The Dialogue – an occasional discussion between myself and a prominent employee-side attorney, Nina Pirrotti returns today after a late summer hiatus. Today’s chat focuses on employee separations and severance agreements.  Share your own tips or observations in the comments below. As always, my thanks to Nina for sharing her insights here.

Dan: Hi Nina! How was your summer? Mine was fine except I can’t stop hearing news about President Trump.

It seems to drown out everything else going on and I think I have a headache from it all. But let’s give it a try, shall we?

I know I’m often confronted with having to fashion separation and settlement agreements for employers.   

What do you find are the items in agreements that you think both sides ought to be paying attention to?

Nina: Drowning in Trump-related noise.  The image is horrifying!  My husband and I were chatting the other day about an old Saturday night live weekend update skit.  As we recall it (it was decades ago), the news media was focused on other events when all of a sudden the character playing Kim Jong Un pops into the screen, holds both arms out and complains:  “What do I have to do to get attention around here?!” 

In the age of Trump that glib remark becomes bone-chilling. 

The art of crafting a fair and balanced settlement agreement isn’t the most riveting of topics in our world but it is among the most important.  

One key strategy I use in evaluating them is to put myself in the position of the employer to ensure I understand company’s (reasonable) priorities. 

Clearly the company seeks to contain the dispute itself, keep the fact that it is settling it confidential, and do everything possible to obtain closure.    If the settlement terms go beyond meeting those priorities, a red flag goes up for me and I scrutinize those terms closely.  

In light of the company’s priorities in containing the dispute and keeping it confidential, I expect to see a confidentiality provision, limiting the disclosure of the settlement agreement to those on a need to know basis (typically immediate family members, financial/tax advisor and lawyer). 

I am also not surprised by a non-disparagement provision which prevents the employee from spreading ill will about the former employer. 

Since I generally advise my client that it rarely reflects well on an employee to speak negatively about his/her former employer (no matter how justified the employee might be in doing so) I usually do not oppose such provisions. 

I will often, of course, make them mutual so that key employees at the company also commit to not disparaging my client. 

In light of the company’s priority in seeking closure, I do not have a one-size fits all response to no re-hire provision.  I understand the company’s concern that should the employee who has settled claims for discrimination apply for a position down the road and the company (for legitimate reasons) declines to hire that employee, it nonetheless remains exposed to a potential retaliation lawsuit by the employee. 

No re-rehire provisions in certain situations can be appropriate but only if they are narrowly tailored to the company itself.  Alarm bells go off for me, therefore, if the employer is large and has numerous affiliates and subsidiaries and the employer insists on including them within the scope of the no-rehire provision. 

In such cases, no-rehire provisions can be tantamount to mini-restrictive covenants and, where they hamper my client’s ability to find comparable work, I will reject them as untenable. 

Speaking of restrictive covenant  provisions, it irks me to no end when an employer tries to slip one into a settlement agreement where the employer was not bound by one during the course of his/her employment!   Such provisions are generally a non-starter for me, absent considerable additional compensation for them. 

Finally, as we discussed in an interview you conducted with me many years ago, I do not abide by liquidated damages provisions. 

If a court determines that my client has breached the agreement, even if that breach is deemed a material one, the employer should still bear the burden of proving that it has been damaged and, to a reasonable degree of certainty, the monetary amount of that damage. 

What are your thoughts, Dan?   Have I articulated the company’s main priorities well?  Are there others I am missing that I should consider the next go-round?   Do tell and I promise to listen with an open mind!

Dan: Well, one day we could talk about Trump-related employment litigation, if you’d like to really talk more about Trump.

You’ve hit on some of the highlights from an employer perspective. When crafting one for an employer, I will let you in on a “secret” – we have a template.

I know — probably not a big surprise to you since our firms have negotiated enough of them.

As a result, I find that agreements at this point are sometimes more of finessing around the edges, rather than major re-writes.

The problem I see is that there are some employers who are using a form separation agreement handed down to them years ago, without understanding what’s in them.

First off, the agreements — regardless of whether you’re trying to comply with federal law or not — should really be written in “plain English”.

