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Termination
• Employment-at-will
– Payne v. Western and Atlantic RA Company
– The Court confirmed the right o f an employer
to hire or fire any individual for good cause,
bad cause, or no cause at all
Restrictions on Employment-at-Will
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Civil Rights protections
Employment contracts, union or individual
Market forces
Whistleblower statutes
Threats of wrongful discharge suits
Civil Rights Restrictions
• Murphy v. American Home Products Corp
– Age discrimination used to challenge at-will
termination
Violation of Public Policy
• Employees may not be fired for exercising rights
protected by law
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Worker comp claims
Refusing to commit perjury
Absence for jury duty
Voting as stockholder
Requires “clear and legal mandate” re public policy
Whistleblowing
Palmateer v. International Harvester
– Employee was wrongfully discharged after
reporting coworkers involved in crime
Sheets v Teddy’s Frosted Foods
– Employee was wrongfully discharged for
insisting company comply with federal Food,
Drug and Cosmetic Act
Expressed or Implied Promise of
Employment
• Touissant v Blue Cross and Blue Shield of
Michigan
– Employees had been wrongfully fired for no
apparent reason, though the employer said
“You can have your job as long as you do
your job.”
– Employer also had written policy requiring
good cause, warnings, and a disciplinary
hearing before discharge
Good Faith and Fair Dealing
• Fortune v. National Cash Register
Company
– NCR had fired long-term employee who was
“at will”, but the employer sought to avoid
paying large commission through the
discharge, demonstrating bad faith
Only 11 states recognize covenant-of-good-faith
exception to employment at will
Tortious Conduct
• Tortious conduct – violation of a duty owed to
others
• Monge v. Beebe Rubber Company 1974
– Female employee was “abusively discharged” for
refusing to date supervisor
– Now that problem would be handled under Civil
Rights sexual harassment protection
Layoffs
• Firefighters Local Union 1784 v. Stotts (1984)
– Supreme Court Ruled a layoff illegal when more
senior white employees were laid off while less senior
black employees were retained – seniority is a
legitimate basis for discharge
• Worker Adjustment and Retraining Notification
Act
– Complicated law affecting employees in facilities to be
shut down
Broad practice implications
• Have written policy manual, reviewed by
employee
• Use positive employee relations approach
• Know the legal context of your business
operations
• “Golden Rule” – do to others as you would
have them do to you
• Keep an excellent employment attorney on
retainer