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8/26/11

Employment and Labor Law, 8th Edition instuctor manual and test bank

Employment and Labor Law, 8th Edition  instuctor  manual and test bankemployment and labor law - patrick j. cihon (7th ed) solutions manual and test bank


Employment and Labor Law, 8th Edition

  • Patrick J. Cihon Syracuse University
  • James Ottavio Castagnera Pinnacle Employment Law Institute and Rider University
  • ISBN-10: 1133586600
  • ISBN-13: 9781133586609
  • 800 Pages Hardcover 
  • Previous Editions: 2011, 2008, 2008
  • © 2014 | Published
  • Book Resources

    Chapter 2

    EMPLOYMENT CONTRACTS AND WRONGFUL DISCHARGE

    True/False Questions

    _____ 1.  Common law deals with issues of wrongful discharge.
              ANSWER:  T

    _____ 2.  If the statute itself provides the employee with a cause of action, the courts are reluctant to recognize an alternative remedy in the form of a lawsuit for wrongful discharge.
              ANSWER:  T

    _____ 3.  Employees cannot be terminated under the public policy exception.
           ANSWER:     F

    _____ 4.  Pennsylvania Human Relations Act provides that a person fired on the basis of gender or race discretion has to initially seek redress from the commission created under the Act and not with the court.
               ANSWER:      T

    _____ 5.  The opinion of a judge or appellate panel of judges that are tangential to the rule, holding, and decision which are at the core of the judicial pronouncement is known as dicta.
              ANSWER:  T

    _____ 6.  The National Labor Relations Act (NLRA) forbids firing employees for engaging in protected concerted activities.
    ANSWER:  T

    _____ 7.   An implied contract is a contract which is made either verbally or in writing.
              ANSWER:  F

    _____ 8.  Public Policy Exception is not a commonly adopted exception to the pure employment-at-will rule.
              ANSWER:  F

    _____ 9.  Section 3(a) of the Model Employment Termination Act provides that an employer cannot terminate the service of an employee without giving good cause.
              ANSWER:  T

    _____ 10.  The provision of Sarbanes-Oxley Act amended the Employee Retirement Income Security Act (ERISA).
              ANSWER:  T

    _____ 11.  Occupational Safety and Health Act (OSHA), does not offer protection to employees who cooperate during investigations or testify at hearings from employer retaliation, such as employment termination.
              ANSWER:  F

    _____ 12.  A whistleblower is an employee who reports his or her employer’s illegal activities to the appropriate governmental entity.
              ANSWER:  T

    _____ 13.  Section 10 of the Model Employment Termination Act forbids retaliation by employees who make claims or who testify under the procedural provisions of the META.
              ANSWER: F

    _____ 14.  The drawback under Sarbanes-Oxley Act is criminal provision, which used to punish people who provided information to law enforcing agencies relating to commission of any federal offences.
              ANSWER:  T

    _____ 15. In the case of McClaskey v. California State Auto Assn., once an employer’s unilaterally adopted policy has become a part of the employment contract, the employer may thereafter unilaterally terminate the policy.
              ANSWER:  F

    Multiple Choice Questions

    1.  The law which is created by judges opposed to statutes and legislation for the equity, justice and conscious is called:
                 a.  common law.
                 b.  codified law.
                 c.  statutory law.
                 d.  ordinance.
                 ANSWER:  (a)

    2. The freedom of employees to quit the employment relationship is an important issue underlying which doctrine?
           a.    the express contract doctrine.
           b.    the employment-at-will doctrine.
           c.    in independent employee doctrine.
           d.    the legal doctrine of an implied employment.
           ANSWER:     (b)

    3.  An employee who has not been hired for more than a year can be fired by the employer for any reason or for no reason. This is the doctrine of:
                a.      self employed.            
                 b.  employment-at-will.
           c.    contractual employed. 
                d.      whistleblowers.
           ANSWER:     (b)

    4. Courts are reluctant to recognize an alternative remedy if the statute itself provides an employee with a cause of action in the form of a lawsuit for:
           a.    willful misconduct.
           b.    negligence.
           c.    wrongful discharge.
           d.    tort.
           ANSWER:     (c)

    5.  The exception under the employment-at-will rule, where the employer cannot fire an employee from employment for exercising a legal right or fulfilling that legal duty created by a statute, is called:
                 a.  court order.
                 b.  administrative action.
                      c.    public policy exception.
                 d.  statutory exception.
                 ANSWER:  (c)                                                                 

    6.  In Pennsylvania, if an employee is fired on the basis of gender or race discrimination, then State law remedy is provided under the Pennsylvania:
                a.    Occupational Discrimination Act.
                b.    Human Relation Act.
                c.    Labor Relation Act.
                d.    Gender and Race Discrimination Act.
                ANSWER:    (b)
     
    7.  A private or civil wrong or injury caused by one party to another, either intentionally or negligently is a:
                a.      breach of contract.
                b.      criminal act.
                c.      tort.
                d.      act of god.
                ANSWER:       (c)

    8. Some employees have express contracts of employment, usually for a definite duration. Others fall within the coverage of a(n) ________________ negotiated for them by their union.
                a.      collective bargaining agreement
                b.      employment bargaining agreement
                c.      cooperative bargaining agreement
                d.      negotiable agreement
                ANSWER:       (a)