Get rid of the “Whereas” clauses.

Use bold language or simply to understand provisions.

And try not to have it be 15 pages.

Second, the agreements should contain: a) a release of all state and federal claims (and local ones if you’re in places like New York City); b) confidentiality (and if it needs to be mutual, so be it); c) non-disparagement (same).  There’s more of course, but start with the basics.

Third, employers should think about provisions that may actually be helpful: a) What are you going to do about references? Is it “name, rank, serial number” or something more? b) Do you want an arbitration provision for any breach of the separation agreement?

Neither is typically a high priority but taking care of some of these details are important.

A few employers are trying to get the “best” deal and negotiate strongly but I find most employers just want to move on; the termination was probably not something that they wanted to do anyways and putting some distance between the employee and the company is probably a good thing for the business ultimately.

Since you’re not finding separation agreements all that exciting, what about how employers handle the termination or termination meeting itself? I’m sure you’ve heard some stories from clients.

Nina: Wow – you hit the jackpot with that question!   

I was once asked at an ABA conference at which I spoke what was one step management lawyers could take to maximize the chances that a departing employee won’t seek out the counsel of someone like yours truly. 

My answer?  Treat them like human beings when you terminate them.   

Don’t do what one Fortune 500 company did to one of my clients which was to call her as she lay in a hospital bed with her infant daughter who had been born earlier that day and inform her that she need not return to work because her job had been eliminated.

Time and again prospective clients had told me that they would have gone quietly into the good night had their employers treated them with a modicum of respect during the termination process. 

I recently settled a case involving a woman in her mid-60s who had worked for the same company for 20 years and proven time and again that she would do ANYTHING for that company and, indeed, had worn a number of hats over the years, shedding one and donning another as the company’s needs shifted.  In her 20th year, a new CEO was hired and you can guess what happened next.  He terminated her and replaced her with a brand new hire, decades younger, who my client had helped train.   

Doesn’t sound kosher right, but that is not the worst part! 

It was the WAY the company terminated her that prompted this lovely, meek, non-confrontational woman to summon up the courage to pick up the phone and call me. 

Her termination consisted of a three minute meeting in which the CEO informed her she was no longer needed and handed her a severance agreement that provided her with two measly weeks’ pay. 

She was literally sobbing as she signed it then and there after which she was immediately escorted out the door.   She contacted me weeks after she signed her agreement.  Too bad, so sad, right?  Wrong. 

The employer neglected to include in her severance agreement language required by the Older Worker Benefits Protection Act (OWBPA), including a 21-day period to consider the agreement and a seven-day revocation period.  She was able to keep her paltry two weeks and I got her many months more on top of that!   

There are so many morals to that story, the least of which is that severance agreements for employees over 40 should comply with the OWBPA.   Employers should be expressing their gratitude to terminated employees who have proven their devotion to the company by providing them with severance that sends the message that they valued that devotion.  

There other ways to go that extra mile to treat such employees with dignity.   Think about how you would want to be treated if you were undergoing one of the worst days of your life and act accordingly.  Thank them for their service, tell them how sorry you are, assure them that you will do everything in your power to facilitate their transition, allow them to say goodbye to their colleagues, hell, even offer to throw them a farewell gathering.  The possibilities are endless.  Sometimes we lawyers get in our own way. 

Dan, I know none of the clients who have had the benefit of your wisdom prior to terminating an employee would succumb to such pitfalls.  But what do you do when you have to clean up after the fact?

Dan: You’ve raised a good question, but I want to address something you said first. 

You said: “Employers should be expressing their gratitude to terminated employees who have proven their devotion to the company by providing them with severance that sends the message that they valued that devotion.”  

It’s that phrase that I think gets to the heart of the issues with severance in 2017. 

When I first started practicing (a few years ago, ahem), there were still many companies that offered severance without ANY release because that just seemed “the right thing to do.”

After all, there was still a bit of an unspoken contract that employers would take care of employees.

Think back to the “Mother Aetna” description of the insurance company.  But as the recessions took their toll and employee mobility took root, that social contract has definitely been frayed over the years.  In part too is the rise of employment litigation. 

