Emotional Intelligence and Employment Practices Liability Part I: The Nature and
Importance of Emotional Intelligence
By Donald A. Phin, Esq., Employment Practices Liability Consultant Newsletter
"More effective and important than ... legislation is our regard of one another's
feelings at a simple human level." —Dalai Llama, Ethics for the New Millennium
What Is Emotional Intelligence?
Why do people get into accidents? Why do they violate company ethics policies? Why
do they ignore personnel rules? Why do they use illegal drugs? Why do they put self-interest
ahead of organizational values? Why do some people cause conflict while others are
gifted at resolving it? Why do some people engage in "riskier" behavior than others?
In many cases, the answer to each of these questions boils down to what has been
labeled "emotional intelligence." This two-part article will explore the latest
research on the subject of emotional intelligence. This first part examines the
nature of the emotional intelligence concept and then discusses its implications
for the employment practices liability field. The second part, which will appear
in the spring issue of EPLiC, addresses whether
and to what extent employee testing and evaluation tools can measure emotional intelligence,
the legal implications of such tests, and their costs versus benefits.
"People see what they want to see." —Red Barber
Emotional Intelligence in Action: An Illustrative Scenario
Susan is a customer service representative who believes that her boss, Jim, the
director of sales, is sexually harassing her. She complained to Marcy, a human resources
manager, that she was uncomfortable with Jim's use of vulgar language and with his
propensity to touch her and other women. Susan believes that Jim's conduct makes
it difficult to communicate with him and the situation is beginning to affect her
productivity. She tried to make Jim aware of this fact, but his only reply was,
"Get over it." Marcy told Dave, the owner of the company, about the situation. Dave
responded by saying that he has known Jim for years and that he is simply "...old
school—he doesn't mean anything by it. Try not to take it so seriously."
Employment Practices Issues and "Emotional Competency"
Already we realize from this illustration that employment practices liability issues
are influenced more by a person's "emotional competency" than by the existence of
a company policy against sexual harassment. This firm, like most, probably has a
policy aimed at sexual harassment printed in its employee handbook or on a poster
on the wall, and likely participates in regular training on awareness and prevention
of sexual harassment. Yet Jim's conduct and Susan's reaction to it were not affected.
That is because it is the emotional competency of these participants that will ultimately
determine whether the situation eventually ignites into a formal complaint by Susan—and
perhaps even a lawsuit—or if it can be resolved in some form of "win/win" fashion.
"If we should change the world, first we must change ourselves." —Socrates
What Is Emotion?
Just what is "emotion"? The word emotion comes from the Latin
emoveo, which means "to move from." According to
Webster's 1828 Dictionary, emotion is "a moving of the mind or soul."
Historically, the word emotion has been associated with a strong sense of feelings
or drama. Therein lies my trouble with the emerging use of the term emotion in relation
to the workplace. I don't know about you, but the last place that I want drama is
in my workplace.
As we soon shall see, Daniel Goleman's books tie the term emotion to almost every
type of personality variable. When a word means so many things that it loses distinction,
it tends to cause confusion. For the sake of clarity throughout this discussion,
the word emotion will be used interchangeably with "personality" or "character."
"Unmet emotional needs cause the majority of problems at work." —EQI.org
Working with Emotional Intelligence
In his 1995 bestseller, Emotional Intelligence,
Goleman argued quiteconvincingly that a person's "emotional intelligence" (EI) or
"emotional quotient" (EQ) is, in today's evolving right-brained world, the single
most important predicator of success. Subsequently, Goleman and his cohorts have
continued to do an incredible amount of research in this area. His recently published
follow-up book, Working with Emotional Intelligence,
focuses on how these factors affect success in the workplace. Regardless of whether
you call it character, emotional intelligence, emotional quotient, or apply some
other verbiage, looking at how we think about
ourselves and the world around us and what we
do with those perceptions helps predict personal and professional success. The concept
of emotional quotient becomes ever more important as we shift from a manufacturing
to a services economy.
