In remarks to the Connecticut State Bar Association’s annual meeting on June 11th, the NLRB identified that the next big enforcement focus will be on employers’ “at-will” statements within employee handbooks. Lafe Solomon, acting NLRB General Counsel, stated at the meeting that provisions asserting that employment is “at-will” and can be changed only in writing by a senior company official, violate the NLRA because an employee could reasonably believe that type of clause means even union representation and collective bargaining will not alter his or her at-will status, therefore attempts to organize would be futile. That violates the collective action portion of Section 7 of the NLRA. 

At-will employment, a creature of state law, is the doctrine that provides that the duration of employment is for no particular term and either the employee or employer may end the relationship without notice.  The opposite of “at-will” is employment for a set period, normally requiring termination only “for cause.”

Hyatt Hotels was hit with an NLRB complaint filed February 29^th of this year (Case Number 28-CA-061114 filed in Phoenix, Arizona). While it predominantly involved social media issues, the NLRB alleged that the following phrases were discriminatory:

• I understand my employment is “at-will”               
• I acknowledge that no oral or written statements or representations regarding my employment can alter my at-will employment status, except for a written statement signed by me and . . . Hyatt’s Executive Vice President . . .
• The sole exception [to employer’s right to change handbook and other policies] to this is the at-will status of my employment, which can only be changed in a writing signed by me and [Hyatt Executive].

The NLRB alleged that this language constituted the employer interfering with, restraining, and coercing employees in the exercise of rights guaranteed by the NLRA.  It was recently announced that Hyatt agreed to change those polices, in response to the NLRB’s complaint, on a nationwide basis. (http://hr.cch.com/eld/Hyattsettlement.pdf)  The Hyatt action by the NLRB comes after the decision in American Red Cross Arizona Blood Services Region, Case No. 28-CA-23443, decided February 1, 2012. (http://hr.cch.com/eld/RedCrossALJ.pdf). 

In Red Cross, the administrative law judge held that similar language violated the NLRA’s Section 7 rights, although for tenuous reasoning.  The reasoning was based on the government’s argument that the acknowledgement in effect constituted a waiver by which the employee agrees his or her status cannot change, which thereby effects a relinquishment of rights to advocate concertedly, whether represented by a union or not, to change at-will employment status.  This is in light of undisputed testimony that the employee at issue did vehemently engage in concerted activities.

It appears that the NLRB’s focus on social media and altering the employment-at-will doctrine is interjecting federal standards into state contract relationships, with an end game of promoting employee leverage against employers policed by the NLRB.  Notions of “free speech” under Section 7 are being articulated by the NLRB, even in private segment workplaces.  Perhaps for those non-union employees, the NLRB seeks to fill the void created by the free marketplace rejection of union representation – by fiat.  Employers are encouraged to have their personnel policies reviewed by competent legal counsel, to reduce the risk that the NLRB can take issue with the receipt provided by their employees.

Such promises can create contract or reliance claims if the “hot” candidate turns out to be not so hot as an employee and has to go.  An offer letter can constitute a contract as to termination or other terms and conditions of employment which can lead to damages for breach – particularly suspect are letters that have no clear at-will disclaimer language.  A reliance claim arises when there is a promise of employment that is specific and relied upon and compensates an employee for losses incurred in taking a job that doesn’t work out. Reliance claims usually arise in the context of job offers that are withdrawn.

Courts have often rejected attempted contract or reliance claims on the strength of the at-will doctrine, but a specific-enough promise with clear detrimental reliance or an offer letter that makes promises of employment for a definite period of time can support a reliance or contract claim and make a termination an expensive mess.

Takeaway:  Once you write an offer letter, review it backwards.   If the employment is at-will, include language expressly stating that.  Think about a termination meeting and ask yourself if you are making specific promises or saying things about the position that may compromise at-will employment rights.  If you think you are, then consult legal counsel about rephrasing the letter to take out the potential contract or reliance language without entirely losing the intended tone and points meant to attract the candidate.  Or, if such promises are really necessary to attract the candidate, have counsel draw up a reasonable contract that maximizes the employer’s rights while giving whatever binding assurances are necessary for the hire.

Advantage for Employer: At-Will allows an organization to remove a bad employee or an unneeded employee quickly.  Everyone has heard the horror stories of bad teachers that could not be removed due to tenure.  At-Will saves an employer from getting stuck in a similar situation.  The employee still might win unemployment benefits, but suing you for breech of employment contract is far less likely.  If an employee gives notice, you do not have to let them work until that date- especially if they start goofing off on-the-job.

The employer also has more freedom to move employees to different positions as the employer’s needs shift.

Advantage for Employees:  For most employees, At-Will is seen as a cold, heartless, and selfish act by the employer.  However, At-Will also helps the employee in certain ways.  With At-Will, the employee can quit your organization whenever he or she wants.  There is no need to give “two weeks notice” or stay to fulfill an employment contract.