Now each employer has to worry: Is THIS going to be the employment termination that leads to a lawsuit?

 I can’t even remember the last time that an employer offered severance without also demanding the employee sign a release. 

In other words, the idea of severance as “gratitude” and “thanks”, has now been replaced with much more of a quid pro quo. 

For employers, the thought ii: If we give you this severance, please don’t sue us. 

And yet for employees, some of them still remember the days when severance was just something companies did without worrying about the lawsuit. And so when the employer demands the release, some employees take offense to it, not realizing that times have changed. 

As a result, I have also seen employers trying to offer less and less; the notion of one week of severance per year of service (with caps) is still strong, but not universal. 

As to being the fixer – yes, sometimes it happens.  The lack of OWBPA provisions is really something that just shouldn’t happen anymore. 

But it’s more that employers go ahead with the termination without thinking about what comes next.  And some employers are moving so fast, that the details such as having two people in the termination meting and having COBRA information available, get lost in the shuffle.

I don’t know of a single employer that has enjoyed firing an employee.  

Even when they catch an employee red-handed, many employers are aware of the consequences that may flow for the employee from a firing. The employee may have a tough time finding a new job, for example. 

But it strikes me that a small subset of terminated employees are LOOKING to bring suit or a payday instead of looking forward to a new time in their life. 

Obviously sometimes past discrimination has to be examined, but what do you think makes employees sue their employers instead of signing severance agreements that are presented to them?

Nina: I think that employer conduct that rises to the level of actionable discrimination and/or retaliation is alive and well, unfortunately. 

The only up side of all of this is that I get to keep my day job, which I love! 

Of course there are those (“small subset” would accurately describe them) who seek to avoid accountability and are looking for a quick pay out of claims. 

Virtually all of those individuals never make it to our front door. 

I say “virtually” because we are human, after all, and one or two may sneak through the cracks in that door. 

But then we have competent lawyers like you for whom we have great respect who (very politely) convince us – – with facts – – that we are being misled. 

That is why I believe that the only situations in which early negotiations are successful are those in which both sides fight their natural inclinations to hold their cards close to their chests and actually share meaningful information from the get go.  

But how to conduct negotiations effectively is a topic worthy of its own separate dialogue, no?

Dan: I think so. Now, I have to save whatever energy I have left to stay up late to watch playoff baseball with the Yankees. Hopefully, it’s a long October filled with lots of late nights and distractions.  Until next time, Nina!  

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.

hartfordYears ago, I recall having a friendly conversation with another attorney in Connecticut where the topic turned to the notion of “At Will” employment.

When we couldn’t settle on an answer, we moved on to talking about whether the Hartford Whalers would ever come back.

I think we had a better answer for that question: Probably not.

But this is an employment law blog, not a sports one, so let’s get back to the topic.

Employment-at-will is, from a legal perspective, the notion that an employer may discharge an employee without restriction, that is, for any reason or no reason, without incurring any liability to the employee.

Simple enough, right?

Well, not quite. First off, Connecticut recognizes two major exceptions to this doctrine:

  1. The termination cannot violate an important public policy;
  2. The termination cannot breach an implied contract of employment if one as formed.

And, it should be noted, that there is the obvious exception that the termination cannot violate any other state or federal law — such as the laws prohibiting discrimination.

This again sounds simple enough, but in discussions with employers, there is another topic that comes up — fairness.  In other words, employers typically are wise the ask themselves whether a termination under the circumstances is “fair”.

Now that can mean a lot of things in a lot of situations.  For example, suppose an employer hires an employee, but 3 weeks later the employer loses a major contract and needs to layoff ten employees.  It may not be exactly “fair” to terminate this newly hired employee, but if the employer may be being “fair” by laying off newly hired employees first.

Sometimes, the “fairness” question is framed slightly differently.  Suppose you have a newly hired employee who is late to work a few times in the first 30 days and then shows up to work under the influence of alcohol.  Can you simply terminate the employee then?

Under most circumstances, yes, and most people would say this is fair because the employer is simply holding the employee accountable under its rules and a new employee shouldn’t get a lot of free passes.

