I Am So Polite About Money

One of the things upper class people do not talk about is money. Most have never worked two jobs, struggled to pay a morgage, or had to send money to a relative to get out of jail. Money is beneath them! It's just downright tacky to show concern about money! (It makes we queasy just thinking abouty it.)

Not exactly! Part of the life long negotiation that governs their lives is not to show vulnerability including with respect to how much they are paid. In fact they do care. This is not to say that the money per se is the issue. Instead the money symbolizes whether they are valued by someone else as much as they value their selves.  And since everyone is above average (apparently this is a universal thing) each person deserves more than the average. (I am pretty sure this is numerically impossible which means one of a  law dean's most closely guarded secrets is what the average actually is.)

So, here is how it works. Let's say for the first time your law school has money to give raises. No one talks about it except maybe to their closest friends or in code by mentioning the type of work that is "valued."

And then, they individually directly or indirectly make their cases where no one can see. I do not know what percentage find their way down to the dean to talk about the importance of their work, how many students they teach, why they should be making more than Sue,  how the new salaries to new people mean they are not making a "fair" salary, why they were so busy with important matters that there was no time to write, or  the jobs they could get if their salary is not high enough.  Each one probably imagines he or she is different from the person who just left the office. Each story is imagined to be unique.

I probably agree with many of the cases they make. It's the pretense that puzzles me. Do they actually not know the dean has heard it 1000 times? One thing that is worse than the pretense is the, I hope, remote possibility that anyone listens.

Silenced: Uni’s £1.8m gagging orders

The University of Sheffield has spent over £1.8 million taking out controversial ‘gagging orders’ on former staff members in the last five years.

Compromise agreements with confidentiality clauses, known informally as ‘gagging orders’, have been issued to members of staff leaving employment for reasons other than early retirement. They are now known as settlement agreements following the Enterprise and Regulatory Reform Act 2013.

The agreements are used when the University is in dispute with a staff member and are made through a voluntary process where both the University and the employee are legally represented. But unions fear that employees may sign compromise agreements because they fear the stress associated with taking legal action or remaining in work.

The Trades Union Congress (TUC) said: “We are seriously concerned that the new legislative provisions on the admissibility of settlement offers and discussions in unfair dismissal cases will send a signal to employers that they are free to sack staff for arbitrary reasons without needing to follow a fair disciplinary procedure.

“Whilst employees will have a theoretical right to turn the employer’s offer down, many will consider they have no genuine choice other than to accept the sum of money and leave their job. Many employees will accept the offer simply because they assume it is a foregone conclusion they will be dismissed if they do not.

“Others will fear that they will be bullied or victimised if they remain in the job. The provisions are therefore open to abuse by employers and could have a detrimental effect on wider employment relations.”

The University said that “the decision to compromise is made taking into consideration factors including the beneficial impact to all parties through timely resolution to the dispute, the commercial impact of resolution, and the effective management of personal and or organisational risk.”

A former University employee who signed a compromise agreement told Forge Press: “Such is the stress of taking legal action against powerful organisations that many employees choose to sign a compromise agreement containing a gagging clause rather than pursue legal action and put their health in jeopardy.”

Cllr Shaffaq Mohammed, leader of the Liberal Democrat Group on Sheffield city council, described the figures as “worrying”, going on to say: “When such large sums are being spent on these agreements students have every right to know why this money isn’t being invested in university services instead. As one of the largest and most respected institutions in our city,  the University of Sheffield should be setting an example to other employers.”

Compromise agreements have been a contentious issue in the area recently, sparking outrage from local people when it was discovered that Sheffield city council had spent almost £200,000 on the orders since 2011.

Sheffield city council spent £28,000 on compromise agreements in 2011 and £162,530 in the 2012-2013 period, with many of their compromise agreements including the controversial confidentiality clauses. But the University of Sheffield’s spend dwarfs this – with £196,907 spent on gagging orders in 2011 alone, more than seven times the amount spent by the council in that year, despite having only 6,031 employees compared to the council’s 18,000 plus.

The number of agreements made and the costs incurred are subject to annual scrutiny by the University’s senior remuneration committee, made up of the vice-chancellor and non-University staff.

The University has racked up almost £2 million worth of the controversial clauses in the past five years, peaking in 2009 when 24 agreements were made at a cost of £549,589.

