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Vol. 28, No. 5

Trouble at the top? In an uncertain climate, EDs weigh contracts and evaluations

by Robert J. Derocher

The bar executive community is a tight-knit one, so when some prominent leaders of state and local associations suddenly left their posts over the past year, the word spread quickly.

And so did the questions.

“You have to wonder why someone who has a lot of experience is just let go,” says Tom Pyrz, executive director of the Indiana State Bar Association and president of the National Association of Bar Executives. “That’s a very scary thing.” And one can say that without commenting on the merit of these dismissals; when a longtime colleague is suddenly missing from a NABE meeting, it raises eyebrows, regardless of the circumstances.

The recent turnover was so startling, in fact, that the issue of job security for bar executives was the primary topic of discussion at the NABE Chief Staff Executives’ Retreat in Chicago in early March, just prior to the ABA Bar Leadership Institute.

Just how safe is an executive director’s job? Are economic and membership woes making the job more precarious? Are volunteer boards expecting more from their executive directors? Will a contract keep an exec’s job safe, or just provide a financial cushion on the way out the door? How does a bar executive know when it’s time to go?

Those are just some of the questions being pondered by many bar executives today in light of recent developments. And for bar leaders and human resource professionals, they are legitimate questions that need more discussion.

While some execs—many of them long in their positions—work on a handshake and a casual performance review, others operate with detailed contracts and formal evaluation processes. Although there might be debate about which formula works best, it’s becoming clear to bar observers that the issue of job security and performance for execs is being examined in a different light and that more changes might be on the horizon.

“This is an issue that’s hard for folks to talk about,” concedes Robert Craghead, executive director of the Illinois State Bar Association and chair of NABE’s Chief Staff Executive Committee. “The difficulty is that every bar association has its
own culture.”

That reluctance is one of the reasons why Craghead and Tulsa County Bar Association Executive Director Sandra Cousins sought to address the issue further in a retreat setting (Cousins was the retreat organizer). The thought, she says, was for bar executives to learn not only from each other, but from executives who have lost their positions.

“What are some of the telltale signs that there may be trouble?” she asks. “We wanted to talk to bar executives, and to learn from those who have been burned.”

Who has a contract?

One of the main issues related to job security for executive directors concerns contracts. Who has them, who doesn’t, and why? are some of the questions being asked.

“When we think about contracts, it brings a new dimension to the employment situation,” says Judy Clark, president of HR Answers, a human resources consulting firm in Oregon and Washington state. “It brings a structure and a formality to the relationship. There isn’t the ‘fuzziness’ that’s there without a contract.”
A contract can be a positive for the employer and the employee, particularly at the executive level, she says. While it might not afford job protection for the executive, it might be able to provide for compensation if the executive is terminated. For a volunteer board, it can help spell out what’s expected of executives while they’re employed. But not everyone wants a contract, even in these uncertain times.

Pyrz (11 years), Craghead (10 years), and Cousins (15 years) are all longtime bar executives. None of them have employment contracts and none of them are looking for them. “I would probably feel really uncomfortable with a contract,” Cousins says.

For Elizabeth Price, executive director of the Delaware County (Pa.) Bar Association for nearly three decades, the idea of a contract for her or anyone else is almost laughable. “The only thing it does is that it gets you some sort of severance when you’re leaving,” she says. “If [the board of directors] wants to get rid of you, they’ll get rid of you.”

Alex Lagusch, executive director of the Columbus Bar Association for more than 25 years, once thought that a contract just wasn’t necessary. But in 1996, he and the bar’s board of directors changed their minds. He signed a three-year “evergreen” contract, which means the contract automatically adds another year if both sides agree after a one-year evaluation.

The contract includes provisions for severance, deferred compensation, and a noncompete clause that would keep him from working for a competitor. “It provides security,” he says. “A contract captures, in one place, the conditions of your employment. It’s just a good, businesslike way to approach this.”

While that first contract was negotiated when economic times were good and relations between Lagusch and the board were also good, Lagusch was still wary of what could happen in the future.