    9.  Contracts that courts infer from company policies and the behavior of the parties are known as:
                 a.  implied contract.                       
                 b.  void contract.             
                 c.  express contract.
                d.      voidable contract.              
                 ANSWER:  (a)

    10.  Section 3(a) of the Model Employment Termination Act (META) protects employees from wrongful termination from employment and states that:
                a.    an employer may not terminate employment of an employee without good cause.
                b.    an employer can terminate employment of an employee with perverse reason.
                c.    an employer cannot terminate an employee without government consent.
                d.    an employer may not terminate an employee from work without court order.
                ANSWER:    (a)

    11.  The provision of Uniform Employment Termination Act deals with protection of employees from:
                 a.  misdemeanors.
                 b.  wrongful discharge.
                 c.  government order.
                 d.  court order.
                 ANSWER:  (b)

    12.  An employee who complaints against his or her employer pertaining to fraud and corruption is protected under the provision of:
                a.      Occupational Discrimination Act.            
                b.      Model Employment Termination Act.
                c.      Sarbanes-Oxley Act.
                d.      Wage Act.
                ANSWER:       (c)

    13.  An act that contains anti-retaliation provisions is:
                a.      the Equal wage Act.
                b.      the Civil Procedure Act.
                c.      the Gender Discrimination Act.
                d.      the Occupational Safety and Health Act.
                ANSWER:       (d)

    14.  Which Act was passed by Congress on July 30, 2002 and signed by the president for the protection of whistleblowers?
                 a.  Sarbanes-Oxley Act
                 b.  National Labor Relation Board
                 c.  Occupational Safety and Health Act
                 d.  Wage Act
                 ANSWER:  (a)

    15.  An Act which makes it illegal to fire an employee in retaliation for filing a safety complaint is covered under the provision of:
           a.    Title VII of Civil Rights Act.
           b.    National Labor Relations Act.
           c.    Occupational Safety and Health Act.
           d.    Public Policy Exception.
           ANSWER:     (c)

    16.  Employees of public companies are protected from retaliation for engaging in certain whistleblowing activities under:
                a.      the Occupational Safety and Health Act.
                b.      the Workers’ Compensation Act.
                c.      the National Labor Relations Act.
                d.      the Sarbanes-Oxley Act.
                ANSWER:    (d)

    17.  Many federal and state statutes seek to protect whistleblowers from the employer’s retaliation by declaring such retaliation as:
                a.      illegal acts.   
                 b.    defenses.
                 c.    legal rights.
                 d.    improper conduct.
                ANSWER:       (a)

    18.  Identify the case in which the Supreme Court upheld the dismissal of a lawsuit brought by a salesman who was fired for refusing to sell what he insisted to management was an unsafe product?
           a.    Knox v. Board of School Directors of Susquenita School District    
                b.      Geary v. United State Steel Corporation
                c.      Asmus v. Pacific Bell
                d.      Marcus v. KFG Employment Services, Inc
           ANSWER:     (b)

    19.  The Rodgers v. Lorenz case involved which of the following acts?
              a. Model Employment Termination Act
              b. Sarbanes-Oxley Act
              c. Workers’ Compensation Act
              d. Occupational Safety and Health Act
              ANSWER:  (c)

    20.  Kelly was an employee of a retail outlet. Although the nature of the work and duties performed by both male and female workers were comparable, the remuneration paid to male workers was significantly higher compared to the female employees. When Kelly brought this to the attention of the management and objected to the difference in pay, her services were terminated without good cause. Under which law can she challenge her termination?
           a.    Sarbanes-Oxley Act
                 b.  National Labor Relation Board
                 c.  Occupational Safety and Health Act
           d.    Model Employment Termination Act
    ANSWER:       (d)

    21.  Muriel is the owner of a garment factory in New York City. Ten months back she hired 20 employees to work in his factory, but due to the economic downturn she decided to let go of the new hires in order to save her business. All 20 employees were fired and no explanation was provided. This action is perfectly legal and covered by the doctrine of:
                a.      implied contract.
                b.      good faith and fair dealing.
                c.      employment-at-will.
                d.      necessity.
                ANSWER:       (c)

    22.  Steven is the Executive Director at a telecom company in Texas. He regularly misappropriated company funds which belonged to the employee benefit plan and several clients. Robert, his corporate secretary was aware of his superior’s illegal activities. He brought this to the attention of law enforcing agencies. What is Robert’s role in the above scenario?
                a.      Spokesperson
                b.      Whistleblower
                c.      Gatekeeper
                d.      Outworker
                ANSWER:       (b)

    23.  Robert is a respected member of the Santa Clara community and works with a local architectural firm. He was selected by the court to perform jury duty on a case. The case went on for several days and caused Robert to miss work for the entire duration. Upon his return, he discovered that his team member had replaced him and his services were abruptly terminated. In this scenario Robert can challenge his termination under:
                a.      the public policy exception.
                b.      Title VII.
                c.      the National Labor Relation Act.
                d.      the U. S. Constitution.
                ANSWER:       (a)

    24.  Brett (defendant) entered into employment contract with Krista (plaintiff). Brett had hired Krista as a staff assistant at a pay rate of $20 per hour. Krista’s duties consisted of driving trucks and making deliveries. Although Krista worked for 120 hours in total, she was paid only for part of her services which did not abide by the terms and conditions agreed in the employment contract. Krista has most likely instituted a suit against Brett for:
                a.      breach of trust.
                 b.    breach of contract.
           c.    gender discrimination.
                 d.   wrongful discharge.
                ANSWER:       (b)