In total, the University has made 102 compromise agreements with confidentiality clauses since 2008, resulting in a total spend of £1,835,498.

These figures also tower over the “concerning” spend of almost half a million pounds at the University of York. When the University of York Students’ Union officers found out about the £479,464 spend on confidentiality clauses since 2008, the spending was criticised as “careless”.

Kallum Taylor, York Students’ Union president, told York student paper Nouse: “These numbers are obviously concerning. Obviously we don’t know the ins and outs, but 80k a year could go a hell of a long way elsewhere for students here. Students are now paying a fortune, and their financial stake in the University has increased dramatically. Scrutiny on spending should be higher than ever, and this type of business shouldn’t be carelessly accepted as a norm.”

University of Sheffield Students’ Union president Ally Buckle declined to comment on the figures. A human resources spokesperson for the University said: “The University of Sheffield has a well deserved reputation as an excellent employer committed to developing a culture of excellence, collaboration, innovation, commitment and respect.

“The University is proactive in ensuring that it promotes and develops its staff capability, and considers a range of employment options to address any shortcomings which, when the circumstances warrant it, include compromise agreements. We take care to ensure this approach is only used voluntarily, and in circumstances where both parties have agreed it’s the best course of action, frequently in discussion with trade unions.

“The number of cases and University of Sheffield spending on such agreements is low when compared to other sectors. Over the past six years, spending has been at an average of around £18,000 per case, representing a tiny fraction of our total £1.1bn staff budget over the same six years.”

Externships for Students or Employment for Graduates?

An empirical questions keeps occurring to me and it deals with the relationship between externships and employment. By externships, I mean the practice of law schools to grant credit to students who work for government agencies and various corporations without compensation. If schools offering these opportunities are true to their promises, these students are are not just fetching coffee and typing. Instead, they are often doing what a law school graduate might be doing if someone were not already doing it for nothing. Of course, externs take the jobs of others even  if they are only typing and fetching coffee but law schools aren't inclined to worry the "little" people. While encouraging externs, law schools wring their hands about the employment opportunities of graduates.  Part of the wringing can be traced to the negative impact that low employment rates  have on national rankings but there is also generalized worry about the future of the institutions, positions, and income.

Of course correlation does not mean causation. There is clearly a correlation between externships (free labor) and the unwillingness of employers to hire graduates (paid labor). It would be silly, though, to think more externships have caused the current conditions in the market for graduates.

But wait.  Is there really no impact at all? Is it really possible that hundreds of students willing to work for nothing actually have no impact on those who would like to be paid? I doubt that. That leads to question about just how much of an impact there is. For example, do 20 externs lead to one less full time paying job?  Externs and graduates are in many respects perfect substitutes, One is priced at zero. The other is not. If you were a profit maximizer, which would you choose?

So, are law schools offering an opportunity to current students that is paid, in part, by recent graduates. I think so but I cannot say  how much.

Law Professors and Veblen Salaries; Irrational?

At my school all salaries are a matter of public record. If you want to know who makes what, you can look it up. I did a few years ago and then I realized how little I knew. For example, all but a few get paid all year but for most only a 9 month salary is reported. In addition, there is an unreported bump associated with various chairs and professorships. The public record actually tells you very little about actual salary. (Why those actual salaries are not reported and how they are determined is too complicated to be explained, or so I have been told.)

All of this leads to a behavioral economics type of phenomenon. Recently I discussed the reported v. unreported salary matter with a couple of colleagues.  Both expressed concern that their public salaries were lower than their actual salaries. More importantly, they might be earning more than a colleague but it would not appear that way to the public.

In both cases the reasoning was that students and others might make inferences about their competence and relative competence based on salary. Moreover this halo effect could carry over to evaluations. Something like this: "Gee,  don't have any idea what professor Jones is talking about but he must be great because she makes $30,000 more than Professor Smith." When you think about it, it is no different from the institutional authority law professors and law review editors worship. You know, "OMG, she must be good, she went to Yale" or "The article must be great because the author went to Yale and thanks Professor Big Cheese for his comments on an earlier draft." Of course, we all know the Professor Big Cheese just shared a cab with the professor and said "Good luck in your job." So, the validity of institution authority must vary on whether it cuts for you against you

But the most interesting thing is this. Clearly some professors would accept less  in order to have their salaries reported as more. Presumably in a negotiation with the Dean, he or she  could say: "Bill your salary next year will be $100k but if you will take $98K I will report it as $150K. In fact, a shrewd Dean could auction off higher reported salaries. The bids would in the the form of a reduced actual salary. This is a great cost saving strategy for the Dean with budget problems.

