Home 2015 June
Employment Sections
Failure to Hire Muslim Woman Was Religious Discrimination

By KIMBERLY KLIMCZUK

Kimberly Klimczuk, ESQ.

Kimberly Klimczuk, ESQ.

It is well-settled that employers may not discriminate against employees or applicants on the basis of religion. On June 1, the Supreme Court ruled that Abercrombie & Fitch unlawfully discriminated against applicant Samantha Elauf when it failed to hire her because she wore a headscarf.
Abercrombie & Fitch maintains a so-called ‘look policy’ for all employees in order to project a particular image across all of its stores. The policy specifically prohibits employees from wearing “caps,” because, according to the company, they are too informal for Abercrombie & Fitch’s image.

Elauf, a practicing Muslim, wore a headscarf in observance of her religion. She applied for a position in an Abercrombie & Fitch store and wore a headscarf to her interview. Heather Cooke, the assistant manager who interviewed Elauf, rated her according to Abercrombie & Fitch’s applicant-evaluation system and determined that she was qualified to be hired. However, Cooke was concerned that wearing a headscarf would violate the company’s prohibition against caps.

The look policy does not include a definition of the term ‘cap,’ so Cooke asked her district manager, Randall Johnson, whether Elauf’s headscarf would violate the look policy. She also told Johnson that she believed Elauf wore the headscarf because of her religion. Johnson told Cooke that all headwear, including Elauf’s headscarf, would violate the look policy, and he told Cooke not to hire Elauf.

Elauf filed a complaint with the Equal Employment Opportunity Commission, which sued Abercrmbie & Fitch on her behalf, alleging that Abercrombie had violated Title VII of the Civil Rights Act of 1964 when it refused to hire Elauf. The district court for the Northern District of Ohio found in favor of Elauf, but the Tenth Circuit Court of Appeals reversed the ruling, holding that an employer cannot be liable for failing to provide a religious accommodation until the applicant or employee provides the employer with actual knowledge of her need for a religious accommodation.

Abercrombie had argued that, because it hadn’t known for sure that Elauf wore the headscarf for religious reasons, and therefore didn’t know whether she would need an accommodation, it couldn’t be liable for religious discrimination.

The Supreme Court disagreed, pointing out that Title VII makes it unlawful for employers to fail to hire an applicant “because of” her religion, which includes religious practice. The court noted that, unlike other anti-discrimination laws, such as the Americans with Disabilities Act, Title VII does not include any knowledge requirement. Rather, Title VII prohibits discriminatory motives, such as, in this case, the desire to avoid potentially having to accommodate a religious practice.

The court also clarified that an applicant only has to show that her need for accommodation was a “motivating factor” in the decision not to hire her. The court found that was the case here, stating that “the employer at least suspected that the practice was a religious one. Its refusal to hire was motivated by the desire to avoid accommodating that practice, and this is enough.”

Abercombie argued that Elauf could not demonstrate a discriminatory motive because its look policy is neutral — it prohibits all headwear, religious or otherwise. However, the court pointed out that Title VII does more than require that religious practices be treated no worse than other practices; it gives religious practices favored status, requiring employers to accommodate religious practices unless doing so would create an undue hardship.

Because the Tenth Circuit dismissed the case on other grounds, the Supreme Court did not discuss whether allowing Elauf to wear a headscarf would be an undue hardship for Abercrombie, but the court ordered that the case be sent back to the Tenth Circuit for a ruling on that issue.

So what can employers learn from Abercrombie & Fitch’s mistakes? First, employers should not jump to conclusions about applicants’ need for religious accommodation, and, if they do, they cannot simply decide not to hire an applicant based on that conclusion. Rather, employers have an obligation to explore whether a religious practice can be accommodated.

Here, for example, Abercrombie could have hired Elauf and then, if she asked to be allowed to wear her headscarf at work, decided whether it could accommodate that practice in light of its look policy. Another option would have been to inform Elauf during the interview of Abercrombie’s look policy and to determine at that point whether allowing Elauf to wear a headscarf would create an undue hardship for the company.

Although the Abercrombie decision does not signify any change in religious-discrimination law, it serves as an important reminder to employers of their obligations under the law.


Kimberly Klimczuk is a partner at the management-side labor and employment firm Skoler, Abbott & Presser, P.C.; (413) 737-4753; [email protected]

Cover Story
UMass Grad Marty Meehan Now Leads the System

COVER0615cMarty Meehan acknowledged that, when someone decides to run for Congress, and then succeeds in that mission, they’ve done more than win an election. They’ve also more or less committed to a career in politics.

But when Meehan set out to capture the Bay State’s 5th Congressional District seat, anchored by his hometown of Lowell, in 1993, at age 37, he said he did so with a much different mindset.

“I knew I didn’t want to serve in Congress for the rest of my life,” he told BusinessWest, adding quickly that he didn’t know exactly what path his career should ultimately take.

So in 2001, he engaged the services of New Directions, an executive career-development firm that, in essence, helps clients determine a path and, in Meehan’s words, “tells you what you’re good at.”

After an extensive three-week process that included several tests and interviews with people who knew him well, those at New Directions told Meehan he’d be good at running a professional sports league or taking an executive position in higher education.

Marty Meehan, seen here with the mascot for UMass Lowell

Marty Meehan, seen here with the mascot for UMass Lowell, says graduating from the university gives him a unique perspective that will serve him well as president.

To make a long story short, that analysis was on the money.

Meehan, who said he essentially put himself on a track for either of those pursuits, eventually became chancellor of UMass Lowell, where, by all accounts, he led a stunning resurgence at the school.

And last month, he was chosen to succeed Robert Caret as president of the entire university system, thus becoming the first UMass undergrad (he earned a degree in education and political science at the Lowell campus) and first chancellor within the five campuses to ascend to the president’s office.

He said those two qualities, if you will, provide him with a unique perspective, one he believes will serve him well in his new position.

“I have a passion for the University of Massachusetts, and I view that as an asset,” he explained. “When I interact with students, I literally say, ‘I was where you are.’ I have a passion for the institution because I was a student here. I fundamentally understand at my core what it means to have a great university system.”

In a wide-ranging interview, Meehan, who takes the helm July 1, touched on a number of issues involving the university and his role as its president. They include:

• The overall accessibility of the university’s campuses: “The fact is that public higher education in this state has been privatized over the past three decades; the cost of a UMass education has stayed the same, adjusted for inflation, but the burden of paying that cost has shifted from the Commonwealth to students and their families”;
• His perceived role: “A big part of my job is to make the case for this system and demonstrate why it’s important to make the investment in a world-class public research university”;
• His quick take on his job description: “My job is to provide leadership, inspiration, and passion to help the university get what it needs in terms of funding and what it needs in terms of stature, prestige, and reputation. Universities are all about students, faculty, and the interaction that takes place between students and faculty; the rest of us are there to support and embrace that interaction”;
• His leadership style: “I’m very strategic in everything I do; I’m also collaborative and accessible”;
• The importance of the Amherst campus: “UMass Amherst sets the standard for what the UMass brand is all about. So it’s in the interest of all the UMass campuses for UMass Amherst to improve its ranking; that’s where the brand comes from.”
• The role of the system as a whole: “I think the economy of Massachusetts runs through this university”;
• His expectations for the Baker administration: “The governor fundamentally understands how the economy of this state works, and he understands the role UMass plays in the economy. I think he’s thoughtful, he’s smart, and the University of Massachusetts could do quite well under Governor Baker”; and
• His commitment to stay for the “long haul,” as he put it: “I didn’t take this job to get another job — I’m not thinking about what else I’m going to be doing. When I got the job at Lowell, everyone thought I was going to run for the Senate a couple of different times or run for governor. What I said was that I didn’t think you could take a job like that and not make at least an eight-year commitment, and I feel the same about this job.”

