Author Archives: Holland & Hart

November 5, 2012

NLRB Affirms At-Will Disclaimers

Most employers today provide a handbook or another document confirming employees’ at-will status. Until recently, there was no question that this is a good business practice. But earlier this year, an NLRB (National Labor Relations Bureau) administrative law judge concluded in Am. Red Cross Ariz. Blood Servs. Region, No. 28-CA-23443 (Feb. 1, 2012), that such a disclaimer violated the employees’ right to engage in concerted activity under the National Labor Relations Act (NLRA). The judge reasoned that the disclaimer, which said “I further agree that the at-will employment relationship cannot be amended, modified or altered in any way,” effectively precluded employees from engaging in concerted activity (a protected right under the NLRA) to alter their at-will status.

Thankfully, the NLRB—which enforces the NLRA—has pulled back. On October 31, 2012, the NLRB issued two memos regarding the enforceability of “at-will” provisions in employee handbooks. The first memo involved a provision, stating as follows:

“No manager, supervisor, or employee at Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will. Only the president of the Company has the authority to make any such agreement and then only in writing.”

This provision was found permissible because it explicitly permitted the company’s president to enter into written employment agreements that modify the employment at-will relationship, and therefore included the possibility of potential modification of the at-will relationship through a CBA ratified by the president.

The second memo involved the following provision:

“No representative of the Company has authority to enter into any agreement contrary to the foregoing ‘employment at will’ relationship.”

This provision was determined to be lawful (but a closer question than the first provision) because it only highlighted the company’s policy that its own representatives cannot modify the at-will relationship and reinforced that the handbook did not create a contract of employment.

With both of those provisions, the NLRB distinguished the American Red Cross case because there the at-will employment relationship could not be altered or modified “in any way.”

Bottom line: As with its position on social media policies, the NLRB appears to be splitting hairs in terms of what type of language is, and is not, a violation of the NLRA with respect to at-will disclaimers. While these two decisions suggest that the NLRB will not take an unreasonably aggressive approach in challenging at-will disclaimers, it’s not a bad idea to compare your own disclaimer to the ones the NLRB approved to avoid any potential issue with the NLRB.

November 2, 2012

Marijuana in the Workplace: Amendment 64 – Same Can, More Worms for Colorado Employers

By Emily Hobbs-Wright

Amendment 64 would, among other things, allow individuals age 21 and over to possess and use one ounce or less of marijuana. If the Amendment passes next week, employers will face increased uncertainty when it comes to the enforcement of workplace drug testing policies. A reckoning is inevitable because the debate over the scope of employers' rights to terminate workers who use marijuana outside of work and then test positive in violation of company policy has been brewing for several years in the context of Amendment 20 (which decriminalized the use of medical marijuana by registered patients). Amendment 64 does not clarify the extent of employers' right to terminate for marijuana use. On the contrary, it fans the flames by incorporating language that fueled employment litigation in the medical marijuana context following Amendment 20's passage, and by extending coverage to the general workforce, not just a handful of employees who are registered medical marijuana patients.

The debate to date

In November 2000 Colorado voters approved Amendment 20, which authorizes patients with certain debilitating medical conditions to receive from the State of Colorado a registry identification card allowing them to obtain and use marijuana without threat of criminal prosecution by the state authorities (but not the federal government).

With regard to employers' rights, Amendment 20 states: "Nothing in this section shall require any employer to accommodate the medical use of marijuana in any workplace." Both sides of the debate agree that this language preserves employers' right to prohibit employees from using marijuana at work, regardless of whether employees hold medical marijuana cards.

The parties sharply diverge, however, on the subject of whether Amendment 20 preserves employers' right to prohibit medical marijuana users from reporting to duty under the influence of, or having trace amounts of, the drug in their systems due to off-duty use. This issue typically arises when an employee tests positive for THC (the psychoactive constituent found in marijuana) in a random or post-accident workplace drug screen. Because most workplace drug testing policies prohibit employees from using illegal drugs as defined by federal or state law, employees are typically terminated following such positive results.

In recent years, medical marijuana cardholders who have been terminated from jobs for failing workplace drug screens have argued that the "in any workplace" language allows employers to regulate medical marijuana use at work, but not during non-working hours. These legal arguments take many forms, but the predominate themes in litigation to date are that (1) medical marijuana use is not illegal under state law and (2) employers should not be permitted to regulate an employee's off-duty medical marijuana use absent evidence that a worker is actually impaired at work. One obvious Colorado law that is triggered in the context of this argument is Colorado's lawful off-duty activity statute, which makes it unlawful for employers to terminate workers for engaging in lawful activities outside of work during non-working hours.