But now suppose you have a 20 year employee who has an exemplary record of service.  The employee has no record of tardiness or misbehavior, but after a March Madness weekend, shows up at late to work with bloodshot eyes.  It should be noted, though, that a week before, the employee had complained to his boss that the machine he was working on seemed in need of repair.

Under the employment-at-will doctrine, the employers still has the same right to terminate the employee, but I think most people would think this situation ought to be looked at differently.  If the employer proceeds with the termination, it’s possible that it opens itself up to a threat of a claim.

Why? Because while the employment-at-will doctrine still applies, a judge or fact-finding would also then ask the same question — does this termination seem “fair”?

If the answer to that question is “no”, then judges and juries will look for alternative explanations.  Here, one could argue that it was the employee’s complaint that was the motivating factor in the termination and the employee was being retaliated against for complaining.  Otherwise, the termination seems a bit “unfair”.

That type of logic may not be “fair” either, but it goes to show that the employment at will doctrine should not simply be relied on in all circumstances.

I’ve yet to have an employer just say, “I didn’t have a reason for firing the employee. I just felt like it.” That may work under the “at will doctrine” but in the real world, it probably wouldn’t fly.

For employers, always try to look at your decisions through a neutral prism.  Or better yet, ask yourself: What would my neighbor think about this? If the termination seems unfair under those circumstances, it may be a clue to re-think your decision.

 

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

pottYou might think that smoking pot on the job as a state employee would be justifiable grounds to get you fired.

A no-brainer, right?

(Let’s save a discussion for eating brownies and swearing at your cat for another blog post.)

After all, even the Connecticut Supreme Court is stating that the “statutory, regulatory and decisional law of Connecticut evinces an explicit and well-defined public policy against the recreational use of marijuana, particularly in the workplace.”

So why is the result of today’s Connecticut Supreme Court decision (in State of Connecticut v. Connecticut Employees Union Independent) that a pot-smoking employee gets his job back?

Well, the answer is based on a few facts that I think tipped the decision of the court and that are important to understand about the case.  (And for more background, the CT Mirror released a post today too.)

First off, the court was not reviewing the underlying decision to fire the employee. Rather, it was reviewing an arbitration decision that had reinstated the employee but with a number of sanctions and conditions, including imposing an unpaid suspension, a last-chance status, and random drug testing.  As I’ve noted before, Connecticut courts will review public policy and a number of factors including whether the employee is “incorrigible”.

Put more simply, courts do not like reversing arbitration decisions, even if those decisions are flawed. (See Brady, Tom.)

And that leads to the next factor: here there was a 15 year, relatively low-level employee with a clean record.  His union argued that he was “dealing with serious personal struggles” and believed that “smoking marijuana helped to alleviate stress and anxiety”.   The court thought that the employee’s past history was worth consideration.  And, it should be noted, the court’s decision was unanimous.

Third, I think the court was reviewing whether an employee who smoked pot COULD be terminated versus MUST be terminated. And on that issue —  namely whether public policy dictated an employee be fired for smoking pot — the court said public policy wasn’t definitive.  Rather, the court found that an array of responses may be appropriate.

So, what does this case mean? First off, it does NOT mean that private employers can’t fire an at-will employee for smoking pot. In fact, the above-language from the court suggests that such terminations are going to be upheld by the courts in most instances.

And, for public employers, it also does not mean that all terminations of drug-using employees are going to be invalid either.  An arbitrator could find the employee’s termination justified in other instances based on the circumstances or the type of position that the employee held (such as a teacher or bus driver, one could imagine).

Rather, the decision means that arbitrators will have some breathing room in reviewing the facts of a situation and fashioning a solution that may be less than a termination in some instances.

For lawyers, the concurrence by Justice Espinosa is worth reviewing; she would have the court revisit its decision that set forth the standards for the court to review in such instances.

Before I even begin this post, let me advance the disclaimer right off the bat: Despite the title of this post, there is no sure-fire way to fire an employee without getting sued.

Indeed, the title is a bit of a misnomer.  It’s often been paraphrased that anyone can sue anyone else for anything at any time in any court. While that’s not quite true, it’s not that far off the mark either.