For this issue, BusinessWest delves into much greater detail on these and other matters as we talk at length with the next leader of the state university.

School of Thought

As Meehan wrapped up his comments with BusinessWest in the office of the UMass Amherst athletic director — he was at the Mullins Center to attend the June board of trustees meeting — he used that setting and its view of the arena to segue into one of the dilemmas he’ll be facing as president, if one could call it that.

“Someone in the press asked me who I was going to root for when UMass Amherst plays UMass Lowell,” he said, referring specifically to two hockey squads that face off against each other and the 10 other teams in the highly competitive Hockey East conference. “I said, ‘that’s an easy one; when the game’s in Amherst, I’ll be rooting for the Minutemen, and when the game’s in Lowell, I’ll be rooting for the Riverhawks; that’s how I’ll solve that.’”

Marty Meehan says one his first priorities

Marty Meehan says one his first priorities is to initiate a new strategic plan for the UMass system, one that will be conducted from the ground up.

Surely, the myriad other issues he’ll be confronting as president will resist such quick, easy, and diplomatic solutions, but overall, Meehan believes he’s ready for pretty much whatever this job can and will throw at him.

Such confidence stems from a career in leadership positions, which have yielded a wide range of learning experiences.

They came in Congress, where he served seven terms, served on the Armed Services and Judiciary Committees, and established a national reputation for his work with everything from campaign finance reform to tobacco control; before that, in stints as the first assistant district attorney of Middlesex County and Massachusetts deputy secretary of state for securities and corporations; and especially at UMass Lowell — which brings him back to that determination readied by New Directions.

Meehan said he worked to position himself for possible management roles with sports leagues — on the House Judiciary Committee, he became more involved in anti-trust issues that affect professional sports leagues, for example — but soon became more focused on the second career path recommended to him.

Indeed, the post at UMass Lowell was actually the second opportunity within the broad realm of higher education that he considered. The first was his pursuit of the job as dean of the law school at Suffolk University, where he earned both his master’s and juris doctor degrees and was also on the board of trustees. But it wasn’t a hard pursuit.

“I told the search firm that I didn’t think I was what the law school needed at that point,” he recalled. “I felt it needed a nationally known academic or perhaps a former federal judge.

“But during the course of an hour-and-a-half conversation, I got an opportunity to talk about higher education,” he went on. “And when the Lowell position came up, the same search firm was hired to handle that search, and after that long conversation we had, I knew they’d be calling me for that position.”

They did, and after overcoming some reluctance to being named a finalist — he was concerned about both publicly acknowledging his pursuit of the job and competing against seasoned academics — Meehan was awarded the job.

He believes that aforementioned passion resulting from his student experiences there — and his ability to communicate it — was a big factor.

“I wanted the job because I felt that I could make a difference at an institution that meant so much to me personally,” he explained. “Number one, it’s in my hometown, and number two, I graduated from the school. And I felt UMass Lowell could be a much greater institution than what it was.”

At Lowell, he took over a school that was, by most all accounts, underperforming, and certainly changed that dynamic.

Indeed, during Meehan’s tenure, the school, founded in the 1890s as the Lowell Normal and Lowell Textile schools, achieved record growth in enrollment, student retention, research, and scholarship funding. The school has also undergone a dramatic physical transformation, with new academic buildings and residence halls; upgraded academic, research, and athletic facilities; and enhanced student-activity spaces.

Meehan’s comprehensive portfolio of improvements includes:

• Rating as a top-tier university by U.S. News & World Report for the first time in 2011. The school has subsequently seen a four-year gain of 27 spots, from number 183 to 156, the second-largest leap in the nation;
• A 50% increase in enrollment over the past seven years, to more than 17,000 students;
• An accompanying rise in academic qualifications, as the average SAT score of incoming freshmen, math and verbal combined, has increased 80 points since 2008;
• A 10% increase in freshman retention, from 75% to 85%;
• A dramatic rise in research expenditures, specifically 80% since FY ’07 to $65 million;
• The construction of 10 new buildings on campus. That boom includes two new academic buildings (the first in 35 years) — the Mark and Elisia Saab Emerging Technologies and Innovation Center and the Health and Social Sciences Building. It also includes two new residential facilities that are now home to a quarter of the 4,000 students living on campus, a 33% increase in three years;
• Purchase of an underutilized hotel in the city’s downtown and converting it into the UMass Lowell Inn & Conference Center, which provides housing for 500 students as well as conference space, lodging, and a restaurant for the public;
• Acquisition of the 6,500-seat Tsongas Arena in 2010 (it’s now known as the Tsongas Center at UMass Lowell); and
• The opening in 2014 of University Crossing, a $95 million student-engagement center created in a former hospital site purchased by the university in 2011.

Degrees of Progress

When asked how all that and more was accomplished, Meehan said it resulted from assembling a great team, putting in place an ambitious strategic plan titled “UMass Lowell 2020,” and achieving critical buy-in on its many initiatives.

This is the same formula he intends to use as president of the system, which, he believes, has already achieved considerable progress in a number of areas, ranging from enrollment to academic qualifications to new building on each of the campuses.

But there is still considerable room for improvement, said Meehan, who was asked to interview during the system’s last presidential search, in 2010, but eventually withdrew, believing the timing wasn’t right and because then-Gov. Deval Patrick had his own preference for a candidate — someone else.

Looking back, he said that decision was a good one, because it gave him additional opportunities to build on his track record of success at UMass Lowell and ultimately learn from the man he would eventually succeed.

Marty Meehan says his primary role as UMass president is to advocate for the system

Moving forward, Marty Meehan says his primary role as UMass president is to advocate for the system and secure funding to ensure that the schools are accessible.

“I got a great opportunity to do two things,” he said. “One was to finish what I set out to accomplish at Lowell, and secondly, I got to work with a second UMass president, Bob Caret. And because of those experiences, I feel that I’m better-prepared to lead the entire system.”

Looking ahead, Meehan, as he mentioned earlier, said one of his primary responsibilities will be as an advocate for the UMass system — in Boston, Washington, and wherever else that broad assignment takes him.

And as advocate, one of his duties is to articulate how the university’s role has changed and broadened — within the Bay State but also nationally and even globally — and what that means in terms of how the system should be viewed and, more importantly, funded.

“Historically — and when I say historically, I mean over the past 30 years — the political leadership in this state has often viewed the University of Massachusetts as a safety net for students who either can’t get into the elite private colleges or can’t afford to go to those schools,” he explained. “The paradigm has changed dramatically; the elite private universities in this state are not training residents of this state, by and large.”

Thus, with this change in role, the university has taken on an even bigger role when it comes to fueling the state’s economy — an assignment that involves everything from sparking startup businesses to educating and training the workers that ventures across all business sectors will need to succeed.

“I think the argument is powerful: if you want a strong economy, you must have a strong university of Massachusetts,” he told BusinessWest.