Also At-Will frees the employer up to find the best employees, which means better co-workers for that employee.  In a good organization, an At-Will employment policy helps in creating the best team possible.

Work Contracts: The other big option is an employment contract, which is more complex to create so that it is fair for both sides.  Typical people on employment contracts include unionized staff, professors, sports players, and key top officers (CEOs, CFOs, etc.)  A contract means the employee cannot be demoted, moved, or fired without extreme problems, but it also means that the employee cannot easily quit either.  The classic example comes up in sports, when a player wants to go to a new team but his current team refuses to release his contract.  A business might want certain, hard-to-replace personnel, under work contracts but it should be used only for those vital positions (like a general manager, research scientist, or chief financial officer).

If your organization has employees under contract it could find itself in a
difficulty should  it want to shift staff to new responsiblities (due to new opportunities, changing demographics, etc.) or need to reduce staffing due to a drop in revenue.  The organization may still have to pay that salary no matter what.  That can be seen in a sports team that is forced to still pay a player that is on the disabled list due to an injury or when a company fires its CEO yet still is contractually required to pay millions as a payout.

Some experts recommend taking a third approach:  having a “good cause” or “just cause” employment policy.  This is an attempt to soften that harshness of At-Will, but it is difficult for the employer to enact correctly.  Such a policy must be carefully designed to prevent any implied work contract or guarantee of continued employment.  We would recommend having a labor law attorney draft such a policy to make sure it is well crafted.

Locations that do not allow at-will employment:  Currently, only the state of Montana does not recognize at-will employment.  Companies in Montana must show just-cause for any terminations.

Put your At-Will employment policy in writing.  Consider having a professional design an Employee Handbook for your organization, including a strong at-will employment policy.  We recommend New Wind Business Solutions:
http://www.go2newwind.com/employee-handbooks.html

Employment lawyers commonly see the following range of individual employment agreements:

• The Comprehensive “Just Cause” Agreement:  These are sophisticated binding contracts often limited to the most senior management.  They have provisions for “just case” termination, severance, protection of company information, post-employment restraints, and, as applicable, stock options, change of control, and the like.  If such a contract is breached by the employer (for example, terminated without “just cause”), the employee usually can seek the remaining compensation due under the contract.  Drafting such important agreements takes an investment of time and effort and truly needs careful legal counsel and review.  The adage “a small mistake in the beginning can be a big mistake in the end” is rarely more applicable than in these type of contracts.

• The “Term” Contract:  These contracts can be as sophisticated as the comprehensive “just cause” contracts, but they include a term provision ending the contract at a certain date with renewal or non-renewal at the discretion of the parties.  This provides the employer with the opportunity to end the employment relationship at non-renewal time without the risk of breach.  Term contracts are often first or “trial” contracts and can interest employees who believe that they will be able to negotiate better terms once they have proven themselves.  Legal review for consistency in term contracts is very important if the non-renewal option is to work.

• The “At-Will” Agreement: These individual contracts contain many terms and conditions of employment (e.g., salary, bonus, confidential information, post-employment constraints), but there is no just cause provision by which the employee can only be terminated for specific reasons following specific procedures.  The objective of these “at-will” agreements is to commit the employer and employee to certain aspects of employment, but to keep employment itself at-will – usually with only a modest notice provision, if any.  Preserving “at-will” status in a contract prohibits the terminated employee from seeking damages for breach of a contract.  Because these contracts are so limited, they can be tricky to draft.

• Post-Employment Contract Constraints:  Many employers, especially those with sales forces, have contracts that are explicitly limited to securing non-compete and non-solicitation obligations as a condition precedent to employment.  The contents of the contract, legal  “consideration”, professional drafting, and timing of these agreements will be of critical importance if they are to be enforceable.  Contracts with post-employment constraints may either preserve or alter at-will status.

Takeaway:  Think about the range of possible individual employment agreements (there are more types than just listed above) when determining whether you want to enter an individual employment contract.  What are your objectives?  What does the candidate really require in order to be successfully recruited?  Are you setting precedent in the organization?  And stay away from the “off the shelf” contracts – each needs to be drafted with care and professional precision.

The court ruled that Joseph Sullivan, a compliance officer for a hedge fund, could not sue the fund and majority owner William Harnisch for wrongful discharge. The officer alleged nine causes of action, including that he was fired because he “spoke out” about “manipulative and deceptive trading practices,” and that his dismissal violated “a company policy to prohibit retaliation” for such conduct.

New York is a strict employment-at-will state, except in one instance. In that case, a lawyer claimed to have been dismissed by his law firm “because of his insistence that the firm comply with the governing disciplinary rules by reporting professional misconduct” committed by one of the plaintiff’s colleagues. That claim survived a motion to dismiss.

The appeals court wasn’t buying that argument though in this case.

