ASSESSMENT OF PROPOSED WISCONSIN ABUSIVE WORKPLACE ACT (AB 894 ) by Bob Gregg, Boardman Law Firm

Transcription

1 ASSESSMENT OF PROPOSED WISCONSIN ABUSIVE WORKPLACE ACT (AB 894 ) by Bob Gregg, Boardman Law Firm Workplace intimidation and bullying are serious issues. They cause significant harm to individuals and to organizations. The National Institute of Occupational Safety (NIOS) has defined workplace violence to include not only physical assault but threats, harassing calls, verbal abuse, following, yelling, bullying and overt intimidation or overt incivility toward others. Under OSHA s duty of care for a safe place provision, employers should focus on this NIOS definition and have policies and practices to identify and stop intimidating, harassing, bullying, uncivil behaviors before they do harm and before they escalate into assaults or worse. On March 24, 2010, Wisconsin Assembly Bill 894 was introduced. It would prohibit general abusive behavior including bullying, derogatory remarks, insults, verbal humiliation, threats, sabotage, undermining an employee s work performance, and exploiting an employee s known vulnerabilities, among other things. The proposed law provides for both corporate liability and personal suit of individuals: the abusive supervisor or co-worker can be personally named in the suit. Under AB 894, an aggrieved employee can seek the following relief: reinstatement, removal of the person who engaged in the abusive conduct, unlimited monetary damages for medical expenses, back pay, front pay, compensation for emotional distress, punitive damages, reasonable costs and attorney fees. The complete act is available at The following assessment compares AB 894 with existing state law on harassment. Harassment incidents involve many of the same types of behavior and create the same harm to employees in the workplace. Contrast with Wisconsin Fair Employment Act (WFEA) AB 894 provides more extensive liability than the WFEA. The WFEA is Wisconsin s equal employment opportunity law. The basic EEO categories are age, disability, national origin, race, religion, sex, sexual orientation, marital status, record of arrest/conviction, and retaliation for a variety of protected activities. The WFEA prohibits harassment based on these categories and provides significant remedies for employees subject to a hostile environment. The WFEA has a $300,000 cap on compensatory and punitive damages. It has lesser caps for smaller employers. This recognizes that the purpose of any remedial law is to hit hard enough to

2 correct and deter wrongful behavior, but not put an employer out of business, and all the rest of its employees out of jobs. AB 894 has no caps. There is sky is the limit liability, allowing the plaintiff to allege claims for millions of dollars. The only limitation is in Section (5)(b). When the abusive behavior does not result in an adverse employment action (i.e., discipline, discharge, etc.), the punitive damages part of an award is limited to $25,000. However, punitive damages are usually a small part of any award, especially when unlimited emotional and other damages are allowed. The WFEA provides for organizational liability only. There is no personal liability, unless the employer is the sole proprietor of a business. In contrast, AB 894 allows personal suit of any individual involved. So, co-workers, supervisors, board members, etc., can be named. AB 894 then creates some confusion over this issue. Section (5)(a) provides that if the circuit court orders any payment under this paragraph because of the unlawful employment practice engaged in by an employee, the employer of the employee is liable for that payment. It does not state that the employer is liable for defense costs so the individual can be left to pay for their own legal defense. Actual personal liability for the unlimited damages could result if the costs of litigation or awards caused a small business to file for bankruptcy protection. Then the named individuals could presumably be liable to pay any damages from their own assets. This has been the result in a number of cases under other laws which allow naming of individuals along with the company (i.e., the FMLA, FLSA, etc.). Whether or not actual money is collected, being named personally in a lawsuit has serious consequences for individuals. It can wreck one s credit standing -- just try to get a mortgage or significant loan during the two to three years the case is still in progress. Regardless of the outcome, one s name is forevermore on the public record as being charged as an abuser. This comes up on every credit check and reference background search, forever. There is often fear with any new law that people will misuse it and name individuals for frivolous purposes and malicious personal vendettas, rather than for valid reasons. These fears are usually overblown, and the majority of cases are filed in good faith. The major concern with AB 894's Section (5)(a) provision is the legal reality that any competent plaintiff s attorney will name all of the individuals even potentially involved, in order to be sure to cover all the bases just in case the employer has low assets or declares bankruptcy. Failure to do so could be malpractice for a plaintiff s attorney. So it is virtually guaranteed that, over time, a number of people will be named on the public record as abusers who were, at best, only tangentially involved. They may escape monetary liability, but they may never clear their name. AB 894 does require, in Section (1)(h), a showing of intent and malice. This appears to mean that one must prove the wrongful behavior was intended to be abusive toward the employee, with the purpose of harm -- not just an angry, aggressive, disrespectful person who 2

