Michigan’s Small Business Leaders Investing at Slower Rate Due to National Economic Uncertainties

This post was reprinted from a Press Release by Stepheni L. Schlinker, Press Secretary for Accident Fund Holdings, Inc.

LANSING, Mich. – The latest Michigan Future Business Index survey of small and midsize business leaders shows the state’s job providers ‘tapping the breaks’ due to a variety of national economic uncertainties. While business owners say they remain optimistic that Michigan is headed in the right direction, they also say their shrinking bottom lines are causing them to take a second look at earlier hiring and wage increase plans.

“These surveys are very useful to Accident Fund for taking the economic pulse of small and midsize business owners,” Mike Britt, president of Accident Fund Insurance Company of America, which commissions the survey, said. “Small business is the core of our state’s economy, and they’re concerned that the slowed national economy, coupled with a new dose of regulations will temper Michigan’s economic recovery and job growth just as we’re on the mend. Small and midsize businesses are our customers, so their feelings about the economy are as important to us as they are to them.”

Britt added that the survey shows quite a bit of good news. There are signs that business leaders believe Michigan’s recovery continues, albeit at a slower pace, with survey respondents reporting continued growing sales, and more of them revealing plans for new product and service line launches and location openings.

Dissatisfaction with the state’s economy has ticked up one point since June to 57 percent, while satisfaction has dropped two points to 41 percent, though satisfaction with the economy is still 14 points stronger now than it was a year ago.

Additionally, the percentage of businesses with new hires is still 20 points higher than one year ago, but statistically unchanged since June of this year. New hiring remained the strongest in West Michigan and there has been a significant increase in hiring among larger businesses (35%) as well as those in construction, manufacturing and distribution (26%). Also a positive sign, 40 percent of business owners reported in the latest MFBI survey that sales had increased over the previous six months, a two-point increase from the June 2012 survey.

Other positive results from the survey include:
• Six-month business outlook. While optimism has ebbed slightly since June, a majority (52 percent) of respondents still believe the business outlook for the next six months remains good, with 17 percent saying it is “very good.”

• Hiring and layoffs. Twenty-four percent of respondents said they plan to hire more employees in the next six months. While that number is two points lower than it was in June, it’s still nine points higher than in October 2011. The outlook for new hires remains strongest in the Detroit Metro region (26%). Larger businesses and new businesses, especially childcare, are hiring the most new employees (33%).

• Increased wages. The outlook for increased wages continues to improve marginally, as 26 percent of respondents said they plan to increase wages for their employees within the next six months – up two points from 24 percent in June 2012. Employers in West Michigan are most likely to increase wages for workers, with 32 percent indicating they will do so. Additionally, wages are most likely to climb within the financial, insurance and real estate sectors – 32 percent of those employers said they will raise compensation.

“The results of this latest Future Business Index survey are less encouraging than I had hoped,” said Chris Holman, CEO of the Michigan Business Network and publisher of the Greater Lansing Business Monthly. “Michigan is still in a vulnerable position at this infancy stage of recovery. The current concerns over the ‘fiscal cliff’ and the growing anxiety over added health care costs are causing Michigan businesses to recalculate their strategies for capital and human resource investments. We need to see quick action by the President and Congress on these two issues to ease uncertainty and reignite the recovery.”

The Michigan Future Business Index, commissioned by Accident Fund and the Michigan Business Network, is conducted semi-annually by Marketing Resource Group, Inc. (MRG). The survey has been conducted since 2006. A total of 1,015 Michigan business owners, operators, officers and managers were interviewed for the October 2012 survey.

To view a summary of the most recent Michigan Future Business Index, please visit the Accident Fund Insurance Company of America website at http://www.accidentfund.com or the Michigan Business Network website at http://www.michiganbusinessnetwork.com/.

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Accident Fund Insurance Company of America
Founded in 1912 and headquartered in Lansing, Mich., Accident Fund Insurance Company of America is a licensed workers’ compensation insurer in 48 states and the District of Columbia. Accident Fund is rated “A-” (Excellent) by A.M. Best and is a wholly owned subsidiary of Accident Fund Holdings, Inc., the 13th largest workers’ compensation insurer in the United States. For more information, visit Accident Fund’s website at http://www.accidentfund.com.