“Important as regulatory compliance is, it cannot be said of Sullivan, as we said of the plaintiff in Wieder, that his regulatory and ethical obligations and his duties as an employee “were so closely linked as to be incapable of separation.”

That holding stoked the ire of Chief Justice Williams, who issued a passionate dissent. He said that “In the wake of the devastation caused by fraudulent financial schemes—such as the Madoff ponzi operation, infamous for many reasons including the length of time during which it continued undetected—the courts can ill afford to turn a blind eye to the potential for abuses that may be committed by unscrupulous financial services companies in violation of the public trust and the law.”

That sums up the two sides of the argument right there.

Here’s the full text of Sullivan v. Harnisch.

One certified question involves the interpretation of a homeowners insurance policy under Virginia law:

For purposes of interpreting an “all risk” homeowners insurance policy, is any damage resulting from [the covered home's] drywall unambiguously excluded from coverage under the policy because it is loss caused by: (a) “mechanical breakdown, latent defect, inherent vice, or any quality in property that causes it to damage itself”; (b) “faulty, inadequate, or defective materials”; (c) “rust or other corrosion”; or (d) “pollutants,” where pollutant is defined as “any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste”?

The per curiam unpublished certification order in Travco Insurance Company v. Ward was entered by a panel consisting of Judge Shedd, Judge Wynn, and Senior Sixth Circuit Judge Keith. The panel heard oral arguments on September 20, 2011. The court’s reasoning with respect to certification is not that extensive for the amount of time that this appeal has been pending.

The other certified question arises out of the employment context:

Does Virginia law recognize a common law tort claim of wrongful discharge in violation of established public policy against an individual who was not the plaintiff’s actual employer, such as a supervisor or manager, but who participated in the wrongful firing of the plaintiff?

Judge Floyd authored the certification order in VanBuren v. Grubb, on behalf of a panel that also included Judge Niemeyer and Judge Motz. The reasoning in favor of certification is much more extensive than in Ward. In addition to noting that the Virginia Supreme Court has not addressed this issue, the order notes that no consensus has arisen among Virginia’s trial courts and that other states are split on the issue.

According to a recent decision by the Court of Appeals of Oregon, Mr. Cocchiara, a car salesman, told his employers at Lithia Motors, Inc., that he needed less stressful work after the heart attack, and had taken a job with with a different employer, the Medford Mail Tribune.  Cocchiara said Lithia called him “too valuable” to Lithia and said he should withdraw from the Mail Tribune job, and that if he would come in the next day to complete some formalities, they would give him a “corporate” purchasing job to accommodate his disability. 

However, he told the Court, when he went in the next day, he discovered he had not been hired, but was only going to be interviewed.  By then, he had already backed out of the Mail Tribune job and could not get it back.  He did not get Lithia’s corporate job and wound up in a job paying less than it would have. 

Cocchiara went to court, stating that Lithia promised him the corporate job and claiming damages based on wages he would have earned in that job.  For reasons not explained in the decision, he did not claim damages based on potential earnings from the Mail Tribune job.  (He also withdrew another claim, for discrimination due to disability under an Oregon statute.) 

In its defense, Lithia asserted that Cocchiara had lost nothing, because Lithia would only have rehired him to work “at will,” meaning that either party could have terminated the job at any time for any reason, or no reason.  The Court agreed, and said this meant Cocchiara could not rely on any promise of employment, and so has no claim for damages for not getting the job.  The Court stated that an at-will job remains an at-will job, even when given to a disabled person as an accommodation for the disability.  The Court affirmed the lower court’s judgment for defendants. 

The Court did not rule that there are no limitations on firing an “at will” employee.  This case did not involve that issue.  As the Court suggested, the law prohibits discrimination in employment, which a firing might be.  Also, a “whistleblower” law may protect employees who take certain actions in the public interest.  Statements in employee handbooks may be interpreted to protect employees.  Also, a union collective bargaining agreement may impact an employer’s termination rights.  A written employment contract may prohibit termination, other than for cause, for a defined period of time. 

Legal brief.  The case discussed is Cocchiara v. Lithia Motors, Inc., (Ct. App. Ore. December 29, 2011).  Appeal from summary judgment for defendants on claims of fraudulent misrepresentation and promissory estoppel related to alleged promise of employment to accommodate employee disability.  Held, affirmed.  Plaintiff could not reasonably rely on defendants’ statements as promising anything other than “at will” employment, nor recover damages based thereon.  Plaintiff voluntarily dismissed without prejudice statutory claim for employment discrimination on basis of disability.

