President Obama Issues Three Pro-Labor Executive Orders

The President issued three "executive orders" affecting certain federal contractors:

1. Requires contractors to post a poster explaining employees' rights to join or not join unions. View here.

2. Denies federal funds to pay for contractors' activities related to "persuading" employees to join or not join unions. View here.

3. Requires contractors to retain predecessor companies' qualified employees rather than laying them off and hiring their own workers. View here.

I-9 Form Changes

The USCIS has delayed implementation of a new I-9 form containing new employment eligibility documentation requirements. The January 30, 2009 announcement is here. Under the current schedule, a new I-9 form will be required on April 3, 2009. The Jan. 30 order extends the comment period for proposed regulations issued in November 2008.
You can see the new proposed regulations and the sample new I-9 form and instructions here.

Stanford GSB, Entry 17: Winter Networking, The Revolving Door, and Sundance

My experience with classes this quarter is VERY different from my experience last quarter. How so, you ask?

On the one hand, I have more classes than I had last quarter; but on the other hand, I find myself with a little more free time.

How is that possible? First, I was smart enough to select classes in such a way that I have only one class on Monday’s and Friday’s (in the morning) – this means I’m free all afternoon on both days. (Actually I wish I could really claim to be that smart – it just kind of ended up that way by accident, but now I see the wisdom of it). Secondly, the GSB doesn’t have classes on Wednesday, which means that I’m free that whole day (except for an occasional test like the Accounting midterm, which is coming up next week!). So three out of five days a week, I have mostly free days.

This comes in handy because part of the benefit of going to Stanford GSB comes from networking, and I didn't do any real networking last quarter at all. OK, OK – I’ll admit it- I’m sure I’m not the first GSB student to say this publicly – networking is not just “part of the benefit”, it’s probably the “main benefit”; the real reason why we’re shelling out so much of our own cash to go back to school is mostly because of the contacts and relationships we hope to make, academic and business.

This includes not only the relationships we develop while we’re here, but the very impressive (… drumroll please …) Stanford alumni network. As current students (and alumni), we have access to the GSB Alumni database, which includes management from pretty much every company in California. In my industry (software, VC, internet) this is what Maverick would call a “target-rich environment’ (Yes, I’m quoting from the movie Top Gun!)

Since we arrived in the fall, we’ve had several alumni of the program tell us that we should take advantage of this resource while we’re at Stanford. Lars Delgaarde (more on him later), a very successful Sloan alumnus, told us that almost all GSB alums will take a meeting with us while we’re students, but maybe not once we’ve graduated. Another alum told us to “use the student card” as much as possible, ‘cause we won’t have it for long.

Tick-tock. Amidst this background, I realized recently that the Sloan program is half-over, and I hadn’t contacted a single alumnus in the fall quarter. I'm starting to hear the academic clock ticking, ever so slightly off in the distance.

Slowly, the MBA2’s (second year MBA’s) are starting to get job offers and making plans for what they’ll do next. Though even in the MBA community there is some anxiety nowadays because of the weak job market. The management consulting and investment banking jobs that MBA’s jet off to in droves every year are suddenly much diminished in number, or not to be found at all! Tick-tock for them too.

For company-sponsored Sloans, this clock just means they’re getting closer to a promotion or some other job back in their companies. For the self-sponsored Sloans, many of whom have no source of income lined up after the program is over, it’s like a horror movie where you gradually realize that there’s something creepy out there watching you, and it’s gaining on you. Tick-tock, Tick-tock.

OK LOL, it’s not really that bad, yet. We are still having fun and I am enjoying my classes. But there is some strange sound in the background that I haven’t really been paying attention to that seems to get a little bit louder every week. Tick-tock.

The Revolving Door

What also makes this quarter different is that the classes are more interesting. That doesn’t mean that classes last quarter weren’t interesting in their own way (Economics turned out to be very interesting, and I learned more in Finance than I thought I did, and Modeling turned out to be kind of fun by the end).

But it seems like we’re talking more about real business issues than we did before. Or maybe I just think that’s the case, since I got to choose which classes I’m taking this quarter.

In my undergraduate days at MIT, I skipped classes pretty often. I’ve had that temptation here at Stanford many times, especially the early morning classes. But each time, I have to remind myself that the classes are interesting enough that I usually don’t want to skip them.

OK that’s not entirely true: I have skipped our 8:15 am Basic Accounting Class once or twice (hopefully the professor is not reading this blog!).

I've been thinking about it and maybe one of the reasons why the classes are more interesting is that we have a LOT of guest speakers.

Many of the professors themselves have led interesting lives (Eric Schmidt, the CEO of Google, teaches a class here at the GSB, and my VC and Entrepreneurship teacher, John Glynn, runs a VC firm as his “real job” – Glynn Capital) before teaching classes here at Stanford.

