At-Will Simulations
Rick Bales
NKU/Chase College of Law
Taylor Smith
You are an accounting clerk for Widgcorp, making roughly $40,000 per year.
Widgcorp is a nonunion company of about 200 employees. There are about 20
employees in your department, five of whom have the same basic job description as you.
You are the most senior of the accounting clerks, though you’re only 41.
You know from your work in accounting that this has been a lean year for
Widgcorp. Product orders from customers have slowed down, and commodity prices for
Widgcorp’s materials are up. You’re worried about the possibility of layoffs, and you
really need this job.
You are a parent of three children. Your spouse does freelance work from home,
but business has been way down this year, and the loss of income has put a severe strain
on the family finances. The mortgage company just bumped up the rate on your
adjustable-rate mortgage, and, being an accounting clerk, you’ve run the new numbers –
if the family cuts all discretionary spending (no entertainment, no eating out, cancel the
cellphones and cable), the family might be able to squeak by. If you lose your job,
though, you’ll lose the house for sure. What’s more, your youngest daughter has cerebral
palsy, and your family depends on your job at Widgcorp for health insurance benefits.
You couldn’t even begin to pay out-of-pocket for the costs of your daughter’s care.
When you get a phone call instructing you to meet with Human Resources
Director Alex[is] Miller, you’re afraid you’re going to get laid off. Your goal is not to
leave this meeting until you can convince Miller not to lay you off. If that means you
have to play for sympathy, or persuade Miller to lay off another of the accounting clerks
(who, by the way, are far less dependent than you on their paycheck and health benefits),
then so be it.
Feel free to embellish upon the facts of your family life as you see fit to make
your predicament even more compelling.
Alex[is] Miller
You are the H.R. Director for Widgcorp, a nonunion company of about 200
employees. You’ve been the H.R. Director for about five years. For the eight years prior
to that, you were a Widgcorp H.R. Officer. Although not a lawyer, you have a basic
familiarity with employment law. For example, you know that all Widgcorp employees
(except the CEO and vice presidents, all of whom have one-year employment contracts)
are employed at-will, meaning that they can be fired (and they can quit) at any time for
any lawful reason with or without cause. You know, however, that it’s unlawful to
discriminate against an employee on the basis of race, sex, disability, etc.
This has been a lean year for Widgcorp – product orders from customers have
slowed down, and commodity prices for Widgcorp’s materials have gone up. Two
months ago, the CEO directed you to coordinate an across-the-board 10% reduction of
payroll. That necessarily means layoffs.
You’ve reviewed everyone’s personnel files, performance evaluations, and salary
information. You’ve met extensively with the department heads. The final decision on
who to layoff, however, has been yours. You’ve made the layoff decisions, and now it’s
time to implement them.
You’ve scheduled one-on-one meetings with the affected employees to tell them
they are being laid off. You’ve planned the meetings out carefully. The employees will
come into your office. You will explain that Widgcorp is going through difficult times,
and that it can’t afford its current payroll. You will – as gently as you can – tell the
employee that s/he is being laid off. You will tell the employee that the layoff is effective
immediately, that s/he will receive three weeks of severance pay, and that s/he will have
access to a career counselor. You will then escort her/him to the conference room across
the hall from your office, where a benefits person will explain the severance package,
process the paperwork, arrange for the employee’s personal affects to be boxed and
delivered to her/his home (to spare the employee the trauma of packing in front of her/his
peers), and explain that the employee is legally entitled to continue her/his health benefits
for one year so long as the employee pays the premium her- or himself.
Your goal is to make this as painless as possible, and to get the employee out your
door as quickly as possible.
The first layoff meeting you have scheduled is with Taylor Smith. Smith is an
accounting clerk making roughly $40,000 per year. The decision to lay Smith off was a
difficult one from a personal perspective but an easy one from the company’s financial
perspective. You know Smith fairly well, and you know that Smith is financially
strapped at home because of a precipitous drop in Smith’s spouse’s income. On the other
hand, though Smith is only about 40, Smith is the senior accounting clerk, and because of
seniority makes about $5000 more than the next highest-paid clerk. They all have the
same job description, and do more-or-less the same type and quality of work, so laying
off Smith instead of one of the other clerks saves the company money. You know that
Smith has a chronically ill child at home, and that this illness is sending the company’s
health insurance premiums through the roof, but of course that hasn’t affected your
decision.
Pat Steele
You are a salesperson for Widgcorp. You earn a base salary of roughly $50,000
per year, but with bonuses your total salary is about triple that. You have an employment
contract with Widgcorp that spells out how your monthly and yearly bonuses are
structured. You negotiated this bonus structure when you came to work for Widgcorp
about five years ago, and you know your bonus structure is a bit more generous than the
one that applies to other Widgcorp salespeople (you are, after all, a master negotiator!).