In Gunderson v. Alliance Computer Professionals, Inc., 628 N.W.2d 173 (Minn. Ct. App. 2001), the Minnesota Court of Appeals identified several factors that influence whether a minority shareholder’s expectation of continued employment is reasonable or not.  Here are some of the key points from that decision:

• Shareholders who sign buyout agreements permitting termination of employment for any reason and obligating shareholders to sell their shares to the corporation upon termination of employment likely do not have a reasonable expectation of continuing employment.
• An employee who has no capital investment in the corporation but either buys a small percentage of stock through periodic company offerings or receives a small percentage of stock as part of a compensation package likely does not have a reasonable expectation of continuing employment.
• To be reasonable, an expectation of continuing employment must be known and accepted by other shareholders, as opposed to based only on the shareholder’s “subjective hopes and desires.”
• An expectation of continuing employment is likely reasonable if “continuing employment can fairly be characterized as part of the shareholder’s investment.”  Factors to be considered in making this determination include, among others, whether a shareholder’s salary and benefits constitute de facto dividends and whether procuring employment with the corporation was a significant reason for investing in the business.
• Expectations of continuing employment must be balanced against the controlling shareholder’s need for flexibility to run the business in a productive manner.  Accordingly, an expectation of continuing employment is not reasonable when the shareholder-employee’s own misconduct or incompetence causes the termination of employment.

Anyway, my point is to say that I always profoundly disagreed with them on a lot of things, but the big one—and the reason I could never be a socialist, or even a proper Marxist—is that I’m big on property. I think reasonably strong property rights are not just important, but fundamental to a working democracy and liberty generally. I think it’s so plainly obvious that it’s not even worth arguing about. Property rights are a funny thing though; libertarians—hard libertarian, not the vague Ron Paul-ish ones—take the extreme view that property rights precede all civil society. In other words, they are inviolably ours, to the degree that the state can have no powers that conflict with that right.

This isn’t a very common view; the Constitution itself gives the government the power of eminent domain in its 5th Amendment “takings clause.” The takings clause allows the government to take any property for a “public use” so long as it is done via due process and pays a “just compensation.” So our starting point, as a society, is that the right to and dominion over your property is not 100% absolute. The debate then settles in on what is an appropriate framework, or the optimal limits, for our property rights.

Consider two examples:

In the first, you are you. You work for a firm as, say, a designer of some kind. You lead a team, but don’t have any management authority. You’re there for five years. You get incremental raises every six months. You’re five years in, and you make $65,000 a year now, and pay about $18,000 in taxes. Now, a management position just under the executives, say, two levels above you, opens up. You interview and you get the job. Now you make $174,000 a year, and pay $55,000 in taxes, or a 5% greater rate. Is that fair?

In the second, you’re still you, but probably older. This time, you’ve bought a little vacation house—one story, a few rooms, modest—on the beachfront. The whole beachfront is homes, with the exception of a lookout point that is owned by nobody—or rather the public. Now it so happens that your newly bought house is situated so that it provides one of the only safe and convenient passages to this spot. After noticing that people will occasionally traipse across your yard while you’re barbecuing or hosting friends or what not, you decide to put up a little wooden fence to discourage people from crossing your property, and to instead take the extra-long way around. The state, which runs the coast, comes in citing an Open Beaches Act and historical practice and tells you that your property’s unique location gives the public an easement, or right, of entry over it and in fact you can’t put up a fence. What about this one? Fair?

I think most people have little problem with the first, but instinctively recoil at the second. But why? They’re both you’re property. Arguably, the government’s taking of that disproportionate $7,000 or so every year is just as bad, if not worse, than tolerating a few beach-goers every once in a while? Think about what you could do with just a handful of years of that $7,000. You could pay for a kid’s college tuition. You could take a dream vacation. You could invest it in a business and double it. You could buy a slightly worn first edition of Darwin’s Origin of Species. What do you really get out of building a little fence just so you don’t have to cast your imperial visage on an outlander?

Part of the answer is that we “feel” different about our real property than abstract property like money. Even if that quality is ineffable, there is a qualitative difference between these two kinds of property. The law agrees; it’s generally a lot easier for the government to take your money property than it is to take your real property, even in the trivial sense described above.

We can all agree on these two things, though: first, in neither case would it be okay if the government took this property without the force of law behind them, and second, we want there to be differing standards to address the differing qualities of these kinds of property.

A third example: you live in Chicago and you hate the jacked-up parking prices so much, you prefer to take your chances with a ticket rather than pump cash into the meter. You accrue tickets and one day, you walk outside to find they’ve towed your car, and they won’t release it to you until you’ve paid your $1,500 in tickets and penalties. Your car’s Blue Book value is only $1,250. Outrage! Right? That’s your property! GIVE IT!

Now, here’s the pitch: the evolving nature of the economy and the social relationships that define and are defined by it have given rise to the fact that our employment is a form, though definitely a differing form, of property, over which we have some degree of right.

Currently, we don’t have any property rights over our jobs. But we should have at least some. Not as much over our right over our real property, and perhaps not even as much as our right over our cash-as-property, but some. In the sense that if we’re threatened with losing it, we have some recourse to preserve our right over it.

