Have a general question about employment law? Want to share a story? I welcome all comments and questions. I can't give legal advice here about specific situations but will be glad to discuss general issues and try to point you in the right direction. If you need legal advice, contact an employment lawyer in your state. Remember, anything you post here will be seen publicly, and I will comment publicly on it. It will not be confidential. Govern yourself accordingly. If you want to communicate with me confidentially as Donna Ballman, Florida lawyer rather than as Donna Ballman, blogger, my firm's website is here.

Friday, June 15, 2018

How To Bring Back Unions? Give Unionized Companies A Tax Cut

If there is one thing that will make a huge difference in the fight for worker rights, it's unions. Yet unions are under attack. Employers try to bust unions and prevent unionization. They do everything they can to make sure their workforce is not unionized, and if it is, to discourage workers from joining the union.

So what if we could change that picture just a little? What if employers had an incentive to encourage or at least not prevent unionization? What if employers were motivated to have a unionized workforce?

But how, you ask?

Corporations just got a huge tax cut, and if Democrats manage to take back Congress, the corporate tax cuts will be one of the first things to be rolled back. But I would suggest offering corporations the opportunity to keep their tax cuts if their non-management workforce is 95% unionized.



Right now, the companies that got the tax cuts have pretty much taken their money and run. They have moved jobs overseas, cut jobs, given raises and bonuses to C-level employees, and have done little or nothing to help their workers. Unions have asked employers to show what they did with their tax cut money, but have been met with crickets.

If employers had a tax break for a 95% unionized workforce, then they would have an incentive to stop their anti-union activities. They would also have more of an incentive to keep jobs in the U.S.

Will this result in fair pay, better pro-employee policies, and better benefits for American workers? I think it would help slowly increase the unionization in the U.S., which will be good for workers. Maybe with a tax break, it will be good for employers too.

Maybe a tax break could help stop or slow the war on workers in this country.

Friday, June 8, 2018

Harvey Weinstein's Contract Is An Admission Of His Propensity To Sexually Harass

In the land of what-the-heck-were they thinking, I give you page 10 of Harvey Weinstein's contract, Paragraph i, which is basically an admission that the company's board and management were aware of his propensity to sexually harass. I can't believe they put this in, and I'll be shocked if a judge and/or jury doesn't slap them hard with punitive damages and some personal liability.

necessary to fulfill the Board's fiduciary duties. Failure to provide the Board within a reasonableperiod with such information regarding the business, operations, financial results, prospects andaffairs
of
the Company, including, without limitation, information relating to acquisitions,divestitures and any other potential or actual corporate transaction, that is (a) reasonablyrequested in writing to you by the Board and (b) accessible to you, will be considered a materialbreach
of
this Agreement.
h
Settlements. You acknowledge and agree that (i) the settlement
of
anypending or threatened litigation by the Company that would result in a liability to the Company
of
$1,000,000 or more may only be entered into with the prior written approval
of
a majority
of
the Board, and (ii) you will inform the Board promptly once you become aware that theCompany or any
of
its executives or employees are in discussions to enter into any suchsettlement. You further acknowledge and agree that you will report to the Board (at leastquarterly) the settlement
of
any pending or threatened litigation by the Company that wouldresult in a liability to the Company
ofless
than $1,000,000.
1
Code
of
Conduct. You shall abide by the Company's Code
of
Conduct
as
in effect on the date hereof (andany amended Code
of
Conduct, provided that you approve theamendment), which shall apply to all
of
the Company's employees and directors.
1
In the event that you violate the Company's Code
of
Conduct,other than a violation relating to business expenses, you shall, in addition to any consequencesset forth herein, be subject to the following.(a)
f
the Company is obligated to make a payment to satisfy aclaim that you have treated someone improperly in violation
of
the Company's Code
of
Conduct(an ObligatePayment ), you will be required to reimburse the Company for the entire amount
of
the Obligated Payment and the costs and expenses incurred by the Company in connectionwith such claim. For purposes
of
this provision, an Obligated Payment is either where thepayment is required by a fully litigated award or where the payment is made in settlement
of
theclaim and either the Company and you agree that it was a reasonable settlement, or, in theabsence
of
such agreement, the payment is determined to be a reasonable settlement in expeditedJAMS arbitration.
10
 
