6/12/2006

Several questions on employee termination

In general, is an employer required to state a reason for terminating an employee under Massachusetts law?

Massachusetts law does not require an employer to state a reason for the termination of an at-will employee. However, as a practical matter, terminating an employee without explanation could invite a lawsuit by raising the employee's suspicions that there is an unlawful reason, or could at the very least damage workplace morale. If you do provide a reason, keep the discussion brief, and make sure that you give the real reason, that the reason is lawful and nondiscriminatory, and that the company can prove any accusations that are made in providing the explanation. Attempting to spare an employee's feelings with a less-than-truthful reason is a very dangerous practice, because the employee could bring suit on the grounds that the false reason was a pretext for discrimination. Be sure to limit discussion of the reasons for the termination to those employees who actually need to know.

We have an employee who has been performing marginally for some time. Now she is pregnant. Assuming proper documentation, can we terminate her while she is pregnant?

You are entitled to terminate an employee for performing marginally but are prohibited by federal and state law from terminating her because she is pregnant. If your documentation shows that the employee's performance was evaluated as marginal and that the termination decision was made prior to the company learning that the employee was pregnant, you may be justified in proceeding with the termination. The unfortunate timing may still trigger a lawsuit, but you would have a strong defense to a pregnancy discrimination claim, particularly if you can show that other marginal performers who were not pregnant were also terminated, and that good performers who were pregnant have been retained. On the other hand, if the company did nothing about the employee's mixed performance appraisals until learning that she was pregnant, the company may have a problem proving that the decision was not based on pregnancy discrimination. In that case, you may want to build a better record before proceeding with the termination in consultation with an employment lawyer.

An employee didn't come to work because he attended his mother-in-law's funeral without any advance notice. His supervisor now wants to fire him. Is that grounds for dismissal?

The law generally allows an employer to fire an at-will employee for any non-discriminatory reason, including an unexcused absence. That said, termination for a single unexcused absence, particularly for a family funeral, seems unnecessarily harsh absent good justification. Before taking any action, review your company policy on unexcused absences and bereavement leave to verify that the employee is in violation. If the company has a progressive discipline policy, be sure to follow it; for example, a verbal or written warning might be a more measured response to the absence than termination. Given that the supervisor has reacted so strongly to the absence, you may want to explore whether there has been a history of other performance problems with this employee, or whether there is a personal conflict between the supervisor and employee that needs attention. Finally, make sure that the supervisor is not singling this employee out for unfair treatment because of race, gender or other protected classification.

Can we fire an employee who is on short-term disability, and if so, at what point?

You should not take any action to terminate an employee on short-term disability leave without careful consultation with an employment attorney who understands the specifics of the employee's situation. The attorney can evaluate the terms of your company's short-term disability benefit policy or plan, and ensure that the company complies with the numerous laws that may protect an employee on disability leave, including state and federal disability discrimination and anti-retaliation laws and the Family and Medical Leave Act.

-- MIKE BROWN with Dawn Solowey

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When employees work in different states

Our company, approximately 170 employees, has a sales force in 36 different states. Often these are one or two person offices. Is the company responsible for honoring the labor laws in each state, or because we are headquartered in Massachusetts does Massachusetts law apply to all our employees?

A Massachusetts-headquartered company that has offices and employees in multiple states can be subject to each of those states' employment laws. Employment laws cover a wide range of issues - from overtime to discrimination to maternity leave - and while there are many similarities between various states' laws, there are also real differences. For example, a non-compete agreement that is enforceable in Massachusetts may not be in California. A worker who would be characterized as an employee in Massachusetts may be an independent contractor under another state's laws. An employer who operates in multiple states should consult with an employment lawyer who can ensure that the company's handbook and policies are in compliance with all of the relevant laws.

-- MIKE BROWN with Dawn Solowey

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Regulations regarding temporary employees

What are the regulations regarding hiring a temporary employee, without benefits?

The answer to which regulations apply to a temporary worker depends on whether that temporary worker is classified -- or should be classified -- as an employee of the company. Regardless of how the company itself classifies the worker, the courts and various federal and state agencies will each decide for themselves whether a temporary worker is an employee, and therefore the extent to which the company may be responsible for compliance with various laws that apply to employees, including those involving tax withholding, discrimination, sexual harassment, health care privacy, and employee benefits, to name just a few.