Environmental Protection Agency (EPA) requests public comment on three Regulatory Flexibility Act (RFA) section 610 reviews.

On October 31, 2012, EPA announced that it will review three regulatory actions pursuant to section 610 of the RFA.

The three actions are:

• Heavy-Duty Engine and Vehicle Standards and Highway Diesel Fuel Sulfur Control Requirements;
• NESHAP: Reinforced Plastic Composites Production; and
• NPDES Permit Regulation and Effluent Limitations Guidelines Standards for Concentrated Animal Feeding Operations (CAFOs).

EPA is soliciting comments on: the continued need for the rules; the complexity of the rules; the extent to which the rules overlap, duplicate, or conflict with other federal, state, or local government rules; and the degree to which the technology, economic conditions or other factors have changed in areas affected by the rules.

Comment submission deadline is December 31, 2012.
•  Notice from the Federal Register
•  Advocacy contact: Sarah Bresolin at 202-205-6790
•  Regulations.gov, the Federal government’s one stop site to comment on Federal regulations

For more information on Regulatory Alerts please see the Office of Advocacy webpage http://www.sba.gov/advocacy/815

Chamber Announces 2012 Ballot and Candidate Endorsements

The Saginaw County Chamber of Commerce Board of Directors has approved and announced endorsement positions for the upcoming November 6, 2012 elections.

 

The Chamber recommends the following actions on statewide ballot issues 12-1, 2, 3, 4, 5, 6, and the renewal of the eight year millage request for Delta College.

 

Ballot Proposal                                                                                             Chamber Endorses

12-1   Emergency Manager PA 4 Referendum………………………………… Vote YES

 

12-2   Amend the Constitution:

            Regarding Collective Bargaining…………………………………………… Vote NO

 

12-3   Amend the Constitution: to Establish A New

            Standard for Renewal Energy“25 by 2025”…………………………….. Vote NO

 

12-4   Amend the Constitution: to Establish The Michigan

            Quality Home Care Council and Provide Collective

            Bargaining for In-Home Health Care Workers…………………………. Vote NO

 

12-5   Amend the Constitution: to Require a 2/3 Majority Vote

            of House and Senate to Enact New Taxes by State Gov’t………….. Vote NO

 

12-6   Amend the Constitution:  Regarding Construction of

             International Bridges and Tunnels……………………………………….. Vote NO

 

 

Delta College Millage Renewal

            Eight Year $0.4864 per $1,000 millage renewal,

            continuing the current rate of funding for Delta College…………… Vote YES

 

Saginaw County Chamber President Bob VanDeventer

Saginaw Chamber President Bob Van Deventer stated,  “Our Board of Directors voted unanimously to endorse a NO vote on each of the proposed amendments to our state’s constitution. We are against the attempt of special interest groups to embed public policy into Michigan’s constitution.”

 

Van Deventer also stated,  “We are in favor of reinstating Public Act 4 (Proposal 12-1), because this law more clearly defines the trigger points indicating financial stress within a municipality, allowing them to be considered for an Emergency Manager appointment by the Governor’s office. This law also provides more effective resources to the Emergency Manager to develop effective plans for recovery”.

 

County and State House of Representatives Candidates:

The Saginaw County Chamber of Commerce has completed a review and endorsement process for all County and State Representative candidates willing to participate. Each candidate was provided with a questionnaire that asked for the candidate’s viewpoints on difficult issues that impact residents and businesses in Saginaw County and the Great Lakes Bay Region. The questions asked the candidates for their positions on the statewide ballot issues in the November 6^th election, recommendations they have for addressing Public Safety issues within Saginaw County, their positions on the issues of Prevailing Wage and Minimum Wage status in Michigan, and their recommendations for maintaining balanced budgets for the State and County.

 

The following list represents the Chamber’s endorsement position, based upon the candidates’ answers to the questionnaire and their personal interviews conducted by the Chamber’s Screening and Endorsement Committee. Because not all candidates elected to participate in the endorsement process, and some of the candidates are unopposed, the Chamber elected not to make endorsements in some of the races.

