Risk Management and Litigation Avoidance An ounce of prevention is worth a pound of cure.

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1 Risk Management and Litigation Avoidance Risk Management and Litigation Avoidance An ounce of prevention is worth a pound of cure COSE Small Business Conference October 25-26, 2012 Presented by Robert S. Gilmore, Esq. Kohrman Jackson & Krantz PLL The Employee Timeline Hiring Employment Training Compensation Performance Documents Termination HIRE EMPLOYEES THE RIGHT WAY Avoid discriminatory hiring practices 1

2 Applications Interview the right way Applications should include: A statement in which the applicant certifies that all information provided is true and that a misrepresentation or omission is grounds for an adverse decision or discharge. A statement in which the applicant authorizes the company to check and verify all information on the application and release reporting companies from liability resulting from the verification process. A statement confirming that all employment with the company is on an at-will basis. A statute of limitations for all employment related claims. A question on an employee s prior convictions? Things to do: Keep records on all job applicants to show legitimate rationales behind decisions not to hire. Things to be cautious about: Sleuthing on your own Asking the wrong questions on: Race Religion Sex Age Disability National origin Marital status Pregnancy Age of children or childcare arrangements Bankruptcy Background Checks Background check can prove essential to avoid negligent hiring and retention litigation. Be cautious when performing self-help background checks and reviewing an applicant s social media profile. Use a third party service for check. Ensure background check does not lead to discriminatory hiring practices. Be cautious when using criminal background check information. What if the check reveals a criminal history? Early this year, the EEOC issued Enforcement Guidance on criminal background checks. The Enforcement Guidelines discourage: (1) the use of criminal background checks; and (2) asking about criminal convictions on applications The EEOC has stated that excluding an individual based on their criminal history may be discriminatory under Title VII under a disparate impact theory. The EEOC now states that employers must use a targeted screen that considers at least the nature of the crime, the time elapsed, and the nature of the job, and then must provide an opportunity for an individualized assessment to determine if the policy as applied is (1) job related and (2) consistent with business necessity. There is no legal support for the EEOC s position, but employers should be aware of the EEOC s new approach to criminal background checks. Criminal background checks are still allowed, but be cautious on how the information is used. 2

3 Social Media Many employers attempt to screen applicants by searching their social media profiles (Facebook, Twitter, LinkedIn) for inappropriate or unprofessional conduct Risks Discovering a protected characteristic of an application Violations of the Fair Credit Reporting Act. Play it safe: Notify applicants that social networking websites may be screened as part of background check. Obtain consent of the applicant. Or only check the website after interviewing and before hiring. THE HIRED EMPLOYEE Your Employee Handbook Perform Employment Audits Ensure Protective Language is in the handbook Make sure your handbook is up-to-date regarding new laws Remove provisions that are not consistently followed Review Likely Risks Take action before the issue arises Use a proactive approach to employment law 3

4 Training Your Supervisors to Avoid Risk Performance Reviews Reviews Documentation Employee Complaints Harassment Retaliation Regular and timely Should be accurate not sugar coated Treat people in a generally consistent way Documentation Document poor performance - - at the time of the event Retain signed documents Otherwise it s a swearing contest in court; juries want proof of what happened Use a form that: (i) Identifies the employee and the specific misconduct and date (ii) Memorializes previous discipline (iii) Lets the employee know what is expected of him in the future (iv) Identifies action to be taken if problem not corrected (v) Allows for employee comment (vi) Requires employee acknowledgment. ADA/FMLA/Workers Compensation Triangle Did the injury/condition occur at work Is this a serious health condition under FMLA Is this a disability under ADA/state law If FMLA, then return to work at same or comparable job If a disability under ADA/state law, is there an accommodation required, for the employee to perform the essential functions of the job Engage in the interactive process No fault attendance under FMLA Intermittent leave under FMLA Leave as a reasonable accommodation 4

5 Wage and Hour Issues Increased Government scrutiny DOL audits Significant increase in private suits - lawyers are looking for cases Off the clock allegations Lunch periods/breaks Employee Harassment/Discrimination Complaints How to recognize a complaint that requires follow up and investigation Advise HR Disparate treatment claims how to avoid What is harassment? Sexual Harassment Quid Pro Quo Hostile Environment Unwelcome conduct Severe or pervasive Substantially interferes with performance or creates intimidating or hostile or offensive environment Harassment, cont. Physical Harassment Physical interference or contact which impedes normal movement when directed at a person Unwelcoming touch (backrubs, hugging, grabbing, patting, kissing, brushing up against someone, etc.) 5

6 Harassment, cont. Harassment, cont. Verbal Harassment Repeated, unsolicited, derogatory sexual comments Continued requests for social or sexual contact after being advised such is welcome (e.g., repeatedly asking out on a date, repeated phone calls) Discussing sexual exploits, questioning someone s sexual practices Sexually patronizing comments ( honey, doll, baby, etc. Comments on body parts Obscene or suggestive sounds or gestures Vulgar or sexist jokes Written Harassment Unwelcome greeting cards, notes, invitations, and love letters Visual Harassment Sexually offensive posters, cartoons, pictures, drawings, computer graphics, magazine, s, etc. Retaliation Claims Violence in the Workplace What is employee protected activity? Supervisor conduct that can be perceived as retaliatory Company liability/individual supervisor liability the legal landscape Warning Signals Escalation Management response to defuse Consider termination 6

7 Employment at Will TIME TO TERMINATE WHAT TO REMEMBER Ohio law Terminate the Employment Relationship With or Without Cause Wrongful Termination Exceptions to the employee at will doctrine: Public policy Implied contract Promissory estoppel Employment discrimination statutes Statutes that Restrict Grounds for Termination The National Labor Relations Act, 1935 Taft Hartley Act of 1947 Title VII of the Civil Rights Act of 1964 Age Discrimination in Employment Act of 1967 Pregnancy Discrimination Act of 1978 Immigration Reform and Control Act of 1986 Americans With Disabilities Act of 1990 Family and Medical Leave Act of

8 When It Is Time To Terminate Employee is not improving If it does not look like employee will improve, then it is time to terminate Don t wait too long. Failing to take action will cause workplace to suffer When It Is Time To Terminate, cont. Get everything in order Contact your legal counsel Discuss potential risks associated with employee termination Review employee file to make sure in order Is reason for termination clearly identified? When It Is Time To Terminate, cont. Notify the Employee Communicate in person. Have a witness with you at time of termination. Give clear and concise reasons for termination. Do not engage in a long drawn out back and forth discussion. The decision is not going to be changed. When It Is Time To Terminate, cont. The Golden Rule Treat your employee with respect and dignity. Only call security if there is a real threat from the terminated employee. Consider offering outplacement services. Allow the employee to gather his or her personal belongings. Buy out the bad risks consider releases and waivers. 8

9 Layoffs/Reductions In Force Base decision on objective criteria qualifications, experience, ability to perform certain work essential to the organization Verify group does not contain disproportionate percentage of protected group employees Employment file should support the decision 9

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