On the flipside, employers assert that Amendment 20 does not place any obligation upon companies to accommodate employees who use medical marijuana. Employers are free to enforce their drug testing policies and to prohibit the use of illegal drugs, including marijuana, whether medical or not, even when the use occurs off the worksite during non-working hours. Employers further assert that the Amendment is intended to provide certain individuals with an affirmative defense against criminal prosecution, but not to restrict employers' rights. Moreover, because marijuana is still illegal under federal law, an employee's use of marijuana outside of work is not a "lawful" activity that is covered by Colorado's lawful off-duty activity statute.

To date, Colorado courts have not squarely addressed whether employers can lawfully terminate employees who use medical marijuana outside of work during non-working hours and subsequently fail workplace drug screens. The Colorado Court of Appeals came close to weighing in on the issue in 2011 when it upheld the Colorado Industrial Claim Appeals Office's (ICAO's) decision to deny unemployment benefits to a worker, Jason Beinor, who was terminated for violating his employer's zero-tolerance drug policy after testing positive for marijuana in a random drug test. See Beinor v. Indus. Claim Appeals Office, 262 P.3d 970 (Colo. App. 2011).

Beinor argued that the Colorado Constitution protected his marijuana use because he used marijuana for medicinal purposes outside of work and was in the process of obtaining a registry card. In its opinion, the Court of Appeals made the following observations: (1) marijuana remains a Schedule I controlled substance under federal law and cannot be lawfully "prescribed;" (2) Amendment 20 provides an exemption from criminal prosecution – it does not grant medical marijuana users the "right to use the drug in any place or in any manner;" and (3) medical marijuana users do not have an "unfettered right to violate employers' policies and practices regarding use of controlled substances." However, the court cautioned that its holding was limited to the issue of whether the ICAO properly denied unemployment benefits. By contrast, the court was "not deciding whether the amendment limits an employer from discharging an employee for using medical marijuana." Thus, while the decision provides some helpful guidance into the direction Colorado courts would likely take in the future if faced with the issue, the debate concerning the extent of employers' right to terminate employees for engaging in off-duty use of medical marijuana remains unresolved.

Employers' rights under Amendment 64

Amendment 64 does not provide any additional guidance on this issue. The Amendment contains three provisions that address employers' rights. First, like Amendment 20, Amendment 64 does not require employers to "permit or accommodate" the use of marijuana "in the workplace." Second, employers may have policies restricting the use of marijuana by employees. Third, employers may prohibit and regulate the "possession, consumption, use, display, transfer, distribution, sale, transportation, or growing of marijuana" on their property.

Thus, like Amendment 20, Amendment 64 opens the door for employees to argue that employers may regulate marijuana use inside the workplace, but may not impede employees' right to use marijuana outside of work. However, unlike Amendment 20, which provides an affirmative defense to criminal prosecution, Amendment 64 would decriminalize marijuana use under state law. Additionally, Amendment 64 purports to allow employers to retain policies restricting employees' use of marijuana; however, the Amendment does not specify whether such restrictions may lawfully extend to off-duty use. If the arguments lodged in the context of Amendment 20 are any indication, employees who are terminated for testing positive for marijuana will likely continue to argue that employers' policies may only regulate use and possession on company property.

Employers' drug testing policies at center stage

If Amendment 64 passes, employers' drug testing policies will be at the heart of workplace disputes over employees' marijuana use. Because marijuana use is expected to grow if the Amendment passes, employers may expect that a greater number of employees will likely test positive for the drug in random screens. This increase in positive tests, in turn, will likely lead to a greater number of challenges by employees terminated for violating their employers' zero-tolerance policies. Further, because marijuana use would be lawful at the state level, employers would no longer be able to argue, as they did in the Amendment 20 context, that marijuana is illegal under both state and federal law.

