Meaning of Work and the Changing of Workplace

Meaning of Work

Work as a vitue

o Example: Protestantism views work as parallel with self sufficiency and

industriousness

Work helps with self-worth

o Society views unemployment as weakness

o Gives the ability to provide for self, family

Work and Identity

o “You are what you do.”

Changing Workplace

Workforce Trends

o Baby-boomers getting older, retiring

o Other trends: Women hold steady at at half the workforce, increased diversity

needed

o Increased work times (more hours per year)

o Unions declining

o Income inequality growing

o New Technology, pushing workers out of the market

o Education increasingly necessary

o Outsourcing increasing

o Immigration into US – “exploitable workers”

o Worker training: shifting to employee’s responsibility – expectation that

employment relationship will not last – training = investment

The “New ‘New Deal’”

o Flexibility and efficiency replacing long term commitment and equity

o Pay for performance rather than emphasis on seniority, employment development,

and internal job ladders

o New “Psychological Contract” – employees give up job security for worker

training to enhance employabilioty, networking opportunity and compensation

tied to markets

Effects: Reduced tenure, employee instability, shifting risk to workers

High turnover jobs: Service sector jobs – rigid control systems to buffer

effect of constantly changing workforce

Corporate citizenship: incentive employees to perform well by making

them “a part of the company”

Contracting and Job Security

Default rule: Employment terminable at will

o Why?

Early 1900’s: Adair – Government stays out of it

o Employee and Employer have equality of right (to quit or to fire, to accept

employment or to hire)

o Lochner: Court will not intervene in employment – Freedom of Contract

State statute limiting number of hours interferes with right of contract

between employer and employees. Contracting for employment falls under

14th

Amendment.

State has police powers, but they may only go so far

Muller – The Court says that states can pass laws restricting the number of hours that

women can work per week

o Court needs to look out for women (women seen as weaker) so its OK for the

states to interfere here

Contract vs. At-Will

Savage—An indefinite hiring is a hiring at will and may be terminated at any time, by

will of either party

o Plaintiff’s “consideration” – moving, giving up other employment, etc. were

merely a detriment to him and not mutually understood as an “agreed exchange”

or consideration.

Overcoming At-Will Employment: Express Agreement (rare)

o Guiliano: Employer can not “constructively terminate” an employee – must show

“just cause” as employment angreement required.

o Definite term contracts: employment for a definite period of time enough to

overcome the “at-will preseumption, even when contract is silent on termination

o “Just cause” – generally understood as poor job performance or employee

misconduct

Financial reasons are insufficient to qualify as “just cause”

Modern courts willing to enforce contracts for an indefinite term with

“just cause” limitations when “terms are clear.”

Oral contracts: treated just like written contracts

o Oral contracts face more hurdles

Puffery vs. Promise

Implied Agreements: Courts will enforce certain contractual rights in situations where

agreement is implied, but individual contracts are lacking

o Woolley – Employee handbook is a unilateral contract

Termination provisions are company “policy” not

“philosophy”

Employee’s consideration was continued employment

o To avoid liability when termination occurs, the employee can put a “clear and

conspicuous” disclaimer in the handbook in order to avoid appearance of contract

o Asmus: Employer can unilaterally modify a manual so long as it occurs after a

reasonable time and w/ reasonable notice (though some look to see if Er reserved

the power to modify in handbook).

Implied-in-Fact Contracts: No mutuality and additional consideration needed. Taking job

and doing it are adequate

o Implied in fact promise factors: (1) personnel policies (2) longevity of service (3)

Actions assuring assurances of continued employment (4) Practice of industry

o Employee not terminable at will – court says need

good cause” – something reasonable but less than “just cause”

Implied covenant of good faith and fair dealing: Every contract imposes upon each party

a duy of good faith and fair dealing in its performance and enforcement.

o Fortune: Even in an at-will contract, employer can not fire an employee for the

purposes of not wanting to pay him commissions that he is on the brink of

receieving

o Courts also recognize an “unfettered right to terminate” – “at will” is an express

term in a contract, trumping any implied terms

Public Policy Protections

Work to mitigate the harshness of the At-Will rule. Public Policy places some limits of

unbrideled discretion to fire an employee at-will

Examples include interference of employes right to: (1) refuse to commit perjury (2) file

a workers comp claim, (3) engage in union activity or (4) perform jury duty

o Sheets: Court recognizes public policy exception – employee in a position that

affects public safety and health

o Also, employee was held to personal liability

o Dissent: Court is making policy, this should be up to the legislature

What is public policy? “What is right and just and what affects the citizens of the State

collectively.