 

Candidates Endorsed

State House of Representatives

94^th District…………………………. Tim Kelly (R)

95^th District…………………………. No Endorsement

 

County Officials

Prosecutor…………………………. Matthew Frey (R)

County Clerk………………………. Susan Kaltenbach (D)

 

County Commissioner

District 1……………………………. Patrick Wurtzel (R)

District 2……………………………. Alex Boese (R)

District 3……………………………. Kirk Kilpatrick (R)

District 6……………………………. Ron Sholtz (R)

District 8……………………………. Dennis Kraft (R)

 

The Saginaw County Chamber of Commerce is a multi-faceted not for profit organization that is a coalition of approximately 900 businesses located in the Great Lakes Bay Region of Michigan. Taking the leadership role in developing programs that initiate and implement economic development, quality of life, education, public sector, core city redevelopment, and crime prevention strategies, the Chamber also offers a large number of value added benefits and programs that help members make money and save money. We are the voice of business to local, state and federal legislators and provide pro-business impetus and support for legislation and planning.

Mission: The Saginaw County Chamber of Commerce will be a catalyst for economic and community progress.

Vision: The Saginaw County Chamber of Commerce vision is to foster a thriving Saginaw Valley within the Great Lakes Bay Region.

Summer Temps Bring Increased Risk of Heat Exhaustion

The summer months bring with them high temperatures, high humidity and a high potential for heat-related illness. Heat exhaustion includes a spectrum of conditions with minor symptoms, such as prickly heat or heat rash, and can progress to heat cramps and heat stroke — a life-threatening medical condition.

When a person works in a hot environment and sweating cannot dissipate enough heat, heat-related illness is bound to happen. The loss of about 1% of body water through sweating can be tolerated without serious effect. When sweat loss exceeds this amount, serious consequences of dehydration can arise. There are several symptoms that workers should be aware of when working in extreme heat:

• Profuse sweating
• Weakness
• Muscle cramps
• Headache
• Reduced urination
• Nausea and/or vomiting

As dehydration increases from the loss of body water, lightheadedness and fainting can also occur. If any of these symptoms are present, it’s imperative that the worker take a break (out of the heat) and drink plenty of water or electrolyte replacement solutions. If nausea, vomiting or severe muscle cramps are present, the person should seek medical attention.

In the event of seizure or if the person is acting confused and disoriented, emergency medical services should be contacted immediately as this is likely heat stroke. It’s important to know the difference between heat exhaustion and heat stroke. Heat stroke needs to be treated as a true medical emergency requiring immediate professional medical attention. If an employee has hot, dry skin or is unconscious, call 9-1-1. If not treated rapidly, heat stroke can lead to death.

There are several ways to avoid heat exhaustion:

• Taking      frequent breaks in cooler areas
• Drinking      an adequate amount of fluids
• Dressing      in light-colored, lightweight clothing
• Slowing      the pace of work

It’s crucial that both employers and employees are aware of the dangers related to working in high heat. Employers should have a heat stress prevention program in place and should be sure all employees are properly trained prior to working in high temperatures.

Ways to Protect Workers

• Learn the signs and symptoms of heat-induced illnesses and what to do in the event of an emergency.
• Develop a heat stress prevention program and provide training for all employees.
• Perform the heaviest work in the coolest part of the day.
• Slowly build up tolerance to the heat and the work activity (can take up to two weeks).
• Drink plenty of cool water (one small cup every 15 to 20 minutes).
• Take frequent short breaks in cool shaded areas. (Allow your body to cool down.)
• Avoid eating large meals before working in hot environments.
• Avoid caffeine and alcoholic beverages, which make the body lose water.

 

This article was reproduced with permission from Accident Fund Insurance Company of America. Founded in 1912 and headquartered in Lansing, Mich., Accident Fund is rated “A” (Excellent) by A.M. Best and is a wholly owned subsidiary of Accident Fund Holdings, Inc., the 10th largest workers’ compensation insurer in the U.S. Accident Fund offers low-cost group rates with a 5% up-front discount on workers’ compensation insurance, as well as the possibility for long-term dividends. For more information, contact Beth Goodman (517) 202-5121, or visit www.accidentfund.com.