Moreover, if Amendment 64 becomes law, employees who lose their jobs because of a drug screen revealing trace amounts of marijuana in their urine will likely argue that their employers' drug testing programs infringe upon their right under the Colorado Constitution to use marijuana outside of work. In other words, they (or their advocates) will likely take the position that, if a worker is not under the influence of marijuana at work and does not pose a safety risk, an employer may not lawfully terminate his or her employment. Workers will likely further argue that there must be outward signs of impairment at work in order for employers to legally terminate their employment.

Employers, on the other hand, will likely be forced to take a firm and even stance when interpreting and enforcing drug testing policies prohibiting the use of marijuana. Inconsistent application of such policies may expose companies to discrimination claims based on a "disparate impact" or other theory of discrimination. The practical problem that employers may face is that, unlike breathalyzer tests which can easily detect whether someone is under the influence of alcohol at work, urine tests cannot easily detect the level of marijuana impairment. Marijuana may be present in an individual's urine for several weeks. Blood tests may detect the level of marijuana in a person's system with greater accuracy, but they are more invasive and still do not pinpoint when a person actually used the drug. Further, impairment at work can go undiscovered until an accident occurs. This creates an unacceptable risk of exposure for companies which have a duty to protect employees and the public from harm. Policies that prohibit use altogether avoid these and other issues and allow employers to implement drug testing programs with greater efficiency.

Ultimately, marijuana remains a Schedule I controlled substance under federal law. Amendment 64 is clear on that point. Thus, if marijuana is legalized in Colorado, employers will need to take care to ensure that their drug policies expressly prohibit the use of illegal drugs as defined by federal law. Of course, employees who are fired or disciplined for testing positive for marijuana will still likely argue that federal law cannot usurp their right to use marijuana under Colorado's Constitution. However, employers may be able to justify their decision to continue enforcing drug testing policies through reference to federal supremacy or common sense arguments.

Bottom line

If Amendment 64 becomes law, it will ultimately be up to the courts or the legislature to settle the debate and provide employers with the clarity that the Amendment currently lacks. Resolving the unsettled issues could take months, or even years. In the meantime, employers would likely be in the trenches for the foreseeable future, incurring legal fees and spending more internal resources navigating employee grievances.

September 14, 2012

Working from Home – Not a Reasonable Accommodation

By Mark Wiletsky

If an employee claims that she needs to work from home due to a medical condition, do you have to grant such a request under the Americans with Disabilities Act (ADA)? Typically, the answer is no. Physical attendance is often an essential job function. So, even if some job duties could be performed remotely, being at work is still considered a critical part of the job. In a recent case, a federal district court in Michigan reiterated that principle, rejecting a claim brought by the Equal Employment Opportunity Commission (EEOC) against Ford Motor Company.

In that case (EEOC v. Ford Motor Co., Case No. 11-13742, E.D. Michigan), an employee with irritable bowel syndrome asked to work from home up to four days a week. Ford ultimately rejected the employee’s request. Although Ford allowed some employees in the same group to telecommute, those employees worked at home only one day a week, on a prescheduled day. Also, the employee who made the request had a history of attendance and performance problems, and Ford concluded that working from home that many days per week would not allow the employee to interact with others, as needed to complete her job. The employee then filed a charge of discrimination with the EEOC. A few months later, Ford placed the employee on a performance improvement plan for failing to meet certain goals, and then discharged her when she did not successfully complete her improvement plan. The EEOC later sued Ford for failing to accommodate the employee, and for retaliating against her for filing a charge of discrimination. The federal district court rejected both claims as a matter of law.

The court noted that the employee was absent more often than she was at work, which meant she was not a “qualified” individual under the ADA. More importantly, though, the court rejected the EEOC’s argument that Ford should have allowed the employee to telecommute. Courts typically do not second-guess an employer’s business judgment regarding what job functions are essential. Here, Ford said that attendance was an essential job function. In addition, courts generally find that working at home is “rarely a reasonable accommodation.” In this case, that was especially true because the employee wanted to work from home up to four days per week, choosing what days to work from home at her own discretion; she had frequent and unpredictable absences, which negatively affected her job performance and increased her colleagues’ workload; and her managers did not agree that she could complete her job duties from home. Therefore, the court concluded that working from home was not a reasonable accommodation in this case.

The court also rejected the EEOC’s retaliation claim. There was no evidence that Ford’s stated reasons for the employee’s low performance rating and ultimate discharge were “pretextual,” or a cover for unlawful retaliation.