“If there’s a personality conflict, or if there’s a conflict over the organization and things go in a different direction, do you just dismiss the individual? Should an executive be at risk because of a change in management?” he asks. “If the problems are irreconcilable, there has to be parting of the ways.”

Karen Garst was comfortable in her role as the director of another nonprofit association when she decided to accept an offer in 1996 to become executive director of the Oregon State Bar Association. She surprised some members of the bar’s board of directors when she asked for a contract.

“I would not have taken the job if I didn’t have a contract. Otherwise, what protects you against capriciousness of a board?” Garst says. “I don’t want to work for a board that doesn’t want me. It’s not good for the board, either.”

A bar association board of directors is a changing set of people, she says, and that can often translate to “a lot of different personalities and a lot of different agendas.” A contract, she says, can provide stability and spell out precisely what a board expects of an executive director.

Sometimes a contract can’t or won’t be had, but that doesn’t mean there aren’t other ways an executive director can gain a measure of security, according to Sheree Swetin, executive director of the San Diego County Bar Association.

While Swetin is an “at will” employee of the association, she helped develop changes in the association’s bylaws when she was hired more than two years ago. “My authority is spelled out very clearly in the bylaws. This helps reduce friction,” she says. “Your best negotiating position is before they hire you.”

The association’s bylaws also clearly state that Swetin works for the entire board of directors, and not just the president or one individual. While she would be more comfortable with a contract, she agrees with Price when she says, “If it’s just not going the right way, a contract is probably not going to protect you.”

Is a formal evaluation needed?

Another provision that Swetin worked for is an annual evaluation of her performance by the entire board of directors. From his perspective as NABE president, Pyrz can’t say if more executive directors are getting contracts, but he says that “the change is toward more formal evaluations of the directors.”

That would be good news, says HR Answers’ Clark, an adviser to several bar associations who still sees too many loose evaluation guidelines.

“If I could make a change in one area [of an association’s bylaws], I would insist, I would require, I would mandate that the board of directors have a formal process for evaluating the executive director, and you have to tell them in advance that, ‘These things matter,’ ” Clark says.

At the Oregon state bar, the board names a special committee each year that meets with other association members, community leaders, staff, and others who have worked with Garst and the association in order to get a gauge on her performance. The committee then meets with her to discuss the findings. “It’s a real opportunity for people to give you constructive criticism,” Garst says. “Every one of the sessions I’ve had over the years has been very valuable.”

Loretta Larsen Topey has been executive director of the Louisiana State Bar Association for 13 years. Like many longtime EDs, she has not had a formal evaluation process. “It’s fairly informal,” she says. “Whoever happens to be president at the time sits down and talks to me.”

Now, Topey is talking with colleagues at other associations in order to develop a formal evaluation process. “We would like to institutionalize it,” she explains. “I think we would all be better served if we had a formal process.”

At the Columbus bar, where Alex Lagusch’s tenure began when many current members hadn’t yet made it to law school, Lagusch still finds a formal evaluation process informative and helpful. “I fully appreciate what the board needs to do,” he says. “I don’t take it for granted.”

Increasing pressures

Lagusch, Topey, and other veteran bar execs have seen plenty of changes in the ED’s role in their tenures. Perhaps the most significant changes—the increased financial and membership demands on directors—might explain why some executive directors are feeling less certain about their jobs.

Many bar associations, particularly voluntary bars, have been struggling just to retain their membership, let alone grow their bases, according to Cousins. “It’s on the minds of everyone, especially with the way the economy is right now. We’ve had a 50 percent turnover in our board. We’re constantly trying to come up with new programs.”

No longer is a bar association just a center for social and civic activity, many say. It is a business.

“I think the whole bar environment is more competitive than it was 20 years ago,” Swetin says. “I think there’s tremendous competition for bars to become more business-oriented. There’s a lot of pressure to have bar associations be on the cutting edge.”

And more often than not, the pressure is coming from boards of directors and bar members.

The federal Sarbanes-Oxley Act, which requires closer financial oversight from boards of directors of publicly traded companies, is slowly working its way into the nonprofit sector, Clark and others say. That means more board members taking a more active role in a bar association’s direction.