3 generically lashes out at people around them. However, the standard for showing intent is not clear. The WFEA and AB 894 both give great weight to an organization s corrective action policies. In general, the EEO laws expect the victim of harassment to use the internal policy to complain, and give the employer the opportunity to correctively address the situation before any suit can be brought. AB 894 provides this same requirement in sec (1)(e). Constructive discharge (quitting employment due to the harassment or abuse ) is recognized as an adverse employment action under both the WFEA and AB 894. However, the AB 894 standards appear to be more lax than under the Wisconsin and federal EEO laws, allowing suits for lesser behaviors. The WFEA and other EEO laws require a constructive discharge situation to be exponentially worse than illegal harassment or abusiveness. The situation must be objectively intolerable or impossible. One can sue and collect damages for illegal racial, sexual, etc., harassment, but is not justified in leaving the employment unless the work environment is clearly unbearable by an objective standard. AB 894 does not use an objective standard. Section (1)(e) creates a subjective standard, leaving it up to the employee s own sensitivities. The employee can leave employment because the employee reasonably believes he or she was subject to abusive conduct. Though the proposed law uses the words employee reasonably believes, it still emphasizes the individual s personal state of mind and seems below the well-established objective and intolerable environment standards of the WFEA and other federal EEO laws. AB 894 provides a direct suit in circuit court. WFEA requires an administrative procedure, with investigation (at no expense to the plaintiff) and initial determination of probable cause or no probable cause prior to any hearing or trial. This serves to either resolve cases or filter out cases which do not have sufficient evidence or meet the level for violations of the law. This WFEA administrative procedure saves all parties great time and expense. Circuit court litigation is incredibly expensive. It does allow for summary judgment to dismiss cases which have insufficient evidence to meet the legal standards (the DWD - Equal Rights Division procedure does not have a summary judgment provision). However, summary judgment is usually only granted far into the litigation process, when both parties have expended great effort and tens of thousands of dollars, or much more. The proposed AB 894 seems to make harassment based on race, sex, national origin, religion, disability, etc. second class categories. As previously mentioned, under the Wisconsin Fair Employment Act (and also the federal EEO laws), there is a cap on damages which may be awarded. There are no such caps under AB 894. The damages are unlimited. The claim can be in the millions of dollars. Further, the standards for AB 894 are a bit looser than under the discrimination laws, allowing plaintiffs to walk off the job and sue for lesser acts than under the WFEA. 3

4 So, one could be unmercifully racially harassed, called vile names, have nooses hung at one s work station, and receive only a capped damage award. One could be sexually touched and harassed with ongoing overt sexual and gender hostility and yet be capped, and may be unable to show a constructive discharge under the WFEA standards. However, under AB 894, an employee subjected to lesser general, ongoing incivility could leave the job and sue for the sky, with no limits. AB 894 seems to propose a two-tiered system in which some of our most long term, entrenched socially destructive forms of racial, sexual and ethnic discrimination are seemingly less worthy. The elevation of generic incivility above the other forms of, often horrific, harassment and hate speech seems to send a message of either legislative unawareness, or that our lawmakers no longer see civil rights as a priority matter. At minimum, the Legislature should consider reasonable limits to liability, so as not to pit the EEO protections against the abusive workplace protections. Workers Compensation. AB 894 seems to require an employer to re-pay its Workers Compensation insurer, or the state. Under Section (6)(1), if a Workers Compensation insurance company or the State Workers Compensation fund has paid the plaintiff s medical expenses or disability benefits, the court shall order the employer to reimburse the insurer or department for the amount of those expenses or benefits paid or for the amount awarded... for medical expenses, back pay or front pay.... This seems to defeat the purpose of insurance. Requiring the employer to repay the insurer nullifies the protection. This provision potentially pits the employer and Workers Compensation insurer against each other in a conflict of interest. The insurance company has less incentive to responsibly protect the employer s interest by assertively examining claims, since it stands to get repaid anyway. This, too, creates a system which elevates the abusive workplace above many other serious workplace injuries. An unsafe place (an intentional disregard by the employer) can cause serious injury or death, yet the employer is not required to reimburse the Workers Compensation carrier. Wisconsin s safe place law (Statute Sections and ) does impose extra employerpaid liability as a form of punitive damages for negligent or intentional safety violations. It does not nullify the insurance and create a payback penalty. AB 894 seemingly proposes elevating a hostile environment above instances of death and permanent disability in workplace injuries. The provision gives nothing more to the injured employee; it just seems highly punitive to the small business instead of intended to be corrective. Conclusion All organizations should be concerned about maintaining a respectful workplace. All employers should have policies and practices to identify and stop abusive workplace situations. All 4

5 employees should receive training regarding these policies and their responsibilities for a civil, respectful workplace. No one should seek to diminish the serious harms caused by bullying and malicious abuse in the workplace. No one should question the importance of a respectful workplace. These are critical issues. Rather, the concerns expressed in this assessment are about the creation of a new law and greatly expanded liability with serious effects on both organization and individuals. AB 894 seeks to invent a new wheel, that does not fit the existing vehicle already available and in place. The WFEA already provides a well-established and proven effective way to address harassment. It has standards and precedent to judge abusive behaviors and constructive discharge, and provide significant remedies and damages. It should be the vehicle for addressing the concern for abuse in the workplace. Abusive workplace is similar to harassment under the WFEA and federal EEO laws. It involves the same sorts of behavior, just based on a different foundation (not race, sex, etc.). The WFEA umbrella, and the DWD - Equal Rights Division process, already include categories in addition to the standard and previously listed EEO classifications (i.e., unfair honesty testing, genetic testing, use of legal products, reporting of elder abuse, whistle blower protection, public employee safety and health, employee s right to know, etc.). There is no reason to create a separate law, when abusive workplace could be made a category within the purview of the WFEA/DWD - Equal Rights Division. Rather than inventing separate standards, which seem to make EEO harassment a second class citizen, the existing standards could be used. The existing framework for resolving and addressing liability for abuse and constructive discharge can be used. In passing and amending the WFEA, the legislature recognized the issue of small businesses. Small business is the major employer of Wisconsin workers. WFEA provides significant damages, but does not serve as a vehicle to routinely threaten the continued existence of the small business, and threaten to put it and all of its other employees out of work. The WFEA is a more appropriate vehicle for addressing abusive workplace than the creation of a separate process and unlimited liability under AB 894. Bob Gregg is a partner at the Boardman Law Firm in Madison, Wisconsin and has been involved in Employment Relations and Civil Rights work for more than 30 years. Bob has conducted over 1,000 seminars on Respectful Workplace throughout the United States, and authored numerous articles on practical employment issues, including workplace violence and anti-harassment policy and procedure. Bob is a member of the Society for Human Resource Management and the American Association for Affirmative Action. F:\DOCS\wd\25211\149\A WPD 5