Fired Human Resources Director Settles Case

Angela Payne was the Human Resources Director for the City of Sheboygan. She contended that she was fired for rejecting the Mayor’s drunken sexual advances. Payne alleged that the Mayor tried to kiss her, looked her body up and down and implied he wanted a sexual relationship. Following this Payne noticed that the Mayor became distant, refused to call her by name, refused to speak to her directly and rolled his eyes when Payne spoke. To read more about this case click here.

Payne settle this case for $310,000. The City got lucky on this one. They could have been hit for a lot more in front of a jury. Many people think that, by virtue of being in Human Resources, individuals do not suffer harassment, discrimination or retaliation. Having represented a number of individuals who worked in Human Resources I can tell you they are just as vulnerable as the rest of the workforce. Sheboygan is not alone when it comes to these problems.

Later,

Rod

Love Contracts? Romance? Bah Humbug!

I just got through reading an article by a mainstream publication in which it was suggested that through the use of a love contract an employer could either minimize or deflect liability for sexual harassment and retaliation.

If you are unfamiliar with the concept of a love contract, that just means you’re not a lawyer. A Love Contract is a document in which employees acknowledge that a consensual romantic relationship has occurred or is occurring between coworkers, typically between an employee and a member of management/supervision/ownership. Presumably, by signing this agreement employees will be dissuaded from filing a lawsuit and employers will have a defense that may allow them to obtain an early dismissal of any lawsuit.

Let me be clear. I don’t want to deprive anyone of the opportunity to be loved, feel loved, doodle about their loved one or walk around day dreaming with a goofy look on their face. When I wrote an article on romance in the workplace in April of 2009, I received emails from a number of people that met their soul mate in the workplace. That’s awesome. Unfortunately, those folks are the exception rather than the rule. The problem is that not everybody can handle a breakup after being hit by one of Cupid’s arrows. When that happens, the workplace becomes a danger zone and there is no contract the can adequately address the impact on your team as they deal with the fall out of a broken relationship. That is just reality.

Let’s be frank, any time a member of management or ownership has a relationship with a subordinate- the scope of your exposure, as an employer, increases exponentially. A love contract may dissuade some from bringing a lawsuit; which is, perhaps, the strongest argument in its favor. A romantic relationship between management and a line employee, in particular, is fraught with risk and will negatively impact the workplace. The relationships create the impression of favoritism, thus undercutting management’s credibility. You know the comments, “Gee, if I slept with the boss maybe I would get…” and “Do they think we are stupid? Everyone knows what is going on between them.” Second, it makes some people think that using the workplace, as a source of future bed partners/conquests is an acceptable practice. Third, love contract or not, the aggrieved party will likely claim that the relationship was the result of a threat of adverse employment action and that same pressure was exerted to cause the employee to sign the love contract. We are in different economic times. The argument that you should have left and taken another job will not resonate as well as it would in a good economy. Even if you win this argument, it will not be pretty and it will cost you a lot of money.

Bottom Line:

In today’s work environment, a supervisor, manager, or owner that has a sexual relationship with a subordinate does not get any sympathy here. Love contract or not, you are leaving yourself exposed. Pursue romance outside the workplace or get ready to pay your lawyer.

Later,

Rod

THINK BEFORE YOU SIGN THAT NON-COMPETE

In an increasingly competitive business environment the use of non--competition agreements has become commonplace. Employers and employees tend to resort to cookie-cutter agreements which are not narrowly tailored to fit the particular employment relationship at issue. As a consequence, employment lawyers hear employers complaining that the non-competition agreement did not afford them as much protection as they would have liked. On the other hand, employees sign the same non-competition agreements without giving any thought to their scope and duration thereby, in many cases, effectively negating their ability to perform their chosen line of work.

The tried-and-true rule of thumb for non-competition agreements has been that they must be of reasonable duration and narrowly tailored geographically. The shorthand term is reasonable duration and scope. Essentially, since courts do not favor these agreements, given their propensity to stop people from gainful employment, businesses cannot overreach and impose terms that are greater than needed to protect their legitimate business interests. Under the tried and true rule of thumb, a small company operating in Aberdeen Washington, with the clientele within 100 mile radius was not permitted to expand the scope of the non-competition agreement nationwide for the next hundred years.