Crime Prevention Programs — A Must for Every Business

This article was reproduced with permission from Accident Fund Insurance Company of America. Founded in 1912 and headquartered in Lansing, Mich., Accident Fund is rated “A” (Excellent) by A.M. Best and is a wholly owned subsidiary of Accident Fund Holdings, Inc., the 10th largest workers’ compensation insurer in the U.S. Accident Fund offers low-cost group rates with a 5% up-front discount on workers’ compensation insurance, as well as the possibility for long-term dividends. For more information, contact Beth Goodman (517) 202-5121, or visit www.accidentfund.com.

The National Institute of Occupational Safety and Health (NIOSH) defines workplace violence as any physical assault, threatening behavior or verbal abuse occurring in the work setting. Establishing a program to address violent crime in the workplace is an important way of helping to keep employees safe from such behaviors. Knowing a workplace has poli­cies and procedures in place to guard against threats to employee safety also helps to create a more comfort­able and productive environment.

Establishing a Crime Prevention Program

The Occupational Safety and Health Administration (OSHA) indicated workplace murders are the lead­ing killer of female employees and the second-leading killer of male employees. The service sector, which includes retail establishments, police and security services, and limousine and taxi services, accounts for more than half of workplace homicides and 85% of non-fatal workplace assaults. Implementing a violent crime prevention program can dramatically reduce incidents in the workplace.

Here are some tips organizations should use as they address violent crime:

• Be aware of customers or other strangers — if anyone makes you uncomfortable, inform security or management immediately.
• Identify at least two exit routes from each room, if possible, and be able to find them in the dark.
• Use caution with deliveries and pickups — anyone making a delivery to your workplace should be properly identified.
• Have multiple employees on duty during high-risk periods (typically 11 p.m. to 5 a.m.).
• Don’t keep more cash on hand than is needed to do business.
• Install drop safes and have signs in obvious places that say drop safes are used.
• Work with local police to give employees and guests more security.

Want to know more?
For more information on preventing violent crime in your workplace, and for other helpful safety tools and tips, visit www.accidentfund.com/worksafe. You can also visit our crime prevention site by clicking here.

Drive Safe — Arrive Safe!

This article was reproduced with permission from Accident Fund Insurance Company of America. Founded in 1912 and headquartered in Lansing, Mich., Accident Fund is rated “A” (Excellent) by A.M. Best and is a wholly owned subsidiary of Accident Fund Holdings, Inc., the 10th largest workers’ compensation insurer in the U.S. Accident Fund offers low-cost group rates with a 5% up-front discount on workers’ compensation insurance, as well as the possibility for long-term dividends. For more information, contact Beth Goodman (517) 202-5121, or visit www.accidentfund.com.

Drive Safe — Arrive Safe!
When a driver gets behind the wheel, they take responsibility for maintaining control of a two-ton machine that can easily cover a distance of more than 80 feet in one second. Operation of a vehicle must be taken seriously. Driver fatigue, unsafe traveling speeds and distracted driving are three of the biggest culprits of unnecessary vehicle-related fatalities. The National Highway Traffic Safety Administration says nearly 6,000 people died and more than 500,000 were injured in 2008 crashes involving a distracted driver; and the National Transportation Safety Board reported that speeding/driving too fast for conditions was the second leading cause of driving-related deaths in 2007 (most recent data available).

Both Hands on the Wheel, Please!
In a business climate with people always on the go and with an emphasis on productivity, employees may feel the urge to talk, text and e-mail while driving. However, what employees may not realize is that doing business while behind the wheel is not only illegal in several states, but it’s also extremely dangerous.

The Insurance Institute for Highway Safety says that drivers who use hand-held devices are four times as likely to get in a crash. To reduce that number, the use of hand-held devices while driving has been banned in eight states plus the District of Columbia, and texting while driving has been banned in 30 states plus the District of Columbia.

To help avoid accidents, keep employees safe and reduce employer liability, business owners should institute a policy that does not allow the use of hand-held devices while driving. The passage of these new laws reinforces the need for such a policy. The policy should clearly state that the use of hand-held devices while driving will absolutely not be tolerated, and implications for not adhering to the policy will be enforced.

