Posted by marykeating on October 30, 2010 under Economic situation, Restrictive covenants | 
An interesting article concludes that non-compete agreements may be bad for innovation. Agreements outlawing non-compete agreements in California prevents companies from making and enforcing restrictions on their departing employees. The article concludes that the inability to restrict job-changing high tech employees contributed to the fertility of Silicon Valley’s creations. It also argues that those companies were forced to find non-punitive ways to retain employees, and led to widespread equity sharing arrangements.
In Maryland, non-competes are enforceable if they are supported by a business necessity, and are no broader than necessary to protect the business’s interest. The courts agree that employees with special skills, access to company trade secrets, and intimate customer contact can be restricted from taking a job with a competitor for a reasonable time, and in a reasonable geographical area, to prevent trade secrets and customers from departing with the employee. On the other hand, efforts to stop lower level employees or those unlikely to convince customers to transfer their business to a competitor are often unavailing. A restrictive covenant is not a legitimate way to prevent an employee from using his or her experience at a new worksite.
Covenants not to compete are cited by employers as necessary to protect their investment in their business development. The employer has paid the employee to pursue leads and develop relationships with customers, and therefore the employee should not be free to use those relationships to harm the employer. On the other hand, these agreements, which are seldom negotiable, can be very disruptive to an employee’s ability to pursue a career. When a reduction in force occurs, a laid off employee suffers a double hit, by being laid off in a weak economy, often financially unable to relocate outside of the restrictive area, and unable to take a job near home. And sometimes the employer is the one taking unfair advantage of the highly skilled or plugged-in employee. It expects an experienced employee to join the workforce, bring his or her contacts in the industry, and then leave those relationships behind if he leaves, regardless of the reason.
Maybe it’s time we enact a law similar to that of California. If all employers in the state are forbidden to restrict post-employment competition, everyone is on an equal footing, and no company gets a competitive advantage by having a restrictive contract. Then employers have to find effective ways to retain employees, other than by the threat of a lawsuit if they leave.
Posted by marykeating on October 29, 2010 under Interesting cases, Sex-based discrimination |
The Supreme Court will hear oral arguments on November 10 in a reverse discrimination case. The issue is when a foreign-born child born out of wedlock to a non-citizen and an American parent is to be considered a United States citizen. Under the law then in effect (but since changed to be gender-neutral), the child can be considered a U.S. citizen only if the citizen parent had resided continuously in the United States for a period of a year (for a mother) or five years (for a father) after the age of 14. Since the rules were less strict for a mother than for a father, a child denied citizenship and deported claimed gender discrimination.
Since this immigration double standard law has changed, the Supreme Court must have some interest in addressing the subject of gender discrimination and/or immigration policy. Often in the past breakthroughs in sex discrimination standards have arisen when cases were brought by men. For example, the cases that established “intermediate scrutiny” for government-imposed sexual distinctions arose in the context of males being deprived of some right given to females. In Craig v. Boren, a man successfully challenged a state law that set a higher legal age for drinking for men, at 21, than women, at 18. The Supreme Court required that a gender classification used by the government must be designed to meet “important” ends and that the means employed are “substantially related” to the ends. Was it a coincidence that the law was disadvantageous to men? A few years later, the Supreme Court added to the standard, saying that a party defending the law carry the burden of “exceedingly persuasive justification” for the classification. That case involved a man seeking to be admitted to a nursing program, that had excluded them. (Mississippi Univ. for Women v. Hogan.)
If this case is debated on the gender issue, there may be interesting developments, or at least helpful language, devoted to whether men and women are equally parents. In the workplace, as in the larger society, this is still an area where inequality is taken for granted.
Posted by marykeating on October 19, 2010 under Sex-based discrimination |
Many people, including me, were brought up not to talk about money. Or at least not personal money, like how much you make, how much your bonus check amounted to. Many companies have a rule against discussing salaries among workers, but the reason is not rooted in good breeding. Instead, such a rule can be used to avoid paying more money to more educated employees, avoid morale issues that can arise from a sense of injustice, and avoid lawsuits in the case of true, illegal, injustice.
A new study discussed in Smart Money magazine showed that publicity on salary data made some people unhappy about their own pay, but did not contribute to a sense of superiority or happiness with the better paid employees.
As the article points out, rules outlawing employees discussing salary among themselves violates the National Labor Relations Act. That act governs the conduct of union elections and other aspects of the unionized workplace. But some provisions apply to all workplaces, since the law protects collective action. When employees combine together to object to workplace treatment, Section 7 of the NLRA protects their activity from retaliation even when the workplace has no union.
Talking about salaries benefits employees, since they get a better idea of the market value of their jobs. Almost more importantly, patterns of wage discrimination can be uncovered. Secrecy is what stopped Lily Ledbetter from winning her case against Goodyear Tire, where she had been paid 20% less than her male counterparts for 19 years. The Supreme Court held that she had to sue within a short time of the first decision to pay her less. Too late for Ms. Ledbetter, the Lily Ledbetter Fair Pay Act was enacted in 2009, but it does no good if the women do not know what the men earn.
Posted by marykeating on October 14, 2010 under retaliation |
The Supreme Court granted certiorari to a case involving retaliation against government employees. In Borough of Duryea v. Guarnieri, a local government asks the Supreme Court to reverse a decision in favor of its employees who sued for retaliation. Unlike many retaliation charges, which rest on the words of anti-discrimination statutes, this was brought as a constitutional claim. A police chief claimed that he was retaliated against for filing a grievance relating first to his termination (he was reinstated), and then from a grievance following his employer’s treatment of him after he was reinstated. Under the first amendment, citizens have the right to petition the government.
