First of three parts
Lawsuits...they're dreaded by all and yet have become a fact of life. One can't read the paper or listen to the news without hearing the phrase ``wrongful termination.''
In some instances employees are much more educated about the law than their employers.
Recently one of my clients met with an employee to give a written warning regarding a significant error. The employee's response was: ``If you think I'm just going to go away, you're wrong. I am going to fight this because I know my rights. I know what I am entitled to....''
Now let's face it, this is where most of you are thinking, ``If one of my employees said that to me...I'd tell them what they'd be entitled to...RIGHT OUT THE DOOR!''
Normal reaction perhaps-but precisely the reaction that causes employers to make mistakes and get caught on the legal carpet.
In the next three articles we are going to discuss the anatomy of a wrongful termination lawsuit. Fear of a lawsuit is normal and a somewhat educated response. No one wants to waste away time sitting in a little room with no windows giving hours and hours of depositions.
However, sometimes the ``fear of the lawsuit'' will cause dealerships to live with an employee's unsatisfactory performance. As always, knowledge helps to eliminate (or minimize) fear. Therefore, we will be leveling the playing field and covering the following topics in this column:
* The whats, hows and whys of the lawsuit.
* The causes of the lawsuit.
* Bringing a lawyer into the decision-making process.
The remaining topics below will be addressed in two subsequent columns:
* Other tricks of the trade.
* The processes: Let the games begin.
* The investigation process.
* What to do when the lawsuit arrives.
* Alternative dispute resolution.
* The discovery process.
* Trial, post trial and appeals.
The whats, hows of a lawsuit
Lawsuits are created when the law actually is broken or-and here is the key-one party feels the law has been broken. There are myriad reasons why an employer cannot terminate an employee without just cause. One cannot terminate based on:
* All the discrimination statutes and case law: Age, race, religion, national origin, creed, gender (including sexual harassment), pregnancy, citizenship, disability and retaliation.
* Veteran's status.
* Filing of a workers' compensation claim: This reason is activated when an employee files a workers' compensation claim and the employer becomes aggravated and either ``makes their life miserable'' and/or terminates them.
* ``Promissory estoppel'': An estoppel is defined as a bar that precludes someone from denying the truth of a fact that has been determined in an official proceeding or by an authoritative body. An estoppel arises when someone has done some act that the policy of the law will not permit him or her to deny.
Thus, if you make a promise to an employee, and that employee relies on that promise, this can potentially block an employer's ability to terminate. For example, if an employer made a sweeping statement like, ``Well Joe, welcome to the company. If you show up for work every day and try to do a good job, I am sure you'll retire from here in 30 years just like all the rest of us.''
* Use/attempted use of the Family and Medical Leave Act (FMLA): Sometimes an employer becomes frustrated when an employee uses his or her 12 weeks of leave. If you terminate an employee around the time of his or her leave, you'd better have a strong, documented, just-cause reason.
* Wage and hour laws.
* ``Whistleblower'': An employee reports that the company is violating a law and then subsequently is terminated. For example, let's say a dealership is not disposing of hazardous materials properly and an employee reports it to the authorities. If, after the authority's report, the employee is subsequently terminated, he or she may claim the termination was because of ``blowing the whistle'' on the dealership.
* ``Violation of public policy'': If an employee can show that there is a public policy that has been violated by his or her termination and also show that this was the reason for the termination, there can be a valid legal case. For example, there is a public policy that gives an individual a right to sue. Thus, if an employee sued the dealership where he or she worked over a compensation matter, and then the employee was terminated under the guise of another reason, the worker could claim the termination was a violation of public policy. In some states this is becoming the most recent wildcard of employment law.
The above points answer the whats and hows of a lawsuit. Now let's talk about the whys.
Although employment-at-will law is still present, it is becoming watered down in some states. However, it is still OK to terminate for ``just cause.''
Here are five just-cause questions to ask before determining whether to terminate an employee:
* Reasonable Rule of Order: Was the action the employee was doing-or not doing-affecting your business in a negative manner?
* Notice: Was the employee given notice of the rules or procedures being affected and proper direction/training on how they could meet their job requirements?
* Investigation: Was an impartial investigation, be it formal or informal, conducted? To evaluate the impartiality of the investigation, typically a management person other than the immediate supervisor should review the circumstances regarding the termination.
* Equal treatment: Did the employee receive equal treatment relative to other employees who have committed the same infraction? Don't fall into the seemingly common trap of keeping the employee who makes mistakes just because he or she is good looking or likeable.
* Fair penalty: Did the employee receive a fair penalty for his/her action or lack thereof?
Averting a suit
Typically if a lawsuit is initiated, it is because the actions taken with the employee did not satisfactorily meet the above just-cause questions. However, in many instances a lawsuit is initiated because of the employer's approach in attempting to solve the problem.
For those of you who know me, this next area of discussion will not be a surprise. For others, I can already hear the ``Oh no...here we go into that warm and fuzzy stuff again.'' It is the age-old philosophy that we all have heard a thousand times, probably most often from a parent:
* Follow the ``Golden Rule'': Treat others as you want to be treated.
* You attract a lot more bees with honey than vinegar.
* Care about people and they will care about you.
At a recent legal seminar I was pleasantly surprised to hear a very experienced attorney say the following in his presentation:
``Remember, kindness is the first principle of avoidance and the right way to act in any event. It forms the basis of all employment statutes, case precedence and litigation. It also is the key to winning!
``From the beginning: Think kindness, act kindly.
``Management needs to show their employees that they care!
``Virtually all of your actions should be veiled with kindness.
``The jury won't care about anything else. If they detect meanness, the case is over!''
So you can see, in this seasoned attorney's opinion, approach is everything. Honest concern for an employee's need to meet the job requirements is easy. However, communicating a genuine interest in improving/training/developing employees so they can improve their performance? That's not so easy.
Communicating frequently with employees regarding your expectations, and doing so with honest concern and kindness, can frequently diminish the frequency of lawsuits. So the why of a lawsuit is simple: An employee perceives a law was broken, and because he/she feels wronged in some way, he/she decides to sue your dealership.