I’m Not Tired, My Eyes Are Just Heavy!
Almost every driver has experienced feelings of grogginess while driving … when it feels like your eyelids weigh 100 pounds, and the lines on the road start to blur. The National Highway Traffic Safety Administration estimates that 100,000 police-reported crashes are the direct result of driver fatigue each year, resulting in an estimated 1,500 deaths and 71,000 injuries.

Tired drivers should immediately find a safe place to stop the vehicle and rest. Getting some fresh air, walking around a bit and drinking a caffeinated beverage are other helpful ways a drowsy driver can get energized.

What are the warning signs of driver fatigue?

• The inability to recall the last few miles traveled
• Having disconnected or wandering thoughts
• Having difficulty focusing or keeping eyes open
• Feeling as though your head is very heavy
• Drifting out of the lane or driving on the rumble strips
• Yawning repeatedly
• Accidentally tailgating other vehicles
• Missing traffic signs

I Feel the Need for Speed!
According to the National Highway Traffic Safety Administration (NHTSA), speed is involved in about one out of three fatal car accidents. Although speed limits are higher on highways, the vast majority of speeding-related fatalities happen on roads other than interstate highways. In fact, NHTSA’s 2006 fatality data shows that 47% of speed-related fatalities occurred on roads with speed limits of 50 mph or less.

Adverse road and weather conditions are also factors in determining a safe driving speed. The U.S. Department of Transportation recommends that drivers reduce their speed by one-third on wet roads and by half on snow-packed roads. Highway construction zones also present a deadly hazard for workers, motorists and pedestrians. When approaching work zones drivers should slow down, move to the proper lane as instructed, and follow posted speed limits. As a rule of thumb, drivers should keep in mind that the posted speed limit does not always indicate the safest traveling speed.

When to adjust driving speed:

• On wet roadways (rain, snow or ice)
• When there is reduced visibility (fog)
• On uneven roads
• In construction zones
• When entering curves
• When approaching and passing through intersections
• On gravel roads
• In heavy traffic

Check ‘em out! Background checks best bet

This article was reproduced with permission from Accident Fund Insurance Company of America. Founded in 1912 and headquartered in Lansing, Mich., Accident Fund is rated “A” (Excellent) by A.M. Best and is a wholly owned subsidiary of Accident Fund Holdings, Inc., the 10th largest workers’ compensation insurer in the U.S. Accident Fund offers low-cost group rates with a 5% up-front discount on workers’ compensation insurance, as well as the possibility for long-term dividends. For more information, contact Beth Goodman (517) 202-5121, or visit www.accidentfund.com.

There was once a time when a person could walk into a store, grab the help wanted sign from the window, and with as little as a handshake, walk out with a job. But the world keeps growing, the job pool keeps getting bigger and the times—well, they are a changin’. As people, we want to have faith in others, but as employers, we have to be especially cautious, as our hiring decisions affect many people. Hiring just anyone off the street is no longer a safe bet.

High stakes
Today making a snap hiring decision could leave you out of the hiring game for good. Statistics show that 30 percent to 40 percent of job applicants exaggerate or lie on applications and resumes. And occupational Health and Safety Magazine states that “negligent hiring” lawsuits are on the rise. These suits implicate employers and hold them responsible for the actions of their employees. Industry statistics show that one poor hiring decision can cost a business as much as $100,000 or more.

Lay your money on the check
A much safer bet is the professionally done background check. They’re quick — typically taking between 48 and 72 hours to complete—and range in price from $100 to $200, depending on what information you want to find. The more comprehensive the search, the more it will cost. If you are a small-business owner, the costs may seem high, but in the long run, it’s better to be safe than sorry. If you are still concerned about the fees, go to www.esrcheck.com and read “How to Avoid Hiring a Criminal for Under $20.00.”

Playing it safe
While there may have been a time when background checks were something employers did after the decision to hire was made, experts recommend that Human Resource departments and business owners take a new approach to the way they view the hiring process. Safe hiring is something all businesses should adopt as a way to protect their employees, their business and their time.

Employment ads should state that background checks are performed. Policies and procedures should be in place regarding hiring processes and background checks, making sure that each applicant is handled in the same manner. Making it known that background checks are part of your hiring procedure will deter people with something to hide, and encourage those who wish to be considered, to lay all their cards on the table. In the long run, you will save yourself a great deal of time, money and effort by adopting a safe-hiring plan.