o No clear line of demarcation

o Must strike at heart of citizens “social rights, duties, and responsibilities”

o Hayes v. Eateries Inc.: no exception when claim doesn’t involve a “clear and

compelling public policy” (P worked for a private corp.)(purely private interests)

Constructive discharge: Public policy exception requires a “wrongful discharge”,

defined as when “an employer creates working conditiopns so intolerable that the

employee has no option but to resign.”

o Storinsky: Policy behind rule: you don’t want to give employers a “loop-hole” in

order to avoid liability/litigation

Statutory Protections for Whistleblowers – protects employees from retaliation for

violations of a specific statute

o Protections tend to emphasize public health and safety concerns

o Enron spurred new legislation covering financial harm

o Day v. Staples: Whistleblower must have an “objectively reasonable belief” that

reported violation was in violation of SOX

Unemployment Insurance

System aims to promote more stable employment and acts as a stopgap for employees

who have an attachment to the workforce

o For those who lose jobs through no fault of their own and actively seek and

remain able to work

o Administered at the state level

o 26 week standard period for jobless to collect, can be extended 13 weeks

during periods of high unemployment

o Those who left job voluntarily, with no work-related good cause are

ineleigible to receive benefits

Employee Mobility

In General: Employers seek to take their services to the highest bidder in an era when

long-term employment is no longer the “norm.” Part of the “New Psychological

Contract.”

Covenant Not to Compete: Prevents employee from engaging in competition with

former employer for a period of time after termination of employment

o Hopper: A restraint is only reasonable if: (1) it is no greater than required for

the protection of the employer; (2) does not impose undue hardship on the

employee; and (3) is not injurious to the public.

o Policy behind it: protects trade secrets, confidential information, and against

special influence obtained by the employee during the course employment

over the employers customers.

o Balance between protecting employees from unfair restraints and preventing

unfair competition.

Protecting trade secrets

o Dicks v. Jensen: Two components to a trade secret. (1) information has

independent economic value and is not readily ascertainable to others (2)

subject to efforts that are reasonable under the circumstances to maintain its

secrecy.

o Types of trade secrets include: strategic elements of a business plan, formulas

for products, pricing information

o Commons methods for maintaining secrecy: confidentiality agreements,

passcodes or passwords, restrictions on public disclosures of confidential

information

Inevitable disclosure: courts may enjoin “actual or threatened” misappropriation of a

trade secret.

o Policy: we want to encourage innovation and invention. Without doctrine,

employers may try to hide information in their employees or underinvest in

innovation

Employee inventions: many employers require employees to sign contracts governing

the ownership of any resulting patents (either joint ownership or assigning full rights

to employer)

o Womack : employer’s assistance in reducing the invention to practice was not

necessary to its obtaining a shop right. The principal consideration is the

employee’s consent. This may be shown by either the employee’s actual

consent to the employer’s use, or by the employee’s use of the employer’s

time and facilities to make the invention.

o Policy reasons: justified as necessary to encourage adequate employer

investments – don’t want invention-owning employees to “hold-up” employer

investment

Employee Privacy

Privacy in General: Touches upon a number of distinct interests: intusion upon physical

space, seizure of personal effects, insuring bodily integrity, shielding communications

etc.

Constitutional protection for public employees

o O’Connor: In public sector, case-by-case analysis necessary

Fouth Amendment applies to searches by public employers

Standard of reasonableness requires “balancing nature and quality of the

intrusion on the individual’s Fourth Amendment interests AGAINST the

importance of the governmental interests alleged to justify the intrusion.”

Public Employer: Invasion of legit expectations of privacy v.

governments need for supervision, control and sufficient operation of the

workplace

Privacy of Electronic Communications

o Smyth v. Pillsbury: No reasonable expectation of privacy when emailing over

company email system

Liability only attaches when the “intrusion is substantial and would be

highly offensive to the “ordinary reasonable person”

Company’s interest in maintaining integrity and professional email system

outweigh employees interests may have in those comments

o Stengart: Use of a company computer to use a private email account does not

justify intrusion of privacy

Policies which allow compnays to access private email accounts further no

legitimate business interests

o Reasonable expectation of privacy – subjective standard – what did the person

rely on to determine what would be considered private?

o A search is reasonable in scope when “the measures adopted are reasonably

related to the search and not excessively intrusive in light of the nature of the

misconduct.”