The different multi-factored tests that are used in deciding whether a temporary worker is an employee focus on the extent to which the company controls the means and methods by which the worker performs work functions. However, even a temporary worker who is not an employee of the company may be entitled to protection under certain laws such as those prohibiting discrimination and sexual harassment. Companies using temporary workers should pay careful attention to properly classifying those workers at the beginning of the working relationship, since misclassification can lead to significant retroactive liability. In addition, whether you are working with a staffing agency or with independent contractors who work on their own, a well-drafted contract can help manage, though not eliminate, the risks to the company.

-- MIKE BROWN with Dawn Solowey

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New OFCCP regulations for Internet applicants

Did new government regulations go into effect in February, 2006 that involve the tracking of applicants?

Yes. On February 6, 2006, the Department of Labor's ("DOL") new regulations pertaining to Internet Applicants, issued by DOL's Office of Federal Contract Compliance Programs ("OFCCP"), became effective. The Internet Applicant rule applies to all federal contractors and subcontractors and requires them to obtain -- where possible -- gender, race, and ethnicity data on those individuals applying for positions with federal contractors through the Internet. As such, federal contractors are now required to solicit and collect race, ethnicity, and gender data from all individuals who meet the definition of an "Internet Applicant."

To be considered an Internet Applicant, an individual must satisfy the following four criteria:

• 1) The individual submits an expression of interest in employment through the Internet or related technologies;
• 2) The contractor considers the individual for a particular position;
• 3) The individual's expression of interest indicates that he or she possesses the basic qualifications for the position; and
• 4) The individual at no point in the selection process removes himself or herself from further consideration or otherwise indicates that he or she is no longer interested in the position.

Please note that DOL record-keeping standards remain unchanged for those federal contractors that do not accept any electronic submissions for employment through the Internet or related technologies (ie, e-mail, commercial and internal resume databanks, and employer websites).

For more information concerning the Internet Applicant rule, please see the Department of Labor's OFCCP FAQ page.

-- JOSH BLACK with Kevin Powers

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When headhunters recruit your employees

Employees in our company are receiving calls and letters from headhunters trying to recruit them to competitors. Is there any action we can legally take to stop such activity?

The best way to stop headhunters in their tracks is to treat your employees well and pay them salaries that are market competitive. Aside from these fundamental retention strategies, there is not much an employer can do to prevent headhunters from contacting employees and trying to entice them with other offers.

An employer can call the headhunter or send a letter asking them to stop interfering with their relationships with employees, but most headhunters will ignore such requests. Similarly, a request to employees that they not speak with headhunters will usually backfire because the employer will seem defensive and may create a perception that employees are defecting in droves. Furthermore, identifying the headhunter to employees will only give dissatisfied employees a name of someone to call to explore other opportunities. In addition, an employer that files legal claims against a headhunter is very unlikely to prevail and will only antagonize the headhunter, increasing the likelihood of future solicitation.

If there are employees whose defection to a competitor would be harmful, an employer should consider the adoption of non-competition and non-solicitation agreements, which, if properly drafted, will minimize the risk of employee departures.

Finally, retention bonuses or other incentives which are contingent upon remaining employed until a certain date will also decrease the effectiveness of headhunter solicitations

-- JOSH BLACK

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Documenting discipline before a demotion

Is it necessary to go through the process of documenting progressive discipline before a demotion?

Except where a written policy, collective bargaining agreement, or an individual employment contract expressly requires progressive discipline protocols, an employer is not required to follow any particular procedures before demoting an employee. Most of us are so-called "at-will" employees, meaning we can be demoted or discharged at any time, with or without cause or prior notice. However, the best practice in most instances is to give an employee ample notice of performance issues that need to be addressed. A bad evaluation or a decision not to promote should never come as a surprise to the affected employee. Regular and frank communication about performance and expectations is the best way to avoid misunderstandings, which also decreases the risk of a dispute. Finally, if an employer elects to adopt a written progressive discipline policy, it is advisable to make clear that the employer retains the discretion to proceed immediately to discipline or discharge, in its discretion. Employers who adopt such written policies should take care to follow their written procedures, as failing to do so can give rise to a claim for breach of contract.

-- JOSH BLACK with Kevin Powers

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