Consider the example of the UK. In the UK, after working somewhere for a year, you can still be fired (or “dismissed”) but only for the following reasons:

Behavior or conduct; capability; layoffs (generally); reaching official retirement age; or because a change of law that made the job illegal.

These all sound like precisely the reasons you’d expect to be fired from a job. What other good business reason would an employer have to fire you? Surely we aren’t concerned with an employer’s right to fire you because you’re funny looking or complained to the human resources lady that your supervisor is always talking about your “taut, tear-drop ass.” In fact, if you work for a corporate employer, there is a near 100% likelihood that you were given an “employee handbook” that specified those UK-style causes as the appropriate causes for dismissal. With one addendum: you signed it when they told you to, and in so doing acknowledged that your employer didn’t actually have to abide by this. You acknowledged that you are an “employee-at-will” who can be terminated for any cause or no cause.

What we’re talking about is giving people a “property interest” in their job that requires a species of due process be satisfied before that property interest can be terminated. You have a right to your employment int he same sense, if not to the same degree, as you have a right over your money or your real property or your car. We could do it the same way the British did it, by statute that creates the right.

Thought of another way, it reads an implied element to our employment contracts. When you’re hired, you create a contract, whether or not you sign an actual contract. Normally, if you have a contract with someone, and they want out, they have to make you whole, or have to demonstrate why they have a right to end the relationship without doing so.

If we’re going to have an economy where wealth can freely accrue and more and more Americans work for fewer and fewer employers—something like 40,000,000 Americans work for fewer than 2,000 firms—it makes perfect sense to compensate for the inherently superior bargaining power of one side.

Our freedom to determine the boundaries of various property interests gives us a wide range of options. You could limit this rule to firms that employ more than 5,000 people, and thus impact less than 0.03% of firms, but meanwhile cover 40,000,000 people. Bring it down to firms that employ 1,000 people or more, and you’re still only impacting 0.1-0.2% of firms, but 55,000,000 people or nearly half the work force. Is this as radical a reform as requiring as many as 45,000,000 to buy health insurance?

The effects would be profound. Firstly, and perhaps most importantly, such a reform would protect your basic dignity in the workplace. Secondly, it would bring predictability and security to employment. Third, it would rebalance, at least a little bit, the bargaining power of employees vis a vis their employer. That’s important, because it would improve working conditions and stabilize income inequality in the workplace, rather than requiring government policies that are imposed (and arguably constitute taking of property).

One last example, I swear, to bring the point home. You live in Chicago. You own a small bungalow. On the same day you mail in your property taxes, you come home to find that you’ve got a boot on your car. You stomp into the backyard to have a cigarette and rue your fate. Once there, you find a Streets & Sans crew, and they’re telling you the city has to dig up a corner of your driveway abutting the alley and put in a grate so that crews can get to a sewage…uh, thing, that is under there. You shake your fist at the sky. “O! Let me but call a witness in my defense! Let the Almighty state his case against me! I would plead the whole record of my life and present that in court as my defense!”

Then you walk inside and the mail is waiting for you on the kitchen counter. Right on top is an envelope from your employer and inside a pink slip. Under the reason for your termination, it says, “No cause at all.”

At which point in that chain of events would you feel most aggrieved? And when would panic, true panic, set in?

A ski resort in the state recently tested the breadth of the law by arguing that it had the right to fire a worker under a three-year contract that also reserved for it the right to discharge the employee for any reason.

However, the Montana Supreme Court ruled that this was an attempt to evade the law’s requirements. Although the law has an exception for a “written employment contract for a specified term,” the court held that the presence of the at-will cause in the plaintiff’s contract “essentially rendered the three-year term meaningless.”

You can read more about Brown v. Yellowstone Club here.

• The employment relationship ceases to be “at will,” and employees may only be terminated for “just cause.”
• The employer is prohibited by law from dealing directly with union employees about wages, hours, and working conditions and must deal directly with the union instead.
• Employees tend to go to their union rather than their employer when they have a problem.
• The relationship between the employer and the employees tends to become more adversarial rather than cooperative or collaborative.
• The employer is required to expend additional time, money, and resources to deal with the union, particularly in the area of collective bargaining and grievance processing.
• Supervisory employees are required to become familiar with the collective bargaining agreement and administer it on a consistent basis. Flexibility is reduced and the rules become more rigid regarding employee conduct.

The traditional rule of at-will employment may be altered and a contract for employment may be formed by:

• Employment contracts or collective bargaining agreements;
• Statements made in employee handbooks or policy manuals without an appropriate disclaimer;
• Specific oral statements made to applicants or employees; and
• Other written representations, for example, those contained in an offer or warning letter to an employee.

Many employees think that they are protected by “freedom of speech” found in the First Amendment to the Constitution. This may be true if your employer is a government agency, however, the first amendment does not otherwise apply to non-government employers. If you work for a big corporation or a small company, they CAN fire you if you criticize them on Facebook or elsewhere. The reason for this is that most states have “employment at will” which allows an employer to fire employees at any time for any reason, or no reason at all. Facebook postings are NOT protected speech under the First Amendment when it concerns a job with a non-government employer.

