By Ruth Binger
Owners and managers frequently face the difficult process of terminating an employee for a reason other than lack of work. The reasons are many and varied, ranging from being placed in the “wrong seat on the bus” to poor cultural fit to “good cause” reasons, such as performance or behavior. Although employment at will is the rule of law, laws exist that undercut the employer’s absolute power to terminate for any reason whatsoever. Many of these laws are just plain common sense and can be compared to administering discipline with your own children.
Decisions made in haste or poorly executed have a very long damage tail including lawsuits, reduced morale, and loss of business momentum. By looking through the lens of both human nature and law, managers and owners can learn to make and execute decisions that are generally defensible both inside and outside the company culture. Knowing what could be coming and where it’s coming from will create a wiser decision process, a more legally defensible position, and buy-in from your watchful employees.
Practicing the following 10 rules will put you on a road map of common sense when dealing with issues related to employee discipline or termination:
- Investigate. Investigating the facts protects the integrity of the process and lessens the ability of an employee to establish an unlawful motive. Poking in the weeds also provides feedback to you on what is working, what is not working, and what should be changed. Look for facts – not hearsay and speculation. Determining credibility is your job. Companies are human collaborative efforts containing many actors with varying motives and agendas that can be constructive, bad, opportunistic or even crooked. Consider plausibility, demeanor, motive to lie, corroboration, and past record when making judgment calls.
- Interview witnesses and the employee in question. Ask the employee in question to explain what happened in front of two management witnesses. Write down exactly what the employee states and ask him/her to sign it. Ask the employee for objective facts or witnesses to support his/her position. Your aim is to pin down the employee to “one recollection.” Interview complainants and witnesses by asking who, what, where, when and how questions. Let them know that you will try to keep the investigation as confidential as possible under the circumstances and in compliance with the law. This arduous process prevents tears at the fabric of your culture. Continue reading »
03/20/13 11:41 AM
Business Law, Employment Law, Manufacturing and Distribution | Comment (0) |
Common Sense Road Map to Employee Discipline and Termination
By Laura Gerdes Long
On June 28, 2012, the Supreme Court, in a 5-4 decision, upheld the Patient Protection and Affordable Care Act (the “Act”), more commonly known as the health reform law, including the highly controversial individual mandate. While the Court limited the Act’s planned expansion of Medicaid, the decision was overwhelmingly a “win” for President Obama.
Now that President Obama has been elected to a second term, those who resisted implementing the first set of provisions (waiting for the Court to rule) will have to begin earnestly working to comply with both provisions already in effect and forthcoming provisions, including key provisions which require compliance in 2014: the individual mandate and the employer mandate.
Provisions currently in effect include:
- No lifetime limits on coverage.
- Restrictions on annual limits.
- No “rescissions,” meaning health plans cannot cancel coverage once you are sick unless you committed fraud when you applied for coverage.
- Dependent care coverage is provided up to age 26 for adult children without employer-sponsored coverage.
- Federal small business tax credits have also been available for employers who provide coverage, with credits differing depending on the size of the company and increasing to 50 percent in 2014.
- Many consumer employees have already experienced not having to pay out-of-pocket costs for certain preventative services, such as breast cancer screenings and cholesterol tests, and the disqualification of over-the-counter drugs as medical expenses for Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs).
- Insurers will have to provide rebates to consumers if they spend less than 80 to 85 percent of premium dollars on medical care.
The impact of both the individual mandate and the employer mandate will not be fully known until closer to 2014; however, there has been great speculation about who will be most impacted. Continue reading »
12/17/12 9:27 AM
Business Law, Employment Law, Healthcare | Comments Off |
Employers and the Health Reform Law
By David A. Zobel
An Illinois appellate court recently upheld a two-year, non-solicitation activity covenant and one-year anti-raiding covenant between a tax preparation service and its employee, despite the employee’s seasonal employment of just three months. Zabaneh Franchises, LLC v. Walker, 972 N.E. 2d 344 (Ill. App. 2012).
In July of 2010, Zabaneh Franchises, LLC, an income tax preparation service based in Quincy, Ill., purchased an existing H&R Block, Inc. franchise. The sale included an assignment of employment agreements with H&R Block’s employees, including that with Terri Walker. Walker had signed an employment agreement in November 2009, as she did annually beginning in 2003. Pursuant to this agreement, Walker agreed to work during the 2010 “tax season,” from January 2 through April 15, 2010. Walker completed this tax season employment without incident.