    25.   Linda was employed with General Mills in Minnesota for over three years. She was a highly productive employee and was known as the star performer on her team. Due to the economic recession the company had to lay off a large number of employees, and she was one of the employees who was asked to leave without being provided good cause or an explanation. In this scenario, Linda is protected under Section 3(a) of META which says that an:
           a.    employee can be fired without any reason.
                 b.    employee may not be terminated without good cause.
                 c.    employee can be terminated in financial crises.
                 d.    employee may not be terminated with good cause.
                ANSWER:       (b)

    26.  Peter, an employee of Light Ware was terminated from his job without wages and benefits for a period of three months. This was in violation of META. Under META his claim is subject to:
                a.      Court.
                 b.    Administration.
                 c.    Employer.
                 d.    Arbitration.
                ANSWER:       (d)

    27.  Adam was an employee of ABC Corporation and he discovered the management was hiring illegal immigrants in most of its factories. He raised objection against the employer’s practices and provided information to the law enforcing agencies regarding the illegal activities. The employer retaliated against Adam by terminating his employment. In this scenario, Adam is protected under:
                a.      Pennsylvania Human Relation Act which prohibits employee retaliation.
                 b.    Section 203 and Section 806 of the Sarbanes-Oxley Act for illegal strikes.
                           c. OSHA and Title VII which protect employees who blow the whistle on illegal practice.
                 d.    Section 203 of Title VII for breach of contract.
                ANSWER:      (c)

    28.  Watson, a Director of a telecom company in Florida, entered into a written contract with Carter Telecon.  The contract outlined the services his company would provide in exchange for a fixed monthly rate. This is an example of:
                a.      an implied contract.
                 b.    an express contract.
                 c.    a specification of contract.
                 d.    a breach of contract.
                ANSWER:       (b)

    29.  Brandy and Matthew are neighbors and live in Texas.  Matthew was renovating his house, which caused dust and debris to collect in Brandy’s front yard. Unfortunately her son was highly allergic to these particulates and fell grievously ill. In this case, Matthew violates: 
                a.      the U.S. Constitution
                 b.    the Labor Act.
                 c.    tort laws.
                d.      breach of trust.
                ANSWER:       (c)

    30.  Lionel, an African American resident of Pennsylvania was employed in a garment factory. He had a public fallout with his white male co-worker, Tom. Following this, Lionel was fired from his job while Tom was let off with a warning. Lionel contended that he was fired because of his race. In this scenario, Lionel is most likely to file his case under:
                a.      the Gender Discrimination Act. 
                b.      tort laws.
                c.      the Labor Act.
                d.      the Pennsylvania Human Relation Act.
                ANSWER:       (d)

    Short Answer Questions

    1.  Explain the meaning of the term whistleblower.
    ANSWER: An employee who reports his/her employer’s illegal activities to the appropriate governmental entity or, under some state statutes, to the board of directors or senior management of the firm is known as a whistleblower.

    2.  What is employment-at-will?
    ANSWER:   A kind of employment wherein both the employee and the employer are free to unilaterally terminate the relationship at any time and for any legally permissible reason, or for no reason at all.

    3.  What is the exception under employment-at-will?
    ANSWER:   The most common exception to the employment-at-will rule is the public policy exception. Under this although the employee is employed at-will, termination is illegal if a clear and significant mandate of law (statutory or common) is damaged if the firing is permitted to stand unchallenged.

    4.  Define dicta.
    ANSWER: Opinions of a judge or appellate panel of judges that are tangential to the rule, holding, and decision which are at the core of the judicial pronouncement are known as dicta.

    5.  What is a tort?
        ANSWER: Tort is a private or civil wrong or injury, caused by one party to another, either intentionally or negligently.

    6.  What are the two most common types of contracts?
        ANSWER:   Two kinds of contract are:
                   a. Express contract which has terms spelled out by the parties, usually in writing.
    b. Implied contracts are contracts that the courts infer from company policies and the behavior of the parties or that are implied from the law.

    7.  What is META? Explain the importance of Section 3(a) of META.
        ANSWER:    META stands for Model Employment Termination Act and Section 3(a) of META prohibits the employers from terminating the employees from employment without having good reasons.

    8.  Identify two Acts that protect whistleblowers from employer retaliation.
     ANSWER:   Occupational Safety and Health Act (OSHA) and Title VII provide protection to whistleblowing employees.

    9.  What is SOX?
    ANSWER:    SOX is the Sarbanes-Oxley Act. It protects employees who report improper conduct by corporate officials concerning securities fraud and corruption.

    10.  What does Title VII of the NRLA deal with?
      ANSWER: Title VII forbids discharge on the basis of race, color, gender, creed, or national origin.


    Essay Questions

    1.  Define the doctrine of employment-at-will? Explain its exceptions?
        ANSWER:    Employment-at-will holds that an employee who has not been hired for an express period of a year can be fired from his/her job by employer at any time with or without any reason. Both the employer and the employee are free unilaterally to terminate their relationship any stage without any compulsion or force. However there are exceptions under the doctrine. The most commonly adopted exceptions under employment-at-will is Public Policy exception. If a statute creates a right or a duty for the employee, he or she may not be fired for exercising that legal right or fulfilling that legal duty.

