Black & White

As a CEO, your instinct is to help employees whose personal problems are interfering with their job performance. But what makes you so sure you can help?

"Once in a while, people who are on the road go out and have a few too many, and that's fine," begins the owner of a $14-million computer consulting firm, recalling an incident involving one of his employees that happened a couple of years ago. "But one Monday morning, this particular employee just didn't show up for a project, and it was like, 'Oh no, where is he?"

The company, which had about 35 employees and $6 million in revenues at the time, helps businesses design, install, and implement complex back-office software systems. Only about a third of its employees work out of headquarters. The rest, including this consultant who was nowhere to be found, operate from their homes, since the job requires traveling to the customer's site.

On this particular Monday morning, the customer was expecting his new computer system to go live for the first time. A handful of people had worked on the job, but the consultant in question was the only one left to make sure that the system worked. Until he disappeared. "They were bullshit," recalls the CEO, describing the customer's call to him. "Not showing up is pretty bad, but his not calling just made it worse."

By Wednesday morning, after calling the man's sister to help track him down, the CEO had found the consultant. "Apparently, there'd been a lost weekend," says the CEO, referring to the fact that the consultant had been too drunk to get on the plane Monday morning. "It was a quart of gin, I guess."

The company "limped through the rest of the project," finishing up the best it could. In the end, the CEO decided his company would eat half of the consultant's $200,000 fee.

But the CEO still had to decide what to do about the consultant. When the CEO and his vice-president of operations made contact with the consultant, the man foisted the mishap off on bad travel miscues, saying he'd overslept and missed his early-morning flight. By Saturday he'd broken down and called the vice-president at home to admit that he was an alcoholic. He was "basically crying and saying he needed help," the VP recalls.

Now that the CEO knew what he was up against, he faced the sort of agonizing decision that every employer dreads. Hire enough people and you're likely to grow comfortable passing certain judgments--right or wrong--on them: that they have particular skills or lack them, that they can rise to a certain potential or can't, that they fit in or don't. But the stakes are never higher than when what's under scrutiny is someone's personal behavior. Most CEOs, confronting what can often feel like life-or-death consequences, would rather sidestep such uncertain terrain altogether.

But every CEO will, at some point, have to face the problem of a valued employee whose performance is impaired by a personal problem, whether it's substance abuse, an addiction to gambling, or a debilitating emotional problem. It's hardly rare for a CEO to grapple with an employee who abuses alcohol; roughly one out of every 12 full-time workers between the ages of 18 and 49 abuses alcohol, according to a report by the U.S. Substance Abuse and Mental Health Services Administration. When, if ever, does a CEO need to step in? And what factors should be weighed in figuring out what to do?

Many business owners assume that it's difficult if not impossible to fire an employee who has a medical condition such as alcoholism, even if he or she frequently misses work. Actually, "absenteeism may be a basis for termination," says Jeffrey Klein, an employment-law specialist at Weil, Gotshal & Manges, a New York City law firm. "The fact of being a drinker and having a hangover and not being able to come to work is not protected. What's protected is alcoholism as a disability."

But firing the employee was never an option as far as the CEO was concerned. "He made about as bad a mistake as you could make, but it was a first mistake," the CEO explains. "And people make mistakes of judgment all the time, even when they're not drinking."

This was the first time the company, only five years old at the time, had confronted such a situation. It wasn't, however, the CEO's first close encounter with alcoholism. As it happens, his father is a recovering alcoholic who has been sober for 30 years. His father's recommendation: cut the fellow loose. "His logic was that people have to hit rock-bottom before they can pull themselves up," says the CEO. "And what might seem like rock-bottom to me, which is how I thought the consultant was at the time, is really not rock-bottom. But I just didn't think I could do it."

The VP, who was also in charge of personnel issues, agreed. "I'll tell you honestly what went through my head," she says. "It was, What if this guy hits rock-bottom and kills himself, and it's my fault? I just couldn't take that kind of risk."

Besides, abandoning the employee felt inconsistent with the company's team-oriented culture. "We preach and talk a lot about caring for the people here. If you tell people you're going to care about them and you're going to support them, then when you get into a sticky situation, running away from it is the worst way to deal with it," the CEO says. "Embracing it is pretty messy as well, but somebody's hurt, and you've got to do something." Something, yes. But what?

After discussing the situation with his operations VP, as well as informing his chief financial officer and recruitment VP, the CEO called the consultant and told him to find a treatment program, get help, and then come back to his job. The consultant subsequently enrolled in a two-week outpatient program near his home. The company paid for the program, since it had neither a short-term disability policy nor an employee-assistance plan. The company kept paying his salary throughout.

Soon the consultant completed the treatment program and got back to work. Everything went fine--for about eight months. "Then he just didn't show up for work again," recalls the CEO. This time he cost the company about $5,000.

Again, after consulting with his operations VP, the CEO decided not to fire the consultant. Admittedly, it was a more difficult call. But the managers decided they hadn't been tough enough with the consultant; this time they needed to make clear to him what the consequences would be if he failed to show up again. He had to get into and complete a residential treatment program--which would be covered by the short-term disability insurance that the company by then had in place--or he had to clean out his desk. If he disappeared again, he'd be fired.