In February 2011, Zabaneh filed suit against Walker alleging that within a few months of leaving Zabaneh in April 2010, Walker started her own tax preparation business, solicited clients, and hired employees of H&R Block in violation of her employment agreement. Zabaneh’s complaint sought a temporary restraining order against Walker to bar her from engaging further in such activities. The trial court found Walker’s employment agreement to constitute a “contract of adhesion” (a “take it or leave it” imbalanced agreement favoring one party) and denied Zabaneh’s request for a temporary restraining order. The case was subsequently dismissed with prejudice.
On appeal, the appellate court was asked to consider whether Walker’s employment agreement was reasonable and enforceable. In doing so, the court noted that the Illinois Supreme Court had recently addressed the proper standard for analyzing the enforceability of restricted covenants in an employment agreement in Reliable Fire Equipment Co. v. Arredondo, 965 N.E.2d 393 (Ill. 2012). Continue reading »
11/28/12 10:15 AM
Business Law, Emerging Business, Employment Law, Litigation | Comments Off |
Two-year, Non-solicitation Activity Covenant Upheld in Illinois for Seasonal Tax Employee
By Christopher D. Vanderbeek
On the whole, the American workforce is less healthy now than it has ever been. The sad truth is that many American workers live unhealthy lifestyles of poor exercise and eating habits, due in part to an increase in automation and technology. This unhealthy state, in combination with the natural aging process, leads to an American workforce struggling with chronic conditions such as obesity, diabetes, and arthritis.
Missouri workers are no exception, and this causes an increasing concern for Missouri employers. Increasing unhealthiness contributes to a higher incidence of degenerative and inflammatory musculoskeletal conditions. Put simply, this means that less healthy workers tend to become “injured” due to work activities more often than other workers.
How can Missouri employers insulate themselves from increased workers’ compensation liability for unhealthy workers?
There are two analytical measures employers can implement to limit their workers’ compensation liability in the face of increased liability risk due to unhealthy workers. Continue reading »
10/29/12 6:00 AM
Business Law, Employment Law, Workers' Compensation | Comments Off |
How to Limit Work Comp Liability when Faced with Unhealthy Workers
By Christopher D. Vanderbeek
In Missouri, an employer has the right to direct and control medical treatment in workers’ compensation cases. This means that when an employee injures himself on the job, the employer has the right to direct the employee to a specific medical provider for treatment, and the employer thereafter has control over where the employee treats until the employee is released.
This may not seem like a big deal, but it is. An employer who seizes and proactively manages this dual right (first to direct treatment, and then to control it) will keep medical costs much lower than an employer who flouts them. And as all employers know, the less the insurance carrier pays for work-related medical treatment, the lower the work comp insurance premium will be.
In the vast majority of cases, the employer will ultimately defer to its workers’ compensation insurance carrier to handle medical care for an injured worker. After all, one of the functions of a work comp insurance carrier is to do just this – manage and pay for work-related medical care until the injured worker is released from care.
However, in most cases, medical treatment decisions need to be made before the insurance carrier is even involved. The most common example is where an employee is injured and tells his supervisor, and the supervisor tells the employee to go to a specific provider – usually an urgent care or occupational medicine clinic. This is an important step, because it constitutes the employer’s exercise of its right to direct and control medical treatment. (Additional discussion of the importance of exercising this right is contained below.)
Continue reading »
06/1/12 8:57 AM
Employment Law, Workers' Compensation | Comments Off |
Missouri Employers and the Right to Direct and Control Medical Treatment in Work Comp Cases
By David R. Bohm
We have all seen hairstyles that made us ask the question, “What were they thinking?” But when employees show up with such hairstyles in our place of business, do we have the right to restrict hairstyles? Does it make a difference if the hairstyle – or even a head covering – is due to the employee’s religious beliefs?
Recent federal court decisions have made it clear that an employer must tread carefully when addressing an employee’s choice of hairstyle or head dress. Otherwise, it could be the employer being subject to a “haircut,” rather than the employee.
Accommodating Religious Beliefs
Of particular concern are cases where an employee’s choice of hairstyle or head dress may have a religious basis. In such cases, an employer has a duty under Title VII of the federal civil rights act (and in most states under state law, as well) to reasonably accommodate the employee’s religious beliefs. Failure to do so could result in the employer being found liable for religious discrimination, and being required to pay actual and punitive damages, as well as the employee’s legal fees.