“I think boards of directors have become more involved in direct management issues. There are changing expectations, and it’s important that we understand these changes,” says the ISBA’s Craghead. “What worked in the 1980s doesn’t work now.”

In North Carolina, where Allan Head has been the executive director of the North Carolina Bar Association for nearly 30 years, Head is now required to have a joint signature on some checks issued by the association, says bar President Allyson Duncan, also a U.S. Appeals Court judge. Head also no longer signs the authorization for the bar’s annual audit.

It’s not a reflection on Head, Duncan says. Rather, it’s a reflection of changing times. “I think you do have more hands-on involvement from the board of directors,” she notes.

The changing of the guard

As many veteran bar executives like Head inch closer to retirement, the professionals who take their places and the association boards that will appoint them are likely to continue to look more closely at issues such as contracts, evaluations, and performance criteria.

“When I started, I knew one bar executive who had a contract—and he still has one. Now, I know a few more who have contracts,” Topey says. “If [my successor] is someone who has been in association work, I think contracts might be a matter that will be discussed.”

While a contract for Head would seem highly unlikely at this point in his career, Duncan says, she also expects that it might be a little different for the next executive director. “Given the greater mobility of people and jobs, it would be more likely that people will have contracts,” she says.
“Executive directors have left and been asked to leave, so I can see where it would make sense.”

Bar associations, in particular, says Judy Clark, need to closely scrutinize their executive director appointments and continue to carefully monitor their performance. “Bar associations should be above reproach,” she says.

The new bar execs must be prepared for the challenge, as well, she says. If not, they might find themselves looking somewhere else for a job.

An evaluation timeline

The decision on whether or not to have a formal contract between a bar executive and an association can be a personal or institutional one, says Judy Clark, president of HR Answers. The decision to have a formal evaluation process for the executive, she says, should be an automatic one: It should be done.

A longtime human resources adviser to bar associations, as well as other nonprofit organizations, Clark offers this timeline to associations for the evaluation process:

1. Mutually develop with the executive director her or his performance goals and professional development plan.

2. Approve performance goals and a professional development plan.

3. Meet with the executive director to review progress on goals and professional development.

4. Develop a timetable and deadline for gathering information on the executive director’s performance during the past year.

5. Conduct the annual evaluation of the executive director’s performance and growth. | Review information gathered. | Discuss and complete executive director evaluation form. | Summarize findings and share with the executive director.

6. Report to full board with recommended actions. | Salary increase or bonus for exceeding expectations. | Consider compensation options for meeting expectations. Areas of growth should be clearly defined for the coming year. | Corrective action plan for not meeting expectations. | Termination for failing to meet basic requirements.

A number of factors vary from one association to the next, Clark says, including who does the evaluation, where and how information on an exec’s performance is gathered, how compensation is tied to the evaluation, and how often an evaluation is done.

“I believe a good bar executive evaluation should be done on a 360-degree basis,” she says, referring to a comprehensive process that involves gathering information from association members, co-workers, and those outside people or organizations who work with the executive and the association (see “Oregon bar provides a model for employee evaluations,” July-August 2002, page 17; and “360° evaluations: A case study from the D.C. Bar,” November-December 2003, page 23).

Whatever process is used, Clark says, consistency and clarity are key.

Longevity tips for executive directors

Many executive directors work without a contract or a yearly evaluation. So how else can they ensure that their stay in the bar world is a long and productive one? At August’s Annual Meeting of the National Association of Bar Executives, a panel of longtime executive directors shared their advice.

The first piece of wisdom offered by Diane Minnich, executive director of the Idaho State Bar, was, “Pick your battles.” Turnover at the executive director level often happens because the ED digs in when perhaps he or she should not, she said. Minnich advised that an ED keep this in mind when trying to decide whether to press an issue or let it go: “If you don’t win, always remember that the board is not going to stick with you. They’re going to stick together.”

