With nervous employers still keeping generous raises on the shelf, more companies are turning to job title promotions to show their appreciation.
The risk: “While employers may have good intentions, if you start inflating titles, the titles themselves don’t reflect the duties of the position and required expertise,” says John Skousen, a partner with the law firm of Fisher & Phillips in Irvine, Calif. “It also can become confusing, disorganizing and difficult when striving to maintain job classifications and proper salaries when the economy bounces back—including dealing with inaccurate job descriptions with misleading duties requirements, which can cause difficulty separating exempt and non-exempt employees.”
Skousen offers the following issues to consider before implementing title changes in today’s economy:
1. Steer Clear of Negligently Promoting. To give someone a responsibility he/she is not capable of doing—or a title that suggests something he/she is not really doing—is very risky. This may occur inadvertently when “promoting” by consolidating two or more positions into one job, leaving an employee unable to perform certain new functions in the glorified job. Employers are largely liable for their employees’ actions and if they haven’t trained them properly, or are negligently promoted, the company is responsible for that action. Skousen advises employers to avoid the temptation to change titles if it misstates what the person actually does.
2. Avoid the Temptation to Give Overworked Staff Title Changes. In a recession, people get more responsibility and jobs are combined. Instead of two employees working 40 hours per week, companies may have one person in that role working 60-hour weeks. Risks include increased turnover due to injuries or job turnover. Skousen advises employers to be smart and evaluate the risks of spreading out more work and responsibility to fewer employees just to save money.
3. Don’t Play the Name Game. Many companies started calling staff “associates” several years ago, and it’s lost much of its value today. Similarly, “consultants” are no longer sophisticated business consultants making $200,000 per year giving sound advice to companies. Now everyone’s a “consultant” instead of a “salesman” or other appropriate title. Ensure the reputation of your team’s qualifications are maintained, and that management titles remain respected.
4. Ensure Exempt and Non-exempt Accuracy. Employers giving supervisory title changes may also assume they can shift a nonexempt employee to exempt status. However, if the actual job duties or responsibilities do not change much, there may be legal ramifications for misclassification and a potential lawsuit against the employer for unpaid overtime.
5. Remember Past Lessons Learned. Inflating job titles is nothing new. In fact, similar practices took place in the ‘80s during that recession as employers attempted to compensate overworked and loyal employees during a tough economy. In addition, Skousen compares job title inflation to grade inflation in education, “If everyone has an ‘A,’ how do you discern between the best and the average?”
