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.

Monday, October 29, 2012

Can You Be Fired For Supporting A Political Candidate?

In my home state of Florida (why is it always Florida?), a CEO sent an email to all of his thousands of employees saying that, if Obama is elected, they would likely lose their jobs. He didn't threaten to fire them for supporting Obama, but did make it clear that, should Obama win, his employees would suffer dire consequences. Then a Wisconsin employer followed suit. The Koch Brothers did the same.

It turns out that Mitt Romney personally instructed CEOs to use this tactic with their workers.

So, have the CEOs crossed a line? Probably not. At least yet. Here are some things employers can't do during this political season:

Limit Discussions On Which Candidates Would Improve Working Conditions: While employers can certainly prohibit general political discussions and political campaigning at work, the National Labor Relations Act says that private employers cannot prohibit discussions about workplace conditions. Therefore, if employees discuss the employer's lengthy email about why a candidate is better for them as workers, then the employer can't fire employees who voice that the employer's email is full of misleading and incorrect information and that the other candidate is very clearly the better choice for working Americans. On the other hand, employers can force you, as a captive audience, to attend meetings and listen to one-sided political pitches on behalf of candidates unless you live in Oregon, which has the Worker Freedom Act. New Jersey has a similar law.

Discriminate Based On Political Affiliation
: Not all states have laws prohibiting this, but many do. States that don't have such laws may have county or city ordinances that specifically prohibit political affiliation discrimination.The Civil Service Reform Act of 1978 prohibits political affiliation discrimination against federal employees.

Discriminate Based on Race, Sex, Religion, National Origin, Etc.: If your employer limits political discussions by some, but not all employees, then they may run afoul of discrimination laws. Much of today's partisan politics is about religion, for instance. Women's issues are hot topics in this political season. The presidential candidates are of two different races and religions. If your employer wants only one point of view expressed in your private sector job, the First Amendment won't help you but discrimination laws might.

Prohibit Labor Union Insignia: While employers can prohibit wearing of most political buttons, shirts and other campaign items, it can't prohibit union insignia. They could probably, for instance, prohibit a button that says, "Obama," but not one that says, "Teamsters For Obama."

Reimburse You For Political Contributions: If your employer says you should write a check to a candidate and agrees to reimburse you for it, they are breaking the law and could even go to jail.

Prohibit Time Off to Vote
: Most states, but not all, require employers to let you take time off to vote.

State Laws That Might Help

In some states, these employers' threats may be illegal. For instance, in Michigan, the laws prohibit direct or indirect threats against employees for the purpose of influencing their vote. It also prohibits tracking of political activity.

In Ohio, West Virginia, Pennsylvania and Kentucky, employers are prohibited from posting or handing out notices threatening to shut down or lay off workers if a particular candidate is elected.

In Oregon, it's illegal to threaten loss of employment in order to influence the way someone votes.

In Washington State, it's illegal to retaliate against employees for failing to support a candidate, ballot position or political party.

Some states, like California, Colorado, New York, North Dakota and Louisiana, say it's illegal to retaliate against an employee for their off-duty participation in politics or political campaigns.

In Florida, it's a felony to "discharge or threaten to discharge any employee in his or her service for voting or not voting in any election, state, county, or municipal, for any candidate or measure submitted to a vote of the people."

In general, remember that the First Amendment doesn't protect you in a non-government workplace. Be careful out there, and don't forget to vote.

Friday, October 19, 2012

Can Employers Discriminate Against You Because You're Unemployed? Absolutely

There's been lots of fuss about a recent article in AOL Jobs, Employer Explains Why He Won't Hire the Unemployed. Outrageous, people cry. That can't be legal!

Yet discrimination against the unemployed is indeed legal. Many companies consider unemployment to be a factor that automatically disqualifies applicants.

But it can't really be happening, can it? Yes. Unemployment discrimination is rampant. Whether unemployed for a few weeks or months or even years, employers think less of the unemployed. Some companies are even posting ads saying that the unemployed need not apply.

While a handful of states (New Jersey, Oregon, DC) have passed laws against unemployment discrimination, it's legal almost everywhere in the United States. Other states have tried to pass laws and failed or been vetoed.

But there ought to be a law!

Yes, there should. And President Obama has proposed the American Jobs Act, which has many provisions that will help put Americans back to work. Included in that law is a prohibition against discriminating against the unemployed.

What do you do in the meantime?

Unemployment is having a disparate impact on older workers and minorities. If you're facing discrimination due to being unemployed and you're over 40, a minority, disabled, pregnant, or in some other category that is disproportionately unemployed, you might want to file a charge of discrimination with EEOC and explain that the company's policy has a disparate impact on people in your category (age, race, national origin, etc.).

Don't forget to tell your member of Congress to support the American Jobs Act if you think this type of discrimination should be illegal. And, of course, don't forget to vote in November. The choice is clear on which candidates support workers, and which support the 1% "job creators." I'll stick with supporting workers any day.