    2.  What is a contract? Explain the differences between express and implied contracts?
        ANSWER:   Contract is an agreement between two persons which is enforceable by law. The object must be legal in contract.
    Express contract:  A contract in which the terms are explicitly stated, usually in writing but perhaps only verbally, and often in great detail. In interpreting such a contract, the judge and/ or the jury is asked only to determine what the explicit terms are and to interpret them according to their plain meaning.
    Implied contract:  A contractual relationship, the terms and conditions of which must be inferred from the contracting parties’ behavior toward one another.

    3.  Describe the Model Employment Termination Act.
        ANSWER: Model Employment Termination Act (META) relates to laws pertaining to termination of an employee. The heart and soul of META in its present form is Section 3(a), which states that “an employer may not terminate the employment of an employee without good cause.” Section 3(b) limits application of the “good cause” limitation on employment-at-will to workers who have been with the particular employer for at least one year. The META suggests that claims under it be subject to binding arbitration with arbitral awards being issued within thirty days of hearings. Section 10 forbids retaliation against employees who make claims or who testify under the procedural provisions of the META.

    4.  What are the protections for corporate whistleblowers under law?
    ANSWER:    Sarbanes-Oxley Act provides the protection for the corporate whistleblowers. SOX protects the employees who report for improper misconduct by corporate officials pertaining to fraud and corruption. Apart from SOX, OSHA and Title VII also protects employees who blow the whistle on illegal practices or who cooperate in investigations and testify at hearings from employer retaliation, such as employment termination.

    5.  Define a whistleblower and describe the protection offered to whistleblower employees.
        ANSWER:         A whistleblower is an employee who calls attention to the employer’s illegal or unethical activities. Many federal and state statutes such as SOX, OSHA and Title VII seek to protect whistleblowers by making retaliation an illegal act. The most significant whistleblower-protection law of the 21st century is the federal Sarbanes-Oxley Act (SOX), which protects employees who blow the whistle on illegal financial transactions. However, whistleblowers’ rights may conflict with the privacy rights of others.

     Chapter 2:  Employment Contracts and Wrongful Discharge

    INTRODUCTION

    The second chapter focuses on employment contracts, employment at will, and wrongful discharge.  The chapter begins with a discussion of employment at will; a term first introduced in chapter one. The student should have an understanding of employment at will, and the chapter proceeds to identify all of the many exceptions to this legal theory and when they apply. Generally, the exceptions to employment at will are when the termination violates a public policy, an implied employment contract, a covenant of good faith and fair dealing, or one of the many federal, state, or municipal statutes that protect employees from termination based on basis of some protected characteristic. Termination under any of these situations is called a “wrongful discharge.” An employee who has been wrongfully discharged may be entitled to redress.

    OUTLINE
                Employment - At - Will

        Historical Roots

        The doctrine of employment-at-will in its purest (and harshest) form held that an employee without a contract could be fired at any time, for any, or no, reason.

        While legislation has limited the employment-at-will doctrine in some areas¾such as the NLRA’s prohibition on terminating an employee for engaging in concerted activities and Title VII’s prohibition of any discharge for racially discriminatory reasons—these laws still leave a zone of discretion to private sector employers.

        Advocates of employment-at-will point out that the employee is free to sever employment at any time, and that employees can use bargaining power to attempt to demand an employment contract covering a specific term.

        However, individuals often lack the bargaining power to demand such a set contract¾that's one reason why they join unions.

        But the freedom of employees to quit the employment relationship is an important issue underlying the employment-at-will doctrine.

        Wrongful Discharge Based on Public Policy

        The most common limitation on employment-at-will is the public policy exception¾the employer cannot fire an employee for a reason that undermines or violates a "clear mandate of public policy."

        Most state courts have adopted this exception, although some state courts restrict the "public policy" to some right or duty clearly spelled out in a statute. 

        Geary v. U.S. Steel (PA Supreme, 1978) is an example from Pennsylvania.

        Also, if the statute provides for a remedy or cause of action, the courts are reluctant to allow the employee another remedy in the form of a suit alleging wrongful discharge.


    CASE 2.1                                               Rodgers v. Lorenz
                                                            25 A.3d 1229 Pa. Super (2011)
    SUMMARY:

    Background: An employee filed a complaint, alleging that his employer wrongfully terminated him for planning to attend criminal proceedings against a co-worker and alleging breach of contract, negligent supervision and a violation of the Pennsylvania Whistleblower Law. The Court of Common Pleas sustained the employer's preliminary objections and dismissed the employee's claims, and the employee appealed.

    Issue: When the Crime Victims' Employment Protection Act was written, did the Legislature intend to protect crime victims, who have not yet attended their hearing, from threats, coercion, and loss of employment? Is the Crime Victims' Employment Protection Act preempted by the Workers’ Compensation Act?

    Decision: In its opinion, the trial court stated: “After argument on [Appellee's] preliminary objections to [Appellant's] complaint, [the trial court] decided that the facts alleged were not sufficient to state a cause of action under § 4957. [The trial court] also ruled that the other avenues for relief of [Appellant] against [Appellee] were barred by the Workers' Compensation Act.”  This statement by the trial court clarifies that it did not hold that the Workers' Compensation Act preempts the Crime Victims' Employment Protection Act. Rather, the trial court distinguished the employment protection claim from the breach of contract and negligent supervision claims brought by Appellant and found only the latter preempted by the Workers' Compensation Act.
    Order reversed in part. Case remanded for further proceedings.