Is this irrational? I am not sure. If a higher reported salary leads to better evaluations and a better reputation across the profession, maybe in the long run  high reported salaries have the same impact as high prices on Veblen goods -- it makes the product even more attractive.


Wonderful article. Just substitute law professor for Brits. It's all about never showing feelings because if you do, others will know how you actually feel and anything but the most general and misleading statement is uncollegial: . http://www.telegraph.co.uk/news/newstopics/howaboutthat/10280244/Translation-table-explaining-the-truth-behind-British-politeness-becomes-internet-hit.html

Failure to investigate bullying claim costs $350,000

Three Queensland Appeal Court judges have upheld a security guard’s appeal and awarded her $364,008 in damages for a psychiatric illness caused by her manager “verbally” abusing her.

QCA President Justice Margaret McMurdo and Justice Robert Gotterson and Ann Lyons ruled University of Sunshine Coast’s (USC) failure to investigate and take action on an earlier bullying and harassment complaint left staff unreasonably exposed to risk of damage.

USC security guard Gjenie Wolters brought action against her employer on the grounds it had breached its duty of care by failing to provide a safe place of work. She alleged she developed a “debilitating psychiatric illness” after her line manager Mark Bradley verbally assaulted her in March 2008.

Wolters alleged Bradley “aggressively confronted” her, waved his arms at her and yelled while accusing her of abandoning her duties during a blackout. She said she attempted to explain her conduct, but Bradley did not want to discuss the matter and “stormed off”.

Wolters lodged a grievance with USC HR the next day but the unit “declined to investigate her grievance”.

Bradley, the judges heard, had been the subject of a bullying and harassment complaint some months earlier to Wolters’ grievance. Another female security guard, Heather Carney, lodged a complaint Bradley verbally assaulted her and threatened her position.

Carney voluntarily left USC but did not withdraw her complaint...

Former USC vice-chancellor Thomas said Bradley had a history of raising his voice to security staff. But Thomas did not regard it as bullying as security staff were “quite different from the normal people who populate universities” and used to being yelled at.

The Appeal Court judges upheld Wolters’ argument USC’s failure to investigate the Carney complaint meant “no consideration was given to specific aspects of Mr Bradley’s conduct about which he should have been counselled”. “It follows logically the appropriate reprimand and counselling Mr Bradley would have been given would have placed considerable emphasis on bringing that deficiency to his attention and counselling him to check his facts first before criticising other staff members.”

The judges awarded Wolters $364,008 and ordered USC to pay her legal costs for the appeal.

From: http://sites.thomsonreuters.com.au/workplace/2013/08/28/failure-to-investigate-bullying-claim-costs-350000/

Prevalence and Forms of Workplace Bullying Among University Employees

Over the past decade, a growing number of Anglo-American and Scandinavian researchers have documented the extent to which the university environment provides opportunities for workplace bullying. By contrast, there has been a visible lack of similar studies in non-Western national contexts, such as the Czech Republic and other Central Eastern European (CEE) countries.

The present article addresses this gap by reporting the findings of the first large-scale study into workplace bullying among university employees in the Czech Republic. The exposure to bullying was assessed with the Negative Acts Questionnaire-Revised (NAQ-R) in a sample of 1,533 university employees. The results showed that 13.6 % of the respondents were classified as bullying targets based on an operational definition of bullying (weekly exposure to one negative act), while 7.9 % of the respondents were identified as targets based on self-reports. This prevalence is comparable to bullying rates in Scandinavia but considerably lower than in Anglo-American universities.

Differences between Anglo-American and Czech universities were also found with respect to the status of perpetrators (bullying was perpetrated mostly by individual supervisors in the Czech sample), perceived causes of bullying (structural causes perceived as relatively unimportant in the Czech sample), and targets’ responses to bullying (minimal use of formal responses in the Czech sample). The authors propose that cross-cultural differences as well as differences between the Anglo-American model of “neoliberal university” and the Czech model of university governance based on “academic oligarchy” can be used to explain these different findings.

From: http://link.springer.com/article/10.1007%2Fs10672-012-9210-x