“The truth is that social mobility and economic development in this state really drives through the university on every level. We’re an innovation economy; we literally educate the workforce in Massachusetts in terms of the engineers we produce, the nurses, the teachers. So Massachusetts is very reliant on a world-class public research university, and we have to keep the quality up,” he continued, adding that 88% of the graduates of the schools in the UMass system stay in the state for at least five years after earning their diplomas, and 66% stay longer.

“In an innovation economy, you need a workforce that’s well-trained and highly educated, and I think this state gets the fact that our graduates are the key to economic development and economic growth. I sure get it.”

Course of Action

Making sure everyone gets it will help the university achieve a better commitment from the state and therefore the more sustainable financial model it needs in the decades to come, said Meehan, adding quickly that the economy, and specifically state revenues, need to improve for this to happen.

The Baker administration inherited a severe budget crisis, he went on, one that has forced painful mid-year cuts, hard decisions, a slowing of the momentum achieved over the past few years when it comes to state funding of public higher education, and, ultimately, the rate increases approved by the trustees at their June meeting.

The scope of those increases isn’t known yet, said Meehan, adding that any increase impacts accessibility and grows already-worrisome student debt.

To attain more attractive funding levels, the economy must improve, but the university as a whole must continue to become more efficient and thus worthy of a larger investment from the state.

“The governor is going to want to hold UMass accountable in terms of performance, graduation rates, student-success rates, fund-raising, and more,” he said. “And I think the university is ready to be held accountable in exchange for a deeper investment by the state government.”

One of the other priorities moving forward, said Meehan, is to draft a new strategic plan for the university, something similar in many ways to “UMass Lowell 2020” but much larger in scope.

It’s been 25 years since a new comprehensive strategic plan has been created for the university, he said, which means the system is overdue for such a document. And like the one at UMass Lowell, this plan will come from the bottom up.

“We had more than 200 faculty, deans, administrators, and students who all came up with a strategic plan,” he explained. “It took us 13 months to create it, and because we included all those constituencies, we had buy-in. And that’s how it’s accomplished in any large, complex organization, and a university is certainly a large, complex organization.

“We need to evaluate what the system has done well over the past 25 years and what it needs to improve,” he continued, referring to the broad scope of such a strategic plan. “And we need to bring in some of the best high-level academics from public research institutions around the country to help us determine whether this can become the best public university in the country.”

As for the immediate future, Meehan said he plans to spend considerable time visiting the various campuses and gaining feedback from a host of constituencies.

These include the chancellors of those institutions, staff, faculty, students, and alumni. But he also intends to gain perspective from a business community that has placed workforce issues at the very top of its list of priorities — and concerns.

“I look at corporations like EMC and Raytheon, and the majority of the people they hire come from UMass,” Meehan explained. “I want to talk with those major CEOs in the state, not only get some advice on UMass, but also to get them to join with us to fight for more state funding and more federal funding. The business community should be UMass’s biggest cheerleader because of the huge contribution we make to making sure these companies get the best, most highly qualified employees they can get; it makes Massachusetts more competitive.”

Checking Some Boxes

Returning to the subject of those hockey teams and the intense rivalry that has developed between them, Meehan related a conversation with UMass Amherst Athletic Director John McCutcheon, who was lamenting how his school has come up on the short end of many recent contests between the schools.

Meehan said he responded first with some sarcasm, then a challenge, wrapped in the form of a leadership philosophy.

“He [McCutcheon] said, ‘you guys at UMass Lowell have been beating us up the past few years,’” Meehan recalled. “I said, ‘the problem is, everyone has been, and you have to work at this — I want attendance up.’

“Sometimes, I get into a lot of various details, but there’s a reason,” he went on, explaining why he was dwelling on hockey. “I think good leaders need to say, ‘we want excellence in everything we do.’”

That has been Meehan’s approach throughout a career that’s taken him to the House of Representatives and then the career in education recommended years ago. And it’s one he believes will ultimately help drive continuous improvement at the state university. n

George O’Brien can be reached at [email protected]

Daily News

SPRINGFIELD — Massachusetts Attorney General Maura Healey filed final regulations on June 19 regarding the new Earned Sick Leave Law that will take effect tomorrow, leaving employers with only eight business days to make payroll and policy changes to stay in compliance of the law.

The final regulations addressed questions about the law’s ambiguities that have been raised throughout the Commonwealth, including several by local employment-law attorney Kimberly Klimczuk, partner at Skoler, Abbott & Presser, P.C. Klimczuk testified before the attorney general during the public hearing in Springfield in May, advocating for employers.

“This public-notice and comment period offered by the attorney general was our opportunity to gain clarity on behalf of employers,” said Klimczuk. “Over the last six months, I have presented to almost a dozen groups of human-resource professionals and clients that had questions not clearly answered within the law or previously issued regulations.”

Klimczuk brought the questions to the attention of the attorney general so that ambiguities could be addressed within the final regulations. The final regulations clarified several issues, such as whether sick leave can be used concurrently with leave taken pursuant to the Family and Medical Leave Act or other leave laws, whether differential pay would be included in sick pay, and whether policies that condition holiday pay on attendance the day before and the day after the holiday would be acceptable under the non-retaliation provisions of the law.

“I was impressed with how responsive the attorney general and her staff were to employer concerns,” she said. “Many of the issues I raised at the public hearing were explicitly addressed in the final regulations, such as the provision about holiday policies, which was a huge relief to many of my clients. While not everything was resolved in exactly the way we had hoped, in many areas, we at least have the information we need to provide a definitive answer to our clients’ questions.”

Still, given the short period of time between the issuance of the final regulations and the effective date of the law, many employers are scrambling to make the policy changes necessary to come into compliance by the July 1 effective date. To assist employers in this endeavor, Skoler, Abbott & Presser, P.C. attorneys Susan Fentin and David McBride are presenting a seminar this morning on the new Earned Sick Leave Law and the final regulations at the Sheraton Springfield. The firm is also planning a seminar in Worcester, date and time to be announced.

40 Under 40 The Class of 2015
The Class of 2015 Has Its Day in the Sun

40 Under Forty 2015DSC_0499The ninth annual 40 Under Forty class of 2015 celebrated their big night on June 18 with style, class, and Flair — as in wrestling legend Ric Flair, a guest of presenting sponsor Paragus Strategic IT, who delivered brief, heartfelt words to this year’s assembly of high achievers, and a standing-room-only crowd of supporters, at the Log Cabin in Holyoke. Paragus was in the spotlight in another way, as CEO Delcie Bean (40 Under Forty class of 2008) won BusinessWest’s inaugural Continued Excellence Award (see photo at right), sponsored by Northwestern Mutual and presented by Kate Kane, managing director of its Springfield office, and BusinessWest Editor George O’Brien. But the night belonged to members of the class of 2015, who proved, yet again, that this region has no shortage of young professionals who are making an impact in business and in the community. Below, we present some scenes from a memorable, exuberant evening.
Photos by Denise Smith Photography [email protected]





Presenting Sponsors:

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Sponsors:

Fathers&Sonns200x130pxIsenberg200x130pxHNElogo200x130pxMoriartyPrimack200x130pxUnitedBank200x130px

















Partner:

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Elizabeth Barajas-Roman, CEO, Women’s Fund of Massachusetts; Terra Missildine; owner and operations manager, Beloved Earth Co.; and Erin Buzuvis

From left: class of 2015 honorees Elizabeth Barajas-Roman, CEO, Women’s Fund of Massachusetts; Terra Missildine; owner and operations manager, Beloved Earth Co.; and Erin Buzuvis, professor of Law and director of the Center for Gender & Sexuality Studies, Western New England University School of Law.