Even though she considers herself to be an outspoken person, Christine Burdick, executive director and general counsel at the Santa Clara County (Calif.) Bar Association, agreed that sometimes it’s best for the executive director to step back from a conflict. “There are things that I just don’t care about not being visible on,” she said.

Making that realization was an important phase in her growth as a bar exec, Burdick said, adding that the ED’s career typically develops in stages: “The first seven years are really different from the next seven years.” In that initial seven-year “honeymoon period,” the executive director is still learning, she said. In the second phase, he or she has amassed a store of knowledge and must learn to use it in a way that is not perceived to be threatening by the board.

One way to do that, Minnich suggested, is to always remember that “the association belongs to members, not you.” It’s easy for longtime staff to see that certain ideas—such as public relations efforts to boost the public image of lawyers—come up year after year, but it’s important that those staff members not roll their eyes and say, “ ‘We’re not going to talk about that again.’ ”

But that doesn’t mean the ED must agree with every “pet project” of every president, Burdick said. In fact, she noted, “An executive director’s fiduciary responsibility is to the short- and long-term well-being of the organization,” rather than to the initiatives of any particular president or board member. Even though it’s important to know when to let go, Burdick said, it’s also important to know when and how to speak up. If a plan put forth by the board or executive committee doesn’t seem to be in the best interests of the bar as a whole, Burdick suggested the ED not be afraid to say, “ ‘You can do whatever you want, ultimately, and I’ll execute it, but here’s my perspective.’ ”

Key to all of this, Burdick added, is to strive not to take conflict personally, but to adapt to the new personalities that come into play each year.

As chief staff executive, the executive director should resist interference with hiring and firing, the panelists said. “Don’t hire anyone you can’t fire,” said Keith Birkes, executive director of the Missouri Bar, advising attendees to think twice before hiring that nephew or niece of a board member. Likewise, he said, the executive director should resist pressure to fire an employee who is performing well but is disliked by a member.

What if an employee is impossible for other staff to work with, but is popular among members? In that case, Burdick would head off any surprise and outrage by approaching an elected leader and explaining why that popular employee needs to go. “When you fire that person and then put someone in who is as good or better, those members forget,” she added.

Being open and honest—even when there’s trouble—is another key, Minnich said: “Never hide the ball.” Whatever the crisis or mistake, she noted, it’s far better that the board hear it from the executive director than from some other source. Burdick agreed, adding that it’s important to convey to the board that there’s a plan for dealing with the problem, and also to ask for its input.

But the executive director’s job isn’t all about conflict and problems, Minnich said; staying positive can prevent burnout and also ensure on-the-job longevity. “This is fun work,” she said. “Enjoy it.”

—Marilyn Cavicchia

What does a good contract look like?

If a bar executive gets a contract, what should it contain for each side to be happy? Judy Clark, president of HR Answers, offers these “minimum” requirements:
| A specific contract length. | Compensation, including how any bonus would be determined. | What would happen in the event of any termination. It’s important to cover the different provisions that might apply to the different reasons for termination. | How contract renewal or extension will be determined. | What performance appraisal process exists and how a pay increase would be determined. | Clear definition of the role or responsibility of the position (This may also be covered by referencing a job description document.) | How resignation is handled in terms of length of notice. | Whom, specifically, the position reports to. | Any appeals process if the individual experiences a challenge with the board president.


A delicate issue

In putting together this story, we encountered a number of people who felt strongly about the value of contracts and evaluations, but who did not wish to be named because of the sensitive nature of the topic. Here are some of their comments.
—Marilyn Cavicchia, editor
| From an executive director who accepted his position with the understanding that he would work for a few months without a contract, but would eventually have one:

“Apparently, when I accepted the position and had this discussion with the president, [he or she] didn’t communicate that to the board. So [a few months later], when I submitted a proposed contract to the president, and asked that [he or she] discuss it with the board, I ran into some problems. They have no problem at all with my performance; quite the contrary.

