What Would Clooney Think?
What Would Clooney Think?

Your employee that you are firing should not hear about his firing from a television report first.

I suppose that would seem an obvious rule to follow. But apparently not.

Let me back up.

Earlier today, the President fired FBI Director James Comey — an act that really is more for politics blogs, than an employment law blog.

But as the details of the firing trickled out in the evening, one detail jumped out at me — James Comey found out he was fired through the television.

From The New York Times:

Mr. Comey was addressing a group of F.B.I. employees in Los Angeles when a television in the background flashed the news that he had been fired.

In response, Mr. Comey laughed, saying he thought it was a fairly funny prank.

Then his staff started scurrying around in the background and told Mr. Comey that he should step into a nearby office.

Now, I’m sure there are many who don’t feel sorry for Mr. Comey; but still, where’s the humanity in firing someone via television?

Of course, this kind of schtick isn’t reserved just for politics. I remember back in 2009, I gave the following tip as well: Do not do layoffs or firings via e-mail. Period. (And last year, I wrote about how to conduct firings without getting sued too.)

So, for employers that are having to conduct firings, let me offer five suggestions for the actual informing of employees that they are being fired.

  1. Do it in person if possible, and have a witness.  If it’s not possible (distance, other circumstances), a phone call is a backup option.
  2. Do it in private.  Pick a time perhaps near the end of the day (or beginning) and perhaps in a location in the office that is away from crowds.
  3. Be brief and direct.  And plan in advance, what you are going to say.  Don’t draw it out, and don’t use wishy-washy language.  Some employers start with the “I have some bad news for you today.”
  4. Don’t argue with the employee or get into lengthy discussions regarding the termination. Be clear that the decision is final.
  5. Be sensitive.  Yes, firing an employee is typically hard on the employer, but guess what? It’s harder on the employee. Always.  Acknowledge the employee may disagree with the decision but be consistent with your message.

There is obviously a lot more to a termination meeting than this. Successful meetings are the result of preparation and practice.

But just remember: Your employee should find out he is being fired first from you — not a third party.

file0001835967537The Connecticut Supreme Court, in a unanimous decision that will be officially released April 4, 2017, has ruled that employers may not use the “tip credit” for pizza delivery drivers and therefore, the employees must be paid the standard minimum wage.

You can download the decision in Amaral Brothers, Inc. v. Department of Labor here.  The decision is no doubt a disappointment to employers who believe that the Connecticut Department of Labor’s regulations in this area far outstretch the plain language of the applicable wage/hour statute.

The case arises from a request by two Domino’s franchises for a “declaratory ruling” from the Connecticut Department of Labor (DOL) that delivery drivers are “persons, other than bartenders, who are employed in the hotel and restaurant industry, …who customarily and regularly receive gratuities.” The request arises from Conn. Gen. Stat. §31-60(b), which has been amended over the years.

Why would the employer make such a request? In doing so, the employer wanted to take advantage of the “tip credit”, in which employees are paid below the conventional minimum wage, but his or her salary is supplemented by tips from customers.

Originally, as noted by the employer’s brief to the Court: “The DOL denied Plaintiff’s Petition for the following stated reasons: (1) the regulations were valid because they served a remedial purpose, were time-tested and subject to judicial scrutiny…; and (2) the only act of “service” was handing the food to the customer at the customer’s door and so delivery drivers’ duties were not solely serving food as required under Regulations of Connecticut State Agencies § 31-62-E2(c). The DOL’s decision was that only employers of “service employees” as defined by the DOL could utilize the credit, and Plaintiff’s employees were not service employees.

A lower court upheld the DOL’s conclusions “agreeing that the regulations were ‘reasonable’, ‘time tested’, and had ‘received judicial scrutiny and legislative acquiescence’. The court also determined that the ‘minimum wage law should receive a liberal construction.'”  (You can also view the DOL’s brief to the Court here.)