Jennifer Levesque, operations manager, R. Levesque Associates; with her husband, Robert Levesque

From left: Jennifer Levesque, operations manager, R. Levesque Associates; with her husband, Robert Levesque (class of 2015), president, R. Levesque Associates; and Christopher Novelli (class of 2015), architect, Studio One Inc.


From left: class of 2015 honorees Dr. Anthony Sarage, pediatric surgeon

From left: class of 2015 honorees Dr. Anthony Sarage, pediatric surgeon, Western Massachusetts Podiatric Associates; Jim Angelos, owner and executive director, InspireWorks Enrichment Inc.; Gregg Desmarais, vice president and store manager, TD Bank; Kate Lockhart, development director, Big Brothers Big Sisters of Hampden County; A.J. Crane, co-owner and partner, A. Crane Construction; Terra Missildine; owner and operations manager, Beloved Earth Co.; Jennifer Gallant, chief financial officer, Polish National Credit Union; and Patrick Davis, operations manager, CRD Metalworks, LLC.


Joel Mollison (class of 2015), president, Northeast IT Systems

Joel Mollison (class of 2015), president, Northeast IT Systems; with his fiancée, Christine Gryknkiewicz, respiratory therapist, Cooley Dickinson Hospital.


: Marcelia Muehlke (class of 2015), owner, Celia Grace Wedding Dresses

From left: Marcelia Muehlke (class of 2015), owner, Celia Grace Wedding Dresses; and Sarah Shube, owner, Creative Art Therapies.

Isenberg School of Management at UMass Amherst, a 40 Under Forty sponsor

From the Isenberg School of Management at UMass Amherst, a 40 Under Forty sponsor, from left: Jennifer Meunier, director of Business Development; Trista Hevey, director of Alumni Corporate Relations; and Kyle Bate, academic advisor.

Sarah Williams (class of 2015), vice president of Global Risk Management, MassMutual Financial Group; with her husband, Richard Williams

Sarah Williams (class of 2015), vice president of Global Risk Management, MassMutual Financial Group; with her husband, Richard Williams, investigator, Investigators LLC.


Tim Steffen, director of recruitment; Nico Sananiello, financial advisor; Kate Kane

From Northwestern Mutual, presenting sponsor of 40 Under Forty, from left: Tim Steffen, director of recruitment; Nico Sananiello, financial advisor; Kate Kane, managing director; Rob Walker, financial representative; and Taylor Hassa, financial representative.

From Paragus Strategic IT,

From Paragus Strategic IT, presenting sponsor of 40 Under Forty, from left: Lisa Lococo, office manager; Delcie Bean IV, CEO; Dave DeRicco, account representative; Anthony Schiappa, account representative; Tyler Lucas, COO; Sarah Powers, financial administration; and Margie LaMotte, executive assistant to the CEO.

From Fathers and Sons

From Fathers and Sons, a 40 Under Forty sponsor, from left: Bill Visneau, sales associate; Marissa Monti, business manager; Shera Rosarario, sales associate; Steven Langieri, sales manager; and Jon Schulz, sales associate.


From Moriarty & Primack, P.C.

From Moriarty & Primack, P.C., a 40 Under Forty sponsor, from left: Tax Director Bob Supernaut; Tax Associate Shelley Sheridan; Audit Associate Jessica Peet; Tax Associates Laurie Bonan and Chris Walker; Manager Rebecca Connelly, Tax Manager Tim Prozost; and Partner Doug Theobold.

Kate Campiti, associate publisher, BusinessWest, welcomes the more than 650 attendees of the ninth annual 40 Under Forty gala.

Kate Campiti, associate publisher, BusinessWest, welcomes the more than 650 attendees of the ninth annual 40 Under Forty gala.

Joseph Bednar, senior writer, BusinessWest; and Denise Hurst

Joseph Bednar, senior writer, BusinessWest; and Denise Hurst (class of 2014), quality improvement manager and human rights coordinator, Department of Mental Health, and vice chair, Springfield School Committee, get ready to welcome this year’s 40 Under Forty honorees to the stage.

Health New England, a 40 Under Forty sponsor, from left: Steven Webster, director of marketing and digital strategy; Jessica Dupont

From Health New England, a 40 Under Forty sponsor, from left: Steven Webster, director of marketing and digital strategy; Jessica Dupont, risk adjustment manager; Robert Ravenscroft, clinical healthcare analyst; Nicole Santaniello, content management specialist; Sandi Bascove, marketing operations manager; Elaine Mann, marketing content strategy manager; Yvonne Diaz, account executive, existing business; and Patrick McColley, UX/CX architect manager.


George O’Brien, editor, BusinessWest, shares a laugh with wrestling legend

George O’Brien, editor, BusinessWest, shares a laugh with wrestling legend ‘Nature Boy’ Ric Flair, a special guest of 40 Under Forty presenting sponsor Paragus Strategic IT.


George O’Brien and Ric Flair shared the privilege of presenting awards to the class of 2015, including, clockwise from top right, Eric DevineDSC_0545
Danielle Williams, attorney, Fierst, Kane & Bloomberg LLP.

George O’Brien and Ric Flair shared the privilege of presenting awards to the class of 2015, including, from top to bottom, Eric Devine, Information Technology Services officer, Country Bank for Savings; Jessica Fraga, continuous improvement consultant, MassMutual Financial Group; and Danielle Williams, attorney, Fierst, Kane & Bloomberg LLP.























































Photo gallery from the June 18, 2015 BusinessWest 40 Under Forty Class of 2015 Gala




For reprints contact: Denise Smith Photography / www.denisesmithphotography.com / [email protected]

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Opinion
Washington Betrays Americans — Again

Much is being said and written in the wake of the recent Senate vote to extend to President Obama complete authority to negotiate trade agreements in a sweeping Pacific Rim trade deal known as TPA (Trade Promotion Authority).

The vote is being called a triumph for big business, especially the giant multi-nationals likely to benefit from softened trade restrictions. But we see this backroom deal (yes, Americans were kept in the dark regarding the details, and that’s a big problem for a democracy) as a major defeat for American workers and democracy itself. The bill, from the scant details available, will most likely result in lower wages and more job outsourcing. At least, that is what big labor, which our readers know we are no fan of, is saying.

The secret deal is seen by many as a key victory for a lame-duck president sorely in need of a legacy-boosting piece of legislation. But we don’t see much legacy in this piece of twisted legislation. Others say it is a victory for Republicans and giant corporations who will get preferential tax treatment and more HB1 visas to bring in more foreign workers to replace American ones.

Politicians in Washington, both Democrat and Republican, who continue to benefit themselves in their Washington enclave of privilege and entitlement, see the bill’s advancement as a rare example of how a historically divided government can actually slice through crippling gridlock and get something accomplished. We disagree. And those brave politicians who fought this secretive measure tooth and nail and came very close to handing the president what would have been a very embarrassing setback need to take a bow.