CONFIDENTIAL
 WEINCO_BK-001676
(b) You and the Company recognize that, in addition to beingindemnified for the amount
of
payments the Company is obligated to make
as
a result
of
yourmisconduct, such misconduct can cause significant damage to the Company which is difficult orimpossible to measure. Accordingly,
if
your misconduct results in the Company making anObligated Payment to a person damaged by such misconduct, in addition to the indemnificationset forth in subparagraph i.(a) above, you will pay the Company liquidated damages
of
250,000for the first such instance, 500,000, for the second such instance, 750,000 for the third suchinstance, and 1,000,000 foeach such additional instance.
11.
As promptly as possible at the end
of
each calendar year, allexpenses paid by, on behalf of, and/or at your request shall be audited by the Company.
f
theaudit shows that you have personally paid more business expenses than the Company has paidyour personal expenses, the Company shall promptlyreimburseyou for the difference. To theextent the audit shows that the Company has paid more personal expenses than you have paidbusiness expenses, you shall promptly reimburse the Company the difference. You and theCompany recognize that
if
Company funds are used to pay for your personal expenses, theCompany can be damaged in an amount that is difficult or impossible to determine beyondreceiving the reimbursement provided for aboveAccordingly,
if
the audit provided for aboveshows that the Net Personal Expenses then owed by you to the Company for personal expenses
i
.e., the excess
of
personal expenses paid by the Company over business expenses paid by you)is greater than the amount the Company owes you for any reason, including for amounts loaned,advanced, or deposited, then in addition to reimbursing the company for the Net PersonalExpenses paid by the company, you will pay
as
liquidated damages the amount by which suchNet Personal Expenses exceeds the amount the company then owes to you.
12.
Incapacity
a.
In the event you suffer total mental or physical disability and cannotsubstantially perform your duties at any time during the Employment Term, the Board
of
Representatives may at any time after such disability has continued for ninety (90) consecutivedaysrequirethe Company
to
give you written notice that it intends, subject to applicable stateand federal law, to suspend this Agreement. Upon receipt
of
such notice, prior to any suspension

Wednesday, June 6, 2018

Roseanne, the NFL, and Employee Free Speech at Work

There are two big stories in the headlines involving employee speech and the consequences thereof. If you haven't heard of both, welcome back from the coma. The most recent was Roseanne Barr's racist tweet rant, which resulted in the cancellation of her number 1 rated TV show, Roseanne. Then there has been the ongoing saga of NFL players kneeling during the national anthem in protest over the extreme number of police killings of black people. The NFL recently decided to impose penalties on teams with players who kneel, but will allow them to stay in the locker room.

So, let's first address the elephant in the room. What about free speech? I have to keep saying this, and I shouldn't: there is no free speech in the workplace unless you work for government. Even working for government, your free speech is limited.

Do the NFL players and Roseanne have any rights in this situation? Maybe.

Roseanne is a well-known star. She has a contract with the network. If she had a good agent or lawyer, she likely has a clause protecting her in this situation. If I were negotiating, I might have demanded that the network agree not to cancel the show if ratings were over a certain number. Or that the network guarantee a certain number of shows. I don't know what her contract says. However, it may also have a clause allowing the network to cancel if the stars engaged in behavior that they deemed damaging to the network. Depending on the language of such a clause, a racist rant may well mean the network was within its rights.

Had there been no contract, the network could cancel for any reason or no reason at all, because employees in every state but Montana are at-will unless there is a contract saying otherwise.

The other issue is whether the network should have canceled the show. On that issue, I have to come down in the yes column. They are now on notice of her propensity to engage in race discrimination. Now that they are on notice, if they allow her to continue and she discriminates against cast or crew, they could be liable for punitive damages. I don't see that they had any choice here. There is also the issue of sponsors. If sponsors backed out in droves, that would similarly justify the cancellation.

Now, on to the NFL. The players have a union. This new requirement that they not kneel may well violate the NFL's obligation to collectively bargain regarding terms and conditions of employment. I suspect we'll hear more from the union on that issue.

Should the NFL have done this? On the one hand, some fans were freaking out about the kneeling. But they still keep concession stands open so nobody is freaking out about buying hot dogs during the anthem. These are players quietly and respectfully protesting discrimination. There is nothing about the protest that shows any propensity to engage in discrimination like Roseanne. I, personally, would not organize a protest in a way that allowed the opposition to question my patriotism, but this is how they chose to protest, and I think they should be allowed to do so as long as they do so respectfully, as they have done. I understand the NFL's wanting to end the controversy, but I think they just managed to step it up instead.

Overall, the lesson to those of us who aren't multi-millionaires with big contracts is that there is no free speech in the workplace in America.

Friday, May 18, 2018

Customer Heaping Racist Abuse On Employees? Employer Must Stop It Or Risk Suit

The video of the guy heaping abuse on a restaurant's employees for speaking Spanish that went viral made me wonder: what did the restaurant do after this? A company's duty to keep the workplace free of national origin and immigration status harassment extends to protecting its employees from customer abuse and discrimination.

The most common case comes when a customer demands the company engage in discrimination by not assigning people of a particular race or national origin to them. An example would be a hospital patient refusing to be treated by people of a particular race.

But when a customer heaps discriminatory abuse on employees, it is the employer's duty to keep the workplace free of discrimination. The employer now knows about this customer's propensity to discriminate. It now must take prompt action to correct the situation.