The Connecticut Supreme Court upheld the Department of Labor’s interpretations here finding that the regulations issued by the agency were “not incompatible” with the enabling statute.  In doing so, the Court noted that this is a bit unusual because the employer was contending that the regulations were originally valid when issued, but repealed by implication when there was an amendment to the statute at issue.

The Court’s decision traced the origin of the tip credit in a portion of the decision that only lawyers will love. But then they get to the heart of the matter: “It was reasonable for the department to conclude that the legislature did not intend that employees such as delivery drivers, who have the potential to earn gratuities during only a small portion of their workday, would be subject to a reduction in their minimum wage with respect to time spent traveling to a customer’s home and other duties for which they do not earn gratuities.”

While the court’s decision directly implicates delivery drivers, it only impacts those employed directly by the employer (see also: UberEats, GrubHub etc.).  Nevertheless, in upholding the DOL’s interpretation here, the scope of who falls within the tip credit at restaurants is going to be further challenged in the courts.

Before employers make any further conclusions, Connecticut businesses should also be aware that the scope of the tip credit and of tip pooling is being debated at the federal level as well.  The National Restaurant Association has joined many others in asking the U.S. Supreme Court to hear a case on the subject. We should hear shortly whether the Court will accept such a case.

The Court’s decision is yet another reminder that restaurants in Connecticut should review the situations in which the tip credit is being utilized. Issues regarding tip pooling should be reviewed as well.  This case doesn’t answer all the questions that come up in the restaurant context. But in terms of figuring out the scope of the law, it helps to answer (albeit in a manner not helpful to employers overall) some outstanding questions.

monkeyIn yesterday’s post, I talked about some of the reasons why an employee’s lawsuit against his or her employer was destined for failure.

But employers, I’m afraid you’re not off the hook that easily. This post is for any employer that just got sued or threatened with suit.

Maybe that lawsuit isn’t so frivolous after all.

Wait a second! You said yesterday that ‘Odds are, you probably weren’t discriminated against’!”  

Ah, but isn’t that rub? Odds. Statistics.  Yes, some (many?) lawsuits brought by employees are losing propositions. But some are not.

Here are some things I tell clients or prospective clients when I see a lawsuit filed or threatened as to why they should take the lawsuit seriously.

1. That frivolous lawsuit is still going to cost you thousands (if not tens of thousands) to defend.  But I thought you said this post was about non-frivolous lawsuits?  True. But for my first point, that’s beside the point entirely.  Whether a lawsuit is frivolous or not, the system of justice through our courts and administrative agencies moves slowly and with some cautiousness.  Even the frivolous ones need to be defended.  Court filings need to be, well, filed.  And court conferences need to be attended.  So your first point always is to recognize that all employment law cases have a cost associated with them.

And as such, all cases have what we call a “nuisance” value as well.  That is — you are going to spend X amount of dollars defending the lawsuit.  It may be cheaper to just pay a certain amount to avoid the cost of defense.  Now, there are business reasons why you won’t want to do so in all or even many cases, but the employer who fails to recognize the nuisance value of the case is destined to be disappointed in the long run.

It’s a bit of hyperbole to say that any person can sue anyone at any time for any reason. But not that much.  Lawsuits are a part of doing business.  Frivolous or not, you will still have spend money to defend your decision. Be prepared for this eventuality when making your employment decisions and deciding whether or not to offer severance in exchange for a release.

2. “At Will” Employment Is a Misnomer.   In Connecticut, the default employment relationship between an employer and employee is “at-will”.  As many offer letters suggest, that means either the employer or employee can terminate the employment relationship at any time for any reason or no reason at all.  And so, I sometimes hear employers exclaiming “Connecticut is at-will! We should be able to just fire them for any reason!  How can they still sue?

Continue Reading Maybe That Lawsuit Brought By Your Employee Isn’t So Frivolous

outten
Wayne Outten addresses conference

No one will ever mistake the Connecticut Legal Conference, run by the Connecticut Bar Association, for, say a glitzy gaming conference. But if you were fortunate to attend, you had the opportunity to hear some pretty good speakers talk about employment law for several hours.

