What else I'm reading this week #10

We'll start this week with a couple of posts on issues surrounding the drafting and enforcement of employment agreements:

Jottings by an Employer's Lawyer lists the 8 parts of an executive employment agreement.

Suits In The WorkPlace gives some sage advice on how to draft solid non-compete agreements. The discussion is under Illinois law, but the principles transfer well to Ohio law.

On other topics:

Dan Schwartz at the Connecticut Employment Law Blog draws some lessons from his recent middle school mock trial coaching, and recommends that to avoid employment law issues, HR should keep things simple.

The Evil HR Lady gives some advice on how to handle a job applicant's prior criminal conviction. As long as the policy is neurally applied (i.e., disqualifying anyone with a conviction other than a traffic offense), you should not run into any problem using conviction histories in employment decisions. Arrest records are another story, because arrests may disparately impact one race over another.

Should you fail to hire someone and end up defending an administrative charge, the Pennsylvania Employment Law Blog tells us 5 things every HR generalist should know in responding to EEOC and state agency discrimination charges. Let me add #6 - call your employment counsel.

John Phillips, at The Word on Employment Law, has posted the 2nd half of his excellent 6-part series on the art of firing employees. (Part IV, Part V, and Part VI).

In the wake of the debacle over the proposed maternity leave regulations, the Ohio Practical Business Law Counsel asks, "Where is the Ohio Civil Rights Commission going?"

Finally, the Wall Street Journal's Law Blog asks the self-evident question of whether the jury trial is an endangered species.

Some more shameless promotion

I commend to everyone's reading an article in this week's Business Insurance on the Huber v. Wal-Mart case that the Supreme Court last week decided to hear - High court to hear case on ADA job applicants. I has a collection of quotes from lawyers all over the country predicting how the Court will rule, including me:

Jonathan T. Hyman, an employer attorney with Kohrman, Jackson & Krantz P.L.L. in Cleveland, said he expects the court to rule in Wal-Mart's favor.

"I think it would be a dangerous precedent to write affirmative action into the ADA by saying you don't have to hire the most qualified person for a position," said Mr. Hyman. Hiring the most qualified person is "one of the cornerstones of employment law," he said.

Ohio Supreme Court holds that no wrongful discharge claim exists for employee terminated while on workers' comp leave

Four months ago, I reported on Klopfenstein v. NK Parts Industries, Inc., an Ohio appellate decision which held that Coolidge v. Riverdale Local School Dist. created an independent public policy exception to the employment at-will doctrine. Klopfenstein stood in direct contrast to other Ohio appellate districts, such as Cuyahoga County in Brooks v. Qualchoice, which held that Coolidge does not create a new public policy exception to the employment at-will doctrine, but instead illustrates conduct that is retaliatory under R.C. 4123.90 (the workers' comp anti-retaliation provision). At that time, I predicted that given the conflict, the Ohio Supreme Court would soon be asked to revisit this issue, and that it should reject the Klopfenstein line of cases:

Klopfenstein will not be the last word on this issue. Whether in an appeal from that case, or some future case, the Ohio Supreme Court will be called upon to clarify its Coolidge holding and definitively state the proper statute of limitations. In anticipation of that future battle, let me suggest that Klopfenstein was wrongly decided. R.C. 4123.90 states: "No employer shall discharge ... any employee because the employee filed a claim ... under the workers’ compensation act for an injury ... which occurred in the course of and arising out of his employment with that employer." If an employee is terminated because of workers' comp-related absences, that employee is being terminated because of the claim. Thus, the termination falls squarely within the coverage of R.C. 4123.90. It is the job of the legislature, and not the courts, to expand the statute of limitations for Coolidge claims if it sees fit to do so.

Today, the Ohio Supreme Court has proved me to be both prescient and correct. In Bickers v. W. & S. Life Ins. Co., the Court has held: "An employee who is terminated from employment while receiving workers' compensation has no common-law cause of action for wrongful discharge in violation of the public policy underlying R.C. 4123.90, which provides the exclusive remedy for employees claiming termination in violation of rights conferred by the Workers' Compensation Act." In so ruling, it greatly limited the reach of its 2003 Coolidge decision, limiting Coolidge to considerations of "good and just cause" for termination under R.C. 3319.16 (which involves terminations of contracts by boards of education). The Court explained its rationale for limiting employees to a statutory claim under the workers' comp retaliation provision:

The policy choice between permitting and prohibiting the discharge from employment of an employee who has been injured at work is a difficult one, as it inevitably creates a burden of some degree upon either the employer or the employee.

Should the policy choice be to deny employers the exercise of their employment-at-will prerogative and require them to hold open the jobs of injured employees for indefinite periods of time, then employers will be burdened with employees unable to perform the work for which they were hired and an inability to obtain permanent replacements. This would be particularly onerous on small employers with few employees, who lack the ability to shift the duties of an injured employee to other employees.

