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Wise of you, to repeat and expand on this topic, in light of last week's million-dollar settlement by NE Health in Troy NY for allegedly violating some of those three rules.

Remember, it is NOT the survey provider/supplier who pays the penalty: it is the USERs. Bothers me no end, I must admit, to see so many so-called survey organizations with no clue about surveys, entangling their customers in questionable schemes and exposing them to a world of hurt.

We abide by those rules religiously and cite them in all our survey Methodologies. Even though we get instant feeds from job board postings and credit rating services (where we do income verifications) and other real-time sources, we sit on all data for 3 months before releasing it. Doesn't mean we can't use the instant info to refine our trend studies for the update rates we apply to "legal" data, though. ;-)

Jim somewhat got to what I was thinking; "give me an example of this being enforced." So there you go, it is being enforced. I have seen or participated in a number of home-grown surveys--few of which fall into the safety zone. There was one that was set up very well and I almost fell out of my chair when I got the results and each survey participant was named next to their results.

Jim:

Thanks for the comment and additional information. As I understand it, the NY case is part of a wave which includes:

· Reed v. Advocate Health Care, No. 1:06-cv-3337 (N.D. Ill)
· Merendo v. Detroit Medical Center, No. 2:06-cv- 15601 (E.D. Mich)
· Clarke v. Baptist Memorial Healthcare Corp., No. 2:06-cv-2377 (W.D. Tenn.)
· Maderazo v. Hospital Corp. of America., Inc. No. 5:06-cv-535 (W.D. Texas)

I'm not sure which, if any, of the rest of these have settled, but I believe they are all class-action suits, all reflecting liabilities in the millions of dollars. Plus, I believe that most or all of these were largely supported by the Service Employees International Union. Which tells me that if the Employee Free Choice Act is made into law - in one form or another - the greater levels of unionization that will likely follow will probably increase the risk of challenge on this front.

All to your question, Joe!

Thanks, both of you, for the comments and discussion here.

Joe:

Additional note - I have had experiences similar to yours, in many cases for surveys that are conducted by so-called "professional survey organizations". So the disregard is widespread, and obviously the enforcement efforts haven't been enough (or publicized widely enough) to hammer home awareness of (much less respect for) the regulations. Again, that may change.

Thanks again for joining the discussion!

Now I'm not an anti-trust lawyer, but it seems to me that the "safety zone" information above doesn't get at the heart of what anti-trust activities are all about. The idea of anti-trust legislation is to prevent organization's from interfering with competition and acting in monopolistic ways, but the safety zone doesn't addess what companies do with the compensation data.

Hypothetically, lets take three companies looking at a mountain of compensation data. Company A looks at the data and secretly decides that to be profitable, they will establish a market approach at the 33rd percentile. Company B looks at the data and secretly decides they want to attract the best and brightest and adopts a 75th percentile approach. Company C secretly decides they'll be happy with a 50th percentile strategy. To me, the looking at all the compensation data is not an anti-competitive use of survey data. It only becomes anti-competitive if Companies A, B and C discuss the best ways to use the data, and discuss a strategy for controlling labor costs.

Am I over-simplifying this issue?

Paul:

I don't think you're over-simplifying at all. At the risk of being a cynic, I think it may just be another example of government regulation missing the boat. As you point out, collecting data in a manner that is outside the safety zone doesn't necessarily constitute anti-competitive practices - it is all in the way the data is used.

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    Compensation consultant Ann Bares is the Managing Partner of Altura Consulting Group. Ann has more than 20 years of experience consulting with organizations in the areas of compensation and performance management.

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