Among the topics were a discussion on the Ellen Pao case, a discussion of the “Obama Effect” on race relations in the workplace, and a recap of other notable employment law cases from the last year.

For me, one of the most interesting discussions came from Wayne Outten – the incoming chair of the ABA Labor & Employment Law Section, and an accomplished plaintiff’s lawyer.  His talk focused on the lawyer as “problem-solver” which he said was critical in employment law cases.

He said that he often tells his clients (employees at companies) that self-help is their first best option.  It’s something I’ve preached as well. Once you get lawyers involved, you can never de-escalate a situation.

I’ve often preached about how employers need to be “fair” in the decisions. He said that for employees, he advocates the same thing.

But he also pulled back the curtain on the advice he gives to employees too; he plants a seed for employees to use in their negotiations (and again, it’s a well-known device).  He suggests that the employee tell the employer that he’s met with an employment lawyer and that lawyer said he or she has a good case, but that the employee is the “reasonable” one and wants to work things out directly with the employer.  It’s the veiled threat approach.

For those that haven’t heard Wayne speak before, he also provided a top 10 list that he’s given for many years on the ways for employers to avoid getting sued.  Among them:

  • Be fair and reasonable in all your dealings with employees.  Follow the Golden Rule: Treat every employee the way you would want to be treated — that is, fairly. Treat every employee so as to bring out the best that person has to offer.
  • Consider alternative dispute resolution techniques. When the foregoing approaches fail to avert or resolve a particular dispute, consider using such alternative dispute resolution procedures as peer review, early neutral evaluation, mediation and non-binding arbitration. (Use of ADR procedures should always be truly voluntary — not crammed down on employees as a condition of initial or continued employment.)
  • Be nice to plaintiffs’ attorneys. When you get a telephone call or letter from a lawyer representing a current or former employee, consider it an opportunity to engage in mutual problem-solving. Consider meeting with the employee and his or her counsel to exchange views on what happened and how the situation might be remedied. Such discussions may avert litigation.

For employers, there’s wisdom in this advice.

On New Year’s Day, I had the opportunity to launch model rockets with my son on a gorgeous (but very cold) day.

As it turns out, it was also a windy day.  We discovered this through launching two rockets super high — only to see them carried away deep into the woods a mile away.

But it was a good way to start the year. So with that image in your mind, it’s also time to go back over the minimum wage in Connecticut. We’ve seen increases over the last few years, and this year has yet another raise.

So, as of yesterday, the minimum wage has blasted forward another 45 cents to $9.15 per hour. For restaurant workers who are eligible to receive tips, there was also an increase to $5.78 per hour.

The minimum wage will continue to increase. On January 1, 2016, it will increase to $9.60 per hour. And finally on January 1, 2017, it will max out (at least for now) at $10.10 per hour.

Next week, one of my colleagues, Peter Murphy will be at the Connecticut Bar Association to present a program entitled “CHRO 101 – From Complaint to Public Hearing”.   Full details are available at the CBA website.

The program includes a discussion of

  • The Complaint Process, MAR (Merit Assessment Review), and Mandatory Mediation,
  • Responding to the Complaint and Fact-finding,
  • Reasonable Cause and Public Hearings, and
  • Considerations for Appeal to the Superior Court

It promises to be an informative session.   In addition to Peter will be The Honorable Henry S. Cohn, Connecticut Superior Court, Judicial District of New Britain, New Britain, Mary Kelly from Livingston Adler Pulda Meiklejohn & Kelly PC, Hartford, and Michele C. Mount, Referee, Commission on Human Rights and Opportunities.

From my perspective, I’d add three observations.

First, the CHRO moves slow. Very slow.  While there has been a sincere effort now to close and move cases faster, old habits die hard.  Employers who expect things to happen quickly at the CHRO will be sorely disappointed.

Second, there is still a good deal of inconsistency between the regions of the CHRO.  In addition, each investigator has his or her own style and quirks.  As a result, for employers that are unfamiliar with the process it is crucial to talk with counsel about what you can expect with a particular investigator or in a specific CHRO office.