“However, it seems that a board full of lawyers has a real problem with a contract. The response from the board was a very unlawyerlike ‘Why do you want a contract? Don’t you trust us? Do you feel insecure in your job? Are you going into this job as if you plan to leave?, etc., etc.’ They were the type of questions that you would expect from nonlawyers unaccustomed to dealing with written contracts.”
| From the executive director of a smaller local bar: “We do not have such a contract, although the personnel manual does state, ‘The Personnel Committee will evaluate the Executive Director from time to time.’ After almost six years of employment, I have yet to be evaluated.

“It is a shame because [an evaluation] can fuel the tired and weary. Yes, I receive a bonus at the end of the year and a raise at the beginning of the next year; however, I do not receive any heroing words from our board. I am sure they appreciate me or I would not be here, but it is human nature to want to be noticed, to be thanked for a job well done, to feel appreciated by the powers that be, and not just to receive that thank-you on a piece of paper that has monetary value.

“Yes, I think that I should be evaluated, as well as each one of my employees, each year. I feel the need to know how to improve on my performance, which means being accomplished in what I do, what I have to offer my employer. How will I know that I am taking those steps towards improvement for the betterment of this association?

“Who doesn’t want to be a better person at everything that they strive for—but how does one get to that point if it is only you who has an opinion of yourself? You can shine in as many ways as you want in your own head, but are you really improving, evolving, performing, and most of all, complete? I think an evaluation can work in mysterious ways, in bringing out the best employee in me, as well as the board being privy to what exactly you mean to them on a daily, weekly, and monthly basis.

“As we know, the executive director continues to face an ever-growing job description, and we take everything on with enthusiasm and persistence; would it not hurt to really feel that pat on the back?”
| From an executive director who does have an employment contract: “I think such contracts are great for all concerned.

“The officers do a performance evaluation about me every year and it’s helpful to me. Keep in mind, though, that the evaluations done on CEOs are only as good as the persons doing the evaluating. If they have a personal agenda or are the micromanaging type, the exec will not get an accurate picture of his or her performance. Fortunately, most bar officers are relatively skilled at this phase of management, but we get a few who are not as good as others.”

Are executive directors in peril?

“I see what I have characterized as a troublesome trend of volunteer leaders inserting themselves in an aggressive way in the micromanagement of bar associations.

“And with that backdrop, I think the executive director him- or herself may become superfluous.”

These provocative words are from a 20-year bar veteran who wishes to remain anonymous and who is currently in a struggle over the definition of his job (Note: Although we will use he and his for ease of reading, this person is not necessarily male.) As this bar exec sees it, the ED position—at his own bar and at others—has been moving in the past few years from that of a respected administrative professional to a mere functionary who is expected to carry out the board’s wishes without question.

Rather than seeing chief staff executives and other executive staff members as collaborators in the pursuit of the organization’s mission and the administration of justice, this ED says, “I think the volunteer and elected leaderships see bar executives as little marionettes that they can just simply direct around.” Further, this ED says he has been told that his job is on the line unless he accepts this role.

The ED is not sure what might account for this trend he perceives, but says it predates Enron and the other scandals that have brought increased scrutiny from elected leaders over the budget and other fiduciary matters.

He envisions a day when elected leaders of bar associations may decide that executive directors, in their new role as functionary, are overpaid and unnecessary, and that the elected leaders can “run the show” themselves. And that, the ED believes, would be a terrible mistake. Running a bar association is vastly different from running a law firm, he says, and whether they realize it or not, elected leaders need the counsel of the professionals who have been at the bar year in and year out. A bar association without input from executive staff would soon founder, this ED thinks, and ultimately, the justice system itself would suffer.

As this ED sees it, he and his fellow bar executives should worry less about saving their own jobs by “tucking our tails between our legs and running away” from conflict, and worry more about standing up for the value of the executive director position in general.

That’s a tough proposition, the ED admits. He adds that his purpose in sharing these thoughts is not to complain about conditions at his own bar, but to perhaps open up a healthy discussion among bar executives and between staff and elected leaders.

Likewise, we at Bar Leader stress that we are not endorsing this ED’s opinions merely by printing them. Rather, we found them to be a thought provoking addition to this overall examination of job security at the executive director level. As always, we welcome any and all responses.

—Marilyn Cavicchia, editor