.
Executive Limitations: Staff Relations
B1. With respect to relations with paid and volunteer staff, the General Manager may not cause or allow conditions which are unsustainable, inhumane, illegal, unfair, or undignified.
||The manager may not cause nor allow discrimination or harassment among employees and potential employees based on other than business related criteria, individual performance, and qualifications. Specifically the manager shall not:
||Cause nor allow discrimination or harassment based upon sex, race, age, physical or mental disability, sexual orientation, national origin, marital/parental status, or religion.
||Fail to take reasonable steps to prevent discrimination or harassment.
||Fail to ensure that channels are established and known to staff to bring claims of harassment or discrimination without fear of retaliation.
||The manager may not fail to provide a positive work environment by:
||Providing channels for staff input into decisions about how their work is done.
||Providing sufficient tools, information, and technology needed for staff to perform their jobs.
||Cultivating a workplace culture which emphasizes recognition and appreciation.
||Providing mechanisms for staff involvement in operational improvements.
||Regularly obtaining an objective assessment of the employees’ perception of the current work environment.
||The manager may not operate nor allow the co-op to operate without written personnel policies including a grievance procedure that are issued to all staff in most current form. The personnel policies must:
||Comply with all applicable laws.
||Protect the co-op’s “at will” status and inform staff that employment is neither permanent nor guaranteed.
||Be adhered to and consistently applied to all employees.
||Be regularly reviewed and updated to ensure current legal compliance.
||Provide for a fair and thorough review of any grievance by means of a known procedure which can be used without bias.
||The manager may not fail to protect staff from unsafe, unhealthy, or illegal conditions.
||The manager may not fail to establish and maintain reasonably current job descriptions for all jobs.
||The manager may not fail to provide adequate orientation and training so staff can successfully perform their jobs.
||The manager may not fail to evaluate each staff at least annually based upon pre-established criteria.
||The manager may not fail to take disciplinary action as needed following established policies.
||The manager may not fail to provide for appropriate documentation, security, and retention of personnel records and all personnel related decisions.
||The manager may not fail to provide for staff development by:
||Providing opportunities for staff to develop skills and knowledge.
||Posting all job openings for staff.
This policy shall be monitored annually by internal report in March.
What Happened: Monitoring The Policy
After writing policies, the next step is monitoring to ensure that the manager is complying with the board’s policies. The board determines how, how often and when a policy will be monitored. Typically, policy monitoring reports are prepared annually by the general manager or someone assigned by the general manager. The board has the option to monitor more frequently (and should monitor financial conditions quarterly). The board can also contract directly with an external expert to monitor compliance with board policy (and should in the case of an annual financial audit.)
Whether prepared internally or externally, a monitoring report should:
- restate the policy being monitored;
- clearly address the policy criteria;
- provide data (not just a statement of “compliance”);
- provide a conclusion as to whether or not compliance was achieved;
- be focused and lean.
The board would not discuss the details of the report, unless it states a lack of compliance. The board would NOT discuss or evaluate HOW the manager achieved compliance with policy, only IF compliance is achieved. It simply doesn’t matter if one or more of the board members would have tackled the job differently if they were the manager. What matters is whether the manager achieved the desired results.
Remember that the board’s job is to provide leadership for the co-op, looking into the future, not redoing the manager’s job. The board should not try to “out-manage” the manager, but get on to doing board work!
Telling How it Went: Creating Monitoring Reports
Most staff relations policies lend themselves best to internal monitoring, although in a few special cases, the board may elect to bring in outside expertise. Let’s look at the tools available for monitoring compliance with staff relations policies.
One of the most effective tools is an employee opinion survey. If conducted properly, a survey can collect the combined perceptions of the staff as a body, in a way that transcends anecdotal evidence that board members hear from individual staff.
To serve this purpose, a survey should:
- Be absolutely confidential. Not only should staff have confidence that their ratings and comments on a survey questionnaire will not be revealed to anyone, they should also know that the survey data will be analyzed without bias. For this reason co-op managers may choose to contract with outside parties to coordinate the survey.
- Contain questions targeted to elicit answers in terms of the staff relations policies. In our sample Executive Limitations policy, to monitor compliance with B1.1.3, “Fail to ensure that channels are established and known to staff, to bring claims of harassment or discrimination without fear of retaliation,” it would be appropriate to seek responses to statements such as, “I feel confident that I could use the channels for claims of harassment or discrimination without fear of retaliation.”
- Reflect the opinions of ALL the staff: participants should not self-select based on the intensity of their interest. Self-selection tends to skew results toward the negative. Steps should be taken to ensure that all eligible staff fill our questionnaires.