A winning hand
You simply can’t lose when taking a proactive approach to hiring. You will get the best candidate for the job and ensure the safety of your workers and your business. Background checks are completely legal, if followed according to the Fair Credit Reporting Act, which protects job seekers and employers. Employers have a right to know whom they are hiring. Conducting background checks is your best bet for warding off unwanted job applicants and costly lawsuits.

What to check
County criminal (felony only, felony and misdemeanor, misdemeanor only)
Motor vehicle record
Credit Report
Prior employment verification
Social Security number
Education verification
Reference checks
Licensing verification

How should business POLITICALLY respond to the DYSFUNCTIONAL Federal policy process?

To Our Members …

This short article from our partner, BIPAC, gives us something important to consider as our country continues to work through this challenging economic time.

Bob

written by Greg S. Casey

The partisan political brinkmanship preceding the debt ceiling vote in August was disheartening to most Americans.  The Administration and Congress seemed incapable of demonstrating to a watching world that the U.S. can make even the most basic decisions to correct its fiscal course. Although a compromise decision was reached, allowing the nation to meet its financial obligations for now, the process was anything but reassuring and it kicked the can to a “Super Committee” which could invite more of the same.  Certainly, decision-makers need to know Americans expect better and they will be held accountable for outlandish behavior. The question is how.

Circulating in CEO circles is a message from one of their colleagues essentially suggesting business should withhold their political support from any incumbent member of Congress until they solve the deficit and debt problem for the long term.  The message further suggests business should begin hiring people as part of their responsibility to participate in economic recovery.  This CEO, like millions of his fellow Americans, is justifiably frustrated with the fiasco that has been Washington deliberations of late.  He is beyond anxious to see statesmanship in resolving the critical fiscal issues that vex the nation.  He rightly admonishes his colleagues to get involved.  I understand the CEO’s frustration but his suggestions may make matters worse, not better.

You can’t change bad behavior without also recognizing the good.  There are plenty of policy-makers of both political persuasions who understand the need for focused statesmanship but they have been marginalized by the extremes.  Simply withholding business support from everyone, including those who business might otherwise support, accrues to the benefit of those candidates businesses would never support anyway.  It is a kind of unilateral disarmament that encourages the extremes because it increases the importance of the contributions the opposing point of view is certain to make.
Worse, it signals to those who have or might be inclined to do the right thing, business will cut and run if the outcomes don’t meet their expectations. Business must be smarter and more strategic than that.  An effective process to change bad behavior (and it IS a process) begins with decisions based on how Members of Congress actually vote rather than access, their seniority, political affiliation or the ugliness of the process itself. Concerned businesses should establish a clear standard to guide their political support decisions. The standard should be business-based and intellectually
honest.  This standard should be communicated not only to candidates and incumbents, but to employees and other stakeholders along with tools to facilitate their advocacy of the business point of view.  Those who act consistent with that standard should be supported while those who don’t, should be opposed.  Fortunately, many of the more politically active businesses already have such a system in place.  It is time others, like the company making the aforementioned suggestions, do the same.

I also find the suggestion that businesses should begin “hiring people” just to spur economic recovery incredibly counterproductive. The sour economy wasn’t created by business not hiring enough people. Hiring people to fix the sour economy is like papering over a hole in the wall.  The hole is still there.  There are significant and profound reasons the economy went off track and those issues must be realistically addressed by serious people before the economy can truly recover.

Resolving the underlying impediments to economic recovery will be difficult and time consuming.  Businesses can and should play a key role in shaping the solutions, particularly as the “Super Committee” begins to deliberate. To do so, businesses must be proactive not reactive.  We cannot expect sober and thoughtful deliberations if we ourselves are not equally thoughtful in our involvement.

A BIPARTISAN LOOK AT THE RECENT DEBT CEILING COMPROMISE

To Our Members …

For an easy read of a bipartisan look at the recent debt ceiling compromise, please take a look at this short article from our partner, BIPAC. Come back to our website and visit us. We will be providing you insight from BIPAC on issues that are important, and that affect us all.