Lessons Learned

Although Ford prevailed in this case, employers can expect more and more requests from employees to work from home as technological advances make it easier to communicate and complete certain tasks remotely. Therefore, consider these tips:

Review and, if necessary, update your job descriptions to make sure they capture the essential job functions. If attendance at work is an essential job function, make sure your job description says so, either directly or through a description of other job duties, e.g., employee must regularly interact with managers, customers, and vendors to negotiate sales agreements, etc.
If you allow one employee to work from home for a non-medical reason, be aware that doing so might impact your ability to decline a request from an employee who asks to work from home for medical reasons.
If you allow someone to work from home temporarily, be sure to document that it is a temporary issue, and that you will monitor and potentially modify the arrangement as needed.
If an employee asks to work from home as an accommodation, be sure to engage in the interactive process, e.g., carefully consider the request in light of the employee’s job duties and the organization’s business needs, talk to the employee, and consider other alternatives if working from home is not feasible.
If you reject an employee's request to work from home, especially if the request is based on an alleged disability or medical condition, be sure you can support your decision with legitimate, nondiscriminatory and nonretaliatory business reasons.

July 30, 2012

Court Narrows CFAA

By Mark Wiletsky

In today’s digitized workplace, it is easier than ever for employees to steal information. Whether through a thumb drive, external hard drive, e-mail, or other means, employees can easily transfer reams of information in mere seconds, often without detection until it is too late. Because such information is often incredibly valuable–and potentially harmful when improperly used by a competitor or another–organizations sometimes are forced to sue an employee and/or the employee's new employer for misappropriating such information. At times, law enforcement may be involved. But often, it is up to the employer to initiate a civil action.

Although a variety of claims may be asserted in such circumstances, employers sometimes turned to the Computer Fraud and Abuse Act (or CFAA) for relief. The CFAA is a federal statute that provides civil and criminal penalties when an employee, among other things, intentionally accesses a computer without authorization, or exceeds authorized access to a computer and obtains anything of value or causes damage. On its face, the statute appears to prohibit an employee from using his or her access to a computer to misappropriate his employer’s trade secrets or other confidential information. A recent decision by the Fourth Circuit Court of Appeals, however, concluded otherwise.

In WEC Carolina Energy Solutions LLC v. Miller, the employee (Miller) allegedly downloaded WEC’s proprietary information, at the direction of a competitor, and then used the information to help the competitor solicit a customer. WEC sued Miller under a variety of theories, including conversion, tortious interference with contractual relations, civil conspiracy, misappropriation of trade secrets—and violation of the CFAA. The district court dismissed the CFAA claim and remanded the remaining claims to state court. On appeal, the Fourth Circuit affirmed the dismissal of the CFAA claim.

Because the CFAA contains criminal penalties, the Fourth Circuit adopted a narrow interpretation of the CFAA. It distinguished situations in which an employee exceeds his access to information—which may violate the CFAA—from those in which the employee merely uses his authorized access to misappropriate information. For example, an employee “accesses a computer ‘without authorization’ when he gains admission to a computer without approval” and he “‘exceeds authorized access’ when he has approval to access a computer, but uses his access to obtain or alter information that falls outside the bounds of his approved access.” In WEC, the court concluded that Miller had authorization to access to the information at issue, despite WEC’s policies preventing the improper use of such information. Thus, even though Miller had no authority to download and/or transfer it for another’s use, he was not liable under the CFAA. The court noted that a contrary interpretation could result in criminalizing otherwise innocent conduct, such as when an employee violates a policy against downloading information so that he can work at home.

Interestingly, the Fourth Circuit sided with the Ninth Circuit on this issue, adding to the Circuit split. The Seventh Circuit previously reached a contrary result. It held that an employee may be liable under the CFAA when he accesses a computer or information on a computer in a way that is adverse to his employer, as doing so terminates his agency relationship and any authority he otherwise has to access such information. Int’l Airport Ctrs., LLC v. Citrin, 440 F.3d 418, 420-21 (7th Cir. 2006).

The Fourth Circuit’s narrow interpretation of the CFAA, if adopted by other courts or, eventually, by the Supreme Court, is disappointing to those who seek to hold rogue employees accountable for misappropriating confidential or proprietary information. The CFAA allows employers access to federal courts in these types of situations, which at times may be the preferred venue, and contains other stiff penalties. Still, and as noted in WEC, employers have other options at their disposal, including a variety of state law claims that can be very effective.