While the legislation may in fact be beneficial to big business, we believe the Senate vote is something else, something more significant and, quite frankly, sinister. Indeed, it’s an example of how our government is still very much broken, with our elected leaders acting in a disturbingly non-transparent manner to advance their own agendas, not effectively representing the people who elected them.

For what it’s worth, TPA, hailed as the most significant trade measure of the 21st century, could very well turn out to be a meaningful — and beneficial — piece of legislation, one that will enable this country to better compete in what is now truly a global economy.

What’s more, the measure will enable the U.S. and the other nations involved a chance to write the rules for this more-global economy — and not China, which is not part of the deal.

But in this case, that end — if it does become reality, and it certainly appears it will — doesn’t justify the means. It doesn’t justify the 60 votes to essentially give the president a blank check to negotiate the rest of the trade package with no chance of amendments from Congress. The same president whose name has become affixed to a disastrous piece of healthcare reform legislation. The same president whose record of foreign policy has been a travesty and resulted in a world on fire. The same president who has essentially shown that he is anything but worthy of such trust.

The fact is, no one really looks good with this bill’s passage. Not the Republicans. They’re not acting out of any desire to break gridlock or work with the president. They’re looking to protect and advance the interests of big business, which is an important constituency, but not the one senators are elected to represent.

And not the Democrats, many of whom, while claiming to be looking out for the interests of the little people, are instead pandering to the labor unions and environmental groups that have long been their cornerstone supporters.

As we said at the top, this vote can be considered many things depending on one’s point of view. From our standpoint, it clearly shows that Washington continues to betray Americans, not serve them. And unless we express our dissatisfaction with such betrayals at the voting booth, the same results will continue to occur.

Employment Sections
Supreme Court to Weigh Claims of ‘Class-action Abuse’

By PETER VICKERY

Peter Vickery

Peter Vickery

The U.S. Supreme Court has agreed to take a case concerning the scope of two kinds of mass employee lawsuits against employers — class actions and a similar procedure created by the federal Fair Labor Standards Act (FLSA) called collective actions. If the justices tighten the standards for certifying class actions and collective actions, it would come as a relief to companies with large numbers of workers — and a major setback for the law firms that target them.

So the plaintiffs’ bar and employers alike are watching and waiting for the outcome in Tyson Foods Inc. v. Bouaphaeko, one among a host of overtime cases that two class-action law firms, Smith & McElwain and Kenney McCafferty, have brought against the food company.

Mass lawsuits are costly to defend, which means employers often settle them prior to trial rather than take the risk of going to a jury. When the other side is receiving help from state and federal agencies, the incentive to settle is even greater. But before one of these lawsuits can move forward, a judge has to certify it as a class/collective action.

Certifying an action has a dramatic impact on the lawsuit’s value and, consequently, on a company’s competitiveness and productivity. So the standard for determining whether to grant or deny certification is something that matters a great deal to companies that might find themselves in the crosshairs of mass employee lawsuits.

At issue in the Tyson cases is the amount of compensation that the company should pay its employees for the time they spend donning and doffing protective gear and walking between the locker room and the production line. Tyson pays its clerical workers ‘punch to punch,’ i.e. from the time they punch the clock in to the time they punch out. But it pays production-line workers according to ‘gang time,’ i.e. the time they are actually at their work stations while the line is moving. It does not keep track of how much time each employee spends donning, doffing, and walking, but generally pays an additional four to seven minutes per shift to cover these activities. In the last few years, it has been paying more.

Tyson started paying donning-and-doffing time after a Supreme Court case involving its corporate predecessor, IBP, made clear that this was legally necessary.

Tyson compensates its workers for donning and-doffing at the regular rate of pay. But according to the plaintiffs, under FLSA and state wage-and-hour laws, the company should be paying them overtime (time and a half). In some cases, the plaintiffs enjoy the support of the U.S. Department of Labor, which files amicus briefs to bolster the employees’ argument in favor of overtime. Given the large numbers of current and former employees, the difference is enormous. So far, the donning-and-doffing lawsuits have cost the company millions of dollars in jury awards and settlements.

Sometimes Tyson wins, and sometimes it loses. For example, in two separate cases, Acosta and Gomez, juries awarded combined damages of $24 million. In contrast, in another pair of cases, Guyton and Lopez, which concerned the very same issues — whether donning, doffing, and walking required overtime — juries found in favor of Tyson, and sent away the plaintiffs and their lawyers empty-handed.

With such unpredictable jury results, it is no surprise that Tyson sometimes opts to settle, as it did in a Tennessee case for $7.75 million and another in Georgia for $32 million. But in Bouaphakeo, the jury’s reliance on a controversial formula has prompted Tyson to go all the way to the Supreme Court.

The plaintiffs in Bouaphakeo are hourly workers at Tyson’s Storm Lake, Iowa pork-processing facility, which employs approximately 1,600 people. The class-action lawyers wanted to include all hourly workers at the facility in the class, but the court limited membership to workers in the kill, cut, and re-trim departments. Employees in these three departments have to wear various kinds of protective gear depending on the nature of their work, e.g. hard hats, steel-toed boots, hair/beard nets, ear protectors, gloves, aprons, belly guards, and scabbards. Those who use knives have to dip them in sanitizer at the start and end of each shift. How long an individual takes to don and doff (and dip) depends on the gear.

In the Gomez case, the plaintiff’s expert witness, Kenneth Mericle, a labor economist and professor emeritus at the University of Wisconsin, Madison, School for Workers, testified that, by his calculations, based on analysis of video footage, the workers spent 25 to 29 minutes donning and doffing. Even though Tyson presented no expert testimony of its own to counter Mericle, after listening to his answers on cross-examination, the jury found that the donning-doffing time was closer to six minutes.

This is a significant divergence in view of the number of workers involved and the amount of money at stake. Nevertheless, in Bouaphakeo, the plaintiff’s expert witness used Mericle’s time-studies as the basis for calculating damages. Again, the jury found that the donning-doffing time was just a fraction of what Mericle’s statistics claimed, awarding damages of less than half the amount the plaintiffs claimed they were entitled to receive.

When the Court of Appeals denied Tyson’s request for rehearing, Justice Beam dissented, noting that “giving the best gloss available to the plaintiffs under the evidence they themselves adduced, well more than one-half of the certified class of 3,344 persons have no damages whatever, and the balance have markedly lower individual damages that are now virtually impossible to accurately calculate.” And this constitutes the nub of Tyson’s argument to the Supreme Court: for class/collective actions, there needs to be a way to determine individual damages so as to avoid the practice of ‘trial by formula,’ which the Supreme Court disapproved of in the 2011 case of Wal-Mart Stores Inc. v. Duke.

Tyson argues that the use of Mericle’s statistics amounted to trial by formula. Because of the range of differences between class members, plus the fact that some class members sustained no damages at all, the district court should not have granted class/collective action certification in the first place, said Tyson. The question, as the company presents it, is whether a trial court should be allowed to certify a class/collective action (1) if the court determines liability and damages with statistical techniques that presume all class members are identical to the average observed in a sample, ignoring the differences among individual class members, and (2) when the class contains hundreds of members who were not injured and have no legal right to any damages.

Tyson and allies such as the U.S. Chamber of Commerce would like the Supreme Court to answer ‘no,’ so as to make it harder for cases to qualify as class/collective actions. They characterize the slew of actions against Tyson as class-action abuse, and probably interpret the fact that the court has taken the case as an encouraging sign. Arguments are scheduled for the fall term.