The Importance of Emotional Intelligence
In preparing this article I researched numerous sources. Articles published in England,
Canada, India, and Norway indicate this concept of EQ has not remained confined
within our shores. Based on personal experience and abundant literature, it is clear
to me that emotional intelligence has a far greater impact on a person's personal
and career success than does their IQ or particular skill set. Marcy, our human
resources officer in the above scenario, may be an expert on compliance with the
company's sexual harassment policy. But she may or may not be adept at creating
a dialogue with Dave or Jim. And, if Marcy values job security over her role as
compliance officer, she may be more inclined to placate Dave and Jim instead of
conducting a prompt and thorough investigation. Her attitude may send a message
to Susan that her complaint was ignored. Moreover, Jim may conclude that his conduct
is acceptable, and he may have license to retaliate against Marcy for her complaints.
The next thing the company may hear from Susan—after she quits—is in the form of
a letter from her attorney demanding hundreds of thousands of dollars in damages.
In Working with Emotional Intelligence, Goleman
makes the point that the "emotional intelligence" or culture of an organization
starts at the top. Accordingly, you cannot consider risk management to be a priority
of the rank-and-file employee if it is does not occupy a similar priority in the
executive boardroom. Marcy cannot be expected to be focused on doing the "right
thing" if she is more concerned about Dave's relationship with his friend Jim.
Emotional Intelligence and the Claims Resolution Process
Assume Susan decides to file a lawsuit alleging sexual harassment and retaliation.
What impact will the emotional intelligence of the attorneys, judges, and jurors
play in resolving the conflict?
Again, experience tells me that it is the emotional skill of the attorneys that
often wins cases and successfully resolves conflicts. Most important is their ability
to create a dialogue and communicate toward a win/win resolution. Unfortunately,
attorneys are trained in an all-out, adversarial approach to dealing with conflict.
Lawyers are supposed to "fight" for their side. We must protect our clients at all
costs, even at the expense of our personal well-being. Many attorneys counsel their
corporate clients to contest all claims vigorously, regardless of their level of
merit, so that they do not become known as an "easy mark." This mindset applies
despite the fact there is a glaring absence in the legal literature on the collateral
impact of taking a "no holds barred" approach to litigation. Such attitudes must
be weighed against their effect upon the lives and well-being of the participants
in the litigation and their families, its impact upon the loyalty and commitment
of the workforce, and the manner in which it defines a company's culture.
Risk Management and Emotional Intelligence: A Disconnect
After an extensive, web-based search effort looking for the terms "risk management"
and "emotional quotient" (or "emotional intelligence"), it was surprising to find
that neither of these concepts were combined in the same article or paper. This
is despite the fact that at its most basic level, employment practices liability
is about people and how they think and act. While I would not expect to find much
discussion about emotional intelligence when it came to flood loss, fire loss, or
business interruption claims, I did expect to see more published material applying
to "people losses," such as directors and officers, employment practices, workers
compensation, and employee theft. One reason for the lack of research and writing
in this area may be attributed to the "fuzzy" or "soft" nature of the issue. Until
recently, it has been difficult to catalog and quantify. Suddenly, however, we appear
to have strategies and tools that will allow us to do just that.
Emotional Intelligence Profiles
What if we could develop an emotional intelligence profile of a harasser (or their
victim), of an unethical executive, of a warehouse thief, or a malingering claimant?
There are certainly challenges associated with such an inquiry.
First is obtaining permission from the person you wish to profile. That may be difficult,
if not impossible, especially in the event they were fired from your company for
being a sexual harasser. On the other hand, there is the potential for building
a profile with input contributed by those who worked in the presence of such a person.
In fact, this may be of greater value than the individual's self-awareness. Since
the self-awareness of the wrongdoers is, by definition, flawed, what good does it
do to know what they think about themselves? Perhaps more important, we need to
know what others around them observed, how they felt, and what—if anything—they
did.
Specific Personal and Social Competencies
Goleman's emotional competency framework is effective in furthering this discussion.
I believe these factors also apply in the risk management and employment practices
liability context. They include the following.
Personal competencies:
- Self-awareness (knowing one's internal states, presences, resources, and intuitions)
- Self-regulation (managing one's internal states, impulses, and resources)
- Motivation (emotional tendencies that guide or facilitate reaching goals)
Social competencies:
- Empathy (awareness of others' feelings, needs, and concerns)
- Social skills (adeptness at inducing "desirable responses")
Consider a high-quality customer service representative, for example. This person
would display a high level of self-control, conscientiousness, and empathy.