There ARE, however, ways to fire an employee that can reduce or, in some ways, eliminate the likelihood of being sued.

In fact, I had been working on a draft of this post for sometime thinking of how I could help others make the process of firing a bit more humane.  I’ve had many discussions with clients over the years about how firing an employee is one of the toughest things that they’ve had to do as a “boss”. fire

Yes, firing is part of the job, but I’ve yet to meet an employer that has enjoyed it. Inevitably, there is a sigh of relief when the termination meeting is over.

(And to be sure, the impact on the employee is almost always worse.  There are few things worse in life than being fired, even if it ends up leading to good things later.)

Of course, before I could finish my draft post, Jon Hyman alerted me to an excellent post by the Harvard Business Review entitled “A Step-by-Step Guide to Firing Someone.”

It’s really well done and I encourage you to read that first before finishing this post up.

Among the overall tips:

  • Start by creating a transition plan
  • Take the termination meeting itself step-by-step
  • Avoid misdirected compassion

The discussion in the article about the termination meeting itself is particularly insightful.

Here are three more things to think about too:

  1. Ask yourself: “Is the Termination Decision Fair?”  Sometimes, I rephrase this question into the following: “If you were telling your neighbor about the firing, what would he or she think about it?”  But it all comes done to the same point: Would a third person (or a jury) think the process you used to fire an employee was a fair and just decision?

    For performance-related terminations, you may look to whether the employee had been put on notice that his or her performance was faulty and given an opportunity to improve.

    For reorganizations or reductions-in-force, ask whether the process you are using to select employees (whether it’s seniority, overall performance, or other legitimate factors) is explainable and non-discriminatory.

  2. Consider A Separation Agreement: When I first started practicing law, separation agreements were the exception. Now they are the rule.

    If you’re firing someone and you want to avoid being sued, consider a separation agreement where you offer some severance in exchange for a release.  Of course, I’ve been talking about this since way back in 2008 – so this isn’t something new. But do yourself a favor: Use an agreement that complies with the law.

  3. Know the Difference Between “It’s Legal” and “It’s a Good Idea”: Over the years, I’ve had more clients ask me whether a proposed firing was “legal”.  But as I’ve said in the past, just because something is “legal” doesn’t mean it is a good idea.  For example, it may be “legal” to fire an employee by e-mail, but it may result in hurt feelings and the idea by the employee that the employer doesn’t value the employee as a human being.

    So, when you’re seeking legal advice on a termination, be sure you’re asking the right questions and getting the best advice from your counselor about the termination itself.

There are, of course, many more aspects to a firing than just this. But if you follow a few of these items, it can help reduce the risk of a lawsuit.

crybabyThe Connecticut Law Tribune reported earlier this month on a new Connecticut Supreme Court case that, for the first time, allowed claims brought by kids to proceed based on injuries suffered by their parents.

Plaintiffs’ lawyers have a new weapon in their arsenal. The state Supreme Court, in a split decision, has ruled that Connecticut children have the right to sue for loss of consortium in personal injury cases. Previously, only spouses were eligible to collect such damages.

The court, in overturning longtime precedent, reasoned that there was a “unique emotional attachment” between parents and children, and that the grown-ups provide “critically important services” to their offspring.

So what’s the big deal for employers? Well, in doing so, the court reversed a decision nearly twenty years ago that had everything to do with employers.  That case,  Mendillo v. Board of Education for the Town of East Haddam, involved a wrongful discharge by a former high school principal.

In that suit, there was also a claim for loss of parental consortium — in other words, were the principal’s kids entitled to compensation because of the actions of the employer impacted their relationship with their parents. As noted by the Tribune: “The principal argued that the wrongful discharge forced her to take a job much further away from home, and thus the long commute deprived her kids of her love and affection.”

