Labor and Employment Law blog

The Express Employment Contract - Is This An Option Employers Should Consider?

The threat of wrongful discharge litigation arising from an employee termination often inhibits employers in the development of their personnel programs and practices. One option for eliminating this influence on general personnel policies and yet limit potential liability in a particular situation, is the express employment contract.

Such express employment contracts require customization to address each particular employment relationship involved. Generally, these agreements specifically state the duration of employment and expressly limit the circumstances upon which employment can be terminated, by either party, prior to a certain date.

Express employment contracts may include provisions that permit dismissal "for cause," invalidate the agreement at the discretion of the employer in the event of a company merger or acquisition, and specifically waive the contracting employee's access to grievance and arbitration procedures available to the employees. Perhaps most importantly, express employment contracts usually limit the remedies available for breach of contract. On the other hand, express employment contracts guarantee employment for a set period of time, subject to those exceptions which are enumerated.

There are some disadvantages to express employment contracts. They might include:

• greater administrative costs,
• reduced flexibility,
• inconvenience,
• a potential "chilling" effect on recruitment, and
• potential liabilities due to inadvertent omissions or unforeseen developments.

However, as the wave of wrongful discharge claims rise and judges demonstrate an increasing willingness to infer contractual protections for employees, express employment contracts are an alternative worth considering.

[The above article was taken by permission from What Every Business Manager And HR Professional Should Know About Federal Labor And Employment Laws, a guidebook written for all employers and HR professionals.]

Pre-Employment Job Application - Is Yours Unlawful?

When was the last time you reviewed your pre-employment job application form? If it has been a while, now might be a good time to review what your form contains - and whether all the information you request is lawful. Here's a quick quiz that may help you identify some trouble spots.

Which of the following questions or statements, if they were to appear on a pre-employment job application, would you say are lawful? Which do you believe are unlawful?

1. What is your date of birth?
2. Have you ever been arrested?
3. Are you married? Single? Divorced? Separated?
4. Of what country are you a citizen of?
5. What is your native language?
6. List the name and address of person to be notified in case of an accident or emergency.
7. List any clubs, societies and/or lodges to which you belong.
8. Are you 18 years of age or older?
9. Have you ever been convicted of a crime?
10. Are you a citizen of the United States?
11. (If not a citizen of the United States), do you intend to become a citizen of the United States?
12. What languages do you speak or write fluently?
13. How long have you been a resident of this (city, state)?
14. Do you posses a valid driver's license?

If you said the first seven are unlawful and the last seven are lawful, you are correct. If you got any wrong, check out your pre-employment job application form to ensure that all of the information you request from job applicants meet the legal requirements.

For a more complete list of dos and don'ts, you might like to check out the "job application checklist" found in chapter 16 of the HR employment law guidebook, What Every Business Manager And HR Professional Should Know About Federal Labor And Employment Laws. You find a lot of sound advice regarding what you should and should not do when interviewing and hiring applicants.

How To Protect Yourself From The Hidden Dangers of Unpaid Internships

[Excerpts from a special article written by Louis P. DiLorenzo, Esq.]

It's that time of year when employers are swamped with requests from college students for unpaid internships. And for many employers, the benefits of such a relationship are obvious. An internship provides the student with an opportunity for real-life experiences, resume enhancement and a possible "leg up" in the working world. The employer receives the chance to evaluate a new applicant, at no cost.

The legal risks, however, may not be so obvious.

One area of risk is the Fair Labor Standards Act (FLSA) which requires that nonexempt employees receive the minimum wage for all hours worked and one-and -a-half times their regular rate of pay for all hours in ecess of 40 in a workweek. The $64,000 question, however, is whether the unpaid intern is an "employee" within the meaning of this and other federal and state statutes. The U.S. Labor Department has adopted six criteria for evaluating this issue.

1. The internship should be similar to the training given in a vocational school.
2. The training must be primarily for the benefit of the intern, not the employer.
3. The intern must not displace any regular employees, but must work under close supervision.
4. There should be no immediate advantage to the employer.
5. The intern must not be entitled to a job at the completion of the internship.
6. The intern and the employer must understand that the intern shall receive no pay for the training.

If your organization uses unpaid interns, or if you plan on starting an intern program, here are four things you may wish to consider to protect yourself from the internship pitfalls.