Practical Tips

Even though the Fourth Circuit held that Miller did not violate the CFAA by his actions, it is a good idea to review and potentially update your computer use policies, especially if you have not done so in a while. Technology changes so rapidly that policies may be out-of-date soon after they are issued. At a minimum, be clear about the confidential and sensitive nature of information available on your systems, and permissible uses of such systems. If employees have limited access to certain databases or areas, be sure to emphasize such limitations and the potential penalties for violating those limitations. Also, don’t forget to remind employees that they have no expectation of privacy when using or accessing your organization’s computer resources. You may not always be able to prevent an employee from misappropriating confidential or proprietary information, but strong policies and practices are a good deterrent and a strong tool to use if you have to sue an individual who engaged in such conduct.

June 22, 2012

NLRB’s New Website

The U.S. Department of Labor received much fanfare when it rolled out its new timesheet app. In its news release of 2011 (http://www.dol.gov/opa/media/press/whd/WHD20110686.htm), DOL indicated that it believed the application would ensure that workers received the wages to which they were entitled.

Not to be outdone, although not as an application, the National Labor Relations Board announced that it has launched a new interactive website to describe the rights of employees to engage in protected concerted activity under Section 7 of the National Labor Relations Act. The webpage can be found at: http://www.nlrb.gov/concerted-activity.

You will see that the NLRB details numerous case examples where it found the conduct of employers to violate the act. The interactive map serves to lead the reader to the detail of a case that provides factual detail about the violation. This is just another example of how the social media network can be used as a public relations effort to justify an agency's public purpose and to inform employees of their rights.

For more information on the NLRB or other traditional labor relations questions, feel free to send a comment or reach me directly.

Steven M. Gutierrez

June 21, 2012

New Case Clarifies Test for Contractor Status

By Mark Wiletsky

Many organizations rely on independent contractors–sometimes referred to as consultants or just contractors–to perform a variety of services. But determining who is a contractor, as opposed to an employee, is not an easy task. A variety of state and federal rules apply, each with different factors and tests. If you misclassify an individual, the penalties can be severe. For example, in Colorado, a business may be fined up to $5,000 per misclassified employee for the first offense, and up to $25,000 per misclassification for subsequent violations if the violations were willful. Businesses may also be liable for back taxes, interest, failure to pay overtime, and a variety of other penalties for failure to provide benefits. Therefore, it's very important to ensure an independent contractor fits the tests for contractor status. A new Colorado case provides some important guidance on this subject.

In Softrock Geological Services, Inc. v. ICAO, the Colorado Court of Appeals had to decide whether an individual who provided services to Softrock as a contractor over a three-year period, without performing similar services for others during that period, was a contractor or employee. Under Colorado's unemployment statute, an individual is presumed to be an employee unless the organization demonstrates that the individual: (1) is "free from control and direction in the performance of the service" and (2) "is customarily engaged in an independent trade, occupation, professional, or business related to the service performed." The second part of the test is often difficult to prove. A number of Colorado cases have concluded that unless the contractual arrangement is relatively brief, an individual must perform services for more than one entity to be a contractor. Such a test, however, places a heavy, and often unfair, burden on businesses.

Businesses do not always track the outside activities of a consultant, and a consultant may choose to work for only one entity for a period of time. Recognizing this, the Court of Appeals in Softrock concluded that it is improper to classify an individual as an employee solely because that person did not perform similar services for others while performing services for the alleged employer. Instead, the failure to perform services for others is merely one factor to be considered. The other factors include: the existence of a quality standard; payment of a salary/hourly rate as opposed to a fixed or contract rate; ability to terminate the individual for limited reasons, such as failing to produce results or violating the contract; whether training is provided; whether tools and benefits are provided; whether the individual is subject to a set schedule or has authority to set his or her own schedule; payment to a business or tradename as opposed to an individual; and whether the individual and the business have combined operations or maintain separate and distinct operations. The court remanded the case to the Industrial Claims Appeals Office for reconsideration, though it is possible this case will be reviewed by the Colorado Supreme Court.

The court's guidance in Softrock is helpful because many times, individuals will meet the test for contractor status even though they choose to perform work for only one entity for an extended period. Still, as this case demonstrates, repeatedly retaining an invidual to perform services as a contractor over an extended period, without confirming that he or she is working for others, is risky. As a result, it is best to ensure that individuals are, in fact, working for others or making their services available to others while performing services for your business.