Recently, a Stanford alum told me about the “revolving door” here. A Stanford alum, upon leaving campus, usually gets a job, moves up in their organizations or starts a company, does well, makes lots of money, and then if he or she’s lucky, starts teaching a class here at Stanford (usually in the GSB), ending up right back where they started.

Speaking of revolving doors, this last week has felt like a revolving door of guests in all of my classes. I almost felt like I was at a conference, not at school. Since Last Friday, here is a sampling of the guest speakers that visited my classes:

• David Placek, CEO and founder of Lexicon Branding, who visited our “How to Make Ideas Stick” class. I had never heard of Lexicon, but we read a case about them first. To put it simply: They chose names for things. What kinds of names? Intel hired them to find a name that could be trademarked for its chips (names like 486 and 386 could not be). They eventually came up with “Pentium”. Similarly, P&G needed a name for a new dry mop – Lexicon came up with “Swiffer”. The list goes on and on of popular names that we’ve all heard of (and some we haven’t). I found it interesting that this (naming and branding) was pretty much the only thing the company does. They have an entire process for brainstorming and choosing names – which includes things like phonetics and how different sounds affect consumers. Different. And Interesting.

• David Burke, Makena Capital – who used to be one of the key players managing Stanford’s endowment. Stanford’s endowment is one of the largest in the country (at something like $8 billion, second only to Harvard’s endowment, if memory serves), which means they are one of the largest investors in the country. He spoke to us about how Stanford (and now Makena, which he started with with colleagues from Stanford) makes decisions about investing in Venture Capital funds (since this was for my Entrepreneurship and VC class).

• Naveen Chopra, VP Corporate Strategy at TiVo – In our marketing class, we had a case on TiVo and how it could position its products in the marketplace when they first came out with their innovative product. Today of course they have fierce competition from cable operators like ComCast and have to adjust their strategy. After discussing the case, our professor introduced Naveen and he talked about some of the challenges that TiVo has faced and how they’re being addressed still today.

• Rick Arney, Barclay’s Bank. In my class on currency trading, we had the managing director of investment strategy for Barclay’s Global Market Strategies Group – i.e. their currency trading group stop by. He talked to us about the currency markets. One interesting fact that I remembered: The currency markets are completely unregulated. There is no SEC. Another: the currency markets today are in a state of turmoil that is off the charts.

• Speaking of the SEC, in our accounting class we had our first visitor this week: Julie Erhardt, Deputy Chief Accountant at the Securities and Exchange Commission. Not only is she a Stanford alum, but Julie was in the Sloan program,which made for an interesting discussion. Much of her role consists of working with other countries SEC-equivalent agencies.

• Lars Delgaarde, CEO, SuccessFactors. Lars is a CEO of SuccessFactors, a software company he founded after graduating from the Sloan program a few years back. When he started the company and bought some existing technology, it had been difficult for him to get VC’s to invest in his idea; after a few years he built SuccessFacstors up to over $100 million in sales and one of the most successful software IPO’s over the past few years. Lars spoke about culture and what kind of culture he built at SuccessFactors.

• Matt Harris, co-founder of Village Ventures. We learned of a group trying to innovate the long-unchanged world of Venture Capital. They started with a very small fund in Williamstown, MA, and came up with the idea of supporting VC funds in non-traditional places -i.e. not Silicon Valley and not Boston. Since then, they've established relationships with 16 funds in different cities across the country and the UK, espousing their unique strategy. I found this interesting because I've been thinking about the VC industry myself and wondering if there aren't other models than the popular Silicon Valley model. This is an interesting one.

All of these speakers came in a single week, and in just the classes that I’m taking. Granted, this was a particularly busy week (we don't have this meany speakers in our classes every week), but even half of these speakers would still make for some interesting classes.

And this doesn’t include the numerous optional speakers and presentations that were going on during this same week at the GSB, which always has a lively calendar of events! Now you have a glimpse of what it's like taking classes here at the GSB.

Sundance and other events

I was going to write about the GSB trip to the Sundance film festival two weekends ago, and the Chinese New Year’s party we had last weekend, both of which I attended. I should also mention the Australia day events (the GSB is an international place), the Sloan Ski Trip to Tahoe this weekend, both of which I didn’t attend.

But it’s getting late, and guess what, I haven’t done any networking in the past few days…so it’ll have to wait until the next entry.

Tick-tock. Tick-tock.

Starbucks CEO Salary Cut: Spot the Issue

I saw a news item in the WSJ about the Starbucks CEO's announcement that he's cutting his own salary from $1.2 million to $10,000 per year. Great PR, right? But, let's play "spot the wage and hour issue."