Peter Vickery is an employment-law attorney in Amherst; (413) 549-9933.

Community Spotlight Features
In Westfield, Redevelopment Plan Becoming Reality

Mayor Daniel Knapik says Westfield is rife with activity that is leading to dramatic changes in the landscape, as projects that were years in the making come to fruition.

New buildings are under construction, while older ones that sat empty for as long as a decade are being transformed and repurposed. Phase I of the Columbia Greenway Rail Trail is underway, work is being done in the so-called Gaslight District, and other initiatives are becoming a reality.

“Fourteen years ago, Mayor [Richard] Sullivan showed me his plan for the city, and I saw what the future could be,” said Knapik, adding that this action plan and its prospects for becoming reality led him to seek election to the City Council, where he held a seat from 2001 to 2009 before being elected to the corner office. “It’s astonishing what has happened since then. I supported the mayor’s vision that he created with City Engineer Mark Cressotti, and all of the projects have finally come over the finish line.”

Much of the work has taken place in the last year or two, and projects are in varying stages of development. Change is occurring downtown as well as on Route 20, where a new 99 Restaurant will be built on property that has stood vacant since a Pontiac/Oldsmobile dealership closed down more than 15 years ago.

“We have been talking with officials from 99 for six years to help them find the right spot; they were very selective and looked at other parcels, but finally settled on this one,” Knapik said, adding that ground was broken two weeks ago for the eatery, which is expected to open before Thanksgiving.

In addition, the end units of the former Kmart plaza will finally have tenants. Habitat for Humanity’s ReStore opened in late April in the former Grossman’s Bargain Outlet building on East Main Street, and the space at the other end will soon be occupied by a business that will provide medical-related services. “The site they will move into had been vacant for six years,” Knapik noted.

Daniel Knapik, pictured with Kate Phelon

Daniel Knapik, pictured with Kate Phelon, says the Great River Bridge project, finally completed in 2012 after 30 years in the planning stage, benefits residents and businesses alike.

Another parcel, located at the gateway to Westfield on Route 20, is also flourishing. Nabil Hannoush, serial entrepreneur and vice president of the Hannoush Jewelers chain, purchased the former Balise Ford dealership on 99 Springfield St. and turned the 11-acre property into a center that houses Expert Fitness and other health-related businesses, along with the new Short Stop Bar and Grill and Batter’s Box. He and his wife want to build three additional standalone structures on the side of the building that would likely house a bank as well as retail and commercial office space.

“We are working with them and the Mass. Department of Transportation to enhance the traffic entrance,” said Knapik. “The hope is that the city can secure a grant to widen the road and add a traffic light and dedicated turn lane; we would like to begin work next fall.”

In addition, funding for the entire rail trail has been secured (more about that later), and nearby parks and other venues are planned or under construction.

Progress has also been made on a medical office built on 57 Union St. by Noble Hospital during the recession. Although New England Dermatology rented 20% of the space after it was completed, finding occupants for the remainder became problematic due to the economy. “But that changed in the past year. Noble brought in physicians who have offices there, and it has been nicely filled,” Knapik said.

Overall, the completed and in-progress projects have created a great deal of momentum in the city, said Kate Phelon, executive director of the Greater Westfield Chamber of Commerce, adding that the positive vibes will undoubtedly spur additional growth.

“Since I’ve been in my position, it is very exciting to see these various projects completed, new businesses opening or expanding, and continued growth in our city,” she said. “This has a direct impact on jobs and population growth.”

Complex Components

The vision Knapik embraced and has worked toward with Cressotti’s help included a number of components: the Great River Bridge project, which was on the drawing board when the mayor took office; the rail trail; badly needed infrastructure improvements on Main and Broad streets; and development of the Gaslight District and an area of underutilized property on Elm Street that fronts it.

The $100 million Great River Bridge project was completed in 2012 after 30 years in the planning stage. The original bridge that crosses the Westfield River was rehabilitated, and a twin span was built directly opposite it. The construction required relocating three parks as well as overcoming other obstacles, but today the old bridge serves southbound traffic while the new one accommodates northbound vehicles.

Major improvements have also taken place at Westfield Barnes Regional Airport, including a $13.5 million runway reconstruction and two new hangars to be built in the future. In addition, a $2 million redesign and reconstruction of Airport Industrial Road is complete, providing better access to companies operating just outside Barnes as well as those who want to locate in the city’s new, 80-acre Air Industrial Park.

Knapik said there has been a tremendous amount of interest in industrial parcels on the north side of the city over the past six to eight months.

“It’s a sign that the economy is turning around, and we are anticipating an announcement of a big warehouse and distribution facility this month on more than 500,000 square feet of vacant land by the airport,” said the mayor. “Plus, a manufacturer is looking at a smaller parcel owned by the city. If we capture both of these, it will lead to about 400 new jobs.”

City officials also secured the $18.5 million needed to complete the rail trail. They are working on Phase I, which covers two miles from the Southwick line to the Stop & Shop in the city’s downtown. During Phase II next summer, the old railroad bridge that crosses the Westfield River will receive new decking and a new surface; work on the last leg of the project will take place in 2017 when the middle section will be completed. It’s no easy feat because the elevated, 3.5-mile trail crosses nine bridges.

“But the economic impact will be significant,” said Phelon, noting that it will connect with a larger rail trail that covers 65 miles. “We expect tens of thousands of travelers to use it, including cyclists on multi-day trips and organizations that plan bicycling vacations. Retail stores and eateries will benefit, and the area will become a perfect spot for bed-and-breakfast operations.” She added that the chamber and Friends of the Columbia Green Railway hope to partner with local businesses to help them become more bicycle-friendly and draw rail-trail users into their stores.

Travelers and locals will also be able to enjoy amenities on the Westfield River Esplanade, which runs along the levee between the Columbia Greenway Rail Trail and Great River Bridge.

“We plan to construct overlooks with natural-gas fireplaces on it and bocce courts where families can gather; we broke ground six weeks ago and expect to be done by midsummer. The most livable cities encourage people to get out of their automobiles,” said the mayor, who was recently feted with the 2015 Bicycle Advocate of the Year Award by the Alliance for Biking and Walking.

Another major capital project is underway in the Gaslight District. The streetscapes are being rebuilt, and utilities are being modernized and moved underground.

“The design was completed last year,” Knapik said, adding that the $6.5 million cost is being paid for with local money. “The city engineer wants to make this a neighborhood of distinction, and the six streets in the district will be outfitted with gaslights to create an old-fashioned, colonial-style feeling. It’s appropriate because the gas and electric companies got their start there in the 1870s.”

There will also be a new park in the district that will feature a fountain from the Thayer House that was demolished decades ago. “It was saved and unearthed by the Parks Department and hasn’t been used for about 80 years,” Knapik said.

Once improvements are complete in the Gaslight District, the city will finally be able to redevelop Elm Street. “The infrastructure was 100 years old and failing, so we couldn’t put anything there, but three buildings have been knocked down, and two more will be demolished,” Knapik said. “We have remediated the brownfield sites, and when the project is finished in the fall of 2016, the city will have four acres of unpolluted land ready for redevelopment.”