Should the policy choice be to permit an employer to terminate a worker who is injured on the job and cannot work as a result, then the worker suffers not only the burden of being injured but also the burden of unemployment at a time when seeking a new position is made more difficult by the injury.

In addressing this difficult policy issue, which lacks wholly satisfactory solutions, the General Assembly chose to proscribe retaliatory discharges only. Employers may not retaliate against employees for pursuing a workers’ compensation claim. R.C. 4123.90. It is within the prerogative and authority of the General Assembly to make this choice when determining policy in the workers' compensation arena and in balancing, in that forum, employers' and employees' competing interests. We may not override this choice and superimpose a common-law, public-policy tort remedy on this wholly statutory system.

In holding the employee to the statutory remedy, the Court continued its string of recent opinions limiting the scope of Ohio's wrongful discharge tort (see Ohio Supreme Court rejects common law wrongful discharge age discrimination claim). What is becoming more and more clear under Ohio law is that if a statute provides a remedy that an aggrieved employee can take advantage of, that employee will not have a valid common law wrongful discharge claim.

The Bickers opinion is also interesting for the debate between the majority and the minority on the actual holding of Coolidge and whether the Court is merely clarifying its prior holding, or outright reversing binding precedent. That debate, while interesting from a jurisprudential standpoint, is ultimately immaterial to the practical impact of Bickers for companies: employers no longer have to hold jobs open in perpetuity for employees who are off work because of a workers' comp injury. The FMLA and the ADA, where applicable, will still have something to say about the duration of a medical leave of absence (see ADA may require leaves of absence beyond FMLA mandates), but at least as to the workers' comp law employees are limited to their statutory remedy and the 180-day statute of limitations that goes along with it.

Offensive comments are not just for proof of direct evidence

Today, we are going to play a little game. The following is an excerpt from Vincent v. Brewer Company, a sex discrimination case decided by the 6th Circuit. So that you can follow along: Brewer Company, the employer, lays natural gas pipes; Jama Vincent, the plaintiff, was demoted from a crew leader position to a laborer position, and was laid-off (even though replaced by a man) 7 months later for lack of work and failure to follow company rules; Ken Parker was Vincent's immediate supervisor and the decisionmaker who laid her off; Sal Dilillo is another supervisor and a peer of Ken Parker; Jay Fetters and Kevin Parker are crew leaders who reported to Ken Parker. After reading the following excerpt, decide whether the employee or the employer won the case:

Vincent and other former Brewer employees testified that members of Brewer’s management team frequently made degrading comments regarding the capabilities of female employees, and expressed a desire to rid the Utility Division of their presence. Among the remarks alleged to have been made by Brewer management are the following:

(1) Ken Parker stated that he believed that women do not belong at Brewer and that he would not hire them.

(2) Kevin Parker told a crew leader, Ronald Ayres, that he did not permit his female laborers to do any work aside from directing traffic and that Ken Parker would fire Ayres if he discovered Ayres allowing female laborers to perform any other task.

(3) Ken Parker told a female employee, Tina Updike, that the only jobs available to women at Brewer were those involving traffic direction.

(4) Kevin Parker told Vincent and another female employee, Tammy Ayres, that Ken Parker instructed him to only permit female laborers to direct traffic.

(5) Kevin Parker told Tammy Ayres that she could not be in charge of a project because women are "not leaders" at Brewer.

(6) Ken Parker told Tammy Ayres that "the problem with you is you're a f***ing woman."

(7) Kevin Parker stated that Dilillo disliked women even more than Ken Parker, and that Dilillo wanted to remove all of the Utility Division’s female employees because they made it look bad.

(8) Fetters frequently referred to Tammy Ayres using nicknames such as "sweetheart" and "cupcake," and often asked female employees graphic sexual questions.

(9) Ken Parker told Updike that if she wanted to earn a man's pay then she would have to work like a man or she would be replaced by a man.

Okay, that wasn't meant to be a trick question, and hopefully its obvious from that litany of offensive comments that Vincent won her appeal. What interesting about this case, though, is that despite all of those offensive comments, many attributable to the decisionmaker, and all attributable to high-level officials with managerial authority over the decision, this case was not treated as a direct evidence case, but decided under the McDonnell Douglas burden shifting analysis. In fact, the actual legal holding of the case is: "To establish a prima facie case of gender discrimination, ... a plaintiff who can prove that she was replaced by a member of the opposite sex need not show that she possesses qualifications similar to those of her replacement." The district court erred by requiring Vincent to show that her replacement was outside of the protected class and similarly qualified as her. The latter is simply not part of the prima facie case.

Many of the offensive comments could be subject to exclusion in a direct evidence case because they may not have a sufficient nexus to the at-issue termination decision. However, in this case they were used as part of the pretext analysis, to show that Brewer's legitimate non-discriminatory reason did not actually motivate the discharge. The lesson to take away from this case is that courts will hold you to your legitimate non-discriminatory explanations, and evidence that might otherwise be excluded as unrelated to the challenged decision will become relevant to show pretext and rebut that explanation.

