Big Changes for a Key Employee.. and your reaction
Continuing on the theme of throwing scenarios at you that you respond to, here’s one that we (as business owners) have to be ready for…because it could happen when we least expect it…
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One of your key employees walks in to have a private talk with you. He has a serious situation he’s dealing with.
It’s a life changing health issue and it’s going to require that he stay home much more instead of coming in to work every day for the long hours your business demands.
He loves your business and knows that this is probably going to seriously jeopardize his employment with you and his ability to deliver the way he has since you started up with him as the second hire.
How do you react? You know this person is magic for your business. You really care about him, too. But you also know that he will not be able to do as much as he used to, and your business has traditionally demanded every waking hour of his energy.
What do you do?
August 16th, 2005 at 5:34 pm
No brainer. You use him as much as possible under the altered circumstance while replacing his RESPONSIBILITY
with some one else. If it’s permanant get him to mentor the replacement. Whatever you do keep the relationship as it will always pay dividends.
August 16th, 2005 at 5:36 pm
I’d be frank with him and let him know that we both know how much the business depends on him, but I require this position to be available more than he will be able to commit to in person. I see two options:
1) Inform him that he needs to help train his replacement and that we’ll find a different supporting role that he can work in somewhere else while still utilizing all the knowledge he has.
2) I keep him on for whatever he can commit to, and hope that his condition doesn’t worsen (though I need to have a backup plan just in case). Then I split the position into 2 roles and have a dotted line responsibility between the two positions.
August 16th, 2005 at 7:55 pm
The ease with which people can work remotely today, thanks to the Internet, I don’t see why we cannot set him up with a home office. The tools are out there for anyone to be able to work from anywhere.
He can be required to come in only to perform the tasks that he needs to do in person at the office.
Isn’t the world heading in this direction anyway?
Meanwhile of course, we would want to look for an understudy for him when the "work-from-home" scenario can no longer work because perhaps of a deteriorating health situation.
If his health deteriorates way before his retirement age, hopefully we would be able to get him some kind of "disability benefit" or "early retirement plan" or something. And if he is as good an employee as you say he is, he will understand that life doesn’t always work out the way we planned it.
If we have deep enough pockets, during the worse of his illness perhaps we can even look at paying him a small retainer for consultancy services.
August 19th, 2005 at 12:38 pm
Interesting!!!
So far, no one has suggested finding out the employee’s needs before making a decision. This is particularly important in the case of a key employee.
Until the employer takes this step, he cannot know what is required of him:
a) in assisting the employee over the course of the illness
b) what he can expect, if anything, from the employee either in the near or long-term future.
For example, training a replacement would be unwise if the employee was to return in a reasonable time, unless there would be a role for that replacement on his return. Would you just be training someone who would go to a rival employer and use his training against your business.
August 20th, 2005 at 9:05 am
Bravo– It seems that a combination of ideas from each of the contributors would be the ideal:
Jim- great understanding of the importance of relationships.
Niko- I think your second option is the more viable. Training a replacement makes the inevitable seem unpalitable. However, finding him/her an assistant lets him know that he is valued and you need his expertise.
Aleem- You really understand the power of what I call "no-box" thinking. Technology has done so much to improve life, it can certainly be of assistance in this case.
Phil- Good thinking. With the situation set forth as it has been, you raise a good point. What is the short and long term prognosis? From there, the best course of action can be determined.
What I might add is involving the employee in the disposition of his role. If we sit down with him and ask the questions "What do you believe will be the best course of action? How can we work together to insure that you can meet your personal needs while at the same time provide for your family and the needs of the company through continued employment?"
August 21st, 2005 at 1:43 pm
Wow! I just read all of responces to the question you posed, and am impressed with the sheer understanding and wanting to help that employee. I thought for sure I would read at least one "Get rid of him as soon as he trains his replacement."
I too would do everything resonably possible to keep his services. So many companies out there today dont value a hard working critical employee today.
My families company hasnt come to that point yet, but I am sure that we will cross that road someday. At least I know where I can turn to get some very helpful information. Keep up the excellent work.
August 23rd, 2005 at 5:19 pm
One additional thought I have is about the owner(s) should have considered [b]Disability Insurance Policy [/b]on their [b][u]key employee[/u][/b]. This would account for any losses that the business might incur because of the loss of a key employee.
I would make sure it was a [b]‘Own Occupation’ [/b]type of Disability policy which is defined as: Total disability as the insured’s inability to perform any or all of the duties of his/her own occupation as a result of sickness or accident. This simply means the insured can no longer perform the job he/she was doing at the time of disability. This is the most advantageous definition for the insured.
Key Person Disability insurance will replace income lost due to disability of a key employee. A key employee is a person essential to the smooth running of a business. The benefit from the key person disability insurance can be in the form of salary continuation. In other words, the benefit is paid directly to the disabled key employee. The business will free up money in this way allowing it to replace and train a new employee.
[b]Key person disability insurance can pay the benefit directly to the business. The funds from the policy help to protect the company should it suffer a loss of income due to losing a key employee.[/b]
August 23rd, 2005 at 5:35 pm
Not to mention a [u][b]‘Key Person’ [/b][/u]Life Insurance policy.