But what can an employer do to stop a racist customer? Here are some actions that can be taken in this situation, and I hope the employer did at least some of this:

  • Remove the customer: In this case, the manager was one of those being subjected to abuse. Still, the manager would be within her rights to ask the customer to leave and call the police if he refused.
  • Ban the customer: Let's say management didn't find out about the situation until after the case. The customer could be banned from the restaurant. In the case of a company where the customer represents a large chunk of sales, it's tempting to let it pass. But the company could be liable for the customer's bad behavior.
  • Make sure the customer is accompanied at all times: If the customer is one that is too big to ban, then make sure someone in management is assigned to be with that person at all times they have contact with employees so they can shut down any bad behavior. Let the customer know that further bad behavior will result in banning. Of course, that may be an empty threat if the customer is a major one. Still, the company must stop the bad behavior, even if it means getting rid of an otherwise good customer.

Here's what the company absolutely cannot do:

  • Accede to customer wishes: The company cannot allow a customer to demand it engage in discrimination. The answer to the customer who wants only people of a particular race, national origin or religion to deal with them must be a resounding no.
  • Retaliate against the employee/victim: The employer must not deal with the problem by firing the employee, assigning them to a less-desirable position, or otherwise retaliating against them for being a victim of discrimination.
If a customer is engaging in this kind of behavior, report it to HR or someone in management. If your employer allows customers to engage in discrimination, sexual harassment, or discriminatory harassment, or retaliates against you for reporting it, contact an employee-side employment lawyer in your state to discuss your rights.

Friday, May 11, 2018

Senate Democrats Seek To Ban Noncompetes

It won't pass, but a group of Democrats in the U.S. Senate have proposed a bill that would ban noncompete agreements. The Workforce Mobility Act would prohibit the use of non-compete agreements and require employers to notify employees that these agreements are illegal. It would also allow the U.S. Department of Labor to enforce the ban with fines on the employer.

Here are the key provisions:
3. Presumption of illegality of covenants not to compete in employment contractsA covenant not to compete contained in an employment contract made between an employer and an employee is anticompetitive and violates the antitrust laws unless the employer establishes by a preponderance of the evidence that the covenant does not have an anticompetitive effect or that the pro-competitive effects outweigh the anticompetitive harm.
4. Private right of action
(a) In general
Any person who fails to comply with section 2 shall be liable to any individual in an amount equal to the sum of—
(1) any actual damages sustained by the individual as a result of the failure;
(2) such amount of punitive damages as the court may allow; and
(3) in the case of any successful action to enforce any liability under this subsection, the costs of the action together with reasonable attorney’s fees as determined by the court.
(b)Venue
Any person may bring a civil action under subsection (a) in any appropriate district court of the United States.
5. Trade secretsNothing in this Act shall preclude an employer from entering into an agreement with an employee to not share any information (including after the employee is no longer employed by the employer) regarding the employer or the employment that is a trade secret as defined in section 1839 of title 18 of the United States Code.
It's an excellent bill, but it will take a blue wave in November to get it passed, and it will be vetoed if it does pass. Still, it's a start. I can dream, can't I?

Vote Best. 