Groping of mall Santa raises potential sexual harassment issues

The story of the Connecticut woman arrested for inappropriately groping a mall Santa is making the rounds this morning. (Woman accused of groping mall Santa). Harassment is not confined to employees. Just as companies have a responsibility to investigate and remedy harassment of employees by other employees, companies have a similar responsibility when the alleged harasser is a non-employee, such as a customer, a vendor, or a delivery person. For a thorough discussion of these issues, I recommend taking a look at Harassment by Nonemployees: How Should Employers Respond?, from HR Magazine.

Lord of the pants - When is the right time to countersue?

This morning's USA Today is reporting that famed Irish dancer Michael Flatley has won an $11 million judgment against a woman who had accused him of raping her in a Las Vegas hotel room. According to the article, the woman threatened to sue Flatley unless he agreed to a "seven figure" settlement. When he refused, she sued him, but the case was dismissed. Flatley responded with a lawsuit against the woman and her lawyer, alleging extortion, intentional infliction of emotional distress, and defamation.

While the Flatley case does not involve an employer/employee relationship, it is nevertheless interesting to look at in relation to the Ohio Supreme Court's decision last week in Greer-Burger v. Temesi. I cautioned that employers should tread lightly in filing lawsuits against employees who have engaged in protected activity. Flatley illustrates one situation where it might make sense to file a lawsuit against an employee - where the value of one's personal reputation is harmed by the mere filing of the employee's claim. For example, a CEO or celebrity accused of sexual harassment has a lot to lose even by having a meritless claim alleging sexual misconduct filed against him or her. Another example that comes to mind, although not implicated by the Flatley case, is where an employee has stolen trade secrets. In those examples, the individual or the company has something of value to gain other than mere retribution.

The decision of whether to file a claim against an employee or ex-employee is not an easy one, and should not be undertaken without careful thought, a clear strategy of the goals to be achieved, and consideration of whether those goals are worth the risk of defending against a likely retaliation claim or the perception in court that the counter-suit is merely retaliatory. For Michael Flatley, the decision was a no-brainer, as he was being accused of rape and being extorted. For your company, the decision should be of the same degree of certainty before a similar decision is reached.

The Fox who cried wolf: 6th Circuit finds that mere discussions of a pending lawsuit does not amount to protected activity

If an employee files a charge of charge of discrimination, and then openly discusses with others his strong desire to sue the company for discrimination, do those discussions constitute "protected activity" under the anti-retaliation provisions of the employment discrimination statutes. According to the 6th Circuit's ruling late last week in Fox v. Eagle Distributing Co., the answer is no.

After being passed over for a promotion, James Fox filed a charge of discrimination. After filing that charge, he repeatedly told co-workers and customers that the company was out to get him, and that he was going to sue the company for $10 million. Other than his charge of discrimination, however, he never told anyone that he believed he was the victim of age discrimination. When the company found out that he had been complaining to customers, it fired him for a "poor attitude" which impeded the company's ability to develop good customer relations. Fox then claimed that he was being retaliated against. The only protected conduct he alleged was his boasts that the company was out to get him and that he was going to sue the company.

The 6th Circuit affirmed the trial court's dismissal of Fox's retaliation claim. It reasoned that Fox had not engaged in protected activity because he had never complained that he had been discriminated against. According to the 6th Circuit, to qualify as protected activity, the opposition must be tied to a violation of a specific statute, and not merely generalized grievances.

We conclude that Fox’s discussion with Poplin is not protected activity under the ADEA and, therefore, Fox has failed to establish a prima facie claim of retaliation. Specifically, we hold that Fox’s statements to Poplin are not protected because they did not amount to opposition to an unlawful employment practice by Eagle. In order to receive protection under the ADEA, a plaintiff’s expression of opposition must concern a violation of the ADEA.... Here, the record does not contain any evidence that Fox specifically alleged discriminatory employment practices in his discussion with Poplin. In her affidavit, Poplin states that Fox mentioned suing Eagle and "that he had made comments about not getting promoted to a pre-sell position.... Although Fox’s lawsuit against Eagle alleged age discrimination, Poplin did not state – either in her affidavit or as recounted in the personnel memo – that Fox alleged that he was denied the promotion due to age discrimination or that Eagle engaged in any unlawful employment practices."

In other words, a vague charge that management is out to get an employee, and discussions of a pending lawsuit without specific reference to alleged discrimination are insufficient to constitute opposition of an unlawful employment practice and does not merit protection.

Typically, companies should treat employees who have alleged discrimination with kid gloves. The lesson to take away from this case is that no employee is protected from termination merely because he or she files a charge of discrimination or a lawsuit. Eagle got off because Fox did not complain in the right way, These issues, however, operate in very gray areas, and companies would be wise to move cautiously if deciding whether to fire an employee like James Fox - a disgruntled employee with a history of crying discrimination.