Personal Competencies are "Company-Specific"
Goleman indicates that the competencies we need to master will change as we grow
into different roles. For example, senior-level managers need a greater political
awareness than do their subordinates. In addition, Goleman observes that a person's
competencies are also related to the company's "emotional ecology." Depending on
a company's vision, mission, core values, and goals, a different blending of emotional
competencies may be required. To use another example, a nurse dealing primarily
in pediatrics will need a different set of emotional skills than one specializing
in geriatrics. Moreover, such profiles may also be affected by whether the nurses
work in a private or public heath care setting.
Self-Esteem: A Key Personal Competency
A perfect workplace would be populated only by true gentlemen, who would never consider
harassing a woman, and emotionally strong women, who would not allow themselves
to be sexually harassed for very long. Honesty, integrity, responsibility, and self-control
are critical factors when it comes to preventing wrongful conduct. But probably
the most important competency in this area is self-esteem.
Consider self-esteem as it relates to the role of the victim in these circumstances.
Although it would seem that people with low self-esteem would blame themselves for
their undesirable circumstances, some are quick to externalize: everything is someone
else's fault. Quite frankly, I have yet to meet anyone (including those in a legally
protected category) who has succeeded in life by pointing fingers at someone else.
For example, studies of "whistle-blowers" reveal that their efforts take a huge
personal toll—they end up divorced, broke, or bitter. While I applaud their efforts,
win or lose, I believe it is sometimes better to leave the company to its criminal
or unethical ways, and find a workplace that shares one's core values.
The same concept holds true for the employer. While channel-surfing last month,
I came across a speaker at the National Convention for Attention Deficit Disorder
who told her audience that the first question they should be asking themselves when
an employee is not succeeding at a job is not, "What are company's legal obligations?"
But, rather, they should ask, "What are we going to do to 'own' the problem?" That
is sound emotional advice, especially when 80 percent of ADA disability claims are
decided in the company's favor. The point is this: blaming or justifying doesn't
work—taking responsibility does.
Emotional Intelligence and Technical Skills: A Crucial Evolution
What is interesting is that, to a large extent, it has been the software and information
technology industries that have focused on the issue of EQ. Because of the intense
competition for qualified workers, these industries are not only having problems
finding people with good technical skills, but it is also becoming increasingly
difficult to promote these workers to levels that require management skills.
As computers continue to take over technical, left-brain functions, the value of
the right-brain emotional functions will assume ever-greater importance.
Emotional Maturity
The EQ movement has generated some opposition from psychologists who vehemently
object to the idea of trying to measure emotional skills as an "intelligence." A
hopeful aspect of these studies is that, as we become older, the ability to grow
in our emotional intelligence improves. The studies imply that this blossoming into
emotional maturity occurs around the age of 25. Query: Will our young, technically
savvy but emotionally deficient new workforce cause greater risk for us than their
predecessors?
If the emotional intelligence of an organization is so important, then there may
be an even darker side to downsizing than we had first considered. Arguably, our
oldest and highest paid workers are also the most emotionally mature. If two-thirds
of a manager's or executive's success is based on his or her EQ, then the "emotional
competency drain," not just the "technical brain drain," can have a critical impact
on an organization. Although that new salesman earns only half as much as his or
her predecessor and is also computer literate, his or her emotional immaturity just
caused you to lose two of your biggest clients and get sued by the third. I have
litigated more than one case where a "hot-shot" young manager capable of delivering
incredible "numbers" has created sexual harassment lawsuits, caused stress claims,
and increased turnover within an organization. I call these managers million-dollar
employees—and it's not because of what they're getting paid. In such instances,
their companies would have been better off training the older worker in technical
skills—rather than vice versa.
The Importance of Feelings
Employment practices liability risk management has historically focused on the back-end
of a situation, namely, the point at which a claim is made. As lawyers, risk managers,
and consultants, we typically become involved only
after a problem has surfaced. We are very analytical in both our approach to preventing
problems and in bringing them to closure. We want the facts and the figures before we are ready to defend ourselves. And if
our position fails, we will fight to maintain it, which only raises the emotional
and financial stakes.
The truth is that we are not very interested in how others
feel. We are too busy worrying about how we
feel. Let me give an example. Once a claim surfaces, a "prompt and thorough" investigation
becomes the critical action. As lawyers, we are trained to ask for, as Sergeant
Joe Friday would say, "just the facts Ma'am." We are not supposed to ask how anyone
"feels." That's the forensic psychiatrist's job. Unfortunately, this is one of the
critical gaps in our thinking.