You receive about a 15% commission; the other salespeople average about 10%. The
contract also specifies that you are employed “at-will.” You know this means you can
quit or be fired at any time for any reason without notice. You know this because a few
weeks ago, you asked your brother-in-law, who is an attorney, to look over your contract.
You’re an excellent salesperson (you have to be, to sell Widgcorp’s sorry-a--ed
products), and you’ve been thinking of looking for a sales job elsewhere.
You know from your work in sales that this has been a lean year for Widgcorp.
Product orders from customers have slowed down, though your own sales numbers are
up. As far as you can tell, it’s just part of the boom-and-bust cycle of this particular
industry (but other things being equal, you like booms better than busts, so maybe this is
a good time to move to another industry). You’ve heard rumors that Widgcorp might be
laying people off, so you’ve been scouting around. You haven’t actually interviewed
anywhere yet, but you’ve made some phone calls, and you’re confident that you could
find a new job within a few weeks if you got laid off or decided to move on.
You’ve just received an email from Human Resources Director Jules Abrams
setting up an immediate meeting. Though you doubt Widgcorp would be foolish enough
to lay off one of its best salespeople, if you did get laid off, that wouldn’t be the end of
the world. Your main concern, if this is a layoff meeting, is to negotiate as good a
package as you can get. Remember, after all, that you are master negotiator! At the very
minimum, you want to leave with six weeks of severance pay (calculated using your base
salary), your full bonus for the current month, a prorated annual bonus based on your
year-to-date sales, and a glowing letter of recommendation. If you can negotiate more
than this, all the better. You know that Abrams is the only person in H.R. who has the
authority to negotiate the kind of package you want.
Jules Abrams
You are the H.R. Director for Widgcorp, a nonunion company of about 200
employees. You’ve been the H.R. Director for about five years. For the eight years prior
to that, you were a Widgcorp H.R. Officer. Although not a lawyer, you have a basic
familiarity with employment law. For example, you know that all Widgcorp employees
(except the CEO and vice presidents, all of whom have one-year for-cause employment
contracts) are employed at-will, meaning that they can be fired (and they can quit) at any
time for any lawful reason with or without cause.
This has been a lean year for Widgcorp – product orders from customers have
slowed down, and commodity prices for Widgcorp’s materials have gone up. Two
months ago, the CEO directed you to coordinate an across-the-board 10% reduction of
payroll. That necessarily means layoffs.
You’ve reviewed everyone’s personnel files, performance evaluations, and salary
information. You’ve met extensively with the department heads. The final decision on
who to layoff, however, has been yours. You’ve made the layoff decisions, and now it’s
time to implement them.
You’ve scheduled one-on-one meetings with the affected employees to tell them
they are being laid off. You’ve planned the meetings out carefully. The employees will
come into your office. You will explain that Widgcorp is going through difficult times,
and that it can’t afford its current payroll. You will – as gently as you can – tell the
employee that s/he is being laid off. You will tell the employee that the layoff is effective
immediately, that s/he will receive three weeks of severance pay, and that s/he will have
access to a career counselor. You will then escort her/him to the conference room across
the hall from your office, where a benefits person will explain the severance package,
process the paperwork, arrange for the employee’s personal affects to be boxed and
delivered to her/his home (to spare the employee the trauma of packing in front of her/his
peers), and explain that the employee is legally entitled to continue her/his health benefits
for one year so long as the employee pays the premium her- or himself.
Your goal is to make this as painless as possible, and to get the employee out your
door as quickly as possible.
The next layoff meeting you have scheduled is with Pat Steele. Steele is a
salesperson for Widgcorp. Steele earns a base salary of roughly $50,000 per year, but
bonuses make total take-home pay about triple that. Steele has an employment contract
with Widgcorp describing how his bonuses are structured. Steele negotiated this bonus
structure when s/he came to work for Widgcorp about five years ago.
The decision to lay Steele off was a difficult one. Steele is one of Widgcorp’s top
salespeople, and Widgcorp can ill-afford to lose sales at a time like this. But Steele’s
bonus structure is much more generous than the structure that applies to the rest of the
sales force. (Steele receives about a 15% commission; the other salespeople average
about 10%.) This costs Widgcorp money, and breeds resentment among the other
salespeople. If Steele would accept a bonus structure that’s more in line with what the
other salespeople are making, you’d be willing to retain Steele and find someone else to
lay off.
Casey Strong
You are line supervisor for Widgcorp, making roughly $55,000 per year.