Friday, October 12, 2012

Why Did the Lawyer Put This in My Severance Agreement?: The Cooperation Clause

This continues my series of posts deconstructing the legal gobbeldy-goop in employment agreements. Today I'll talk about a clause I often see in severance agreements: the cooperation clause. It may look something like this:

Employee agrees to cooperate with Employer in connection with any legal matters, if so requested by the Company, including agreeing to make himself available at the Employer's request to assist with matters requiring the provision of information and/or testimony.

Yikes! My clients never like this and neither do I. And really, what good do most employers think is going to come from having an employee they axed testify on their behalf? My first response is usually to ask that this be taken out of the agreement. However, management-side attorneys love these clauses, so here's what I usually do that will work.

First, I ask for language something like this:
Such cooperation shall be arranged so as not to interfere with Employee's employment and/or business.

That way I don't have to worry about the jerk employer who says the employee has to come in during the key sales meeting, the peak busy time, or their first day at a new job. If the employer wants cooperation, they can arrange it after hours or on a weekend so the employee doesn't get fired from their new job. If they want a deposition, same thing. Depositions can be scheduled to work around times that will get the employee fired from their new job. Without this language, the employer can say, "Tough tookies," when the employee cries foul.

The other language I ask for is that the employee be paid for their time. While they probably can't be paid for their time testifying, I want to make sure my client doesn't become an indentured servant forced to help their former employer respond to complicated discovery requests or submit to endless deposition preparation sessions. Even if it's a deposition, the employee should be compensated for their expenses, such as parking fees, gas mileage, and other out of pocket expenses incurred in this cooperation.

Forcing an ex-employee to work for free probably violates the Fair Labor Standards Act in any event, so even if payment isn't in this clause, an employer who goes too far with their demands might run afoul of the Department of Labor.

Friday, October 5, 2012

Why Did The Lawyer Put This In My Settlement Agreement?: Tax Indemnification

This will continue my series of posts about deconstructing the legalese in employment contracts. This week I'll discuss some language I frequently see in severance or settlement agreements when at least some of the money being paid isn't having taxes withheld. The clause will look something like this:
Employer makes no representation as to the taxability of the amounts paid to Employee. Employee agrees to pay federal or state taxes, if any, which are required by law to be paid by Employee with respect to this settlement. Moreover, Employee agrees to indemnify Employer and hold it harmless from any interest, taxes or penalties assessed against it by any governmental agency as a result of Employee's non-payment of taxes on any amounts paid to Employee or Employee's attorney under the terms of this Agreement.

The reason the employer wants this language is that most employment law settlements are for back wages, future lost wages, or severance, which are wages. Wages must have taxes withheld and the employer has to pay its share of employment taxes on them. If the IRS should come back later and claim more (or all) of it should have been wages, the employer wants the employee to agree they'll pay both the employee's and the employer's share of employment taxes on this.

I'm unusual in the way I request settlement money be paid to clients. I usually ask that the employee's portion be paid as wages. I have a couple reasons for this. First of all, no matter how many times I tell the employee to set aside about 1/3 of the money in a CD that comes due on April 1 so they can pay their taxes, it's too tempting to spend the money. I've had too many people call me crying in April that they can't pay their taxes. Second, if IRS should determine that the money should have been wages, my clients can't afford to pay their employer's share of taxes on top of theirs. It's a risk that I usually don't recommend.

Now, let's go back to this tax clause. I used to not object to it being added as is. If my client asks that some of the money be set aside as something other than wages, they should be willing to take the risk that they got it wrong. (On the other hand, if the employer insists that some portion of it be designated compensatory damages or emotional distress damages so they can save money, I insist they take this language out). I say I used to agree because I actually had one employer, after the fact, argue that this clause meant they could withhold the employee's federal income tax and employment taxes, then not pay them in, plus they said they didn't have to pay in their share of employment taxes on the wages amount.

It's probably an only-in-South-Florida thing, but still, this kind of jerkish behavior means I have to change the language in the future. Here's what I now ask employers to add to this clause:
This provision shall not apply to Employer's obligation to pay in amounts withheld and its share of employment taxes on the amount paid pursuant to paragraph ___.

The blank, of course, is filled with the subparagraph that sets out the amount being paid to the employee as wages.

When the attorney's fees are being paid, I insist they be paid separately because they aren't wages. Under the Civil Rights Tax Fairness Act, which used to be part of the mostly-rejected Civil Rights Tax Relief Act, they are still income to both the client and my firm. However, the client should be able to take an above-the-line deduction on their tax return (whatever the heck that is - ask your accountant) so it comes out as a wash.

Basically, there's no way to structure an employment law settlement so any portion of it isn't taxable, at least that I've ever heard of. There have been efforts to pass the Civil Rights Tax Relief Act for decades, all of which have failed. This law would make emotional distress damages tax-free. If you think it's wrong to tax emotional distress damages, which makes it harder to settle employment cases for both employers and employees, talk to your member of Congress.

In the meantime, expect to see these tax indemnification clauses in your agreements, and beware unscrupulous employers who try to use them to force you to pay their share of taxes.