Friday, April 20, 2018

Employer Agreeing Not To Poach Competitor's Employees? That's A Jailing

The Department of Justice's Antitrust Division is serious about going after employers who agree not to poach a competitor's employees. So serious, that they announced in 2016 they would start criminally prosecuting violators, and they recently announced some prosecutions are imminent. In a joint publication with the Federal Trade Commission titled Antitrust Guidance for Human Resource Professionals, the DOJ said this about no-poach agreements (these are my favorite excerpts):
From an antitrust perspective, firms that compete to hire or retain employees are competitors in the employment marketplace, regardless of whether the firms make the same products or compete to provide the same services. It is unlawful for competitors to expressly or implicitly agree not to compete with one another, even if they are motivated by a desire to reduce costs.  
Violations of the antitrust laws can have severe consequences. Depending on the facts of the case, the DOJ could bring a criminal prosecution against individuals, the company, or both. And both federal antitrust agencies could bring civil enforcement actions. In addition, if an employee or another private party were injured by an illegal agreement among potential employers, that party could bring a civil lawsuit for treble damages (i.e., three times the damages the party actually suffered).  
An individual likely is breaking the antitrust laws if he or she:  
  • agrees with individual(s) at another company about employee salary or other terms of compensation, either at a specific level or within a range (so-called wage-fixing agreements), or 
  • agrees with individual(s) at another company to refuse to solicit or hire that other company’s employees (so-called “no poaching” agreements). 
Naked wage-fixing or no-poaching agreements among employers, whether entered into directly or through a third-party intermediary, are per se illegal under the antitrust laws. That means that if the agreement is separate from or not reasonably necessary to a larger legitimate collaboration between the employers, the agreement is deemed illegal without any inquiry into its competitive effects.  
Going forward, the DOJ intends to proceed criminally against naked wagefixing or no-poaching agreements. These types of agreements eliminate competition in the same irredeemable way as agreements to fix product prices or allocate customers, which have traditionally been criminally investigated and prosecuted as hardcore cartel conduct. Accordingly, the DOJ will criminally investigate allegations that employers have agreed among themselves on employee compensation or not to solicit or hire each others’ employees. And if that investigation uncovers a naked wage-fixing or nopoaching agreement, the DOJ may, in the exercise of its prosecutorial discretion, bring criminal, felony charges against the culpable participants in the agreement, including both individuals and companies. 
Sharing information with competitors about terms and conditions of employment can also run afoul of the antitrust laws. Even if an individual does not agree explicitly to fix compensation or other terms of employment, exchanging competitively sensitive information could serve as evidence of an implicit illegal agreement. While agreements to share information are not per se illegal and therefore not prosecuted criminally, they may be subject to civil antitrust liability when they have, or are likely to have, an anticompetitive effect. 
Additionally, merely inviting a competitor to enter into an illegal agreement may be an antitrust violation – even if the invitation does not result in an agreement to fix wages or otherwise limit competition.  
Reports can be made to the Division through the Citizen Complaint Center by e-mail (antitrust.complaints@usdoj.gov), phone (1-888-647-3258, toll free in the U.S. and Canada, or 202-307-2040), or mail (Citizen Complaint Center, 950 Pennsylvania Avenue, NW, Room 3322, Washington, DC 20530).  
Reports can be made to the FTC through the Bureau of Competition’s Office of Policy and Coordination by email (antitrust@ftc.gov), phone (202-326- 3300), or mail (Office of Policy and Coordination, Room CC-5422, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580). 

In my opinion, this not only means that your employer cannot have a gentleman's agreement with a competitor not to hire each other's employees, but that such an agreement is prohibited even when it is done to settle a noncompete lawsuit involving a noncompete agreement of an employee.

If your employer is breaking the law, don't participate in those antitrust violations. You could land in jail. Instead, report them to the Department of Justice or the FTC. If you are the victim of a no-poach arrangement, contact an employee-side employment lawyer in your state.

Friday, April 13, 2018

Are You A Liar? Arbitration Is The Forum For You

Arbitration is very popular with employers, and no wonder. It's a liar's forum that employees can be blackmailed into. While courts penalize litigants for lying with heavy sanctions and dismissal of their claims/defenses, there is little a court can do when a litigant lies in an arbitration.

The Federal Arbitration Act, 9 U.S. Code § 10(a) provides:
In any of the following cases the United States court in and for the district wherein the award was made may make an order vacating the award upon the application of any party to the arbitration—

(1) where the award was procured by corruption, fraud, or undue means

The Florida Arbitration Act, Fla. Stat. § 682.13 provides:
Vacating an award.—

(1) Upon motion of a party to an arbitration proceeding, the court shall vacate an arbitration award if:

(a) The award was procured by corruption, fraud, or other undue means
However, courts have refused to interpret these provisions to allow a court to refuse to enforce an arbitration award procured by perjury, or to set aside judgments entered on awards procured by perjury, except where the perjury wasn't "discoverable upon the exercise of due diligence prior to or during the arbitration." And the perjury must, "materially relate to an issue in the arbitration."

This means that if you know a party is lying during the arbitration, can prove they lied, do your best to impeach them during the proceeding, and the arbitrator still enters judgment for the liar, you have no remedy. The court can't penalize the liar. Arbitration laws give judges almost no leeway to review an arbitration award.

In court, if the other side lies and you can prove it, but the jury finds for the liar anyhow, the judge can set aside the judgment. And if the trial judge doesn't do it, the appellate judge can. Judges hate liars.

This is just one of the many problems with the one-sided forum that is employment arbitration. Employers like it because there are almost no checks and balances. They mostly pick arbitrators that come from an employer-side background, and that tend to rule for employers. While many arbitrators, even from the employer side, try to be fair when wearing the neutral hat, many whose income depends on getting selected by employers are not. Rule for an employee and you can be blackballed from being chosen to arbitrate by employers. So what's a little lie between friends?

Employers in Florida and many states can force employees to sign arbitration agreements with a sign-or-be-fired threat, and the courts don't consider this to be duress. Everyone with any common sense understands that this is coercion, but it's allowed.

I used to be a strong believer in arbitration as a good way for parties to voluntarily choose to resolve disputes. But when one side can blackmail another into "voluntary agreeing" to arbitrate, then veto any arbitrators it knows might rule for employees, plus get away with lying at will, it's a travesty.