In one recent case, reported in an EEOC press release issued April 27, 2012, the owner of a chain of Taco Bell restaurants agreed to pay $27,000 to resolve a religious discrimination lawsuit filed by the EEOC because the owner had fired an employee who refused to cut his hair. The employee was a practicing Nazirite, who, in accordance with his religious beliefs, had not cut his hair in 15 years. After being employed at one of the owner’s restaurants for six years, the employee was told he would have to cut his hair if he wanted to retain his job. Even though he explained that his religion forbade him from cutting his hair, the employer insisted he had to do so if he wanted to keep his job. As the EEOC attorney handling the case, Lynette Barnes, explained in the press release, “No person should be forced to choose between his religion and his job when the company can provide an accommodation without suffering an undue hardship.” In addition to paying the $27,000, the employer agreed to institute a formal religious accommodation policy.
Continue reading »
05/23/12 7:56 AM
Business Law, Employment Law, Litigation | Comments Off |
Hold the Scissors – Telling Employee to Cut Hair Can Lead to Your Company Suffering a Haircut
By Ruth Binger
Thanks to an exponential growth rate in technology, the Internet has changed the world and how we communicate with each other. In 1995, 16 million people used the Internet. Last year, 2 billion people used the Internet and in 2020 it is predicted that the number will be over 5 billion.
Google, a 12-year-old company, has certainly fueled this growth. Social media platforms have also supercharged Internet usage. Facebook claims to have over 800 million active subscribers, LinkedIn claims 85 million subscribers and YouTube has over 100 million videos online.
However, the way we relate to and judge each other, whether it is for employment, relationships, or credit history, has not changed. We are all trying to predict each other’s future behavior for the relationship(s) and transactions we seek.
Facebook purports to be worth $104 billion with its purchase of Instagram. Why is it worth so much? Because companies are spending over $2 billion per year to collect information from social media outlets about what we as consumers want. Our behavior and our opinions can be measured in fine detail as we post and that behavior can be monetized. For example, it is estimated that your personal/buying information is worth $50 to $500 to Google, depending upon how much you spend. On Twitter, each of your followers, assuming you have a large following, could be worth as much as $2.50 each per month. In short, personal data greases the Internet. The data we share (names, addresses, pictures, precise locations, and links) helps companies target advertising based not only on demographic but also on personal opinion and desires.
What does all of this information mean to you as an individual? Technology rules will continue to change, so you need to be vigilant. It is important for you to keep up with the positives and negatives of the rapidly changing technology. Right now, social media is at its height but it is designed for websites. That is predicted to change as the world moves to smartphones. Nearly $1 million worth of features come with any smartphone and there are a billion smartphones in the world. Within the next decade, 6 billion people will have a constant connection to the Internet. This explains why Facebook recently bought Instagram, a mobile app company, for $1 billion. Facebook wants to conquer the smartphone market and not be left behind. Continue reading »
05/2/12 9:04 AM
Business Law, Digital Media, Employment Law, Manufacturing and Distribution | Comments Off |
Social Media: Six Ways to Protect Today’s You and Tomorrow’s You
By David A. Zobel
Within the past few months more and more news outlets have reported stories of employers asking job applicants for their Facebook login information. While many applicants understandably feel uncomfortable with the idea of their potential employer delving through their private lives, applicants are typically not in the position to decline.
This new trend has sparked an inevitable inquiry: is it legal? At this time, the answer is uncertain. Like many issues arising from the fast-paced and ever-changing world of the Internet and social media, the law has not caught up with the question. There does not appear to be a statute, regulation or court decision directly on point – either at the federal or state level. Consequently, experts on both sides of the issue have begun considering and arguing whether any statutes, regulations, or court decisions indirectly apply to the issue.
Missouri statute does not appear to directly prohibit such a practice; however, this does not mean it is wise for employers to engage in it. The reason has little to do with the actual practice of asking for the login information, but rather concerns what may be potentially discovered by such practice. No, I am not referring to finding rants about past employers or photos of bad decisions and misdemeanors. Employers should be concerned about finding family or pregnancy photos, photos of the applicant in the hospital, and/or religious views.
Continue reading »
04/23/12 11:56 AM
Business Law, Digital Media, Emerging Business, Employment Law, Litigation, Manufacturing and Distribution | Comments Off |
The Facebook Folly: Why Browsing an Applicant’s Facebook Profile Could Present Problems for Missouri Employers