If a non-government employer fires you for Facebook comments, you may still be able to collect unemployment, because your exercise of free speech (especially if true) is typically not a legitimate grounds for termination. As such, the unemployment board will often allow unemployment compensation in this situation.

Because of “employment at will”, an employee will often have no remedy for being fired due to a Facebook posting or any other critical comment about their employer. In most states, the only remedies come from federal and state civil rights statutes, namely, discrimination based on age, race, sex, national origin, religion or disability. Unless you can connect your termination due to a Facebook posting to discrimination, there will generally be no valid claim for wrongful termination.

It is important for employees to keep these general rules in mind when they seek to express their feelings about work, over the internet.

________________________________________________________________________________________________

Bruce Coane is a leading lawyer with 30 years of experience in the field of immigration law and employment law. He may be reached via email at houstonlaw@aol.com or his website at Coane and Associates.

2011 Legislative Priorities Employment Relations- Stephanie Foster/ Chair

1. Support transferring control over federally mandated programs like unemployment insurance to states. (80%)
2. Support efforts to maintain employers’ prerogatives to control the workplace, thereby creating a safe, satisfying and harmonious working environment. (94%)
3. Oppose legislation that would erode employment-at-will as a right for all Texas employers and employees. (98%)
4. Oppose legislation and regulations on both federal and state levels that would increase the already-considerable burden on employers regarding occupational safety and health administration (OSHA) requirements. (89%)

Although no documentation is legally required, if we take that concept too literally, we could be looking at trouble, says Jonathan Segal, a partner with Duane Morris, LLP. If the case goes to court, judges and juries create a human factor that can modify the cold realities of what is and what is not in a law book. One factor not written into any law is fairness. Documentation implies fairness. Why is that important? Because judges, juries and investigators always look at fairness. If your process is perceived as fair, you will have an advantage going into any adversarial proceedings.

Here are our suggestions:

• Use Progressive Discipline. If you handle the problem employees through a process, of two or three steps instead of just simply terminating them, you can have more of a clean break.
• Use the Same Person Who Hired to Fire. This step prevents charges of bias in firing. The reasoning is: If the manager showed no bias in hiring that employee, it’s unlikely that the same manager suddenly developed a bias that caused the firing.
• Drop Problem Workers in the First 90 Days. Waiting just builds the worker’s “sense of entitlement” about the job. It is advisable to evaluate new hires at least 10 days before the traditional 3-month introductory period ends and to take action quickly if needed.
• When You Document, Cite Specifics. Instead of using general words like “bad attitude” write out the actual acts that merit the description.
• Avoid Absolutes. Never say “Never” or “Always” with employees. If you say “You always miss deadlines” in documentation or testimony, the employee’s attorney need only to show one instance in which that employee met a deadline and your whole testimony becomes suspect.
• Have Absolute Reasons for Termination. This includes violence or theft.
• Don’t list all of the Little Things an Employee has done Wrong. It makes you look petty. Instead, put three or four examples to show a pattern of problem behavior.
• Focus on the Performance or Behavior Deficiency. Do not speculate on the underlying cause. For example: “Sally is depressed” can be seen as the employee being perceived as disabled. Segal says that just one such utterance can invoke all the job protections of the state and federal disability-bias laws.

From Los Angeles to New York and from San Diego to Humboldt in Northern California, students, faculty and parents at many schools decried higher student fees, reduced class offerings and teacher layoffs in what leaders described as a “Day of Action for Public Education.” Labor unions and student government groups were the main organizers.

. . . .

At Wilson High in Long Beach, about 2,000 students, parents and teachers crowded gymnasium bleachers for a special meeting after school. Union leaders said that more than 700 employees, mainly teachers, face layoffs next year in the Long Beach Unified School District, crowding more students into the remaining classes.

“Bigger class sizes put pressures on teachers, and that trickles down to the kids. It’s a disturbing situation all the way around,” said Diana Craighead, a former PTA leader who has a daughter at a Long Beach middle school and two sons who graduated from Wilson.

If I had been better educated, I would have thought of this quote on my own: “It is more effective to have a good teacher in a large class than a poor teacher in a small one.”  Ouch.  Hopefully the poor teachers get laid off first.

In any event, welcome to the real world, public education.  I’m sure that all those millions of currently unemployed folks feel sorry for you.  Instead of protesting, many of them are trying to find real jobs–that’s how it works with all of the private workers employed “at will.”

Best regards,
Tom Solomon
Thomas D. Solomon
Attorney at Law
9525 Katy Freeway, suite 300
Houston, Texas 77024
(713) 984-9400
(713) 465-2224(Fax)
www.tomsolomon.com
tom@tomsolomon.com

This informational memorandum is provided as a courtesy to provide with items of interest in the employment area. It is not and is not intended to be an exhaustive treatment of its subject matter, but rather an overview of some of the elements of such subject.   It is not intended to be legal advice or a legal opinion and should not be relied on in making legal or business decisions.