• Have an agreement or letter making it clear there will be no pay and no guaranteed job.
• Adopt a policy that sets up strict supervision and assigns a mentor.
• Ensure the primary benefit of the intership is for the student, not the employer. For example, minimize assigning the same duties regular employees perform.
• Arrange for a structured program of internal and, if possible, external instruction in the type of work your organization does.

The determination that an unpaid intern is, in fact, an employee can have impact beyond minimum wage and overtime. A misguided classification can lead to problems involving discrimination laws, worker's compensation, state and federal taxes, benefits and unemployment insurance coverage.

Be careful out there!

[Mr. DiLorenzo has practiced labor and employment law for 30 years and is currently the Co-Chair of the Labor And Employment Law Department for the firm of Bond, Schoeneck & King, PLLC]

"Employment-at-Will" - What Employers Should Know

The common law rule of "employment-at-will" is that an employee who is not hired for a specific duration (i.e. one year, two years, etc.) can terminate his or her employment, or be terminated by the employer, at any time, for good reason, bad reason, or no reason at all. Under the common law rule, an employee who is hired for an indefinite term and who is discharged by his or her employer has no contractual right to challenge the termination decision - regardless of the perceived or actual fairness of the termination decision.

The courts, however, recognize that a person hired for a specific term has a reasonable expectation that the employment would last for a stated period absent of a just or good reason for termination of the employment relationship. Thus, if an employee for a definite term were discharged without good cause, even under the common law, the employer could be liable for breach of the employment contract.

Several states have modified the common law rule by creating exceptions to the employment-at-will doctrine. The two most common exceptions are:

1. an implied covenant of good faith and fair dealing, and
2. considerations of public policy.

The covenant of good faith exception is considered an implied promise, presumed to be part of every employment relationship, that the employer will not terminate the employee arbitrarily or without cause.

The public policy exception generally prohibits an employer from terminating an employee because the employee exercised a statutory right, refused to violate the law, or otherwise acted to further the public interest.

Rather than assume what is or is not implied by the common law understanding of employment-at-will, it is always adviseable for employers to seek legal counsel prior to taking action regarding either an employee termination or establishing an employment contract.

The ADA and Disability-Related Employment Questions

Under the Americans with Disabilities Act of 1990 (ADA), an employer may ask disability-related employment questions only after the applicant has been given a conditional job offer. This helps ensure that an applicant's possible hidden disability (including a prior history of a disability) is not considered before the employer evaluates an applicant's non-medical qualifications.

However, employers may do a wide variety of things to evaluate whether an applicant is qualified for the job, including the following:

• Employers may ask about an applicant's ability to perform specific job functions. For example, an employer may state the physical requirements of a job, such as the ability to lift a certain amount of weight, and ask if an applicant can satisfy these requirements.
• Employers may ask about an applicant's non-medical qualifications and skills, such as education, work history and required certifications and licenses.
• Employers may ask applicants to describe or demonstrate how they would perform job tasks.

Here are some additional things employers may also want to consider.

Once a conditional job offer is made, the employer may ask disability-related questions - as long as this is done for all entering employees in that job category. If the employer rejects the applicant after a disability-related question, and a charge is filed, investigators will closely scrutinize whether the rejection was based on the results of that question.

If the question screens out an individual because of a disability, the employer must demonstrate that the reason for the rejection is "job-related and consistent with business necessity." In addition, the employer must demonstrate that the individual poses a "direct threat." This means that the individual poses a significant risk of substantial harm to him or herself or others, and that the risk can not be satisfactorily reduced through reasonable accommodation.

More Information

For more information about hiring practices and ADA requirements, see What Every Business Manager And HR Professional Should Know About Federal Labor And Employment Laws. Also the EEOC provides additional guidelines regarding disability-related employment questions. You might also like to check out an earlier post about reasonable accommodation.

Checklist For Hiring Employees

Good personnel practices begin with the hiring process. All job applicants should be evaluated consistently as part of the interviewing process. In order to maintain consistency, here is a hiring checklist you might want to include in your program.

