With more than 50 percent of all businesses with employees currently in the ownership hands of the Baby Boomer Generation, our society is poised to experience one of the greatest transfers of capital ever. In New York state alone, that translates to 181,370 businesses employing 1.6 million people (according to a Project Equity report using U.S. Census, 2012 Survey of Business Owners).

Different options for sellers exist such as selling to other, younger boomers who are still the most likely demographic to buy. It may also be that these younger baby boomers are being downsized and need to “buy a job.” Other options, such as selling to family members, are becoming less likely due to smaller family sizes and the different interests of younger generations. One option not getting much publicity, yet, but which has much potential to fill in the gaps of sellers needs for buyers, is that of a purchase by current employees. 

As an example locally, BizBuySell.com recently listed “One of Syracuse’s most beloved restaurants….. Having won numerous awards…. their stellar reputation is well known all throughout Central New York. The same recipe has been used for their pizza in excess of 50 years.” Although a buyer might be found from the general public, the fact that “the owners are getting older” and listing retirement as the reason for selling indicates time may be an important consideration. The fact that “they wish to pass the traditions while everything runs efficiently and wonderfully” would seem to speak to passing it on to those who know those traditions and efficiency the best — the employees.

Everyone from the New York Times, to Public Radio’s Marketplace program, to YES! Magazine, are spreading the word about the option to convert to a worker-owned cooperative business by selling to employees. And that’s with good reason. Beyond the fact that employees are a ready-made buying demographic right under the owner’s nose, New York State declares as policy within Cooperative Corporation Law Article 1, Section 2, that worker ownership is a “means of improving the economic welfare of its people . . . to encourage their effective organization in cooperative associations for the rendering of mutual help and service.”

Employee ownership prevents the closing of neighborhood and family businesses beyond the lifespan of the current owners, retains good jobs in a community beyond entry-level positions, and stabilizes neighborhoods by preventing vacancies and overall loss of employment. 

New York State recognizes how cooperative ownership translates into greater economic stability for the communities that the business calls home, as well as stability for the worker owners as opposed to investors in traditional stock-ownership corporations. Article 5-A, Section 80 of the Cooperative Corporation Law states: “It is expected that cooperative ownership . . . will enable workers to receive the fullest economic benefits from their endeavors. It is also expected that the establishment of cooperatives under this article will . . . discourage the movement of capital and jobs out of this state.”

The sale of businesses to employees should also translate into a more diverse ownership by women and minorities, which are a higher percentage of the up-and-coming business-ownership cohort. Traditionally, these types of buyers have been more likely to not possess the necessary capital for starting or buying a business, but doing so cooperatively may be more feasible with the pooling of money and capital for purchase. Also, it may be less risky for success (as opposed to new business entrepreneurship), because pre-existing businesses have client and customer bases, operating history and institutional knowledge, and working capital and assets.

We have just 10-15 years to manage and implement most of these transitions as 100 percent of baby boomers will be over 65 years of age by the year 2029 (per the U.S. Census Bureau). A high majority of businesses do not have succession plans in place, which leads to the #1 preventable cause of job loss. Our first step moving forward will be to continue to raise awareness and demystify the employee-ownership culture and process, not just for employees and business owners, but also for technical service providers. These support providers that include legal services, business planning and analysis, and financing/capital acquisition, among others, will be as necessary for conversion sales to employee-ownership as they are for any traditional business transaction.                                                 

Frank Cetera is a NYS-certified business advisor at the Small Business Development Center (SBDC) located at Onondaga Community College. Contact him at ceteraf@sunyocc.edu.

Answering some common employer questions

The New York Workers’ Compensation Board on July 19 published its final regulations implementing the New York Paid Family Leave Law (PFL).

The final regulations largely mirror the proposed regulations issued on May 24, but the board provided further clarification in certain areas. For example, in its commentary, the board clarified the rules applicable to coverage of out-of-state employees, the measurement of “days worked” as applied to part-time employees, and how to calculate an employee’s average weekly wage. Core provisions, such as PFL coverage, eligibility, and interplay with other leave laws, remain the same.

Now that the regulations are final, employers should begin, in earnest, to modify existing leave policies and processes to incorporate PFL requirements, and to develop new PFL policies that provide employees with information about their rights and obligations under the law. 

We held a webinar on New York’s PFL on July 25, where we received hundreds of questions. While we didn’t have the opportunity during the webinar to address all the inquiries that we received, we noted afterwards that many employers raised the same questions. Accordingly, this article is dedicated to answering some of the most frequently asked questions we received. We hope this follow-up will be helpful to employers in preparation for the launch of PFL in 2018.

This batch of questions and answers focuses on taking leave to provide care for a family member with a serious health condition.

Q: Can I use PFL to care for my family member with a serious health condition, if the family member lives in a different state?

A: The PFL regulations are not entirely clear on this point. However, the Workers’ Compensation Board (WCB) takes the position that an eligible employee may take PFL to care for a family member who lives in another state. The key here is that the employee is in “close and continuing proximity to the care recipient,” which the WCB has interpreted to mean in the same general location as the family member receiving the care. So, for example, if an employee requests PFL to care for a grandparent living in Texas, the employee would need to physically go to Texas to provide care in order to be covered under the PFL.