The consultant was relieved but not surprised about his employer's ongoing support. "They're familiar with the disease," he says. "They understand it. They understand the lies. And they understand how difficult it is to live with."

Still, it's not entirely clear that the managers made a wise decision, at least in the view of substance-abuse experts. "To put him through a treatment program is a very good thing, but once," says Dr. James W. West, vice-chairman and former medical director of the Betty Ford Center, an alcohol- and chemical-dependency treatment center in Rancho Mirage, Calif. "After that, it's enabling. It sends a message to the person: 'Well, just keep trying to the best of your ability, but if you fall, we're here, and we'll take care of it. In spite of what it does to the company, we'll stick with you. We'll put you back in treatment and hope this will be the last time, but if it isn't, we'll be there again.' It's bad for the company, and it's bad for the employee."

By answering their own need to feel good about themselves--and addressing their worst fears about what he might do--the managers could have been prolonging the consultant's suffering. He'd already been diagnosed with pancreatitis, which was, according to the consultant, "a direct result of excessive alcohol abuse." A relapse into drinking would have only worsened the condition.

Then again, it's practically second nature for entrepreneurs to ignore expert advice and abide by their own instincts. Typically, they're the ones who will suffer the harshest consequences if they turn out to be mistaken. But in a situation like this, the outcome could have a dire effect on an employee. That alone ought to change the decision-making process.

What doesn't change, though, is that a CEO's business mind-set will influence any decision. Even the best-hearted company builders can't help thinking of the tangible rewards that might result from any investment. This CEO admits as much when he refers to the consultant as "a lucky son of a bitch. We have one very loyal employee."

Yet no entrepreneur, after being hit where it hurts most, the bottom line, is likely to forget that trauma anytime soon. This CEO admits he'll never have as much trust in the employee as he did before. It's been nearly a year since the last incident and, says the CEO, "so far, so good. The problem is if he misses a plane or a plane's late, I'm always going to wonder." Rightfully so, perhaps. Months after the second incident, the employee, who is very candid about his struggle with alcoholism, still says he never missed work as a result, which doesn't bode well for his taking responsibility for his actions. "I wouldn't be surprised if something happened again," says the VP.

It's wise, then, to acknowledge up front whatever degree of self-interest guides your calculations--and to listen carefully to those who know more. This CEO, understandably, let his gut instincts lead the way. As a result, he never came to terms with whether he truly wanted to do something that would stand the greatest chance of helping the consultant in the long run, even if that meant taking on the guilt associated with giving the consultant his walking papers. This CEO is a good guy. It's not as if he sat down and calculated how to extract the most from the consultant in his time of need. There's a mix, however, of compassion and selfishness in his decision making that he didn't fully explore. "Business is easy compared to life," he says. "We're just laymen with good hearts and crossed fingers."

Well put. But even so, when faced with such a quandary, company leaders should ask themselves whether their actions are truly designed to help the employee and the company or if they're really just looking to get out of the situation feeling better about themselves. If the latter rings true, they should set aside their own needs.

Jeffrey L. Seglin is a visiting fellow at the Center for the Study of Values in Public Life at Harvard University.

(The following readers' comments appeared in a subsequent issue of Inc.)

Readers' debate

Did a CEO 'place the company's reputation in jeopardy' by helping a troubled employee?

The most recent Black and White column, "The Savior Complex" (February), argued that a CEO who had stepped in to aid an employee with a personal problem might have been motivated more by a desire to "feel better about himself" than he was by a sincere intent to help out. The CEO explained why he had sent an alcoholic employee for treatment--not once, but twice--despite the fact that the employee's failure to show up for work cost the $14-million company more than $100,000. In making his decision, the CEO admitted that he had sidestepped advice from people who were knowledgeable about substance abuse--namely, that the employee would have a better shot at recovery if he were fired. Readers agreed that CEOs must draw a line in such situations, but they didn't agree about where that line should be drawn.

"The CEO had a good heart, but at times the head must rule," wrote Yvette McManus, owner of Yvette's Designs in Sterling, in Lufkin, Tex. "He enabled the alcoholic with support and placed the company's reputation in jeopardy. No winners in that ball game."

Not that there wasn't something "noble and wise" in what the CEO did, as Dick Gray, president of Xtension Technologies, in Laguna Hills, Calif., put it. "But at some point," he added, "every executive must weigh the option of cutting loose an employee who can't adapt to a life without a crutch."

But where is that point? Peter Johnson, president of a technology-consulting firm in Bethesda, Md., believes that a business owner should "try to show a human touch, but not a hug." He admits, however, that making that distinction requires straddling another fine line. "I think of the shareholders, and I think of why the business exists, before spending its time and money on employee disasters. Never take one of these 'helping' campaigns off the business playing field and start helping the employee with your personal time or resources. That is not help."

Indeed, the CEO's mistake was in believing that he knew what would help, offers Stephan Cludts, a student at the Centre for Economics and Ethics at the Catholic University of Leuven, Belgium. "It's possible to help one's employees, even if this has a cost," he says. But "the CEO should have taken advice from people who know how to deal with this kind of problem."