    ANSWERS TO CASE QUESTIONS
    Rodgers v. Lorenz
    25 A.3d 1229 Pa. Super (2011)

    1.         The Superior Court held that the state legislature intended that the Crime Victims’ Employment Protection Act provide employees with a cause of action for wrongful termination.  The court did not, and would not, hold that the employee-plaintiff here was entitled to reinstatement.  That is for the trial court to determine on remand, possibly after a trial on the merits of the plaintiff’s claim.
    2.           The plaintiff will have to prove that the employer in fact fired him for exercising his rights under the Crime Victims’ Employment Protection Act. 
    3.            Neither act preempted the other.  The Workers’ Compensation Act’s “exclusivity” provision prevented the plaintiff from pursuing his negligent-supervision claim;  the essence of that claim was that he got hurt on the job because of the employer’s failure to exercise due care in the hiring and supervision of the plaintiff’s co-worker, who assaulted and injured him.  On the other hand, the Workers’ Comp Act did not shield the defendant-employer from all of the plaintiff’s claims.  Although the job termination grew out of the assault and related to the injury in that regard, plaintiff’s firing was not the sort of consequential injury that falls under the comp act’s exclusivity shield.
    4.           The Superior Court took a broad view of the legislature’s intent, holding that the facts of this case were precisely what the lawmakers had in mind when they enacted the statute.
    5.           This question can make for a good discussion.  The Pennsylvania Supreme Court is squarely among those state forums, which historically have been highly conservative with regard to wrongful termination suits grounded in public policies.  The Crime Victims’ statute, said the Superior Court, presented a clear instance of legislative intent.  Whether the Supreme Court would agree is a matter of speculation.  However, it would require two leaps of faith to conclude that the Commonwealth’s highest court would both affirm the Rodgers decision and use it as a wedge to widen what has for many decades beena very narrow cause of action in that state.


        Express* and Implied Contracts* of Employment

        While some employees are covered by a collective bargaining agreement or an individual contract of employment, many are not.  Those employees have sometimes attempted to persuade the courts that an implied contract of employment has been created.

        Contracts may be implied from the firm's personnel manual or the statement of disciplinary procedures that will be followed.

    *Express Contract: A contract in which the terms are explicitly stated, usually in writing.

    *Implied Contract: A relationship between the parties, the behavior of which leads to an inference of a contract.

    CASE 2.2                                       McCaskey v. California State Auto Assn.
                                                   189 Cal.App.4th 947, 118 Cal.Rptr.3d 34 6 Dist. (2010)

    SUMMARY:

    Background: Former employees brought action this against their employer, asserting claims of breach of contract and age discrimination, alleging that the employer had wrongfully rescinded a policy of relaxing sales quotas for senior employees and subsequently fired those employees for refusing to agree to the employer's rescission of the policy or for failing to comply with non-relaxed sales quotas. The Superior Court entered a summary judgment in favor of the employer, and the employees appealed.

    Issue: Once an employer’s unilaterally adopted policy – which required the employer to relax sales quotas for employees who were over the age of 55 and who had worked for the employer for 15 years – has become a part of the employment contract, may the employer thereafter unilaterally terminate the policy?

    Decision: The court determined that the answer was “no,” the employer could not unilaterally rescind its contractual obligation to relax sales quotas for employees who were over age 55 and had worked for employer over 15 years, because the employees had an ascertainable term of duration.

    CASE 2.3                      Dworschak v. Transocean Offshore Deepwater Drilling, Inc.
                                                   352 S.W. 3d. 191, Tex.App.-Houston 14 Dist. (2011)

    SUMMARY:

    Background: A former employee, Dworschak, brought action against his former employer, Transocean, for breach of contract and wrongful discharge, among other claims, after he was terminated for having a physical altercation with another employee. Dworschak contended that Transocean had been planning to terminate him because he had discovered “certain billing and other irregularities” between the Transocean and a subcontractor. The 11th Judicial District Court granted no evidence motion for summary judgment and the former employee appealed.

    Issue: Did Transocean breach the employment contract by terminating Dworschak?

    Decision: No. Although there was a formal contract between Dworschak and Transocean, it was specifically an at-will agreement. As a result, Dworschak failed to meet his burden to overcome the presumption that his employment was at-will.  There is no material fact question regarding Dworschak's at-will status.  As an at-will employee, Dworschak contractually agreed he could be terminated for any reason.

    CASE 2.4                           Bollinger v. Fall River Rural Elec. Co-op, Inc.
                                                   152 Idaho 632 , 272 P.3d 1263 Idaho (2012)

    SUMMARY:

    Background: An employee, Bollinger, sued her former employer for breach of express and implied contract, including breach of the covenant of good faith and fair dealing, retaliatory discharge and wrongful termination in violation of public policy, and negligent and intentional infliction of emotional distress. The District Court of the Seventh Judicial District granted summary judgment to the employer, and the employee appealed.

    Issue: Did the district court err in granting summary judgment on Bollinger's breach of employment contract claim?

