Unintended Consequences – Lawyering Up – HR Challenges in 2022

CRE Workforce Dynamics & Hiring in 2022

Author: Forbes J. Rutherford, Principal, Rutherford International Executive Search Group Inc., Managing Director, NEXTalent Marketplace & Job Board, T: 855-256-5778 or Chat

Introduction: In Q2/2020, Rutherford International asked 204 senior multi-sector industry leaders within Canada’s commercial real estate industry to rank the political, economic, social and technological threats they expected to face through Q4/2021. Participants with direct or indirect authority over their resource plans also provided details. Please note, the data collection was completed early on in the pandemic when few of us foresaw an extended lockdown.

This article is the seventh in a series of commentaries that examine potential threats to Canada’s CRE industry, post-pandemic workforce dynamics and the probable impact on industry employment in 2022.

Unintended Consequences – Lawyering Up – HR Challenges in 2022

Codification of Hybrid/Work-from-Home/Remote Employment Clauses 

Moving forward into 2022, a hybrid flexible workplace is now an employee expectation and requires a new covenant with high-performing employees. Subject to the nature of the position, employers can expect high-performing and high-knowledge employees to take advantage of rising talent scarcity by increasing their compensation expectations net of inflation. This includes the codification of workplace flexibility to ensure their retention or acquisition.

“Talent scarcity will increase compensation expectations net of the CPI”

Forbes J Rutherford, Rutherford International, 2021

Everyone thinks they can work remotely but not everyone can. Knowing if a candidate or manager can work in a hybrid workforce environment is essential with the codifying of hybrid WFH/remote clauses in future hiring agreements. There is no sense in hiring an employee whose Personality DNA doesn’t conform to the direct manager or the firm’s culture.

“Not All Managers Have the Agility to Lead a Distributive Workforce”

Forbes J Rutherford, Rutherford International, 2021

Nor do all managers have the leadership agility to manage a hybrid or distributive workforce. Managers with a “Utilitarian” and or a “Directive” leadership style prefer to seek environments where they can exert power. Such a leadership style may not conform well with a hybrid employee who responds better to inspirational, entrepreneurial or collegial leadership.

Prepare for Severance Clauses in Key Employment Agreements 

Employers find themselves sitting upon the horns of a dilemma over COVID19 vaccination mandates. Particularly with recent evidence announced in Lancet that COVID19 is an equal opportunity contagion – for vaxxed or unvaxxed. However, life/safety and liability insurance underwriters demand their insurers’ comply with vaccine mandates regardless of distributive workforce solutions, natural immunity, vaccine efficacy, rapid home-based testing, and soon to be announced therapeutics. The governments and health authorities with a penchant for authoritative hysteria over reason, have distracted corporates into implementing a self-destruct patchwork quilt of mandated terminations. Corporates should not expect governments responsible for the labour code, to insulate them from a laid-off electorate seeking redress if further evidence supports the Lancet article. 

“Navigating Life/Safety Protocols Has Been a Challenge Worthy of Soloman”

Forbes J Rutherford, Rutherford International, 2021

Navigating life/safety protocols has been a challenge worthy of Soloman. Pro or con, the longtail impact will lead to workers losing confidence in government labour regulations and collective agreements to protect their future employment interests. This socially sobering realization by the workforce will be evident in future collective bargaining agreements with organized workers. Employment lawyers should plan on being very active in 2022/23 amending employment contracts with pre-determined severance clauses for all full-time hires.

“COVID19 Has Changed the Rules of Engagement”

Forbes J Rutherford, Rutherford International, 2021

The idea of a prospective employee negotiating their exit in parallel with their arrival may leave the hiring manager questioning the reliability of the new hire. Still, they must recognize that COVID19 has changed the rules of engagement. Inserting a severance clause in an employment agreement, which executives have been doing long before COVID19, may mean nothing more than this future hire is prudent with a low-risk tolerance and a strong need for security.

Job Security – Breaking The Circle of Trust

Alternatively, it may also mean, the new hire is aware through platforms such as Glassdoor.com, that the hiring company marched a long-term employee out the door over a vaccine policy without compensation. Negative news travels faster via the internet than positive. The unintended consequence of enforcing arbitrary decrees without an alternative hybrid accommodation will irreparably break the circle of trust productive employees seek from their employer concerning job security.

A precedent for breaking the employer/employee circle of trust took place during the recession of 1983. The worker philosophy of the time was to remain with an employer for life. This lifetime employment ethos was destroyed in the early 1980s when organizations opted to follow management scientists theories to flatten their organizations. The unintended consequence of this organizational design strategy obliterated the idea of a “Company Man.” It gave oxygen to the recruiting profession and the wholesale movement of human capital took off in the mid-eighties.

“Some of the Brightest Minds Will Embrace the GiG Work Lifestyle”

Forbes J Rutherford, NEXTalent Marketplace & Job Board, 2021

We believe, a patchwork application of COVID19 mandates by corporations in 2022 will have a similar impact on the career direction of Gen-Y and Gen-Z human capital, leading to further scarcity of high-performing talent interested in aspiring to full-time leadership positions. Some of the brightest will embrace the Gig work lifestyle.

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