As with everything, the tried-and-true rule of thumb has gone by the wayside due to technology. A prime example of this is the recent decision of the Mississippi Court of Appeals in Timber Lake Foods, Inc. vs. Stephanie Estess. In that case, the employer sought enforcement of a noncompetition agreement that was two years in duration and prohibited any employment within the 250 mile geographical radius. In analyzing whether the scope of the noncompetition agreement was reasonable, the court examined whether the imposition of a 250 mile geographical restriction was arbitrary. In so doing, it concluded that based on the nature of the work performed by the employee, specifically that the employee could perform her job through the use of a computer and telephone from anywhere in the country, that the restriction was not excessive. In so holding, the court cited to several decisions from other jurisdictions in which courts have held that technological advances have significantly impacted the courts' view of the concept of geographical reasonableness.

TAKEAWAYS:

Don’t Get Lost in Love.

Don't enter into long-term commitments without first obtaining the advice of independent legal counsel. Employers and employees are both guilty of not considering the possible worst-case scenarios that can occur when an employment relationship falls apart. Understandably, in any employment relationship there is what can be referred to as the honeymoon phase. As with any relationship, things always look wonderful when you are in love and everyone is optimistic, happy, and just plain content. It is after the honeymoon phase ends that the employer and employee begin to view things in a different light. Unfortunately, by that time all the important documents have been signed and neither party is willing to compromise. Employees suddenly realize that they never considered what would happen in the event of a lay-off, termination, merger, or the availability of a better paying position. Employers, who view noncompetition agreements as mere "boilerplate", find that due to technological advances they have not fully considered the geographical scope of their agreements thus allowing an employee to effectively compete in your market while working outside of the geographical restriction. In each circumstance you have unhappy campers who are forced to go to court to protect their interests.

Time in Breach Should Not Count.

Lawyers drafting noncompetition agreements should also be mindful that litigation involving these agreements can be time-consuming and costly. As a result, it is always important to toll the duration of the noncompetition agreement for all periods of time that the employee is in breach of the same. In the Timber Lake Foods case, the court was unable to issue an injunction enforcing the noncompetition agreement because by the time the matter reached the appellate court level the two-year time duration had expired. That is effectively, winning the battle but losing the war. Employers drafting these types of agreements should also make sure that, given the costly nature of this litigation, that noncompetition agreements contained the shifting mechanisms.

Later,

Rod

Where is the Common Sense

Employment law is a hot area especially in times of economic turmoil. More often than not, employment lawyers are called into action because of a fundamental institutional breakdown in communication. Employers do not want to communicate with their employees about workplace issues because they fear that whatever they say, “Can and will be used against them.” Employees don’t want to communicate with management because they feel that management only has its interests at heart.

I have been met with criticism because I have given advice to both employers and employees that defies generally accepted approaches and borders on, yes,… common sense. One of the reasons that I’ve been able to give this type of advice is because my firm represents employers and employees. I understand a workplace crisis from all perspectives and, unfortunately, I have witnessed both sides act in a less than mature fashion.

Management and human resources professionals, let me share some insight with you. In spite of all those wonderful moments at the last training session, your employees don’t trust you. They want to trust you but they don’t. The challenge you face is to change those deeply ingrained behaviors that scream, “My employer doesn’t care about me.” When a crisis erupts in the workplace, many employees believe that the fix is in. They honestly believe that management will only act in its best interest. Typically, that means getting rid of the employee that raised the issue. I know you are asking yourself, “What about the promises contained in the handbook?” Your employees don’t believe them for one minute. They view your handbook as another level of management protection. While handbooks are an excellent method to communicate expectations, what is needed is a management team that understands the value of human capital in concept and in practice. Only then can a common sense a dialogue begin.

Culture makes the difference.

I represent a number of companies that really care about their employees. These employers dare to be different. Their focus is different. They have committed to creating a culture of respect. They treat all complaints with the same degree of importance. Investigations are performed promptly. The results of investigations, and the underlying rationale, are explained to all parties concerned. These employers will work with the aggrieved employee to find solutions to workplace issues that are tailored to the situation. This requires a lot of face time, give and take, and the ability to trust one another. By taking the steps, employees begin to understand that they are important to their employer and not just another number. This also leads to an engaged workforce that drives high performance and positively translates to a bottom line impact. In so doing, you have created a culture of respect, inclusion and innovation. When this happens you will see a dramatic change in your workplace and a significant reduction in your legal bills because lawyers are no longer needed in the equation. That's a good thing.