Bob

With the debt ceiling deal done, it is time to get serious
By Greg S. Casey

It has been just over a week since the debt ceiling compromise was passed.  It is a lot more complicated than it appears and we will get to the analysis of those intricacies later.  For now, whether or not you liked the deal, the fact remains the outcome only postponed the tough decisions on fiscal and tax reform that must still be made.

I spent the days since the “debt deal” in real America, talking with dozens of people from all political persuasions, from all over the country, employees and employers, rural and urban.  I wanted to know what they thought before I said anything more.  I found their disdain for the partisanship and their frustration with Washington is greater than I imagined.  It is greater than anything I’ve seen before.  Repeatedly I heard, “I’ve been a lifelong (fill in the blank) but I’m not going to be anymore.” Yesterday, Gallup said public disapproval of Congress is the lowest it has been since they started asking the question.

Simply put, Americans have lost faith in the Federal government’s ability to honestly address, let alone fix, our economic woes. They yearn for statesmanlike leadership and a serious conversation where there isn’t any reference to either political party. To them, the three-letter word standing in the way of a solution is neither GDP, nor TAX but EGO.

Few Americans were subsequently surprised by Standard & Poor’s downgrade of the U.S credit rating.  For months, credit rating organizations signaled a downgrade was possible if policy makers didn’t do something substantive to resolve our nation’s systemic addition to deficit spending.  Rather than dicker with the details or castigate the messenger, most Americans wondered
what had taken so long.  Although the debt deal finally enacted might have been the best that could be accomplished under the circumstances, it didn’t meet the substantive change standard.  And it wasn’t just the way it happened that so troubled the S&P.  We shouldn’t forget a downgrade seemed possible BEFORE the debt ceiling became the vehicle fiscal hawks used to force some kind of deficit reduction.  In all likelihood, a “clean” debt ceiling bill without deficit reduction would have resulted in the same downgrade.  Unfortunately, true to form, some in Washington have now chosen to label this a “tea party downgrade.”  That is precisely the kind of political finger-pointing and denial of realty that so infuriates Americans.

Between now and the end of November, the President, Congress and those with influence in the process, must find a way to deal with reality.  In order for this nation to get its house in order and  facilitate economic growth, we need fiscal reform that addresses entitlements and tax reform that addresses rates and exemptions.  Without fundamental spending reform, entitlement spending will consume ALL federal revenues within the next three decades.  Without tax reform, the U.S. will be at a competitive disadvantage that will pinch every corner of our economy.  For both sides, the resulting economic growth is worth the trade.

I am not picking sides.  I am not embracing any scheme over another. I am, however, reflecting the frustration of a very angry public, willing to throw the rascals out if a truly meaningful resolution is not reached. I sense Americans have simply lost their patience with partisan bickering and inside the beltway deal making.

WAIVER OF JURY TRIALS – A MORE BENEFICIAL ALTERNATIVE FOR EMPLOYERS THAN ARBITRATION

Employers are always looking for new ways to limit their exposure to employment law claims.  Throughout the 1990s and early 2000s, mandatory arbitration clauses in employment agreements were the alternative dispute resolution program of choice.  Employers adopting these mandatory arbitration clauses believed that they would get a better, faster, and cheaper resolution of their disputes than they would in court.  For many employers, however, arbitration has not been the panacea that they had hoped for.  Instead, the arbitration process has often proved to be an unsatisfactory double-edged sword for employers as a result of several specific disadvantages of arbitration.            

1.         Filing fees and arbitrator fees are expensive.  Most employers involved in arbitration are quite surprised how expensive the filing fees and arbitrator fees are.  For example, in employment arbitration cases filed with the American Arbitration Association (“AAA”) involving disputes arising out of an employer-promulgated arbitration agreement, the “employer shall pay the arbitrator’s compensation unless the employee, post dispute voluntarily elects to pay a portion of the arbitrator’s compensation.”  In addition, in cases before a single AAA arbitrator, “a nonrefundable fee in the amount of $925 is payable in full by the employer, unless the plan provides that the employer pay more.”  These costs do not include any costs associated with selecting a location of the arbitration.  Even if AAA is not used as a dispute resolution service and the parties select their own arbitrator, an arbitrator’s fee often exceeds $1,000 a day.   