Here are some additional tips to keep in mind when retaining a contractor:

1. Don't classify someone as a contractor just because that person asks to be a contractor. The business bears the responsibility, and liability, for appropriately classifying its workers.

2. A signed contract is not enough. A court or auditor will look beyond the contract to determine whether the individual meets the appropriate tests for contractor status.

3. Do not pay an individual; instead, ensure you are paying a tradename or business entity. Payment to an individual is a red flag for auditors, even when the person is legitimately a contractor.

4. Avoid hiring former employees as contractors, unless you are certain they meet the test for contractor status. Again, this is a red flag for auditors, as employees are sometimes reclassified as contractors even though their actual duties have not changed.

5. Get a business card, print out a website, or maintain some other evidence that the individual has a business and makes his or her services available to others. This type of evidence can be very helpful in the event of an audit.

6. Get your attorney involved early to ensure the person meets the appropriate tests. Although a written agreement is not dispositive, it can help, and analyzing the issue before an audit is generally better than analyzing it for the first time during or after an audit has begun.

7. Do not treat the individual like an employee, i.e., do not have the person sign an employment contract, do not evaluate the individual with the same forms you use for employees, and if you give the person a business card, be sure it notes the individual is a contractor.

8. Do not retain someone as a contractor with the idea of hiring that person as an employee if he or she does well. Most likely, that person will not fit the tests for contractor status.

9. Do not assume that individuals performing short-term projects or part-time work are automatically contractors. Often times, they are part-time or short-term employees.

10. When in doubt, err on the side of employee status.

Contractor misclassification is a big issue in Colorado and many other states. Therefore, be cautious when retaining contractors, and be sure they meet the appropriate tests for contractor status.

June 7, 2012

Last-Chance Agreements — Employer beware!

The EEOC, in its recent press release (http://www.eeoc.gov/eeoc/newsroom/release/5-29-12.cfm) of May 29, 2012, announces a rare victory on summary judgment in what could be a bad trend for employers. In the underlying case of EEOC v. Cognis Corporation, a foreign multinational corporation, the federal judge ruled that the company retaliated against an employee for refusing to waive his rights to file a discrimination charge, both for past conduct and prospective conduct.

The employee, as a condition of continued employment, was asked to sign a last-chance agreement that prohibited him from filing a discrimination charge. According to the EEOC, Cognis conditioned the employment on the execution of the last chance agreement and when the employee refused to be bound by that agreement he was fired. As the Court noted in its opinion, it is not often that an employee is granted summary judgment on a Title VII retaliation claim.

The outcome here is problematic for two reasons. First, in most cases there is often a fact issue over the stated motivation for the adverse action taken by the employer because the motivation for the underlying decision is almost always in dispute; thus, there is a necessary question of fact that would defeat a summary judgment. Second, the Court’s willingness to discount the fact that had the employee not executed the last-chance agreement in the first instance he would have been terminated for a legitimate and non-discriminatory reason – poor performance – is worrisome. In rejecting Cognis’s argument on this point, the Court reasoned that even if it credited Cognis’s argument; it was the employee’s revocation of the last-chance agreement that constituted an adverse action, an act that might dissuade a reasonable worker from making or supporting a charge of discrimination. (See Opinion). This reasoning, of course, doesn’t adequately address the fact that the worker essentially was given consideration to remain employed under the last-change agreement.

What is clear from the Court holding in Cognis is the fact that the last-chance agreement is said to have threatened termination for undertaking future protected activity, which the Court says satisfies one element of the prima facie case of retaliation – a preemptive retaliatory act. Now, all that remains for the Court is a determination of damages. If the Cognis last-chance agreement had not included this prospective provision, I wonder how the case would have turned.

This holding is sure to motivate the EEOC to seek out similar cases of this kind. The EEOC concludes its release by indicating that “[f]iling EEOC charges is a fundamental right of American employees, and this agency always stands ready to protect that right.” EEOC’s Chicago District Director John Rowe further states, “This court’s opinion should cause employers to remember that seeking to dissuade employees from exercising that right is not only bad policy, it’s a violation of federal law which can give rise to very substantial liability.”

Despite the Court’s finding and the threats by the EEOC, this author maintains that narrowly crafted last-chance agreements are often useful to employers, both to ensure employees understand that future satisfactory performance is demanded and to give the employee fair opportunity to improve his/her conduct.

