Mgmt 383

1. Mgmt 383 Chapter 16 Employee Rights and Responsiblities Spring 2008

2. Rights v. Responsibilities • Responsibility – an obligation to be accountable for an action. • Right – that which belongs to an individual by law, nature, or tradition. • Contractual Rights – those conveyed by a specific written agreement between the employer and employee. • Statutory Rights – those conveyed by law.

3. Contractual Rights • Employment Contracts – an agreement that outlines the details and conditions of employments. Binds both parties. • Terms and conditions of employment. • General job duties and responsibilities. • Compensation. • Confidentiality and secrecy of trade secrets. • Termination/resignation provisions • Non-solicitation of current employees upon departure.

4. Contractual Rights • Separation Agreements – an agreement in which a terminated employee agrees not to sue the employer in exchange for specific benefits. • Severance pay. • SUB

5. Contractual Rights • Non-compete Agreement – An agreement that prevents an individual who leaves the company from competing with the employer in the same line of business for a specified period of time. • Non-piracy agreement – not to steal customers. • Non-solicitation of current employees agreement - not to steal critical employees.

6. Employment-at-Will • Employment-at-Will: an employer can terminate an employee for a good reason, bad reason or no reason at all. Exceptions: • Actual (explicit) employment contracts. • Title VII violations • Whistler blowers (retaliation) clauses • State Just Cause laws • Violation of state tort statutes: • Public policy • Implied employment contract • Good faith and fair dealing

7. Public policy • Public policy– termination contrary to public morals, laws, health, safety, or welfare. Examples: • Refusing to take part in illegal price-fixing. • Refusing to give false testimony during a government investigation. • Refusing to violate federal anti-pollution laws. • Refusing to avoid jury duty.

8. Implied Employment Contract • Implied Contract Theory – an assurance has been made to the employee that he/she has continued employment in exchange for good performance. • Written assurance • Verbal assurance

9. Good Faith and Fair Dealing • The employer acts in an unreasonable manner (called “outrage in some states) • Employer decides to discharge a 25-year salesman in order to avoid paying him a substantial commission(Fortune v. NCR, 36 NE2d 125). • About ¼ of the states recognize good faith and fair dealing.

10. Wrongful Discharge • Wrongful Discharge– occurs when an employer terminations an employee for reasons that are improper or illegal (i.e., public policy, good faith and fair dealing, etc.). • Just Cause – a reasonable or legitimate justification for initiating employment-related actions.

11. Just Cause Terminations • Justifications • Financial exigency • Poor performance • Misconduct • Insubordination • Theft • Alcohol or drug use on duty • Violation of work rules

12. Constructive and Pretextual Discharges • Constructive Discharge – deliberately making working conditions so intolerable for the employee that the employee quits. • Pretextual Discharges - Offering a legitimate reason for an unlawful termination.

13. Due Process • The opportunity to defend oneself against allegations of wrong doing and to confront your accusers. • Criteria for due process: • Does the organization have written procedures? • Is the procedure reasonable? • Was the employee afforded the opportunity to use the grievance procedure? • Did the employee have help in preparing his defense? • Is the employee protected against retaliation? • Was the final decision made independent of the original manager? • Would a reasonable person find the process fair?

14. Due Process • Concerns for justice • Distributive Justice – perceived fairness in the distribution of outcomes. • Are people treated fairly? • Is the treatment consistent? • Does the punishment fit the crime? • Procedural Justice – perceived fairness of the procedure used to make the decision.

15. Alternative Dispute Resolution • Arbitration – process by which a neutral third party makes the decision. • Common in CBAs. • Disliked by trial lawyers. • Peer Review Panels – panel of employees who hear appeals from disciplined employees and make recommendations or decisions.

16. Alternative Dispute Resolution • Ombudsman(“Ombuds” in the politically correct)–oftenoperate as in-house arbitrators. They are individuals who are outside the normal chain of command and act as a problem solver for both management and employees. • A Swedish government official (created in 1809) who investigates citizens' complaints against the government or its functionaries • From Old Norse umbodhsmadhr, deputy or trusted agent.

17. Privacy Rights and Employee Records • An employee’s right to review his/her personnel records usually applies only to public sector employees. • Right to access to personal information • Right to respond to unfavorable information • Right to correct erroneous information • Right to notification when information is given to a third party. • Privacy Act of 1974 • Federal agencies. • Federal contractor and subcontractors. • Recipients of federal grant and aid money.

18. Security of Employee Records • Private sector advice: • Keep employment records under very restricted access to avoid public disclosure: • Defamation • Identity theft • Use confidential; pass words for accessing records from HRIS. • Set up separate files and restricted databases for especially sensitive information (investigations, medical records, etc.) • Purge outdate files/information • Release employee information only with consent. • Inform employees of data retained.

19. Privacy Rights & Personal Behavior • Body piercing • Appearance Policies • Requiring employees to take nicotine tests. • Using competitors products • Weight gain • No political bumper stickers on your car if parked in company parking lot.

20. Workplace Monitoring • Legal for private sector employers • Video monitors • One-way mirrors • Ethical consideration: employees should be notified that they are being watched

21. Workplace Monitoring • Computer and Internet monitoring • Computer files • Email • Should have appropriate use policies in place. • Ethical consideration: employees should be notified that they are being watched

22. Employee Discipline • Progressive Discipline • Objective: Behavior modification; correction not retribution. • Example: • 1st Offense – verbal warning (make a record) • 2nd Offense – written warning • 3rd Offense – suspension without pay • 4th Offense – termination • The best discipline is self-discipline.

23. Documentation for Employee Discipline • Documentation (adverse counseling): • Reason for disciplinary action • Corrective Action • Consequences if behavior is not corrected

24. Situations Calling for Immediate Termination • Substance abuse at work • Fighting on company property • Possession of weapons • Theft • Destruction of company property • Falsifying employment documents • Certain off duty criminal activities

25. Reasons Discipline is not Enforced: • Organizational culture regarding discipline. • Lack of support by higher management. • Guilt (manager may have previously violate the same work rule). • Loss of friendship or conflict avoidance. • Time loss (bigger fish to fry). • Fear of litigation.

26. Employee Handbooks • Guidelines: • Readability – written at employee’s reading level (if they can’t be understood they are worthless) • Use – will it be used by the employee • Distribute at orientation • Discuss major provisions • Test employees’ retention of information

27. Legal Considerations for Employee Handbooks • Maybe implied contracts • Failure to have a handbook may expose employers to even greater litigation (sexual Harassment, e.g.) • Areas of concern: • Avoid controversial phrase that implied guaranteed employment: • “Permanent employee” • “Continued employment”

28. Legal Considerations for Employee Handbooks • Provide disclaimers: • “Not a contract” • “Not intended to create a contractual relationship” • Management reserves the right to change or modify policies without notice” • Keep the handbook current!

29. Drug Testing • Drug Testing • Should serve legitimate business purposes: • Accidents rates • Illness rates • Absenteeism • Worker’s compensation rates • Turnover rates

30. Drug Testing • Drug Testing • Recommended policy guidelines: • Drug testing when there is probable cause • Random drug testing of every employee at periodic intervals • Drug testing after accidents • Department of Transportation requires regular testing of employees engaged in the interstate transportation of goods.