2.         Arbitrators are less likely to dismiss a claim.  Arbitrators have an economic incentive to let the case proceed as long as possible since they are typically paid by the hour. Therefore, many arbitrators are less receptive to employer motions to dismiss employee claims. 

3.         Lack of appellate review.   Another problem with using an arbitrator to decide employment disputes is the inherent lack of meaningful appellate review.  An arbitration award is final and binding on both parties unless it is procured by corruption or fraud, the arbitrator was obviously biased or engaged in specific misconduct, or there was no valid arbitration agreement between the parties. 

4.         Arbitrators frequently “split the baby.”  In other words, arbitrators frequently issue a compromise decision, finding in favor of the employee on part of the claim and the employer on part of the claim.  One of the main reasons arbitrators do this is because they hope to be selected as an arbitrator in the future.  If an arbitrator becomes known for being too employee and/or too employer friendly in his/her decisions, he/she may not be selected as an arbitrator in the future.   

As a result of these disadvantages with arbitration, employers have continued their quest to find a better method of limiting their exposure to employment law claims.  The newest method utilized by employers to attempt to lessen their financial exposure to employment law claims is the jury trial waiver.  Jury trial waivers provide that the right to a jury trial is waived for any claim or cause of action arising under the employee’s employment agreement or out of the employment relationship.  Jury trial waivers give employers the benefits of a judicial forum without the expense and uncertainty of a jury trial. In most jurisdictions, after all, it is the jury’s  – not the judge’s – unpredictability that concerns employers.  Most importantly, however, is the fact that a jury trial waiver avoids the disadvantages of arbitration agreements for employers as discussed above. 

As far as filing fees go, unlike with arbitration the employee, and not the employer, is responsible for paying the filing fee at the time the employee’s complaint is filed.  In federal court, the filing fee for a complaint is $350.00 with or without a jury demand.  In Michigan, for complaints filed in the circuit courts without a jury demand, the fee is $150.00.  In addition, unlike with arbitration, neither party pays any fees for the trial court judge in either federal or state court as the judges are paid by the government.  Because bench trials are typically slower, less private, and more costly for employees than arbitration, fewer employees may choose to bring a discrimination claim.  In addition, because a trial court judge has no economic incentive to let litigation proceed, he/she may be more likely to grant a motion for summary judgment or a motion to dismiss in order to clear his/her docket.  Next, unlike with arbitration, an employer that is dissatisfied with a trial court judge’s decision in a bench trial is entitled to a full appellate review.  On appeal, the appeals court will review the trial court judge’s findings of fact under a clearly erroneous standard and the trial court judge’s conclusions of law under a de novo standard. Finally, when it comes to deciding cases, a trial court judge is less likely to split the baby since they do not have an economic incentive to be selected again in the future. 

While a waiver of jury trial is permissible in the state and federal courts of Michigan, there are strict requirements that must be satisfied in order for the waiver to be enforceable.  Employers that are interested in drafting and/or implementing a waiver of jury trial policy should contact their labor and employment law attorneys. 

For more information on this or any other labor and employment law topic, please contact Masud Labor Law Group at (989) 792-4499.

About the Author

Brian Swanson graduated from Wayne State University Law School where he received awards for academic excellence.  While attending law school, Brian participated in Moot Court and also served as editor-in-chief.   Brian received his undergraduate degree from Grand Valley State University in Allendale, Michigan.  Before joining Masud Labor Law Group, Brian obtained extensive litigation experience in both state and federal courts as an associate with a Bloomfield Hills labor and employment law firm.

This article is published by the Masud Labor Law Group, and is intended as general information only.  This article is not intended to provide legal advice or opinion, as such advice may only be given when related to specific fact situations.  Questions or comments concerning this article should be directed to the Masud Labor Law Group, 4449 Fashion Square Blvd., Ste. 1, Saginaw, Michigan, 48603, (989) 792-4499.  E-Mail:  mps@masudlaborlaw.com.  ©Masud Labor Law Group 2010.  All rights reserved.  Reproduction of this article in whole or in part, without express permission from the Masud Labor Law Group is prohibited.