The court rejected the claim in Mendillo. But now, the new decision in Campos v. Coleman suggests that such a claim is revived:

Upon reconsideration of the relevant considerations, including the five factors that this court found determinative in Mendillo, we now agree with the concurring and dissenting opinion in Mendillo that the public policy factors favoring recognition of a cause of action for loss of parental consortium outweigh those factors disfavoring recognition. More specifically, we agree that the unique emotional attachment between parents and children, the importance of ensuring the continuity of the critically important services that parents provide to their children, society’s interest in the continued development of children as contributing members of society, and the public policies in favor of compensating innocent parties and deterring wrongdoing provide compelling reasons to recognize such a cause of action.

The court does place some limits on this new claim.  First, the claim must be joined with the parent’s “negligence claim whenever possible.”  Second, the claim does not survive if there has been a settlement or an adverse judgment against the parent.  Third, the child can only claim damages for the period when the child is a minor.  The court also suggests that the claim should be limited to damages arising from injury to the parent’s life.

The court goes on to add that a fact finding reviewing this must also “consider whether the parent’s injuries were insignificant or serious and whether they were temporary or permanent”.  Those will be determined by a case-by-case basis.

Is a parent’s termination of employment that last six months enough to state a claim? This last limitation by the court suggests perhaps not.  But suppose the employee now takes a job two hours away and doesn’t see her kids as often. What then?

At a minimum, the court’s overturning of Mendillo opens the door to a whole new set of potential claims against employers for terminating employees. How big an opening the court created remains to be seen.

roadcircleIf you like getting lost on roads with your head spinning on which way to go, this is your post.  (Everyone else, well, try to keep up.) I recap a case for companies with unions to pay attention to.

Let’s start with this example:

Employee X is required by law to report suspected abuse in her job. She fails to do so for a few days, but ultimately does.  After investigation, employer terminates employee for her failure to report the suspected abuse and notes that she had been on “final” warning for previous misconduct. Employee and her union appeal.  After a hearing, an arbitrator reinstates the employee while similarly stating that she should be subject to a one month unpaid suspension. Employer appeals saying the arbitration decision violates the important public policy of reporting suspected abuse.

That’s the ground work for a new Connecticut Supreme Court decision (Burr Road Operating Company II, LLC v. New England Health Care Employees Union, District 1199) that will be officially released next week.

The court said that it was not readily disputed that Connecticut has a clear, well-defined public policy of protecting nursing home residents from abuse.  Thus, the sole issue for the court was whether the arbitration decision violates that important public policy.

In doing so, the court emphasized that a party seeking to vacate an award reinstating a terminated employee “bears the burden of proving that illegality or conflict with public policy is clearly demonstrated. ”  But the court was quick to note that a consensus on how to handle such claims was “elusive” from its prior decisions.

Thus, the court said it was using this case to “take this opportunity to clarify the factors a reviewing court should consider when evaluating such a claim.”

When a court speaks like this, it’s probably worth listening to.  And what are those factors? This is where it gets complicated with factors upon factors. First:

Specifically, in determining whether termination of employment was necessary to vindicate the public policies at issue, both the majority and the dissenting opinions of this court have, either expressly or implicitly, focused on four principal factors: (1) any guidance offered by the relevant statutes, regulations, and other embodiments of the public policy at issue; (2) whether the employment at issue implicates public safety or the public trust; (3) the relative egregiousness of the grievant’s conduct; and (4) whether the grievant is incorrigible.

Of course, each of these factors have their own set of considerations as well. For example, on the relative “egregiousness” factor, the court said it encompasses “myriad considerations” including, but not limited to:

(1) the severity of the harms imposed and risks created by the grievant’s conduct; (2) whether that conduct strikes at the core or falls on the periphery of the relevant public policy; (3) the intent of the grievant with respect to the offending conduct and the public policy at issue; (4) whether reinstating the grievant would send an unacceptable message to the public or to other employees regarding the conduct in question; (5) the potential impact of the grievant’s conduct on customers/clients and other nonparties to the employment contract; (6) whether the misconduct occurred during the performance of official duties; and (7) whether the award reinstating the employee is founded on the arbitrator’s determination that mitigating circumstances, or other policy considerations, counterbalance the public policy at issue.