Efforts to modernize Westfield include green initiatives that were finished last year. “Sustainability is important, and adopting single-stream recycling has reduced the amount of tonnage that leaves the city by 30%. We also spent $30 million to make city buildings energy-efficient, which included new rooftops, boilers, and windows,” Knapik said, noting that the heating systems in 14 structures were converted from steam to hot water, which lowered the consumption of gas.

Another green project proposed six years ago came to fruition in January when a ribbon-cutting ceremony was held for a 2-megawatt solar farm on the former Twiss Street landfill, which closed about 20 years ago and was a topic of discussion for many years.

“Citizens Energy is leasing the property from the city and will care for the 10 acres in lieu of a tax payment,” the mayor explained, adding it guaranteed the city’s price for electricity for the next 20 years, and cost savings of about $100,000 a year are expected.

Lengthy Process

When Knapik first learned about Sullivan’s vision for the city, he had no idea how long it would take to accomplish. The work on Main and Broad streets has been completed thanks to stimulus funds, which reaped the city $14 million for shovel-ready projects.

“We’ve spent $130 million on utilities, bridges, roads, and street lamps in the last decade, and all of the projects we envisioned have come to a collision point,” Knapik said. “We have had a lot of support from the governor, and good things have come to Westfield.”

Phelon agreed. “With all that has happened and will continue to happen in our great city,” she said, “the chamber is even more excited about connecting its business members and leaders to further promote economic development and entrepreneurism, and to keep the momentum moving forward that makes Westfield a great place to work, live, and play.”

Westfield at a glance

Year Incorporated: 1669
(town); 1920 (city)
Population: 41,094 (2010)

Area: 47.3 square miles

County: Hampden

Residential Tax Rate: $18.54

Commercial Tax Rate: $34.69
Median Household Income: $55,327 (2010)

Family Household Income: $57,018 (2010)

Type of government: Mayor, City Council
Largest Employers: Noble Hospital; Westfield State University; Airtherm; Berkshire Industries Inc.
* Latest information available

Opinion
Don’t Underestimate Driving Spirit

By JERRY CIANCIOLO

You may have heard that Millennials aren’t starting businesses at the rate of previous generations.

According to the Kauffman Foundation, a nonprofit devoted to studying entrepreneurship, startup rates among Americans age 20 to 34 peaked at 35% in 1996 and has since declined to 23%.

Why?

Forget the pundits and their talk of the Great Recession’s effect, monopolistic corporations, student debt, and slowing population growth. It’s much simpler than that.

Raised by helicopter parents, Millennials just can’t shake the habit of listening to advice. And as an entrepreneur myself, I know how critical it is to ignore so-called experts.

Within two weeks of hanging our shingle, my partner and I submitted to a class project for a local college. A business professor and eight students visited to grill us for 90 minutes. A month later, the retinue returned.

“Let me be candid,” said the professor. “Your business has little chance of succeeding.” Kathy and I flinched.

“We’ve run the numbers, researched the market, factored in your resources and level of experience, and, well . . . ” He looked down and shook his head, delivering the coup de grace non-verbally.

His advice, in so many words? “Update your résumés — today, if possible.”

Almost three decades later, I look back on that afternoon and marvel that my now-wife and I succeeded. The odds were certainly stacked against us.

On our side of the ledger were resolve, resiliency, and a longing for independence. On reality’s side were revenue projections, capital outlays, return on investment, and market share. We were anorexics on the mat with a Japanese sumo.

Yet our business thrives to this day. By any measure, we won the match. But how? If the professor and his students returned and asked how we proved them wrong, what would we say? Simply this — the weaknesses you identified proved to be our camouflaged strengths. For example:

• We were blind to the odds. I remember leasing a postage meter in our first month. The company rep recommended a three-year contract. I suggested five, hoping to shave the fee. She demurred: “businesses like yours, well, let’s stay with three.”
• We didn’t know much about business. I didn’t have financial expertise, nor did Kathy. You wouldn’t find even one economics course on our transcripts. But we possessed what Mark Twain described as the two things you need in life to succeed: ignorance and confidence. The former we had in spades. As for our lack of business savvy, we wore it like a chip on our shoulders.
• We had little patience with systems. At a meeting with a volunteer from SCORE — a group providing free business counseling — I did my best to suppress a yawn as the retired exec plotted a series of steps we needed to take before opening the doors. He also wanted to know whether we had a mission statement. I kept tapping my foot; Kathy withheld her sighs. Paperwork was make-believe to us. It wasn’t going to determine whether we succeeded. Our wits would have to do that.
• We weren’t strategic. Our business goal was basic — survival. Improvise or die was our clarion call. We couldn’t afford to procrastinate, so we ran with whatever seemed sensible at the moment. No one at Wharton would call our carpe diem approach strategic.
• We didn’t delegate. In the early days, there was no alternative. If the computer froze, one of us dug out the manual to thaw it. If a mailing had to go out, we were the clerical staff. But even as profits grew, and hiring was an option, we continued our labor-intensive ways. Granted, we didn’t always put our skills to the best use, but running lean kept margins high and overhead low.

Of course, my wife and I have grown wiser over the years. We wouldn’t advise would-be entrepreneurs to follow our model. But, then, we wouldn’t advise them to follow any model except one that feels right.

That’s why we politely listened to the professor and then went about our business. We encourage Millennials to do the same.

The professor understood business. But entrepreneurs and their driving spirit? Not so much.


Jerry Cianciolo is chief editor at Emerson & Church, Publishers, the company he and his wife, Kathleen Brennan, founded in 1986.

Employment Sections
Carpet-cleaning Venture Advances HRU’s Mission

Zerorez’s Luis Cerrano (center) demonstrates the company’s equipment

Zerorez’s Luis Cerrano (center) demonstrates the company’s equipment for Sue Mastroianni, board member of the Gray House in Springfield, and HRU president Don Kozera.

When Human Resources Unlimited (HRU) decided that its core mission — training and placing people with disabilities in meaningful jobs — would benefit from partnering with a national franchise, carpet cleaning didn’t seem like the most exciting option.

“We looked around the country and found there were few not-for-profits owning franchises, and then we set up specific criteria around what we hope to achieve, how much revenue we need, how much risk we’re willing to accept, and what the tradeoff is between profits and mission,” said Don Kozera, HRU’s long-time president.

The agency wound up looking at 600 chains, then took a harder look at 60 of them, before narrowing its search to three that fit the organization’s criteria. One of those was Zerorez, a carpet-surface cleaning company based in Salt Lake City with a national presence — except in New England.

“What attracted us was its patented ‘green’ approach to cleaning,” he said of Zerorez’s innovative use of what it calls “empowered water” (more on that later). “And if you can innovate in carpet cleaning, you can probably innovate the world. It’s also a technology-based company. With this phone in my hand, I know where all the vehicles are, if their machines are on, how much we booked today, where those leads came from … I know exactly what’s going on.”

But there was some hesitancy based on the perceived lack of a ‘wow’ factor. “People said, ‘really? Carpet cleaning? Don’t we want to do something more exciting?’ But the more we investigated it, the more we talked to franchises across the country and sat down with the owners and looked at their technology, looked at the environmentally friendly detergents being used, that there was a social cause, it made sense.”

So HRU opened its first Zerorez franchise in Holyoke in March, with more likely to follow. “We have a bigger strategy,” Kozera said. “We have the rights to the Hartford and Boston markets. We didn’t do this to own one franchise; we did it as a strategy of revenue generation and job development. It’s solely owned by HRU, but it might not be solely owned in the future; it depends on how much capital we need for expansion plans.”