For more information contact Steven M. Gutierrez.

May 15, 2012

National Labor Relations Board Election Rule Invalidated

A federal judge has invalidated the "ambush election" rule by the National Labor Relations Board ("NLRB"). Brian Mumaugh and Brad Williams summarized the decision by Judge James E. Boasberg of the United States District Court for the District of Columbia and its impact on employers in a post, which is available on Holland & Hart's website by clicking here.

May 15, 2012

Court Invalidates NLRB’s “Ambush Election” Rule

A federal district court judge invalidated the National Labor Relations Board's (NLRB's) controversial "ambush election" rule yesterday, ruling that the Board had lacked a three-member quorum needed to pass the rule last December. The ruling followed a failed Congressional attempt to halt the rule, and came just two weeks after the rule became effective on April 30th. For more information, see the article written by my colleagues Brian Mumaugh and Brad Williams.

May 10, 2012

Good Documentation — a recipe for success

By Mark Wiletsky

As a follow-up to a recent post, here is an article with tips for documenting employee performance issues.

Before terminating an employee, even in an at-will state such as Colorado, employers are well-advised to have good documentation in hand. A solid “paper trail” documenting legitimate performance or behavioral issues is often your best weapon to prevent or quickly resolve opportunistic claims from poor performers and disgruntled employees. Although documenting problems is not required by law, jurors expect to such evidence when faced with a claim that the employee was terminated for an unlawful reason. There is no “one-size-fits-all” approach to documenting performance problems, but following a recipe will help to ensure that your documentation contains the key ingredients to ward off a claim.

1. Start with the facts. When documenting performance or behavior problems, avoid ambiguous or subjective phrases and terms, such as saying the employee has a “bad attitude” or has behaved “inappropriately.” Instead, be factual, specific, and give examples. For example, rather than saying an employee has “repeatedly been late to work,” you could write: “John’s shift begins at 8:00 a.m. However, on March 5, 21, and 28, 2012, John arrived at 8:10 a.m., 8:15 a.m. and 9:00 a.m., respectively. John did not call his supervisor in advance to notify him that he would be late those days. As a result of John’s tardiness, employees from the earlier shift had to stay late, causing the company to incur additional expenses, which it is trying to minimize.” Also, replace labels (such as “bad attitude”) with a description of the actual conduct that is at issue, e.g., John has been inattentive during staff meetings, he failed to work with his teammates to complete deliverables on the X project, etc. Lastly, avoid acronyms and highly technical jargon. Make sure that a layperson could read the document and understand the problem.

2. Add in the employee’s explanation. After identifying the problem, recite the employee’s explanation for the problem, or confirm the employee admitted to the behavior. For example: “When Michelle and I met with John on April 1 to discuss his tardiness, John admitted he had been late on the days noted above, but claimed that he had overslept or that road construction delayed him.” Then state that those excuses are not legitimate and reiterate the expectation that the employee will adhere to the rule at issue.

3. Throw in some history. If the employee has had other problems recently, reference those issues. Similarly, if you have had prior conversations with the employee about the conduct at issue, and that conduct is recurring, point out those past conversations: “This is not the first time John has had problems with tardiness. We spoke about this issue on February 5, 2012, because he had arrived late to work two times in a two-week period, and I warned him that he needed to be sure to arrive on time and notify his supervisor if he was going to be late.” But don’t go back too far into the past, and be sure that you are following any applicable collective bargaining agreement with respect to the time period during which past performance issues may be used against an employee.

4. Lay out expectations. Make sure the employee knows what you expect, and include a policy (or excerpt), if applicable. A common sentence included in disciplinary memoranda is: “We expect immediate and sustained improvement. If there are any further issues or problems, you will be subject to additional discipline, up to and including termination of employment.”

5. Finish off with a signature. Make sure the employee signs a document to confirm receipt. Employees or their attorneys may claim that an unsigned document was created after the fact, or that the issue was never discussed with the employee. If the employee refuses to sign the document, simply note the employee refused to sign, and consider sending a copy of the memo to the employee via e-mail with a note, such as: “John – here is a copy of the warning memo that we discussed a few minutes ago.”

Although there is no one “recipe” for successful documentation, following the steps outlined above should be a good start to ensure that you are appropriately documenting performance issues.