And what does it mean to be “incorrigible”? Well again, the court sets forth various considerations:

Here, relevant considerations include whether, on the one hand, the grievant has committed similar offenses in the past and has disregarded an employer’s prior warnings or clear policy statements; or, on the other hand, whether the grievant: (1) has generally performed his work in a competent and professional manner; (2) has demonstrated a willingness to change and an amenability to discipline; (3) has exhibited remorse and attempted to make restitution for past offenses; and (4) is likely to benefit from additional training and guidance.

But that’s not all.  “We also consider whether the penalty imposed by the arbitrator is severe enough to deter future infractions by the grievant or others.”

So if you’re keeping track at home, that’s over a dozen considerations for the court (and the parties) to address. 

Ultimately, the court in this case upheld the arbitrator’s original decision reinstating the employee applying all of the factors set forth above.

For employers, this case provides a roadmap on challenges to an arbitrator’s decision reinstating a terminated employee.  But beware: This map shows a lot of different paths for courts to follow.  Many of those several ways lead to the same conclusion: Challenging an arbitrator’s final decision remains an uphill battle at best.

paperI’m a big P!nk (yes, the exclamation point) fan. One of her most recent hits, is a song “Just Give Me A Reason”.

Somehow, reading a new Appellate Court case that will be officially released tomorrow, this song title kept sticking in my brain.

The case, Madigan v. Housing Authority of East Hartford (download here), revolves around the removal of the Executive Director of the agency way back in 2008 (who said the wheels of justice move quickly).

The contract for the executive director had this clause:

The [defendant] may terminate the employment and remove [the plaintiff] from his position at any time for those activities constituting misfeasance or nonfeasance or for any other just cause, in accordance with applicable Federal, State or local law.

At trial, however, the jury found that there was not just cause in his removal and awarded the plaintiff over $200,000 in both non-economic and economic damages.

On appeal, the employer argued that the trial court’s instructions to the jury were improper and that regardless, there was not enough evidence to support a jury finding that there was not just cause. The Appellate Court rejected both arguments.

In doing so, it offered a reminder that just cause requires something more than just a “proffer [of] a proper reason for dismissal.’’ The court did not find fault with the jury instructions because just cause means something more:

As previously discussed, the reason or reasons for termination must be substantial.  A reason that is less than substantial would be an improper reason for dismissal, i.e., arbitrary and capricious.

As for the evidence itself, the court punted saying that if the jury believed the evidence offered by the plaintiff, it could have said that there was not “just cause” in the termination.

While “a” reason is good enough in an at-will termination, the court said that something more is required in a “just cause” or “good cause” termination.

For employers, the case serves as a lesson about the use of “just cause” in the agreement without further definition.  And a reminder that in such instances, the reasons for the termination ought to be substantial and documented.

For more on “just cause” provisions, see my prior posts herehere and here.

 

With all the talk about the state’s implementation of medical marijuana laws, it’s easy to wonder what impact those laws will have on terminating employees who use marijuana on the job.

One recent Superior Court decision gave a pretty clear answer for state employees: None.  In other words, for employers: Fire Away.

That, of course, simplifies the decision and the result — employers should still exercise caution when disciplining employees for drug use to understand the facts and circumstances — but the court’s decision is yet another affirmation that the statestillhas a strong public policy against the use of marijuana, at least for its employees.

The case, State of Connecticut v. Connecticut Employees Union Independent, arises from the State’s challenge to an arbitration award reinstating an employee who was terminated for using marijuana while on the job.  The State contended that the award should be vacated on public policy grounds.

The Superior Court agreed with the State because it violates the state’s well established public policy on illegal drug use while on state duty.

The union argued that the award must be confirmed because the State is “currently implementing the legalization of medical marijuana.”  The court rejected that argument pretty simply by stating that even if that’s the case, there is “nothing in the records [to] indicate that grievant was prescribed marijuana.

Regardless, as I said back in 2012:

  • Employers MAY continue to prohibit the use of intoxicating substances, including marijuana, at work.
  • Employers MAY continue to discipline employees for being under the influence of intoxicating substances at work.

It remains to be seen whether other lower courts will follow this path and whether the appellate courts in Connecticut will confirm this logic. But for now, this decision from the Superior Court ought to make employers breathe just a little easier on that point.