Posted on May 28th, 2023
Find below a complete transcript of this video.
What’s up fellow entrepreneurs? It’s John Fagerholm again. And today I’m gonna do a little bit of a different format. I’m gonna do interview format versus information format.
I’ll be interviewing Romy Leah Frazier, entrepreneur, real estate guru attorney, and just an all around pretty cool person. But before I get into the interview, I want to thank Cinema Art School for allowing us to use their beautiful space and their equipment and their wonderful personnel. So, Romy, introduce yourself.
Hi, <laugh>. I’m Romy. I am a former corporate attorney, retired now, full-time real estate investor living and investing mostly in Texas and enjoying life.
So, Romy, you’ve worn a lot of hats. So you’ve been in the corporate world where you were an employee, but you were also responsible for any of the employment claims that came to the corporation, and now you’re an employer.
So tell me the difference between being an employee and an employer in your own words.
Taxes, I’m just kidding. <laugh>. No, but for real. <laugh>, the main difference I would say is ownership. I mean, luckily I had an amazing boss and he told us all to do our role as if, you know, every dollar that we’re spending through the company is our money. And that really created some ownership for anyone who was working using that frame of mind. So, that was helpful.
And what made you decide to become an entrepreneur? Because your, your background is not being an entrepreneur and most people, they get into the corporate grind, especially at the level that you were at. And it’s very hard to get out of that because the pay is good, the benefits are good, the status is good.
What led you to leaving that life and then starting your own business, which of course can be stressful. Again, you said taxes, administration, employees are very stressful. So what motivated you to become an entrepreneur?
Probably my mom. I think from a young age, my mom influenced me. And she always said, you can’t rely on that next paycheck coming through. And I learned that really hands on when I was working in-house, because we would see employees who were with the company for 30 years, for 40 years, and, you know, unceremoniously dismissed from the company for whatever reason.
And it just kind of showed that there’s no guarantee. And from a really young age, I remember my mom telling me that there’s no guarantee, there’s no guarantee on the next paycheck unless you’re creating it for yourself. So it was always in the back of my mind.
Then also the more years I continued in as a corporate attorney, I mean, so my mom was the one doing my tax returns, and she would always see what I was making, and she just was like, why are you doing this? What are you doing? You’re spending most of the money that’s coming in is going to taxes. And so just to be more aware, like creating these other income sources that were more controlled, in other words, more tax efficient. So that was a lot of the influence.
Okay. This is an employment channel, so we have to talk employment.
Yes. Let me <laugh> re repeat the question about
No, I’m gonna ask you employment. You answered that question beautifully. Okay. All right, <laugh>. What I’m gonna ask now is, since you were involved in the employment litigation at your old, company, and I know that it was a large company, and you can’t be specific about things, but tell me either your craziest or funniest employment litigation issue that you came across.
Oh my gosh. Yeah. Like so many just flooded to mind right now. What would be a good one? Geez, this is terrible. <laugh>. I can’t do that.
<laugh>, There isn’t one you can think of that you can talk about. We won’t use names, we won’t, people are just interested, you know, because it, whenever you have an employment issue, when a employee is suing you for something in California, especially if it’s your first time as a business owner, you always think, why me? This is only happening to me.
But in reality, it happens to the majority of businesses in California, right? And so it’s good for the small businesses that I represent to hear that these big, large corporations, and we won’t name the corporation that you worked for have these types of problems, but on a scale that the small business owner probably doesn’t even realize is happening. So how about anything related to sexual harassment? That’s all.
Those are always good ones, the hottest ones. I mean, what I will say is that at scale, when you have, you know, a lot of operations and you’re operating in multiple states and jurisdictions, you will see these claims come through because you’re doing business. And so it’s inevitable.
So any business owner who thinks, why is this happening to me? It’s because they’re in business and it’s because someone sees them as the deep pockets. And so there’s like, oh, there’s money there. And then, you know, the employee will find a lawyer who’s willing to go get that money for whatever percentage. And so there will always be a claim.
So part of my job was receiving all the claims or disputes or any litigation. It’s very common to come back, you know, from lunch. And there’s a lawsuit sitting on my desk that I need to, you know, take the initial steps to intake and get it moving along.
It became very commonplace, even though everyone hates getting sued. And you know, when you’re calling the managers who are actually in that lawsuit, nobody likes that. But it did become, it did become commonplace where, you know, these kinds of claims will come in.
So I’m trying to think of like a sexual harassment issue for you. I mean, our worst ones were probably workers’ comp. We had a lot of employees who claimed injuries that, you know, you can’t prove.
We had people saying, you know, they work or they hold multiple jobs. And so they would work at our company, but also at other companies. And then they would say they were injured, you know, at our company, or it would be some type of cumulative trauma injury where they’re, you know, dating back, my, my neck’s been hurting since, you know, 2020, or, you know what I mean, 20 years ago or whatever.
So that would just kind of all accumulate over time, and then that claim hits, and then you have to, to defend it from there. And then of course, if you say anything to that employee, they’re filing a 1 32 A and then saying it’s retaliation and everything else. So we did see that, you gotta gimme a second.
How, how many, employees were you responsible for in that context?
That I,
Anything? Well, how many employees did the company
Have? The company had over 500 employees.
Okay. So that’s a lot of lawsuits.
I mean, so it’s a lot of claims and a lot of it didn’t develop into litigation, but claims would come in and then, you know, you have people who just kind of raise their hand and make a complaint about something. Sometimes it would come in through dfe h or you know, labor Board or whatever these other arenas.