Later,

Rod

P.S. For those of you that are interested and a truly different approach to building a culture of respect, inclusion and engagement that works, check out the website for Edge (www.edgelearning.com). Their transformational work has impacted individuals, leaders, teams and organizations of all shapes and sizes.

Strippers and Sexual Harassment

Can sexual harassment occur in a strip club? You bet it can and it does. Many of the young women take jobs in strip clubs, as servers or strippers, naively thinking that it can provide them with an income to pay the bills or their college tuition. While their main concern is the customer, unfortunately, many of these young women find themselves sexually assaulted by coworkers, managers and owners. They don't come forward because they believe that there is no right of action or that no one will believe them. Compounding the problem is that many of them live a transient lifestyle or have had past criminal problems.

To be honest, I never gave the subject much thought. Why? Well, no one ever approached me to handle a case against a strip club. This weekend, I saw an article in the New York Daily News about a Manhattan employment lawyer who routinely sues strip clubs for sexually harassing their women employees. (Click here to read the article.) The clubs he sues are not the stereotypical grungy dive, these are the clubs that bill themselves as upscale "gentlemen's clubs". (Not that it matters, sex harassment is sex harassment whether it occurs in a dive or the corporate headquarters of a Fortune 500 company) Regardless of your feelings about strip clubs (personally I find them objectionable), the issue is whether these women deserve to be protected from sexual assault and harassment. That is one proposition on which we should all be in agreement.

These cretins that perpetrate this conduct do so because they know they can get away with it. After all who is going to believe a stripper? Lots of people. Especially if you have other coworkers come forward with corroborative information. It's clear that this is one industry that has no desire to adhere to the law and it is only through the pursuit of litigation against entities that meaningful change can occur in the workplace.

Later,

Rod

Sometimes Good Things Come Out of Train Wrecks

When I grew up there was a different perception of employment relationship that we have seen in the past twenty years. It was an unwritten rule of work that if you, as an employee, gave your all to your employer, they do would do the right thing, even though they were not legally obligated to do so. That changed in the eighties, when corporate bean counters began to assume roles of importance in organizations. Profits became the focus at the expense of human capital. It did not take time for employees to recognize that their loyalty was not rewarded by management. As a result, today we see employees changing jobs as soon as a better opportunity presents itself. Their rationale, "My employer is only concerned with profit, so why should I stick it out with a company that will probably never reward my loyalty?" It is a sad but true statement.

Enter the current economic downturn (a/k/a train wreck). All the rules have gone out of the window. Employers that have been successful in weathering this crisis have come to realize that their ability to adapt to the new economic climate is largely dependent on attracting and retaining quality employees. Employees have also become less eager to jump ship. This is the classic case of employers and employees allowing crisis to become the catalyst for change.

The employers that are succeeding, in spite of the economy, understand that organizational competitiveness not only depends on employees mastering increasingly complex tasks, but that they must place greater value on their human capital. These organizations see that positive change occurs when they take steps to assist their employees become better people. To do so, they have to discard the old paradigm that focused on the bottom line and create a positive environment and an environment of trust. No matter how hard we work as employment lawyers, it is difficult, if not impossible to assist an employer create meaningful organizational change when there is a fundamental lack of trust between management and the people they manage or where employees act like whipped puppies.

I have been accused on being "old school" and maybe that's true, but I believe that most employees want to stay with a company long term and want to enjoy their job. They have all heard about grandpa that worked for a company for 45 years before he retired. They want the same thing. The challenge for you, as a leader, is to recognize this and begin to work with your employees to create an workplace that rewards creativity, longevity of service, and integrity. As I write this I am reminded of a recent conversation I had with a friend. He works for a large company that for the first time in their history experienced a financial loss. When the news of this spread through the company, there was understandable concern. The CEO decided to be proactive and arranged to meet with small groups of employees throughout the company until he met with his entire workforce. In these meetings, he listened to the employees while they shared their concerns, offered suggestions and answered their questions. According to my friend, following these meetings, this company is more focused than it ever has been, morale is up, and there is a greater degree of trust that management has their back. No amount of policies, procedures or training courses can replicate what this CEO did in the course of several weeks.

When was the last time you did an honest review of your company and asked the hard questions such as do people like working here and are we, as a company, achieving our potential? It is not about changing the organization as much as it is about people within your company changing and, in turn, becoming a source of organizational change. As I heard one individual put it, "Most organizations don't aim too high and miss, they aim too low and hit."