    Decision: The court found that the district court properly granted summary judgment on Bollinger's breach of employment contract claim because she was an at-will employee at the time of her termination and, even if the for-cause policy remained in effect, she was laid off for economic reasons in accordance with that policy.

    THE WORKING LAW

    The Model Employment Termination Act is not a real success story.  The purpose of the act is to offer the states a uniform law protecting employees from being terminated except for good cause. The committee charged with developing the act do not agree on it’s terms. If adopted by many states, this law would fundamentally change the employment at will culture that defines employment in the United States. Only one state (Montana) has adopted a form of this law.

        Protection for Corporate Whistleblowers

        In the wake of the Enron and Worldcom scandals, the Sarbanes Oxley Act (SOX) was passed. Among other things, SOX amended the Security Exchange Act and several other statutes to include criminal and civil protection of employees who report improper conduct concerning securities fraud and corruption by corporate officials.  Following the 2008-10 Great Recession, the Obama Administration and the Democratically dominated Congress at that time enacted the Dodd-Frank Act, which reinstated some regulatory restrictions on the U.S. financial industry that had been antiquated in the 1990s, and added additional whistleblower provisions that apply to employees in the realm of banking and investments.

        Many other employment laws such as Occupational Safety and Health Act (OSHA) and Title VII contain anti-retaliation provisions. 

        Additionally, many states have passed laws protecting employees who engage in whistleblower type activities.

        Where there is not a federal, state, or municipal law directly protecting whistleblower activities, employees may still seek protection under the theory of public policy, where an employee provides proof that termination of employment was in retaliation for reporting or restricting supervisory illegal activity.

        Despite this, many who seek to be protected by whistleblower laws find that enforcement is lacking and remedies are ineffective.

        SOX protections are not limited to the reporting of securities fraud. It covers the reporting of any federal offense.

        Civil Liability Under SOX

        SOX only protects employees of publically traded companies.

    CASE 2.5                                         Lawson v. FMR LLC.
                                                   670 F.3d 61 C.A.1 (Mass.) (2012)

    SUMMARY:

    Background: In two separate cases, employees of nonpublic companies in the mutual fund industry sought the protection of the Sarbanes-Oxley Act's (SOX) whistleblower provision, alleging that their employers unlawfully retaliated against them after they complained of employers' improper business activities. The United States District Court for the District of Massachusetts partially granted and partially denied the motions, certified a “controlling question of law” to the appellate court, and stayed the cases. The parties' cross-petitioned for interlocutory review, and those petitions were granted.

    Issue: Are the plaintiffs covered by the SOX whistleblower provisions?

    Decision: Rejecting the position taken by not only the plaintiffs, but also the SEC as amici, the judges held, “Although there is a close relationship between the private investment adviser defendants and their client mutual funds, as pointed out by the plaintiffs and the SEC as amicus curiae, the two entities are separate because Congress wanted it that way. Had Congress intended to ignore that separation and cover the employees of private investment advisers for whistleblower protections, it would have done so explicitly in § 1514A(a). However, it did not.”

    ANSWERS TO CASE QUESTIONS
                                                            Lawson v. FMR LLC.
                                                   670 F.3d 61 C.A.1 (Mass.) (2012)

    1.       The trial judge first decided that private companies, which are sub-contractors of SOX-covered publicly traded companies, ought to be covered by SOX too.  Then, having some second thoughts about how far this stretched the law, the judge tightened up the basis on employees of the sub-contractor could sue under SOX’s whistleblower provisions. The First Circuit disagreed with the district court on both points.
    2.       “Employee” for purposes of a cause of action means someone employed by a publicly traded company.  While the plaintiffs certainly were “employees” in the common-law sense of that term, they were not “employees” for purposes of the SOX whistleblower provisions.
    3.       This and the two questions that follow create opportunities for class discussion and debate. The statutory provision at issue clearly states that no “officer, employee, contractor, subcontractor, or agent of such company, may discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment because of any lawful act done by the employee “ in exercising her/his whistleblower rights.  The plaintiffs contended that this clearly means they were protected by SOX.  The defendants retorted that only the employees of the publicly traded company were protected, albeit that protection extended to adverse actions perpetrated by a subcontractor of the publicly trader firm.
    4.       Here the discussion might center around whether Congress had reason to single out publicy traded companies, leaving private firms alone.  The court noted that Congress could have been clearer, if it really intended to extend rights to persons, such as the plaintiffs.  The judges noted that in other sections of SOX, the Congress was more explicit about being expansive in extending rights and remedies.  When it wanted to extend a portion of the act to private investment advisors, it did so.  The court does not speculate on Congressional motives, but we are free to do so.  Perhaps some Congressmen succumbed to lobbyists.  Or perhaps the sponsors of the bills saw reasons why privately held firms should not be subjected to the same levels of liability as publicly traded entities.  Or perhaps the relative size of the companies was a consideration.
    5.      The answer to this question may depend upon whom we mean by the “investing public.”  If we mean all pension funds, individual investors and others who buy securities, the plaintiffs’ position might best protect them (i.e., all of “us”).  But if we mean the shareholders of publicly held financial institutions, then private firms might very well be excluded since they do not have shareholders, other than those insiders who own the stock of such closely held entities.