Unless I'm missing something, and I've been accused of missing many things,* Mr. Schultz transformed himself into a non-exempt CEO of a publicly traded corporation! (Yes, the salary is too low to qualify him as exempt under federal law).

I got a laugh out of this, because I'm an idiot. But wouldn't they vet this issue with their employment lawyers?

This is probably not a big deal, since Mr. Schultz is likely not going to sue his own company to recover the overtime wages he will be due once he fails the exempt test. Howard...call me.

*If there is some other aspect of his compensation that qualifies him for the salary test that was not reported in the article, please accept my apologies o SBUX legal team.

Lily Ledbetter "Fair Pay" Act

Ledbetter v. Goodyear was one of those Supreme Court decisions that galvanized politicians, activists, etc. and became a proxy for complaints about "conservative" judges. We posted about that case here. We wrote an article about it here.

The opinion simply held that Title VII discrimination claims apply what's called a "statute of limitations." The "statute of limitations" protects employers from old claims. Claims that cannot be defended because records are gone, witnesses are dead or moved away, etc. It also protects defendants when plaintiffs "sit on their rights" and wait too long to prosecute their claims. By the way, Title VII indeed contains a statute of limitations. The dispute was over how it was applied.

Ledbetter had an Area Manager job with Goodyear for almost 20 years. Over a period of 15 years, her pay slipped as compared with other males. She finally sued for sex discrimination in her compensation under Title VII and the Equal Pay Act. The court held that the claims were time barred, because the allegedly discriminatory decisions to set her compensation were made outside the limitations period. But Ledbetter argued that every time she was paid, it was a new discriminatory act. As if the payroll coordinator knew how her wages were set. Anyway, the Court decided that her claims were time barred because none of the discriminatory decisions occurred within the 300 day limitations period that applies.

The decision hardly broke new ground. But it created a political firestorm, maybe because there was a presidential election campaign going on? Nah. But - but - Ms. Ledbetter spoke at one of the national party political conventions this year. Shhh.

Anyway, new administration, new laws. The Lily Ledbetter Fair Pay Act will make all compensation-based discrimination claims timely as long as one paycheck issued under the discriminatory practice falls within the limitations period. Ripple effects? Settlements, documentation and review of compensation decisions, pay equity studies.... the mind boggles.

Here's the text of the Act, which signed on 1/29/09. Oh its effective date? May 26, 2007 - the day the Supreme Court issued its decision. So, it is retro, at least as to pending cases.

Anyway, this will help you take your mind off Ms. Ledbetter and her new law: EFCA can't be far behind!

Greg

Court of Appeal Applies Anti-SLAPP Law to EDD Report

Dible worked for the Haight Ashbury Free Clinic as a counselor. The clinic terminated her employment for performance reasons. The clinic contested her unemployment claim. Ms. Dible sued for defamation and other claims. However, after some litigation, the clinic moved the court under the anti-SLAPP statute to dismiss the claim. Why? Because the clinic exercised its First Amendment rights to make a report in an official proceeding. The Court of Appeal agreed that the anti-SLAPP statute barred her claim. Dible then argued that she should be able to assert a claim for "defamation by compelled self-publication," because the clinic should have known Dible would have to re-publish to third parties the clinic's assertions regarding her performance.

The Court of Appeal disagreed:

Here we are clearly being asked to create a wider exception for claimants who have not republished where it is foreseeable that they might do so in the future. We decline to do so. Such a rule would require courts to engage in considerable speculation as to future conduct and lead to untenable attempts to speculate on future damage. A court could not, for instance, account for the possibility that after a plaintiff has received an award for damages in the form of lost future wages, he or she might republish while seeking a job and be given the job, thus not be damaged, nonetheless.

Since publication or republication to a third person is necessary to establish the cause of action of defamation, we conclude that plaintiff cannot establish a probability of success upon her defamation claim. The motion pursuant to section 425.16 was therefore properly granted.

The case is Dible v. Haight Ashbury Free Clinic and the opinion is here.

U.S. Supreme Court: Retaliation Provisions Cover Investigation Witness

Vicky Crawford worked for the Metropolitan school district of Nashville and Davidson County, TN. The agency was conducing an investigation into a harassment complaint made against an employee, who happened to be the employee relations director.

The investigator from the human resources department asked Crawford whether she had experienced inappropriate behavior by the director. She disclosed she had witnessed certain conduct. The district later fired Crawford, allegedly for embezzlement. She sued for retaliation.

The issue before the Supreme Court was whether Crawford's participation in the investigation fell within Title VII's anti-retaliation protections. The court unanimously ruled that "opposition" includes providing information during an investigation. The lower courts and the employer argued that it would require something more affirmative - such as making a complaint.

The case is CRAWFORD v. METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY, TENNESSEE and the opinion is here.