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This informational memorandum is provided as a courtesy to provide with items of interest in the employment area. It is not and is not intended to be an exhaustive treatment of its subject matter, but rather an overview of some of the elements of such subject. It is not intended to be legal advice or a legal opinion and should not be relied on in making legal or business decisions.

            Ordinarily a contract of employment may be terminated in the same manner as any other contract.  If it is to run for a definite period of time, the employer cannot terminate the contract at an earlier date without justification.  If the employment contract does not have a definite duration, it is terminable at will.  This is called employment at will.  Under the employment at will doctrine, the employer has historically been allowed to terminate the contract at any time for any reason or for no reason.  Some State Courts and some State Legislatures have changed this rule by limiting the power of the employer to discharge the employee without cause.  For example, Court decisions have carved out exceptions to this doctrine when the discharge violates an established public policy, such as discharging an employee in retaliation for insisting that the employer comply with a federal or state law.

       Courts may sometimes construe an employer’s statements concerning continued employment as a part of the employment contract, and therefore require good cause for the discharge of an at-will employee.  Also, written personnel policies used as guide­lines for the employer’s supervisors have been interpreted as restricting the employer’s right to discharge at-will employees without just cause.  Employee handbooks or personnel manuals have been construed as part of the employee’s contract.  This is why all personnel manuals and employee handbooks should contain a dis­claimer.  A sample disclaimer would be: This employee handbook is not intended to create any contractual rights in favor of you or the company.  The company reserves the right to change the terms of this employee handbook at any time.

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Employment-at-will means that an employer or an employee can end the working relationship at any time for basically any reason. If you quit, or are fired, no notice or reason is required. Most states are employment-at-will states, and there are a few exceptions to employment-at-will law.

For example, employers are forbidden from firing anyone for any reason protected by federal legislation: age, sex, religion, etc. If a company’s employee manual states that certain procedures be followed before firing an employee, and those procedures aren’t followed, that can be an exception to the employment-at-will laws. Additionally, an agreement with a union or intentional infliction of emotional distress may prove to be exceptions.

Right to work laws do not cover quitting or being dismissed from a job. Roughly half of the states in the United States are right to work states, meaning that job seekers have the right to work for a company without being required to join and/or financially support a labor union. In these states, it may still be required that a union represents an employee in grievances and negotiations. Railway or airline employees are sometimes not protected by right to work laws, even if they reside in a right to work state. Federal enclaves may also be exempt.

Conversely, those who do not live in a right to work state could be required to join or financially support a union as part of employment. “Unionized” jobs in these states often include railway or airline employees, for example.

In a nutshell, employment-at-will laws refer to whether reason or notice must be given if an employee is fired or quits. Right to work laws make residents of certain states exempt from being required to join a union in order to work.

We’ve been playing a lot of Queen lately, here at Routing By Rumor world headquarters. Especially this tribute to all of the victims of the U.S. economy. It’s too bad that Washington still can’t bring itself to accepting what most Americans already know.

The latest victims are the restaurants owned by S&A Restaurant Corp., which is part of Texas-based Metromedia Restaurant Group, which is part of the privately held Metromedia Company, owned by the 93-year-old billionaire philanthropist John Werner Kluge.

About John Kluge…

Columbia University in New York City announced last year that Mr. Kluge had pledged $400 million to the University, the largest gift in it’s history. With a little less than $10 billion to his name, poor Mr. Kluge is all the way down at #31 on Forbes magazine’s list of the 400 richest Americans, just below Nike’s Philip Knight, but ahead of eBay’s Pierre Omidyar.

Apparently, all of their company owned locations in the United States have closed, and they have filed for Chapter 7 bankruptcy. This past June, Metromedia disputed the accuracy of this report in the Wall Street Journal, that claimed they had already prepared a bankruptcy filing. There were about 150 company owned Bennigan’s restaurants, and 58 Steak and Ale restaurants. Apparently, a smaller number of franchised Bennigan’s locations in the United States and elsewhere are remaining open for now. Restaurants operating under the Ponderosa Steakhouse and Bonanza Steakhouse brands, also owned by Metromedia Restaurant Group, appear to be staying open for now.

John Werner Kluge (photo credit: columbia.edu)

As has been the case at many other companies that have crashed and burned, many Bennigan’s employees were unaware of the closings until they showed up for work last Tuesday, and were greeted by a sign on the locked front door giving them the good news (If you look closely at the photos in this article from the Fort Worth Star-Telegram about the closings, we believe you’ll see a locksmith changing the lock on the front door at a Fort Worth, Texas Bennigan’s …yup, good call, since this article identifies the locksmith!). What ever happened to the good old two weeks notice when your job is about to self-destruct ? OK, maybe two weeks is asking too much… how about 24 hours notice. Maybe it’s just us, but we don’t think that any employer worth working for would treat their employees that way. We think it shows a complete lack of class. We understand that S&A Restaurant Corp. was probably in dire financial straits, but couldn’t they have done better by their employees ?