Having represented a significant number of women in sexual harassment cases, I can
tell you that almost every one of them was offended by the fact that, although the
company did conduct an investigation, the company never once asked how they "felt."
After reporting only the facts and not the feelings, the women felt drained and
manipulated. In their minds, these women thought, "You don't care about me, you
don't acknowledge or validate me, all you really care about is protecting yourself."
It is no surprise that even companies that conduct investigations with the best
intentions find themselves with an employee who is upset and waiting to quit or
be fired.
Often, the only thing we need to feel better is validation. The opposite of validation
is to be ignored: i.e., told we shouldn't feel that way or are too sensitive, and
unfairly judged or criticized. When employees do not feel validated, a whole slew
of bad things happen, including a breakdown in communication, defensiveness, evasiveness,
fear, and loss of productivity. Make no mistake about it: negative emotions, just
like positive ones, are contagious. The negative emotions of a former employee are
contagious. Negative emotions expressed between lawsuit participants and their counsel
are contagious. They spill over not only into our workplaces but also to our families
and deep into our own minds.
Emotional Intelligence and the Ability To Generate Win/Win Solutions
When it comes to the attorneys and adjusters who manage employment practices claims,
their emotional competency will be the single most important factor in determining
their ability to generate win/win solutions. Consider also the human resource manager
and the investigator. Do they really understand others, engage in active listening,
and acknowledge and validate? Are they sympathetic to the person's circumstances?
Will they unite or will they create dissention among the defense team? Do they have
the ability to facilitate the plaintiff and their attorney in making reasonable—as
opposed to unreasonable—demands? Or, will they upset the plaintiff to such an extent
that he or she and their attorney are determined to fight—regardless of the possible
outcome? Ideally, the company and its representatives will be adept at shifting
the plaintiff's focus away from blaming and justifying and toward helping the plaintiff
accept responsibility—at least to some degree.
It is my experience in dealing with opposing counsel during the past 15 years that
the best attorneys are not those with the strongest grasp of the rules of evidence
or legal technicalities, but rather those who are adept at relating to people. The
attorney who will best serve the client is one who can develop a rapport and communicate
with a jury effectively. Such lawyers also have the greatest chance of keeping their
client out of court in the first place.
My experience tells me 80 percent of workplace risks are relationship failures—rather
than the failure to have or properly implement policies and procedures. As stated
by Kevin M. Quinley, CPCU, ARM, in Claims magazine,
"Good relations between employers and employees are key to low or no losses. Be
sure that employees feel comfortable in reporting or discussing any problems and
that managers and supervisors respond to any complaints in a positive and caring
manner."
Concluding Thoughts
The bottom line is that EQ—not mastery of the legal technicalities—is the most important
factor in determining whether, and to what extent, an organization will experience
employee claims. But, because it is a "soft" issue, risk management literature has
virtually ignored the subject. Nevertheless, since EQ is such a critical issue,
this won't last long.
I note that very few employment practices claims appear to emanate from today's
newer and more challenging and exciting work environments. For example, I see more
auto dealerships being sued than dot.coms. Perhaps this trend provides a key to
the root of all employment practices risk management: place people in an environment
where they feel good about themselves and they are much more likely to be focused
on adding value and taking responsibility. Such environments will have no room for
abusive, discriminatory, or blameworthy conduct.
In this issue we opened the door to EQ as a risk management variable; in the next
issue, we'll explore some additional components of EQ. The article will address
questions such as the following.
- What are the various testing mechanisms available for assessing EQ?
- How effective are these tools?
- What are the legal pitfalls associated with these assessment efforts?
- What is the ultimate cost/benefit of assessment tools?
Until then, may your emotional intelligence guide you in the right direction.
Donald A. Phin, Esq.,
has been an employment and business litigation attorney since 1983 and earned certification
as a professional consultant to management (CPCM) in 1994. He presents workshops
and seminars for groups including The Executive Committee, CEO Club, Foundation
for Enterprise Development, Insurance Marketing and Management Services (IMMS),
and Risk and Insurance Management Society (RIMS). Mr. Phin is the coeditor of
EPLiC and the human resources consultant for IMMS. He is
the author of Building Powerful Employment Relationships
and LAWSUIT FREE! How To Prevent Employee Lawsuits.
His articles have appeared in The Risk Report, Business Insurance,
CFG Update, and other industry publications. He can be
reached at (800) 234-3304 or by e-mail at don@donphin.com.