Top Tips for Avoiding Legal Trouble with Employees
By: George Lenard
Being aware of the legal aspects of the hiring process is important, but an underlying knowledge of general employment law is a necessary foundation. Here are the key things to keep in mind when working with existing -- and potential -- employees.
To some extent, legal claims by applicants, employees, and former employees are an inevitable aspect of doing business. When such claims strike, they can be devastating to businesses of all sizes. No magic formula guarantees avoidance of legal trouble with employees, but the following general guidelines should help reduce the risk and prepare a business to address such problems when they arise.
Educate yourself on employment law basics
Employment law can be complex, nuanced, and subject to rapid change, but at the most basic level it is non-technical and quite comprehensible to non-lawyers. Business owners and managers involved in employment decisions like hiring, promotion, discipline, and termination should learn the basics. Sources for such knowledge abound.
Web sites of government agencies such as the U.S. Department of Labor, the Equal Employment Opportunity Commission, and the National Labor Relations Board, contain much useful basic guidance. For example, see the Department of Labor?s "elaws Advisors" and the NLRB?s FAQ?s. Web sites of law firms, publishers, bar associations, and human resource organizations have much other valuable employment law and human resources information.
For a more structured learning approach, take a basic community college or university human resources course, attend a one-time seminar or Webinar, or use computerized or video training resources. Prefer learning the old-fashioned way -- from a book? Many relevant texts are available; an Amazon.com search using the phrase "employment law" yields 3591 books.
Know what you don't know
A little knowledge can be a dangerous thing. Know your own limitations, be able to identify situations requiring expert guidance, and have a trusted advisor lined up for such situations. Money saved through a do-it-yourself approach often leads to much greater expense later that could have been avoided or minimized by paying for expert advice upfront. Don't be penny wise and pound foolish.
Establish fair and open channels for employee concerns, complaints, and suggestions
Employment litigation can often be prevented if the employer knows of a simmering employee grievance before it boils over. Employee productivity and morale can be enhanced if such issues, as well as positive employee suggestions, are brought out into the open. Union grievance procedures can certainly be criticized, but they do potentially serve this useful and necessary communication function. Nonunion employers can do much better, by establishing less formal channels for a wide variety of communications directly from employees to management -- without the third-party intervention that occurs in the union setting. Most employers have established harassment complaint procedures, but there is no reason these cannot be integrated into a broader open door policy or suggestion and complaint procedure. Harassment complaints are not the only complaints that need to be addressed promptly and appropriately in order to avoid legal trouble.
Be consistent, yet flexible
Inconsistent treatment is at the heart of many a discrimination case. For this reason, routine advice is to take steps to ensure consistent treatment of employees. Such advice can be oversimplified, and can lead to unnecessarily harsh results. The consistency required is only among similarly situated employees. Many facts and circumstances may justify treating two employees differently. For example, it is not necessary to terminate a highly productive white male with an outstanding attendance record and 20 years of service because of one incident of horseplay -- even if for a similar offense the company terminated a marginally productive Hispanic female with spotty attendance and only three months? service. There is a valid, nondiscriminatory reason for treating these employees differently -- they are not similarly situated in terms of work experience, productivity, and reliability.
The law does not require that all employees be treated the same, with an inflexible consistency that disregards meaningful distinctions. But decisionmakers should have before them the data required to make appropriate comparisons in order to exercise informed discretion.
Generally apply progressive discipline principles, tempered by sound discretion
Termination is the highest risk employment decision most employers will ever make. Management of this risk assumes corresponding importance. Under union agreements, labor and management have long managed termination risk by applying principles of progressive discipline to guard against unfair or arbitrary termination. Under progressive discipline, a series of disciplinary steps precede termination (except in the event of severe misconduct like theft or violence). Typically the steps include verbal warnings, written warnings, and suspensions.
Though most of today?s employers are not bound by union agreements, progressive discipline is an excellent guideline to follow. However, the company should not obligate itself to do so -- either legally or as a matter of policy -- because there are always exceptions. Progressive discipline gives employees an opportunity to correct problem behavior. If successful, this saves the company significant costs associated with turnover. If not, it establishes that the company acted humanely, with patience and fairness. If a terminated employee attempts to pursue legal action, a legal decisionmaker's favorable perception of such treatment may be extremely helpful.
Consider how your actions will appear to a jury, as well as to a judge
In employment litigation, there is often significant divergence between the legal principles applied by judges and the common sense approach taken by juries. Because legal principles, especially the employment-at-will doctrine, permit employer conduct that many people find unfair, improper, and even morally offensive, there is always a risk that a jury will not focus on the narrow legal question before it. For example, a jury may be less concerned with whether the plaintiff was terminated because of intentional sex discrimination than with whether the termination was fair or deserved.
Typically, a litigated employment case is heard by judges on pretrial motions, which may dispose of the case if the employer is fortunate, and again on appeal, if the employer is unfortunate enough to go to trial and lose. A relatively strict application of legal principles prevails more often before the judges, though they are certainly not above being influenced by a gut sense of justice (nor should they be). In any event, how a case will look to a jury usually looms large over trial preparation and settlement negotiations.
Therefore, when a company makes a decision negatively impacting an employee, it should always ask how it would explain itself before a jury composed of the employee's peers, not of management's peers.
Always consider the big picture
Legal compliance is a very important goal. Unfortunately it is not sufficient. In the hands of a skilled employment attorney, perfectly lawful conduct can easily be made to appear unlawful -- and appearances matter a lot.
For example, typically a business that faces its first discrimination charge views the charge as frivolous and outrageous, because it knows it had absolutely no discriminatory intent. Assuming this is factually true, the company is legally correct, as in the majority of discrimination cases lack of such intent is a valid defense. As a practical matter, however, the opposing attorney may piece together many facts and circumstances to create the appearance of intentional discrimination.
Wise management should therefore not look through narrow legal blinders when making employment decisions, but should take appearances into account. Nonlegal consequences of employment decisions are also important. Terminating an underperforming employee may be legally defensible, but attempting to improve the employee?s performance instead may be preferable in terms of factors such as impact on morale and savings on turnover costs.
This big picture approach often leads to more conservative decisionmaking, with management refraining from lawful conduct because it could give rise to troublesome legal claims. But sometimes it has the opposite result. The nonlegal benefits of a course of action may greatly outweigh its legal risks, in which case the big picture approach counsels taking the risks, after carefully weighing and evaluating them and considering alternative courses of action. For example, although termination of employment often results in legal action, the likely harm to the business from not promptly terminating employees for some types of misconduct or performance deficiencies is so great as to require terminating immediately and rolling the dice on subsequent legal trouble.
In conclusion, the framework for avoiding employee legal problems involves fundamental knowledge of applicable law, appropriate consultation with advisers, open communications, reasonably flexible consistency, the patience and fairness a typical juror would expect, and a big picture perspective.