             ETHICAL DILEMMA
    When the Whistleblower is a Lawyer

    SUMMARY:

    Attorneys discover illegal activity on the part of an important client (child pornography on a client’s computer). Rather than report the client, under federal law, the firm directs one of it’s attorneys to have the computer erased. The attorney in charge of this is uncomfortable carrying out these orders because he knows it is a violation of law. When the partners discover that the attorney has not carried out the orders they fire the attorney. The attorney sues for wrongful discharge, claiming that it is a violation of public policy to fire him for refusing to violate federal law. The firm moved to have the lawsuit dismissed because to proceed with it would necessarily require divulging the client’s possession of pornography, which would be a violation of the attorney client privilege.

    QUESTIONS

    The author views the competing public policies as the law against child pornography and the attorney client privilege.  However, this is also an opportunity to discuss competing public policies – attorney client privilege and the need to feel free to ignore a mandate from your employer to violate the law, regardless of which law is involved.



    PROBLEMS

     

    QUESTIONS

    1.      Students may suggest that the courts wished to protect emerging American industries from employee litigation. Control of the judicial appointments of many states and the federal courts by upper and upper-middle class interests may be another reason. Disdain for immigrant workers may be yet another suggestion.

     

    2.      Employers often defend the doctrine on the ground that they have built their businesses, they create jobs and they ought to be free to decide whom they will employ.  Jurists sometimes point to the fact that employees are free to come and go as they please; it’s only fair that employers have he same freedom of contract.  President Obama directly challenged the first of these propositions during the 2012 presidential campaign, when he pointed out that no so-called self-made businessperson has achieved success without support from both government and her/his employees.  The second position ignores the disparate bargaining leverage enjoyed by employers on one hand and employees on the other.  The U.S. is the only developed nation that still adheres to employment-at-will, which since the 19th century has been a uniquely American common-law doctrine,


          3. (1.)  Contract:  This exception includes express, written contracts; oral contracts under some
               circumstances; and implied contracts, notably handbooks, again under appropriate circumstances;  (2)                              
              Public Policy:  An adverse employment action will not stand, where it offends a
              Clear mandate of public policy; (3) Statutory:  A federal or state statute specifically
              forbids an adverse action, such as termination.

     

          4. The advantage of the common law may be that it is more adaptable and amenable to fine-tuning than a statute, which requires the often difficult chore of legislative amendment.   On the other hand, a statute presumably will provide the parties to an employment relationship with a clearer, plainer, and more predictable expression of the law and the likely legal outcomes of their actions.

     

    5.      As discussed under the case, above, we can speculate about Congress’s motives for limited SOX’s

    whistleblower provisions to publicly traded companies.

    CASE PROBLEMS

    1. No, he does not. The Court held that the intent of the parties was very important in the decision and that if the handbook contains clear language that employment is at will, then the reasonable employee would understand that is the employer’s intent. The Court also said that longevity of employment and promotions or raises do not create an implied contract. This would discourage employers from retaining employees over the long run. In the case in this hypothetical, the company’s handbook clearly stated that the employment was at will. Therefore, the handbook does not constitute an employment contract.

     

    1. According to the decision in Honorable v American Wyott Corporation, 11 P.3d 928 (Wyoming Supreme Court 2000), the employee is not correct. The handbook states that the employee must receive medical leave permission in writing. The employee did not do this. The handbook also clearly states that the employment is at will. An at will employee can be fired for a good reason, bad reason, or no reason. Therefore, even though it appears unfair, the termination is not illegal. This decision will seem unfair to most students, since the HR Director told the employee to take time off from work. Essentially, he was not requesting leave be “granted,” he was barred from returning. Students might argue that it would be a breach of good faith and fair dealing for your employer to bar you from coming to work and then fire you for not showing up.

     

    1. A whistle blower need not be able to actually prove wrongdoing, in order to be protected under the public policy exception to the at will doctrine. It is enough that the whistle blower have a good faith belief that that a crime was committed.

     

    9.      The court ruled that under the Montana Wrongful Discharge from Employment Act, once an agreement to arbitrate has been made it cannot be abrogated by either party, but rather it survives the employment termination and must be honored and enforced.  Possible public policy grounds to be taken into account are predictability and reliability of the remedy, plus the prevention of lawsuits challenging the enforceability of the arbitration clause, precisely as occurred here, if the court held that such arbitration agreements are enforceable only some of the time.  Furthermore, to permit the abrogation of the clause under the attorney’s argument here would require the court to also reach the merits of the case itself..

     

    10.   It is a violation of public policy, according to Wisconsin law, to terminate an employee for refusing to violate any law, regardless of the origination of the law (state or federal). The payroll clerk has an action for wrongful discharge in violation of public policy. This may be an opportunity to discuss with the students that not all states recognize the public policy exception to employment at will, and even the states that do are not all in agreement of what reasons for termination may violate public policy.

     

    11.   In this case, the Iowa Supreme Court said that the employee must show that his dismissal would undermine the public policy identified. Fitzgerald was not able to show that terminating an employee for advocating for an employee who he believed to have been terminated in violation of a policy was itself a violation of public policy. The court was not willing to take that leap and narrowly construed public policy to the types of public policy already recognized. This may be an opportunity to point out to students that other laws, such as Title VII and the ADA protect not only those persons who are directly discriminated against under the law but also those persons who stand in solidarity with them. To be fair to the Iowa Supreme Court, the employer persuasively argued that Fitzgerald did not advocate on behalf of his co-worker due to him being terminated in violation of public policy. Fitzgerald’s complaints to them were that they simply should not terminate the co-worker because he had been a long time and valuable employee.