Widgcorp is a nonunion company of about 200 employees. You’ve worked for
Widgcorp for fourteen years, ever since you joined the production line right out of a twoyear enlistment in the Army (infantry in Desert Storm). You became a supervisor about
five years ago, and are very proud of that accomplishment. You are absolutely
committed to the company. You haven’t missed a day of work in three years, and you
even gave up a week’s worth of vacation last year to deal with equipment problems on
the assembly line. Your shift is the most productive one in the plant, and you know it.
You’ve heard rumors that the company isn’t doing well. You know it’s not
because of anything that’s happening on the production line, because you run a tight ship.
If there is a problem, it’s probably because the suits don’t know what they’re doing, or
are taking too many expense-account lunches, or something like that.
You just got a call instructing you to meet with Human Resources Director Terry
Muncie immediately. You don’t have a very high opinion of Muncie. Two years ago,
you got stuck with a slacker employee that Muncie had hired. When you tried to
motivate that employee a little, the employee went whining to Muncie about harassment.
Muncie, rather than acknowledging that the employee should never have been hired in
the first place, got an outside lawyer to do a full-blown investigation. Though nothing
ever came of the allegations and the employee was later transferred to a different shift,
you think Muncie is a spineless jellyfish
On your way to Muncie’s office, you pass Taylor Smith, an accounting clerk,
who’s walking the other direction in tears. Smith explains to you that Smith has just been
laid off by Muncie. As you continue to walk, you realize that it just might be possible
that Muncie is going to fire you too. There’s no way you’re going to let that sorry-a--ed
woos screw both you and the company over like that. By the time you reach Muncie’s
office, you’ve gotten angry, and a thousand reasons are going through your mind of why
Muncie should not be firing you. You resolve to argue Muncie out of it. If that doesn’t
work, you’re fairly sure you can intimidate Muncie into firing someone else. And if even
that doesn’t work, you’ve always got the old AR-15 assault rifle (military version) at
home – that’d scare the Hell out of ‘em.
Assuming Muncie doesn’t give you what you want, you goal is to deliver to
Muncie a clear (but plausibly deniable) threat of workplace violence.
Terry Muncie
You are the H.R. Director for Widgcorp, a nonunion company of about 200
employees. You’ve been the H.R. Director for about five years. For the eight years prior
to that, you were a Widgcorp H.R. Officer. Although not a lawyer, you have a basic
familiarity with employment law. For example, you know that all Widgcorp employees
(except the CEO and vice presidents, all of whom have one-year employment contracts)
are employed at-will, meaning that they can be fired (and they can quit) at any time for
any lawful reason with or without cause.
This has been a lean year for Widgcorp – product orders from customers have
slowed down, and commodity prices for Widgcorp’s materials have gone up. Two
months ago, the CEO directed you to coordinate an across-the-board 10% reduction of
payroll. That necessarily means layoffs.
You’ve reviewed everyone’s personnel files, performance evaluations, and salary
information. You’ve met extensively with the department heads. The final decision on
who to layoff, however, has been yours. You’ve made the layoff decisions, and now it’s
time to implement them.
You’ve scheduled one-on-one meetings with the affected employees to tell them
they are being laid off. You’ve planned the meetings out carefully. The employees will
come into your office. You will explain that Widgcorp is going through difficult times,
and that it can’t afford its current payroll. You will – as gently as you can – tell the
employee that s/he is being laid off. You will tell the employee that the layoff is effective
immediately, that s/he will receive three weeks of severance pay, and that s/he will have
access to a career counselor. You will then escort her/him to the conference room across
the hall from your office, where a benefits person will explain the severance package,
process the paperwork, arrange for the employee’s personal affects to be boxed and
delivered to her/his home (to spare the employee the trauma of packing in front of her/his
peers), and explain that the employee is legally entitled to continue her/his health benefits
for one year so long as the employee pays the premium her- or himself.
Your goal is to make this as painless as possible, and to get the employee out your
door as quickly as possible.
You just laid off Taylor Smith in Accounting and Pat Steele in sales. Neither
layoff went so well. Next on the list is Casey Strong. Strong is a fourteen-year line
supervisor. The decision to lay off Strong was the easiest layoff decision you made.
Though Strong is dedicated to the company, and keeps the line going efficiently, Strong
is a poor manager of people. Strong motivates people either by becoming their “best
buddy” or, if that doesn’t work, by intimidating them. A couple of years ago the
company almost got sued by one of the employees under Strong’s supervision – a suit
was averted only after you intervened, brought in an outside law firm (at great company
expense) to do an investigation, and agreed to give the employee a transfer to another
shift and a three-month paid “recuperative” vacation. You’ve been looking for an excuse
to fire Strong ever since – Strong is a lawsuit waiting to happen, and the company cannot
afford that risk, especially now.