But in terms of litigation, it really wasn’t too much. We did a good job of like keeping our employee handbook, you know, tight and like having our policies in place and things like that. I mean, there was so much preventative, you know, all the preventative measures that we took to be able to avoid it.
So that’s why I think we kept the claims pretty low. We probably had, I mean, in terms of actual litigation, it was less than a handful a Year.
Okay. And what was the overall philosophy of the company when it came to lawsuits? My, my philosophy is always fight hard to get to a place where you can settle that, that’s the, because, you know, for the most part, like I always say in law, it’s not enough just to be right.
You have to be right and right. You have to be right in your position. I didn’t do anything wrong. And you have to be right in the outcome, which is, okay, if I could settle this for, for 50 K, why am I gonna spend 200 K in legal fees? Right. So what was the philosophy of this large corporation? Because you know, I think it would be maybe a little bit different than the philosophy of a smaller business.
Oh, wow. So the, a lot of the phrases that come to mind are, just get rid of it. Heard that a lot, <laugh>, the facts are what the facts are heard a lot of that mm-hmm. <affirmative>, don’t throw good money after bad. It’s a whole lot of that.
So sometimes I think it was tough to not get personally involved with the lawsuits because, you know, with the company, it, it’s not huge, right? Least it’s not a large company.
It’s kind of like a mid-size company. And so I was familiar, I was actually personally familiar with a lot of the employees. So sometimes it depends on who it was and what their approach is and what you know about that person.
Personally, are they gonna pursue this lawsuit all the way to the end? Are they just trying to get a dollar, you know, are they moving out of state soon? Or, you know, what’s going on with them? And when you have that insight, then you can handle each issue a little bit differently.
But I think overall it’s, you know, it’s a calculus and you look at how much is it gonna cost to prove your case. Sometimes it just hurts to think like you’re gonna have to pay out, you know, whatever amount, $50,000, a hundred thousand dollars to an employee when you think the claim is completely invalid, and you have all of this backup and reasoning on why, you know, you know exactly why, like, I have all the pay stubs, I have all the writeups, the file is this thick and you know, I can prove it.
And it’s like, you wanna spend 200 grand to prove that, you know? Yeah. And then take the risk of losing, or do, would you like to settle it now? And then everyone just kind of gets to sleep a little bit better for the next few years.
Yeah. Okay. So very similar to, to what our philosophies are, but we just, I think, fight a little bit more simply because, you know, with big companies, they have the insurance and they have all these things, whereas smaller companies have to worry about somebody getting a big payout and then that same lawyer coming after them again with the same person.
But anyway, yeah. So, now that you’re in Texas and you’re an employer in Texas, what are the differences you see with Texas employees versus California employees?
Texas is the best. So <laugh>, no, so I mean, my experience, so I’m licensed in both California and Texas, and the company that I was working for had operations in California and Texas, so as well as other states.
So I’m pretty familiar with how that worked. So when I was with that company, I’d say 95% of any issue, not just claims and disputes, but any issue was coming out of California. And I, I mean, I think it was because it was, you know, just a slightly more regulated state with taller standards, higher standards.
Okay. And, and so you’re, you’re away from law now and you’re a person that owns apartment buildings, large apartment buildings, that’s a lot of employees, and I know you probably don’t employ them directly because there are management companies that take care of stuff like that, but there are office staff, maintenance staff.
What, what’s the difference that you see versus if you were to have an apartment building in California? Yeah. And why don’t you have an apartment building in California? Yeah. Why Texas? Oh, boy, that’s two, that’s a compound question,
But it is, I’ll give you a compound answer, but I mean, the last question first, which is why not California? At least right now, it seems like you could just easily, there’s just so many pitfalls in California, you know, so it’s kind of not as business friendly as a state, as Texas, and at least for right now.
And so it seems like operations are a little bit easier in Texas and people are just slightly more willing to work and still be committed to that. You know, that’s such a generalization.
I’m sure everyone, you know, there’s good employees in California, I know that, and I know many of them. It is just, the system is set up for California employees to be able to take advantage of the system and, you know, make money.
See that as like, I’m a professional litigant, and that’s actually a job in California where people are just filing lawsuit after lawsuit with the same attorney over and over and, you know, that’s their, their job being a professional plaintiff.
Whereas I have not seen that issue come up personally. I mean, I haven’t been exposed to as many employees, but I have been exposed to a lot of tenants. And so it’s kind of the same. I mean, all of our tenant issues when I was working in, in the corporate world, a lot of those issues came out of California and then like started creeping over into Nevada a little bit. But today in Texas, what I’m seeing is, I mean, one no joint employer liability, so that’s great.
So you just hire the professional property management company, it’s a third party. They’re responsible for their employees and their staff. And so there’s less of that fear as there was here where it’s like, well, no matter what, even though we created this like independent contractor relationship you know, you still, no matter what, are always tied to that liability and that responsibility.
But, you know, in Texas it feels like there’s at least a, a gentle step away from that.
Okay. Well, I, I appreciate you coming in today. I know that you’re a busy person. Is there anything that you want to talk about? I know you have a YouTube channel that’s focused on helping people get involved in, in real estate investing.
Sure. Anyone who wants to learn more can find me at the fee simple investor on YouTube or look me up Romi Frazier on YouTube.
All right. Thank you, Romy. I really appreciate your time.
Thank you.