1. Write a job discription for the vacant position or review the old one, updating the duties required.
2. Make a skills profile which lists the precise duties of the position and the skills needed to accomplish these duties.
3. Receive applications and evaluate them. Notify unqualified candidates. Rank qualified ones.
4. Schedule interviews. Prepare specific open-ended questions which will help to determine whether the applicant will be able to accomplish the duties of the position.
5. Discuss the duties, responsibilities, and skills required; and describe the wages, benefits, advancement opportunities and other aspects of the job.
6. Summarize the interviews in written reports and retain them in a file.
7. Check the candidate's references. Check the requisite documents to determine whether the new hire is a U.S. citizen or has the proper authority to work in the U.S., and complete the INS Form I-9.

Also note that Federal law prohibits the use of a polygraph to prescreen prospective employees in most situations.

For other good articles about hiring practices, check out Pre-Employment Inquiries - Things Employers Should Know, Hiring Procedures - Seven Personnel Practices To Avoid, and Tell Me About Your Former Employee - Should I Hire Her?

Pre-Employment Inquiries - Things Employers Should Know

Employment application forms and pre-employment interviews have traditionally been instruments for screening out, at an early state, "unsuited" or "unqualified" persons from consideration for employment. The law, interpreted through court rulings and EEOC decisions, prohibits the use of all pre-employment inquiries and qualifying factors which disproportionately screen out member of minority groups or members of one sex, are not valid predictors of successful job performance, and cannot be justified by "business necessity."

In devising or reviewing application forms or in seeking information from job applicants, employers should ask themselves three questions.

1. Will the answers to these questions directly or indirectly reveal information concerning an applicant's membership in a protected class?
2. Will the answers to this question, if used in making a selection, result in disparate treatment or disparate effect on minorities and/or members of one sex?
3. Is this information really needed to judge an applicant's competence or qualification for the job in question?

Here are some additional things employers should be aware of.

• Pre-employment inquiries concerning race, color, religion, sex or national origin are not considered independent violations of the law. However, inquires which either directly or indirectly disclose such information, unless otherwise explained, may constitute evidence that discrimination prohibited by Title VII has occurred. Some state expressly prohibit such inquiries, while other states consider it illegal to seek related information. Employers need to review their state's specific statutes.
• The EEOC and courts have ruled that minimum height and weight requirements are illegal if they screen out a disproportionate number of minority-group individuals.
• Employers are cautioned against using any non-job-related questions that pertain to marital status, pregnancy, future child bearing plans and number/age of children. It is a violation of Title VII for employers to require pre-employment informtion about child care arrangements from female applicants only. The U.S. Supreme Court has ruled that an employer may not have different hiring policies for men and women with pre-school children.
• It is a violation of Title VII when the use of an English language proficiency test has an adverse effect upon a particular minority group, and English language skill is not a requirement of the work to be performed.
• The U.S. Supreme Court has found an employer's requirement of a high school degree discriminatory where statistics showed such a requirement operated to disqualify blacks at a substantially higher rate than whites, and there was no evidence that the requirement was significantly related to successful job performance.
• Requesting information about friends or relatives working for an employer may be unlawful if the information is not relevant to an applicant's competence.
• And finally, the courts and Commission have held that without proof of business necessity, an employer's use of arrest records to disqualify job applicants is also unlawful discrimination.

For more articles about pre-employment dos and don'ts, here is a short list of links you might like to check out:

What you can/cannot ask in an interview.

EEOC Cracks Down On Discriminatory Hiring Practices.

Best practices in interviewing.

And again, check your state statutes as they may be more restrictive the federal mandates.

Guidelines For Conducting Employee Termination Meetings

Back in January, Peter Mullison wrote an excellent article on the use of termination checklists. He correctly mentions that "employers should understand that termination is going to cause hard feelings, and if not done the right way, the first person the employee is going to call is a lawyer."

Even though an employee termination may not be anticipated, smart employers use a checklist when conducting the termination meeting - to ensure that (1) all elements of the termination are completed in the correct manner and (2) policies and procedures are applied consistently with each termination event.

