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Termination. Employment-at-will Payne v. Western and Atlantic RA Company The Court confirmed the right o f an employer to hire or fire any individual for good cause, bad cause, or no cause at all. Restrictions on Employment-at-Will. Civil Rights protections
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Termination • Employment-at-will • Payne v. Western and Atlantic RA Company • The Court confirmed the right o f an employer to hire or fire any individual for good cause, bad cause, or no cause at all
Restrictions on Employment-at-Will • Civil Rights protections • Employment contracts, union or individual • Market forces • Whistleblower statutes • Threats of wrongful discharge suits
Civil Rights Restrictions • Murphy v. American Home Products Corp • Age discrimination used to challenge at-will termination
Violation of Public Policy • Employees may not be fired for exercising rights protected by law • Worker comp claims • Refusing to commit perjury • Absence for jury duty • Voting as stockholder Requires “clear and legal mandate” re public policy
Whistleblowing Palmateer v. International Harvester • Employee was wrongfully discharged after reporting coworkers involved in crime Sheets v Teddy’s Frosted Foods • Employee was wrongfully discharged for insisting company comply with federal Food, Drug and Cosmetic Act
Expressed or Implied Promise of Employment • Touissant v Blue Cross and Blue Shield of Michigan • Employees had been wrongfully fired for no apparent reason, though the employer said “You can have your job as long as you do your job.” • Employer also had written policy requiring good cause, warnings, and a disciplinary hearing before discharge
Good Faith and Fair Dealing • Fortune v. National Cash Register Company • NCR had fired long-term employee who was “at will”, but the employer sought to avoid paying large commission through the discharge, demonstrating bad faith Only 11 states recognize covenant-of-good-faith exception to employment at will
Tortious Conduct • Tortious conduct – violation of a duty owed to others • Monge v. Beebe Rubber Company 1974 • Female employee was “abusively discharged” for refusing to date supervisor • Now that problem would be handled under Civil Rights sexual harassment protection
Layoffs • Firefighters Local Union 1784 v. Stotts (1984) • Supreme Court Ruled a layoff illegal when more senior white employees were laid off while less senior black employees were retained – seniority is a legitimate basis for discharge • Worker Adjustment and Retraining Notification Act • Complicated law affecting employees in facilities to be shut down
Broad practice implications • Have written policy manual, reviewed by employee • Use positive employee relations approach • Know the legal context of your business operations • “Golden Rule” – do to others as you would have them do to you • Keep an excellent employment attorney on retainer