- Include followup one-to-one interviews or focus groups of randomly selected employees to provide more insight into the survey results.
- Not occur too often: if employees perceive that their opinion is repeatedly sought without concrete results, they will experience “survey fatigue.” Most literature on employee surveys recommends intervals of no less than 18 months to 2 years. It takes management that long to implement significant changes. In any case, before employees are asked to fill out a repeat survey, they should be informed of what has been accomplished as a results of previous surveys.
Helpful as surveys are, they cannot entirely by themselves prove compliance with certain policies. They measure what the staff perceive to be true, but sometimes the staff cannot be expected to have all the information needed to demonstrate compliance. A case in point is disciplinary action. Questions about fairness and consistency in handling performance problems typically score low on employee surveys. Keep in mind that disciplinary action should be confidential. Sometimes for legal reasons a manager is forced to let the rumor mill run while staff are hearing only one side of the story. Therefore, to show compliance with a policy on disciplinary action (B1.8), a manager’s report to the board should include actual facts rather than staff opinion, e.g., “The established personnel policy was duly followed in each case of disciplinary action in the past year, and legal advice was sought and followed in two cases.”
For policy concerning a positive work environment (B1.1.2), in addition to or instead of asking questions on a survey, a manager could report on actual practices. Here’s an example of how a monitoring report for that policy might read:
All staff have three well-defined and accessible mechanisms for giving input into operational decisions.
- The 2 cents box. Staff can make suggestions on any topic in the 2 cents box. Anonymous comments are welcome. In the most recent quarter we received 37 entries of which 24 were completely or partially implemented. The most substantial suggestion came from a new grocery employee who suggested a change in our receiving procedures, which has resulted in a savings of 5 hours per week!
- All-staff and department meetings. We hold all-staff meetings once per quarter and department meetings every month. Agendas for both include at least 20 minutes for staff input on current operations or proposed changes. An example: The deli department manager recently proposed a change in how customer orders are filled, but after presenting the idea to the department staff for input, she revised the methods.
- Task teams. The personnel director has established a format for ad hoc task teams to use for problem solving when problems arise that need different perspectives to resolve. For example, the scanning coordinator, a cashier, and a stocker recently worked out a solution to the problem of end cap specials getting programmed into the cash registers as soon as the display signs are hung.
In the same way, policies mandating job descriptions, evaluations, orientation and training, or a grievance procedure, can all be monitored by reporting on existing practices in each of these areas. For example, job descriptions for all positions have been recently reviewed by a consultant and are now “reasonably current;” evaluations happen once a year (or not); orientations are conducted by the human resources manager following a checklist; a grievance procedure has been adopted and used twice in the past year.
Policy requiring management “to take reasonable steps to prevent discrimination or harassment” (B1.1.2) could be satisfied first by showing that the co-op has a personnel policy in the employee handbook against discrimination and harassment, with clearly outlined steps for handling claims of either, and then that training is provided to supervisors and staff in recognizing and dealing appropriately with types of harassment.
For policy on working conditions (B1.4), staff opinions in a survey can be supplemented with data on workers comp claims, inspections by OSHA or the state labor department or health department, and reports on the steps taken by a safety committee.
As for policy on staff development, which seems to be a hot button issue with some co-op boards, the manager should be prepared to list outside seminars attended by staff and on-site workshops conducted to increase staff knowledge. If it is regular practice for department employees to fill in for manager vacations and take on new duties, that could be mentioned as well. In a really well-organized store, there would be succession plans to develop inside staff for key positions. Certainly the board should know that such plans exist, although not the names of individuals involved.
Some staff relations policies do not lend themselves to monitoring through seeking employee opinions. Whether personnel policies comply with all applicable laws and protect the co-op’s “at will” status is best determined by obtaining the advice of an attorney. This can be done in the course of complying with a requirement that personnel policies “be regularly reviewed and updated to ensure current legal compliance.” (B1.3.4) In establishing personnel policies, the board should decide in advance whether it would prefer an external monitoring report from the attorney directly to the board, or an internal report in which the manager informs the board of the attorney’s conclusions.
You CAN Have It All
By using the principles of Policy Governance, it is possible for boards to assure themselves, without getting involved in workplace dramas, that co-op employees are well-treated. Through developing clear staff relations policies at a level of specificity with which the board is comfortable, by monitoring compliance with those policies, and by using hard data in monitoring reports, boards and managers can act together to make their co-op a great place to work –for the staff and the general manager too!