Q: What constitutes “providing care” for a family member with a serious health condition?

A: Providing care includes necessary physical care, assistance with essential daily-living matters, assistance in treatment, and personal-attendant services. It also includes emotional support, visitation, transportation, and/or arranging for changes in care.

Q: Can I take PFL to care for an adult child?

A: Yes. Unlike the FMLA, which contains limits on an individual’s ability to take leave for an adult child, the PFL permits a qualified employee to care for any child with a serious health condition, regardless of the child’s age.         

Kerry Langan and Caroline Westover are labor and employment law attorneys at Bond, Schoeneck & King, PLLC in Syracuse. This viewpoint article is drawn from the firm’s New York Labor & Employment Law Report blog. Contact Langan at klangan@bsk.com and Westover at cwestover@bsk.com.

Good communication is a key to success in any endeavor.

Yet in the business world there is often the sort of “failure to communicate” referenced in the movie “Cool Hand Luke.” That failure in the movie resulted in the premature demise of the hero. 

In real life, when leaders are unclear about their expectations, employees often muddle through blindly, work at cross-purposes or pursue unintended, unproductive directions. The result is poor organizational performance, if not an early obituary for the leader and his or her vision.

Ambiguity is pervasive in every organization, but is rarely recognized and poorly remedied — keeping organizations from achieving success. 

For example, most business leaders will say their top priorities include service and customer satisfaction. Yet seeking improvement in those areas without being clear on what you mean by them is a fool’s errand.

To make the journey from ambiguity to clarity, leaders need to do the following:

– Define what “service” means. Ask any 10 employees, representing different levels and functions, for their one-word definition for service. You are likely to find at least eight unique responses. 

If we can’t even agree on what service means, how will we achieve excellence? Define all work as products that can be unambiguously characterized, measured, and improved. This focuses on deliverables, not activity. 

– Know the customers. Ask those same employees who “the customer” is and you will get a similar lack of consensus. Who is to be satisfied? Are all customers equal in priority? How does ambiguity affect performance of the employee, the department, and the enterprise? The solution is to identify which of three roles a person can play with any product: end-user, broker, or fixer. Empower and seek to satisfy end-users first. 

– Make sure your company has a customer-satisfaction policy. If customer satisfaction is a top priority of leadership, does the organization have a customer-satisfaction policy? Sadly, I have found in over 30 years of cultural-transformation work that fewer than 2 percent of organizations can answer yes to this question. They do have policies on hiring, money management, quality, supplier selection, cost control, and myriad other issues. But not on customer satisfaction. With no policy on it, how important can customer satisfaction really be?” 

Ambiguity can cause chaos, confusion, conflict, and unproductive competition in an organization.          

Robin L. Lawton is a leadership strategist, executive coach and motivational speaker. (www.C3Excellence.com). He is the author of “Mastering Excellence: A Leader’s Guide to Aligning, Strategy, Culture, Customer Experience & Measures of Success.”

Millennials are a stressed-out generation. 

A study by the American Psychological Association reported that the group of Americans in their early 20s to late 30s came in at a 5.4 stress level on a scale of 1-10, higher than the average American at 4.9.

Among the things keeping them up at night are the predictions of being the first generation that will be less well-off than their parents — and that includes retirements that potentially will be less secure. No longer do millennials have the pensions to look forward to in retirement like their parents and grandparents before them, and no longer do they have the confidence that Social Security will help at least supplement some of their retirement income. 

Every generation has had its own set of trials and tribulations to conquer. However, today’s generation of young adults faces a uniquely challenging environment. And saving money for retirement is a luxury that many just can’t afford. Sometimes millennials have to struggle for a while in order to acquire a sound financial foundation for the future. Here are some tips to millennials for improving the odds their retirements will be a little more stress free.

Start saving and investing early

If it’s true that the early bird catches the worm, it’s certainly true that the early investor catches a sound retirement. If you start investing $2,000 a year for seven years in an IRA (individual retirement account) at the age of 19, you could be a millionaire by age 65. While it might not be practical for most 19-year-olds to invest $2,000 a year, the point is that making sacrifices and saving or investing money early makes life much easier down the road. 

Be patient, it’s a long road ahead 

Patience isn’t always the word that comes to mind when we think about millennials. However, if you’re working your first or second full-time job, and beginning to put money into investment accounts, you need to remember that retirement is a long way down the road. Stock-market volatility can make investors very emotional. But the worst move one can make in the middle of such turbulence is to bail. Many investors abandon long-term strategies for the presumed safety of cash. But millennials have time on their side to be patient with their investments. 

Don’t be your own worst enemy 

Obtaining guidance from a financial advisor can help millennials live the life they imagined during their working years and once they retire. The economy will go through ups and downs during your lifetime, but having a financial professional to guide you can improve your financial future and keep you from making some common, costly mistakes.

There is no greater value than peace of mind when it comes to your investments. The time for millennials to start thinking long term is now — before they get too far along in their career and realize they are going to have to start playing catch-up.      

David Rosell (www.DavidRosell.com) is a financial professional and author of “Keep Climbing: A Millennial’s Guide to Financial Planning.”