The local government raises the issue whether public employees should be protected from retaliation when they petition the government on “matters of purely private concern.” The petition for certiorari argues that most of the other federal courts that have spoken on the subject have separated issues of public concerns, which more centrally invoke free speech rights, from private matters, such as a person’s own job. The local government raises the specter that every employee who is disciplined will literally turn the issue into a federal case.
Parties often use the argument that the floodgates of litigation will open if a certain limit is not placed on the exercise of a right. In reality, it is not easy to maintain a federal lawsuit, and it is unlikely to be done on a whim. And in this case, the petition to the government was not a remark or voicemail message, but a grievance filed in accordance with procedures set up for those purposes. Still, this Supreme Court is hard to predict, with two new justices. Since certioari was granted so early in the term, the Court may get to the matter before June.
Posted by marykeating on October 9, 2010 under Economic situation |
The New York Times reported a dip in the number of jobs last month, led by a large loss of public jobs, particularly in local governments. The economic slide has affected tax revenues, and forced local governments, which ordinarily must balance their budgets, to economize. While the private sector did add jobs, the total was lower than hoped, and lower than the past two months. The article also notes that there was no budging the underemployment issue, in which people wanting full-time employment get only part-time hours.
The prolonged malaise of the economy has led to changes in American habits of consumption, some of which may become permanent. In addition, people are much more wary of leaving a job, even if not a good fit, since the next place may be less stable. Young people coming out of school are not finding the job prospects favorable, and may stay longer with Mom and Dad. This should keep social scientists busy for a long time, at least if they can find funding for their projects.
Posted by marykeating on October 7, 2010 under Family responsibility, Pending legislation, Sex-based discrimination |
I have been thinking about the problems of people facing job difficulties because of their family responsibilities. On Sunday, the ACLU hosted a forum to discuss the issue; I talked about the patchwork of laws that cover some areas and leave some unprotected. The forum featured Kevin Knussman, the state trooper who fought a ten-year lawsuit after the state denied him leave to help care for his newborn daughter and ill wife. His supervisor told him that unless his wife was dead or in a coma, he was not entitled to parental leave, since he could not have or breastfeed a baby.
Many workers feel the effects of discrimination against them on the basis of their family obligations. Schedules are changed, which wrecks a carefully mapped out system. An employer assumes that a woman with small children will not want to travel, so she can’t be given the promotion. A worker takes off time to help with his aged father’s illness, and the boss questions his commitment to his job.
In some cases, the attitudes and actions violate existing laws. For example, if a woman is not considered for a plum assignment because she has young children, and is assumed to place her family ahead of her job, while men with young children do not face the same barrier, that is gender discrimination. If an employee takes occasional time off to care for an ailing mother, discrimination may be outlawed by either the Family and Medical Leave Act, or perhaps by the Americans with Disabilities Act prohibition forbidding discrimination on the basis of the employee’s association with a disabled person. But there are holes in these overlapping laws. And often it is difficult to separate the effect of discriminatory attitudes from the employer’s asserted need to impose certain schedules and get certain jobs done.
A new law has been introduced in Congress that would require the employees and employer to discuss the worker’s need for flexibility. Entitled the “Working Families Flexibility Act,” the law is designed to:
permit employees to request, and to ensure employers consider requests for, flexible work terms and conditions, and for other purposes.
Under this bill, the employer is required to discuss the employee’s need for certain hours and places of work. In fact, if the employer rejects the application for flexibility, it must make a written decision outlining the reasons. The employee may ask for reconsideration, and the parties must have a meeting, at which the employee may have representation. The employer is forbidden from retaliating against the employee for making the request, or interfering with the right to make the request.
The thrust of this law would be to force employers to give actual consideration, not an automatic “no” to requests to work from home, start later, or work four ten-hour days. It does not require any particular outcome, however. The bill is in committees in both the House and the Senate.
Maryland’s general assembly rejected a law last year which would have added another prohibited basis of discrimination. Under the anti-discrimination laws, an employer would be liable for taking actions such as firing, refusing to hire, refusing to promote, or paying less to an employee on the basis of his or her family responsibilities. It did not pass, but new laws are more likely to pass in non-election years, which we have coming up this winter.
Posted by marykeating on October 4, 2010 under retaliation |
The Equal Employment Opportunity Commission filed a complaint against Fox News last week, in the District of Columbia’s federal court. The complaint accuses Fox of retaliating against a correspondent who had complained of sex and age discrimination policies at Fox. When it was time to renew her contract, Fox News presented a contract that mentioned her discrimination complaints, and was meant to stop her from pressing such complaints in the future. The reporter declined to sign the contract with that language. Fox refused to negotiate, until the following year, after the EEOC investigated.
A lawsuit claiming retaliation for making complaints can pack a powerful punch. Judges often have a better reaction to retaliation claims than to the discrimination charges that prompted them. Perhaps this is because they represent an attack on the citizen’s right to invoke the protections of a law, or to participate in someone else’s lawsuit.
Retaliation can take many forms, including firing, demoting, isolating, and attempting to make the workplace so harrowing that the employee quits. Sometimes an employer retaliates after the employee has left the employer. Employers need to be careful about reacting in a resentful manner about a claim of discrimination, even if it sincerely believes that the charge was baseless. Giving a bad reference, fighting against unemployment benefits and refusing to consider a person for may all qualify as retaliatory acts, prolonging the problem.
Posted by marykeating on October 1, 2010 under Unemployment compensation |
For newly unemployed workers applying for unemployment benefits, the maximum weekly benefit will be $430, so long as the claim has been filed on Monday or later. Claims filed before that, or benefits already being paid, will be capped at $410 per week. The weekly benefit increases with the worker’s past four quarterly pay.