These days, it is standard procedure for employers to state right there on the job application that it is “employment at will”, and they can terminate you at any time, for any reason, or for no reason at all. For certain, this is driven by the fear of lawsuits, but how the hell can they expect to hire employees who will be committed to the company, if the company won’t make any commitment to their employees ? To us, this is a prime example of the sorry state of American business in the 21st century. And employers wonder why they can’t find loyal, dedicated employees. They wonder why people quit without giving them fair notice. How much notice did Metromedia give their employees about the fact that they would be closing their doors? None. Yet there were published reports a month or two earlier that Metromedia had already prepared a bankruptcy filing.  Shame on you, Mr. Kluge. Those were some of your hardest working and lowest paid employees, who helped you get to #31 on the Forbes list. Welcome to the era of the disposable employee.

In our mind, employees of other Metromedia businesses have every right to simply pick up the phone one day, and tell their boss they won’t be coming to work any more.  If management at any company has a problem with loyalty like that, just remind them that it was their decision to classify you as an “at will” employee, and that you are simply exercising the freedom that being “at will” gives you.

The asymptotically decreasing tenures of the last few CEO’s at Metromedia Restaurant Group (MRG) may shed some light on the troubles at the company. Clay Dover resigned as CEO in late May after holding that position for about six months. Mr. Dover had previously held other positions at MRG, and had replaced Vince Runco, who had been MRG’s CEO for less than a year. Mr. Runco replaced Jeff Moody, who was CEO for about 18 months. Mr. Moody had replaced John Todd, who held the CEO title at MRG for just shy of two years.

Published reports have questioned whether the affected employees will be receiving their paychecks for hours worked up until the restaurant closures, and whether consumers who hold gift cards from the two chains will receive refunds. Our advice… don’t hold your breath. Of course, if Metromedia Restaurant Group wanted to show it’s loyal customers some goodwill, they could announce that gift cards from their Bennigan’s and Steak and Ale restaurants will be honored at their Ponderosa and Bonanza Steakhouse locations. But again, don’t hold your breath.

The minimally carnivorous, quasi-vegetarian staff at Routing by Rumor has never set foot in either a Bennigan’s or a Steak and Ale, so we don’t know if we missed much, but for thousands of their employees now out of work, it’s a disaster. Restaurant workers are among the lowest paid workers, and in the very tough economic times we are experiencing now, they will have a difficult time finding employment.

This brings up another hardship that restaurant workers in the United States are subject to. Many employees allege that they are forced to share their tips with managers and other employees. By law, employers can’t require employees to share their tips with management. To make matters worse, restaurant workers are not subject to the same minimum wage standards that other workers are protected by. As long as their salary plus their tips equal the mandated minimum wage, their employers are within the law. This means that in many cases, they are paid virtually nothing by their employers. Here’s an article from Nation’s Restaurant News, that describes many of the abuses that restaurant employees allege, and some of the litigation that has resulted, involving some of the largest and best known restaurant chains in the country, including names like Applebee’s, which is owned by IHOP.

As of this morning, it appeared that the websites for Bennigan’s (www.bennigans.com), Steak and Ale (www.steakandale.com), and Metromedia Restaurant Group (www.metromediarestaurants.com) had all been taken down. And the vultures are already starting to swoop down and pick through Bennigan’s remains. Check out this article about a locksmith that was hired to change the locks at a Florida Bennigan’s location, and decided to load up his van with liquor and food that remained in the restaurant. He got caught.

- Routing By Rumor

Under Montana law, “A discharge is wrongful … if … the discharge was not for good cause.”

Wisconsin, like most States, is not a “good cause” State and is instead an “employment-at-will” State.  This means in WI an employer may fire an employee “for good cause, for no cause, or even for cause morally wrong, without (the employer) being thereby guilty of legal wrong.”  Brockmeyer v. Dun & Bradstreet, 113 Wis.2d 561, 567 (WI SC 1983).

So, which State is better?  Is Montana an employee’s promised land, or another attempt at utopia that’s bound to fail?  Should Wisconsin be a “good cause” State?  I don’t have an answer, other than to say WI law should be better to employees than it is.

DISCLAIMER: The information in this blog is NOT legal advice, nor does it establish an attorney-client relationship between you and Employee Rights Attorney Michael Brown or the law firm of Peterson, Berk & Cross. Legal advice often varies between situations. If you want legal advice for your specific circumstances, you must consult with an attorney.

For more information about Wisconsin Employee Rights Lawyer Michael F. Brown and Peterson, Berk & Cross, S.C., please visit http://www.pbclaw.com/mb.html.