     

    12.   The “whistleblowing” in this case did not meet the requirements for a violation of public policy.  Because the relevant statute leaves the parameters of “mismanagement” undefined, it is an amorphous term that essentially includes any decision of an employer that’s challenged by an employee with a different opinion about the way an organization should be managed.  The term falls short of being sufficiently specific and clear for purposes of articulating an established and well-defined public policy against discharging employees for reporting mismanagement.  Thus, the statute cannot be used to support a common law claim.


    13.   The court's analysis began with a finding that the local's secretary was a "confidential" employee capable of thwarting implementation of the union's policies and programs.  Since the plaintiff had access to the local's confidential information, including attorneys' opinions, membership and dues records, and disciplinary matters, she was in a position to further her own political views and to thwart the aims of her superiors.  These facts placed her squarely under the provisions of the LMRDA dealing with "confidential employees."  Therefore her common law, wrongful discharge claim was preempted by federal law.


    14.   The court held that there was no public-policy cause of action here.  Considerations included: (a) preemption of the common law by the state statute; and (b) a superior public policy of protecting small businesses from sexual discrimination claims

     

    15.   Students can debate the public policy of whether or not attorneys fall within the intent of the small business public policy exception. Attorneys are officers of the court, and due to the special placement in our system of government, they are necessarily keepers of the public trust. Additionally, before becoming licensed to practice in any state, an attorney takes an oath agreeing to be bound by this higher standard. Therefore, it seems as though the stronger public policy would be to hold the attorney accountable and conduct an investigation, even though there is no other legal action pending. The term “moral turpitude” generally means that if the attorney’s conduct would reflect badly on others in the profession, then the attorney should not engage in that conduct.


    HYPOTHETICAL SCENARIOS

    16.   Constructive discharge occurs when the employer has made the employment environment so intolerable that the employee feels no other choice but to quit. In order for the constructive discharge to become wrongful termination, the motivation for making the workplace intolerable must be illegal, such discrimination in violation of one of the employment laws. Constructive discharge is viewed as the equivalent of termination of employment.  The same analysis is used as to determine whether or not the employer had wrongfully terminated the employee is used to determine whether or not the constructive discharge was wrongful. In our case, Debra appears to be employed at will. Students can debate whether termination for participation or non-participation in extra curricular work activities should be protected under public policy exceptions. Generally, public policy exceptions are those instances where it would serve the public good, such as when an employee is punished for exercising a legal right or duty. It is unlikely that protection from refusing to participate in team building exercises, regardless of how silly and demeaning would be considered important to public policy.


    17.   Since Dr. Boris is an at will employee, he does not have a claim for wrongful discharge. Although according to the law, the hospital had abandoned the property, the hospital apparently did not intend for anyone to possess the equipment after them. There are a myriad of logical reasons why the hospital would not want employees to take things, even things that they planned to dispose of, without permission, the least of which is not liability issues.  If a piece of equipment were damaged and the subsequent purchaser/user suffered an injury, the hospital could be liable for having sold damaged goods, if the buyer could prove that it had a reasonable belief that Dr. Boris was acting as their agent. (If students have not had business law prior to this class, they may not recognize the issue of agency liability).


    The answer does not change if the handbook said that employees would only be fired for good cause. First, this might be enough to satisfy good cause. Second, since we know that Dr. Boris is an employee at will, we can assume that there is likely a disclaimer in the handbook stating that it does not constitute a contract or change the employment at will arrangement. And third, even if the handbook does not contain such a disclaimer, the discipline clause would need to be specific enough that a reasonable person would construe it as a binding agreement. “For Cause” is not a very descriptive term.

    If Dr. Boris had salvaged equipment before, and was acting under a misunderstanding, he still does not have a claim. In order to claim wrongful discharge he would need to prove some sort of public policy exceptions. He was not exercising a legal right or duty.

    18.   Unfortunately, Stanley does not have a case. Although Stanley was concerned with safety, there is no indication that Stanley has any expertise or specialized knowledge related to why the other shed collapsed or to refute the company’s claims that it was due to incorrect assembly.


    If OSHA had a regulation and Stanley had a good faith belief that the regulation was being violated, then he may be protected under a whistleblower statute or public policy, in absence of a whistleblower statute.

     

    19.   Mindy and Fred do not have a wrongful discharge claim, if they are employees at will. An employer is free to terminate an employee for a good reason, bad reason, or no reason at all. There is no public policy protecting people from being fired for having sex with someone who are not their spouse. Whether or not they knew about the policy is not relevant.


    20.   Unless the student has had a business law class, the student will not possess the background to analyze a breach of contract claim. For example, if the company knew that the deal with Wells Fargo was upcoming and elected not to renew the contract, despite good performance, simply as a means to avoid the stock option exercise, Janice may have a claim. The court may determine the “active member of management team” clause to be unconscionable, and reform that part of the contract. However, if the company can show that Janice had ample opportunity to review the contract with a lawyer and understood that even if the sales mark was reached due to her efforts, if it occurred after her contract had expired, she would not be entitled to exercise the stock options, then she would lose. She does not have a wrongful discharge claim against the company because she was not terminated during the term of employment. She simply reached the end of the term of her contract.


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