Third, the CHRO remains permissive of lousy discrimination claims. What do I mean? The system does not do a good job of getting claims that have no or very little legal merit to them out of the system.  As a result, employers are often times forced to spend thousands of dollars to defend itself at the administrative level. Worse, they may feel pressure to settle those claims for “nuisance” value even though the claims ought to be readily dismissed, just to avoid future costs.

Of course, there is new leadership at the helm so it’s also fair to say that employers should not expect the agency to remain static. Changes are continuing to be made so its important for employers to stay vigilent.

Having talked with Peter, there are lots of other little tips that you can expect at the presentation.  So it promises to be a worthwhile program to attend.

The CBA has another Labor & Employment Law program scheduled for next week as well at the Farms Country Club in Wallingford. Full details on that program are also available on the CHRO website. 

Yesterday I posted Part I of my interview with Dr. Steve Lurie. Today, we continue the interview and discuss whether the skills for career success can be learned:

Can those skills (for career success) be learned?

Yes. But for some reason, employees typically receive relationship skill training much later in their careers in management development programs using personality tools, 360 feedback, etc. that help them to see who they are as others see them and make them aware of others styles.

We have found that people are actually ready and able to absorb and apply these insights and tools as early as high school. In fact readers tell us that the most engaging and useful part of the book is about how to use Connecting Style awareness for better relationship building.

You’ve referred to "Connecting Styles." What does that mean? 

Study after study shows that what differentiates the best performers from the rest is not subject matter expertise – the what — but the quality of the connections professionals form with clients and colleagues.

The most powerful connections are formed by those who factor in and respect the learning, communication and interpersonal preferences of the person they are dealing with – and understand their own style and how they are likely to be perceived by others.

While every human being has a unique connecting style fingerprint, we know that people fall into four basic “connecting styles” based on how emotionally and how forcefully they connect:

From this model we can generate a simple roadmap for engaging others based on their connecting style.

For example, analyticals respond best when working within a predictable process that gives them time to prepare in advance, spells out a plan, defines roles, and does not rush them toward a decision. Direct expression of anger, frustration, resentment, whether directed at them or others, makes them uncomfortable and they disengage.

Energizers on the other hand, engage when given the opportunity to express their feelings and ideas and get very impatient when sticking too tightly to process and rules. Once a person understands their own connecting style and how to assess style in others, they can apply these insights with supervisees, supervisors, clients, adversaries, judges, partners, etc. for greater influence and more trusting relationships.

Continue Reading Five Questions with…Dr. Steven Lurie on “Connecting Styles” – Part II

Buried deep, deep, deep in Monday’s Federal Register was a quiet announcement that the U.S. Department of Labor was proposing some new wage/hour regulations interpreting the Fair Labor Standards Act of 1938 (download here).  In the "summary" section, the DOL states that the new regulations are needed because the regulations, in some cases, are out of date based on court decisions or subsequent legislation.  The DOL website doesn’t even have a press release on it as of Monday evening — only a link buried deep on a webpage here.

Comments are requested by September 11, 2008, so presumably the DOL is trying to implement these new regulations by the end of the current administration.  workers, courtesy library of congress

So what topics are covered in these proposed regulations? A few are noteworthy, while several others others are snoozeworthy.

For example, among the more noteworthy items are regulations addressing "compensatory time" and a "fluctuating workweek".  More snoozeworthy items including regulations regarding salesmen who sell boats and regulations regarding workers who work on ditches, canals and reservoirs, where 90% of the water used is for agricultural purposes.

Among the other topics covered

  • Updating regulations regarding "tipped" employees and the way the phrase "minimum wage" is used in various statutes;
  • Updating regulations defining who an "employee" is and excluding certain volunteers at private non-profit food banks;
  • Updating regulations regarding those employees engaged in "fire protection activities";
  • Updating regulations to clarify that stock options are excluded from the computation of the regular rate of pay;
  • Addressing regulations of "service advisers" working for auto dealers;

Upon first glance, most of the changes suggested by the Department of Labor just incorporate language from laws that have been passed in the last 20-30 years.  But for employers that have a particular interest in one of the above topics, special care should be used to review the language to see if it will have a particular impact on the business.