Productivity Monitoring

o Employee argument: having a measure eof control over work life is eesential o

maintain a sense of identity and personal dignity

o Employers: have legit interest in managing business interest as they see best –

have interest in increasing productivity protecting company property, providing

security and preventing illegal activity (reducing liability)

Employee Voice

Employee interests in voice

o Speech has “intrinsic value” – fosters individual self-realization, promotes

autonomy

o Promotes “informed self-governence” in the workplace

o Greater job satisfaction when employees have a voice

o Fosters deliberation, better decision making

o Speech at workplace gives speech a forum – speech can cross social divisions

Public Sector

o Pickering: Court sees value in allowing certain public employees to speak freely

on public matters

Doesn’t impact working relationships, job not affected, no compelling

government interest

o Connick v. Myers: Employee not speaking as citizen on matters of public concern

but as employee on matters of personal concern – speech not protected

First amendment does not require a public office to be run as a roundtable

for employee complaints over internal office affairs

o Threshold test: Is speech a matter of public concern?

o Garcetti: When public employees make statements pursuant to their official

duties, the employees are not speaking as citizens for First Amendment purposes,

and the Constitution does not insulate their communications from employer

discipline.

New test: Look to the role of the speaker first before looking at the

content.

Assurance that public employees have whistleblower protections

Private Sector Employees

o Novosel v. Nationwide: Public employee analysis can apply, public policy issues

at stake. Can’t condition employment on political subordination.

Nontraditional Mechanisms for Collective Voice

o Indentity Caucuses – address concerns of “minority groups” like gays, women,

people of color

Based upon common interests arising out of social identity groups

Challenge discrimination and changing employer practices

o Worker Centers – Community based membership organizations

Nonprofit orgs committed to building democratic organiztions that are

accountable to the interests, needs, and goals of the workers being

organized

o Employee Involvement programs –most are initiated to increase productivity or

quality in response to global comptetition.

Designed to make the workplace collaborative between manager and

works rather than adversarial

FMLA

FMLA in general: providea relief to employees by allowing those who qualify to take

unpaid leave to care for anew child, sick children, spouses or parents, or for the workers

own serious illness.

Provisions and Effects

To qualify, employee must:

o Work more than 1250 hours in a year

o Have worked for employer for at least one year

o Work for an employer that employs more than 50 employees

Qualified employees are entitled to:

o Take up to 12 weeks of unpaid leave to care for (1) child or adopted child (2) care

for a child, spouse or parent who has a serious health condition (3) for one’s own

health condition

o Employee entitled to be restored to the same position as when they left

o Entitled to retain health benefits

NOT Entitled to seniority while on leave

Employee must provide 30 days notice, when feasible

Policy debate: Stronger leave legislation will allow women to better handle competing

demands

o Mother cut out of labor pool becayse they can’t work the “good jobs” – 40 hour

plus per week

Proportionality for part time work

Restructure work schedule: Flextime

Restructure family responsibilities

Extensive state support for childcare

Encouragement of Education

Workplace Regulation

The Regulation of Wages and Hours

o Fair Labor Standards Act: Establishes a federal minimum wage and imposes

financial penalities on employers who required employees to work more than the

statutory norm

o Enacted during the New Deal to quell labor unrest

Hire more workers at shorter hours to alleviate unemployment

o Wages: Minimum wage provides employes can’t pay less than 7.25 an hour

Overtime: Employers must pay 1.5x rate for hours worked in excess of 40

per week

Neither min wage or overtime can be waived by provate agreement

Covered Work

o Individual coverage test: employee covered if engaged in commerce or production

of goods for commerce in a given week.”

o Enterprise coverage test: All employees covered if (1) enterprise engaged in

production of goods for commerce (2) has two or more employees (3) gross sales

or business volume of $500k or in a public facility, hospital, res care facility, or

educational institution.

o Employees vs. Independent contractors – label doesn’t matter – look at “economic

realities of employment”

Relevant factors:

Degree of control that employee has over her work

Emplyees opportunity for profit or loss depending on his

managerial skill

Employees investment in equip or materials necessary for task

Whether special skill required for services

Degree of permanence of working relationship

Whether the service rendered is an integral part of the alleged

employers business

o Exemptions from Coverage: cover minimum wage and overtime provisions of the

act

Lower end exemptions:

Seasonal amusement and reactional businesses

Certain fishing and aquatic business employees

Most agriculutural workers

Publishers of small newspapers

Domestic workers

High End Exemptions

Executive employees – those whose primary duty consists of

management of the enterprise or one of its subdivisions

o Primary duty managing enterprise or a subdivision thereof

o Direct the work of two or mor other employers

o Has the authority to hire and fire

Administrative employees – primary work consists of office or

nonmanual work related to management policies or general

business operations AND has a primary duty which includes

exercise of discretion and independent judgment with matters of

signifigance

Professional Employee

Learned

o Primary duty requires knowledge of an advanced type

o In the field of science or learning AND

o Knowledhe ius customarily acquired by a prolonged course of

specialized instruction

Creative:Primary duty is work requiring invention,

imagineatoin, originality, or talent ina recognized field of

artistic or creative endeavor

Computer Professionals: Paid on a compensated hourly rated of

more than 27.63

Outside sales employees

Paid by Commission

Hihghly Compensated Employees: Paid at least $100k a year and

perform duties of a professional, executive, or admin employe

o Covered work and enforcement

Meal periods – Not covered under FLSA but some states do cover them

Training – covered when for benefit of the employer

Travel time – Portal to Portal Act – home to work commute not covered

but while traveling on travel, etc is compenselable

Preliminary and Postliminary Activites – Not an integral part of the

principal job activites and are not compensable unless made so by contract

Workers’ Compensation

In general: Goal is to prevent income support for victims

o Schemes exist to provide prompt assistance to injured workers regardless of fault

Benefits and Procedures

o State laws differ

o Federal laws establish separate somensatipn schemes for certain workers

o Employers may purchase insurance, participate in state system or self-insure

Who is an employee? Single most import factor is whether purported employer has right

to control actions of employee

Arises out of and in the Course of Employment

o Test for work-related injury

o Prows: Horseplay still covered under test

In cases such as this cases look to (1) extent and seriousness of deviation

(2)completeness of the deviation (is it comingled with employee work

actrivites?) (3)extent to which horseplay practice has become accepted

part of employment (4) Extent to which some horseplay should be

expected

o Houser: physical or mental injuries caused by a mental or emotional stimulus;

excessive and unexpected mental anxiety; or stress, tension, or worry attributable

to the employment can justify an award of benefits, but the ordinary mental

stresses and tensions of one’s occupation do not because emotional stress, to some

degree, accompanies the performance of any contract of employment

o Eckis v Sea World – Worker injured while performing work outside of normal job

duties, but nonetheless still performed “at work” can’t sue in tort – workers comp

is her exclusive remedy

o Cole – Plaintiff can’t sue for conduct (emotional stress) that can be expected to

occur with substantial frequency in the work enviornment

Arbitration

In general – replacing litigation as the primary source of dispute resolution

o Arbitration clauses included in employee contractsas a condition of employment

o Arbitration does not alter employee rights, but rather the forum where substantive

employee rights are adjudicated

o Use of system on the rise – up to 23% in 2003

Enforceability

o Three bases for disputing arbitration agreements

1) Under FAA\

2) Must satisfy certin minimum standards of due process

3) Utilize state law contract principles – unconscionability, bad faith, lack of

consideration, lack of assent

Under the FAA, an agreement is enforceable if it is valid and the dispute falls within the

scope of the agreement

Due Process – standards for assessing enforceability

o Five criteria: (1) provides for neutral arbitrators (2) provides for more than minimal

discovery (3) requires a written award (4) provides for all types of relief that would

otherwise be available in court, and (5) does not require employees to pay either

unreasonable costs OR any arbitrtators fees OR expenses as a consition to access to

the forum

Judicial Review: Arbitration decision are final and unappealbale – save for a few narrow

exceptions

o Where award was procured by currption or fraud//undue means

o Where there was evident partiality or corruption by arbitrators

o Where arbitrators guilty of misconduct in refusing to postpone hearing

o Where arbitrators exceeded their powers or so imperfectly executed them that mutual,

final and dfinite award upon the subject matter submitted was not made