None of this, of course, answers the question of why Human Resources Unlimited, which trains and places clients in some 120 area businesses and has started and closed myriad businesses of its own to achieve the same goals, embraced the franchise model. Simply put, Kozera said, it’s because HRU eventually wants to do some franchising of its own.

Active Intent

It starts with a program HRU created called Move to Work.

“It’s a platform designed to help people who have been out of the workforce — chronically unemployed people, not just people with disabilities. It’s a unique approach that uses physical health, emotional health, and financial health to create a healthy, productive worker.”

The concept is explained by the program’s original title, the admittedly clunkier Changing Habits and Transforming Lives. It takes principles not typically applied to job training, including exercise and physical fitness, and meshes them with conventional job training and the ‘soft skills’ — communication skills, personal work habits, etc. — so in demand by companies.

“With most people who are chronically unemployed, the data will show they’re physically not healthy, emotionally not healthy,” Kozera said. “Of course, being unemployed for a long time can lead to bad habits and losing self-esteem.”

Move to Work, he went on, “was originally to better our services. If people exercise for 20 to 40 minutes at 60% to 80% of their maximum heart rate, their ability to learn and retain information is greatly increased for up to four hours. That’s a scientific fact. So every one of our sessions starts with that.

“But, really, the foundation is our soft-skills training program,” Kozera explained. “Employers in this area are saying, ‘we cannot find qualified workers — at any level.’ The Federal Reserve did a report on Springfield five years ago that really outlined those issues. Companies said, ‘what do we need? People who come to work on time, with a good social skill set. We’ll train them on what we do technically. But we need those types of people.’”

So Move to Work was developed as an eight- or 16-week course to build those skills while incorporating the benefits of exercise for greater mental focus. Recently, HRU applied the program at Tech Foundry, a nonprofit that trains high-school students for information-technology jobs.

Having demonstrated its value, Human Resources Unlimited would like to turn Move to Work into a national model. And that’s something the agency has never before attempted.

“Our goal is to bring this new model into the marketplace as both an innovative program and something that can earn money,” Kozera told BusinessWest. “But it’s not easy to do. How can we raise enough revenue to support the expansion of that model?”

The answer was another question. “It’s taking a self-replicating model to the marketplace, and who does that? Franchises. They take a brand and replicate the brand. Through this confluence of activities, we said, ‘well, if we’re going to learn more about the replication and expansion of a brand into a national model, where else to learn from than franchises?’ So we started looking around, saying, ‘maybe we can start a franchise and look at owning franchises as a way to support ourselves and learn how to be a franchisor of Move to Work.’”

Workplace Legacy

A company like Zerorez is certainly new terrain for HRU. But doing things a little differently has long been the agency’s bread and butter.

Realizing that many employers didn’t believe people with developmental disabilities could work in complicated job environments, Human Resources Unlimited — then knwn as the Carval Workshop — was created in 1970 to be the vocational training center for Belchertown State School residents and provide employment opportunities for residents of the facility.

Zerorez

Zerorez recently donated its services to clean high-traffic areas of the Gray House to demonstrate its work and help another mission-driven organization.

It has expanded and evolved over the years, now offering a broad range of services, from assistance for individuals moving from public assistance to the workplace to a ‘day habilitation’ program called Pyramid for people with developmental disabilities; from commercial endeavors, of which Zerorez is the latest, to a series of so-called ‘clubhouses’ that provide members with a supportive environment where they can get specialized assistance with vocational skills and transition into good jobs at area companies, as well as increasing their participation in the community.

Kozera, who joined the organization in 1980 as fiscal director before moving into the president’s chair, said Zerorez is a good match for HRU because of it’s mission-driven approach to cleaning.

“Zerorez uses technology that was borrowed from the oil-cleanup industry,” he explained. What the national company calls ‘empowered water’ is actually electrolyzed and oxidized to create an environmentally friendly cleaning solution.

Traditional steam cleaning, the company notes, uses heated water mixed with soaps, detergents, and toxic chemicals that are injected into the carpet under pressure, which soak the carpets, pads and backing. Even though some of the soap, dirt, and water are removed, a considerable portion of this mixture remains embedded in the carpet. As the carpet dries, the detergent attaches to the carpet fibers and acts as a magnet for dirt and other substances. Empowered water, on the other hand, is applied to carpet fibers by a patented high-pressure spray system that loosens embedded dirt and removes it.

Zerorez cleans rugs, tiles, wood floors, furniture, counters … basically anything that people walk on, sit on, or work on, Kozera said. The primary market is residential, although it has commercial clients as well.

“We haven’t burst on the market,” he added, noting that the Holyoke franchise, which boasts three trucks and four employees to start, had 37 clients in May and is on track for 50 in June. But in the long run, Zerorez’s established structure and recognized name will help the local office succeed and, importantly, grow its roster of employees and fleet of trucks.

“What has a higher rate of success in business, Joe’s Burger Shop or McDonald’s? With a franchise, there’s a system, a proven model, there’s support. Other franchisees are amazing about sharing everything they know. They help each other. I don’t know how many networks are like that. They tell us what’s successful, what’s not successful. It’s a nice family created by the franchisors.”

Kozera said franchisors wanted HRU to commit to more than one market, adding that, overall, franchised businesses are more often sold to corporations than individuals these days. “You can’t buy just one; you have to buy three, so you have to have $2 million just to enter the market.”

At the same time, national networks have become more willing to sell franchises to nonprofits, while nonprofit boards, which tend to be conservative in their risk taking, like the security of partnering with a known commodity.

Furthermore, “Zerorez has a 90% retention rate in an industry that probably has a 10% retention rate,” Kozera said. “The other appealing part of this is that every customer has to rate us … and if they don’t rate us at least 9 out of 10, we fail.” The idea, he added, is to leverage great customer service into customers for life, one floor at a time.

Destination Unknown

Kozera knows that nothing is a given in any industry. “Any time you open a business,” he said, “the reality is, you don’t know what’s going to happen.”

But if it succeeds, the Holyoke Zerorez office — the first of what might be several across the region — will benefit HRU in three ways, by generating revenue, providing an education in franchising the agency can apply to Move to Work, and, of course, providing jobs for clients.

“It has a call center, and we place a lot of people in call centers at multiple locations; that’s a skill base many of our members have, and they’ve been very successful at that job,” he said, adding quickly, “we’re not creating jobs that don’t exist. We have one technician for one van; we’re not going to put two people there just to create a job.”

As for Human Resources Unlimited in general — which recently moved to a larger headquarters in Springfield — a (slowly) strengthening economy is ramping up demand for qualified workers at all kinds of companies, which can only benefit clients.

“We want to use these franchise concepts throughout the whole business, not just Zerorez,” Kozera said, referring mainly to the key factors of consistency and trust that drive consumers to known brands.

“We want to apply that to everything we do. We don’t have a whole lot of experience in business to business. But the sales process and the marketing process are things that will help us organizationally because human services — in particular placement organizations — don’t invest a lot in marketing and sales. We invest a lot in human capital; we just don’t measure it well.”

HRU’s first franchise business could help change that, while creating cross-learning opportunities across the organization that, hopefully, help more individuals find work.

And that, more than anything, is what makes carpet cleaning exciting.

Joseph Bednar can be reached at [email protected]