Here are nine guidelines that you might like to consider before conducting your next meeting to dismiss an employee:

1. Know precisely why the employee is being terminated and ensure that the grounds for termination are based upon nondiscriminatory reasons.
2. Once the decision is made, set a private appointment in a private office to ensure control and privacy. Under non circumstances should the dismissal be don on the telephone or in a social setting.
3. There is never a "good" time to dismiss, but an early Monday or Tuesday is preferred as opposed to 5:00 p.m. on Friday.
4. Keep the meeting brief. Convey the bad news right up front and avoid making platitudes.
5. Let the dismissed employee have an opportunity to express his/her side of the issues, without interuption. However, keep control of the meeting, and in no way waver in your determination that the decision is final.
6. Do not discuss the situation with any other employee.
7. Have any final payroll checks, benefits or vacation payments prepared in advance.
8. Regardless of the reason for the employee dismissal, be sure the employee understands his/her rights regarding employee benefits such as group insurance continuation, pension plan electibves and unemployment insurance.

If you are terminating an employee "for cause", read our April 4th article about avoiding wrongful discharge suits. The artilce provides a list of "things to do" that could help avoid a larger employee issue.

Some employers include having a third "silent" person attend the dismissal meeting. This is also something to consider. The purpose of the third party is to corroborate the events of the meeting, should any disputes arise in the future.

Remember, while employees may often respond to a dismissal with shock and anger, if the termination is done professionally, such reactions rarely reach the level anticipated or feared by managers. The keys are to ensure that  the dismissal meeting is handled professionally and that all the issues are properly addressed.

Terminating An Employee - Use This Handy Checklist

Unless circumstances involving crime or serious infractions of work rules are the reason for terminating an employee, the decision to discharge an employee should be carefully planned. It should not be something left to spontaneity.

In the vast majority of dismissals there should be a paper trail documenting the circumstances leading to the decision to terminate an individual. Personnel file records and performance reviews often should be part of the documentation. If it is a matter of economics, then there should be a staightforward recitation of those facts(i.e. the loss of a major customer or a general business slowdown) and the reasons the employee was selected.

What is important is to reveal the true basis for dismissal. There are many wrongful discharge suits that are brought primarily to find the "real reasons" for termination. Some suits could be avoided by forthrightly explaining the dismissal.

Before making a termination decision, here is a handy checklist you might like to consider:

• Review the timing of the termination.
• Review the employee's entire personnel file.
• Review all the events surrounding the termination.
• If a disciplinary consequence, verify the employee was adequately forewarned of his or her conduct.
• Make certain the rule/offense is reasonably related to business need.
• Review the investigative findings to ensure the investigation was fair and complete.
• Review the evidence of the employee's guilt to determine if "substantial evidence" exists to support the decision.
• Make sure the applicable rule, policy or criteria is being applied consistently.
• Verify that the punishment fits the offense.
• Consider any protected status, anticipate potential claims and proceed in a manner which mininmizes the risk.

For more information about terminating an employee, you might like to read How To Handle An Employee Termination , Radio Shack - How Not To Terminate and What Is A "Just Cause" Checklist? For anyone involved with a sales organization, Cube Management has written a good article on Terminating Sales And Marketing Employees that would be worth reading.

The decision to hire or dismiss an employee is ultimately the employer's, but should be based on principles of fairness and respectful for the dignity of the individual employee. If these two guideposts are followed, then there is greater certainty that a disgruntled former employee will not prevail in a wrongful discharge lawsuit.

Employment Laws Mistake # 8 - Terminating Employees

The way in which an employee is terminated by his or her employer can have an enormous effect on whether or not the terminated employee looks for a legal recourse. Unfortunately, some employers fail to think through the entire termination process.

Employer Mistake: Be quick to terminate employees who are grappling with health problems and issues at home. Fire people right before Thanksgiving, Christmas, their birthday. Make sure a guard walks them to the door in front of their co-workers.

The Truth:

Remember, employment lawsuits are decided by jurors who are or were employees. The ultimate measuring test for jurors, and other decision makers, is whether the employee was treated fairly.

They need a proven, documented record of fairness. Performance evaluations should candidly, and in detail, describe performance problems. When appropriate, there should be progressive discipline that provides notice of the problem and the consequences of failing to correct it.

The timing of an employee termination is important. If an employee should be terminated - do it. Do not wait until the employee checks into a rehabilitation program or helps start a union campaign. And stay away from a termination right before the holidays unless it would be inappropriate to wait.

Litigation breeds out of humiliation and a lack of respect and dignity. Whether a terminated employee sues their employer often depends on how they are treated during the termionation process. Security guard escort from the premises is an extreme measure. It should be used sparingly and only when necessary.