Lastly, these regulations are mere proposals; while it is somewhat likely that regulations like this will be implemented, they may undergo some significant changes in the final rule. Thus, employers should be cautious about relying on these rules until the final regulations are issued.

I’ll continue to review them and post any further comments or thoughts later in the week.

(H/T Fl. Employment Law Blog)

Photo courtesy of Library of Congress.

A few weeks ago, I posted on a decision by the Connecticut Supreme Court that ruled that an order denying class certification is not an appealable final judgment. I said back then that the case, Palmer v. Friendly Ice Cream Corporation, gives employers and other defendants in class actions, "an important arrow in their quiver of defending against class action cases."

This week,the Hartford Business Journal discussed the case in some detail with some good information about the underlying claims raised by the wait staff. 

The dispute between the food servers and restaurants hinges on the differences in the hourly wages paid to waiters and other non-wait staff. Restaurants are allowed to pay waiters below minimum wage levels, reducing wait staff pay by a 29.4 percent “tip credit,” which is based on the assumption that waiters are expected to earn much of their income from tips.

Food servers claim that their wallets take a hit when employers assign them tasks that don’t include waiting tables, such as brewing coffee, rolling napkins or cleaning restrooms.
For that reason, servers employed by T. G. I. Friday’s and Friendly’s want to be paid for the extra tasks they perform while on the job, so they have been working together to form class-action groups to fight restaurants.

The reporter from the story happened to call me for my views on the case, which I was happy to share with her. You can check out my quotes from the story here.  

Without sounding like I’m trying to fawn over them, the HBJ really is an under-appreciated publication that fills a good niche on business news in the state.  If you aren’t looking at their site, you are really missing out on some great little nuggets about Connecticut business.

The case also highlights the importance of following wage rules carefully. The application of a "tip credit" isn’t exactly the easiest formula for employers to apply in practice. Employers who may pay under minimum wage for one reason or another should consider themselves targets for potential claims and should ensure that they are in full compliance with the wage and hour laws.

The Connecticut Supreme Court, in a decision released today, ruled today that an order denying class certification is not an appealable final judgment.  The case, Palmer v. Friendly Ice Cream Corporation, gives employers and other defendants in class actions, an important arrow in their quiver of defending against class action cases. 

In Palmer, thirty-seven waiters or waitresses employed by Friendly’s, sought certification as a class to pursue their claims that their employer had ‘‘failed to pay servers the hourly, minimum wage mandated by General Statutes § 31-60 because the defendant unlawfully deducted ‘tip credits’
from servers’ wages’’ for work that was ‘‘non-service’’ in nature. The potential class included ‘‘all current or former servers’’ at the defendant’s forty-eight restaurants in Connecticut ‘‘against whose wages tip credits were subtracted.’’

 According to the Court:

The plaintiffs’ complaint arose from the defendant’s alleged violation of § 31-62-E4 of the Regulations of Connecticut State Agencies, which governs the payment
of minimum wage for ‘‘[d]iversified employment within the restaurant industry . . . .’ The complaint
alleges that the defendant ‘‘failed to definitely segregate all of the time spent performing ‘non-service’ duties and nevertheless took a ‘tip credit’ with respect to most of the hours worked by [the plaintiffs] and the class members and failed to compensate them at the required full minimum wage for their entire shift.’

The Superior Court denied certification of the class and the Appellate Court found that such a ruling was non-appealable — a decision affirmed by the Connecticut Supreme Court.

I’ll look at the underlying wage issue another day, but for now, the Supreme Court’s decision will be applicable in all sorts of employment-type class actions filed in state court. 

For employers, plaintiffs will not be able to use the threat of an immediate appeal for settlement purposes, while the employers will also have an extra incentive for defeating class certification. If that decision cannot be appealed until much later (including a verdict), much of the "value" of the class action will be diminished.