Maybe it's time for a change.

Later,

Rod

Termination and at will employment

Most employees are considered to be "at will" employees. What that means in plain English is that the employee is free to leave at any time, for any reason, and with or without notice. Yes, the days of involuntary servitude are over. An employee is free to leave at any time, for any reason, without providing you the courtesy of notice. The notion of "at will" employment also envisions that you, as the employer, can terminate an employee at any time, for any reason, with or without notice, and without consideration for length of service. While the principle of " at will" employment seems rather straightforward, the execution is not. This is primarily the result of advice given by members of local taverns and diners, none of whom have a license to practice law. After all, why get a license to practice law when you can wax poetic about your uncle Cecil’s legal problems and how he is the bastion of all knowledge on issues of employment law? The difference between the well-meaning friends at the local diner or tavern and your lawyer is that the former will often get you sued. In case you haven’t been sued, let me share a secret. It’s more expensive to defend an employment lawsuit than to pay for an hour of your lawyer’s time to get the correct advice. Sorry, as I get older I tend to digress.

Keep it clean.

Employment at will was never meant to be confusing. It is supposed to be simple. With the exception of protections provided by statute, employers are supposed to be free to terminate employees at any time and for any reason. Conversely, employees should be feel free to leave at any time for any reason even if that means they don’t provide you with advanced notice.

Then why the problem? The answer is easy. Employers make promises they don’t have to make. For example, employers, in an effort to make employees feel part of the team, adopted a concept known as an introductory period or probationary period. During the probationary period, the employee was led to believe that they could be terminated for any reason including the slightest infraction. This led employees to conclude that once the probationary period expired they could only be terminated for cause. What employers failed to communicate is that they never intended the nature of the employment relationship to change after the expiration of the probationary period. To further confuse employees, employers began to adopt progressive discipline policies. The rubric under which these were adopted was to make employees feel that all employees were treated equally. Once again problems arose in the execution of these policies. First, progressive discipline policies can never anticipate every conceivable circumstance. Second, employees did not understand that progressive discipline policies were intended to be advisory in nature only.

When I say, "keep it clean" I mean that the message that you, as an employer, convey should be clear when addressing the issue of the nature of the employment relationship. That doesn’t mean that you should not have a progressive discipline policy. It does mean that your progressive discipline policy should clearly state that it is for purposes of guidance only and that management reserves the right to terminate employment at any time for, for any reason, and with or without compliance with the progressive discipline policy.

My mother had a saying when I was a smart mouthed teenager, "It’s the tone that makes the music." This was my mother’s way of saying that she didn’t appreciate the sarcastic tone of my voice. The same holds true in your communications with your employees. You, set the tone of your company, and, in turn, the expectations of your employees. It is, therefore, imperitive that you are consistent in all of your dealings with the employee. A prime example of this is the employment handbook. Most handbooks address the at will nature of employment in two areas. The first is the disclaimer and the second is the obligatory at will policy. Unfortunately the disclaimer and at will policy are in the front of the handbook and are long forgotten by the time the employee gets to the end of the handbook. None of the other policies remind the employee that any promise made does not change their status as an at will employee.

Takeaways.

If there’s nothing else that you take away from this Blog post, hopefully, the following three items will resonate with you:

1. Don’t make promises you don’t have to make.

Your employees are relatively sophisticated. They understand that you are running a business. You don't have to persuade them that you are one happy family that will stay together forever. If you try, they won’t believe you. So be honest. Don’t make promises in your handbook, or any literature you publish, that is inconsistent with reality. Your employees will appreciate it.

2. Get your advice from your employment lawyer, not the know-it-all at the local tavern or diner.

While "Cheers" may be the place where everyone knows your name, it is not the appropriate locale to get legal advice. Over the years I have heard a variety of advice given in local taverns and diners that had no correlation with the status of existing law. This is particularly true when it comes to the issue of terminating an employee. Termination is a serious event that merits implementation of the plan that will minimize future adverse consequences.

3. Be consistent.

All employees should be treated similarly. That means that your most irritating, obnoxious employee should receive the same treatment as the most popular employee. That more than anything else will avoid many workplace lawsuits.

Coming up:

I know I started this series in November with a promise not to keep you hanging, but I just couldn’t bring myself to write about termination during the holiday season. In my next post in this series we will discuss discipline and documentation.

Later,

Rod