Employment & Labor Law
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I.
Employer – Employee Relations (Non-Union)
A.
Governing Law
1.
2.
State law, in general, controls employment relationship
a.
Common Law contract law applies to employment contract
b.
With some exceptions and special situations, no special
rules for employment contracts
c.
In past 15 – 20 years, courts have been less neutral when
interpreting employment contracts
d.
Unless there is a specific federal or state statute, the only
applicable rules are Common Law contract rules
Federal Law governs if applicable
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3.
Fair Labor Standards Act
a.
First adopted in 1938 (part of effort to overcome the Depression)
b.
Establishes minimum wage, maximum hours, etc.
(1)
(2)
(3)
(4)
(5)
c.
Minimum wage now $5.75 ??
Must pay “overtime” (1.5 x wage) for all hours over 40 per week
Some exceptions for “training wage”
Does not apply to all jobs (e.g. farm workers, family members)
Special rules for jobs where tips are routine (restaurant, etc.)
Extensive rules concerning younger workers
(1) “Hazardous” and “nonhazardous” jobs
(2) Younger persons limited to non-school hours, different times
on weekdays and weekends
(3) Treats agriculture and entertainment work as not “oppressive
labor” for children under 14 ????????
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4.
Occupational Safety & Health Act (OSHA)
a.
Concerned with reducing job-related injuries and general safety
(1) Initially adopted many rules that made it very difficult to work
(2) After some experience, both employers and OSHA became
a little more realistic
(3) Record-keeping requirement for employers is burdensome
(Report all injuries to OSHA, with details)
b.
5.
More recently OSHA has given more attention to repetitive stress
injuries (e.g. “carpal tunnel syndrome”)
Workers’ Compensation
a.
Worker may have very difficult time recovering in negligence case
against employer or other worker (traditional tort rules)
b.
Workers’ Comp substitutes a guaranteed payment/recovery
(1) Only question is “was injury on the job”
(2) Amount paid according to schedule of benefits, may be
much less than possible recovery in “normal” litigation
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6.
Social Security and Medicare
(1) All employees and self-employed are covered
(2) Employer pays half of total contribution
(3) Self-employed pay full amount, but can deduct half
(or more for income tax purposes)
7.
Family & Medical Leave Act
(1) Requires employer give up to 12 weeks of unpaid leave for
childbirth, adoption, medical emergency (employee or family
member
(2) Employer must allow return to essentially equivalent job
(3) Applies to companies with 50 or more workers, but only for
workers who have been employed full time for a year
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III. “AT WILL” EMPLOYMENT CONTRACT
A.
Basic Rule = employment agreement for unspecified period of time
is “at will”
1.
Based on traditional contract law philosophy and rules of
interpretation
2.
When “at will” both employer and employee can terminate
contract at any time, for any reason, or for no reason
3.
Assumes essentially equal bargaining power and essentially
equal consequences when one or the other terminates contract
a.
Not realistic in that employee will probably not have much
negotiating, bargaining power before contract agreed
b.
Not realistic in that negative consequences to employee when
employer terminates contract are much more significant than
consequences to employer when worker quits
Not a good idea to say that an “employee was terminated” when
he/she was fired. The employee was not terminated, her/his job was.
Maybe some criminal organizations actually terminate employees.
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B.
C.
Courts have created a number of “exceptions” to at-will rule
1.
Most exceptions recognize the inequalities and try to protect
employee from “unfair” acts by employer
2.
Most employers try to make it very clear that employment is at-will
and that employee was made aware of that from the beginning
“Contract law” exceptions
1.
Statements and promises made before hiring
a.
Statements made during interviews or when employment
offered indicate something more permanent than at-will
(1) Procedures before terminating employment (notice, etc.)
(2) Assurance of continued employment “as long as….”
b.
Changes in management personnel or policies can outdate
the pre-employment promises
c.
Court will enforce pre-employment promises, especially if
employee moved, quit old job, lost money, etc., to accept
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2.
Employee Manuals
a.
Manuals frequently include a procedure normally followed
before an employee’s job is terminated
(Oral notice, written notice, 2nd written notice, counseling, etc.)
b.
Courts have construed that type of employee manual information as terms of the employee’s contract
(1) Most reasonable when employee is given manual
before accepting position
(2) Not so reasonable (based on contract-law) when manual
is added or amended after employee takes position
(3) Employers try to make it very clear that nothing in a
manual changes the contract to something other than
“at will”
Employers have a problem. With multiple supervisory layers, it is
necessary to set standards for supervisors. But setting standards
means that a court might say the employees are no longer “at-will,”
which makes it difficult to deal with unusual employees.
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D.
“Public Policy” Exceptions
1.
2.
Many court decisions have held that
it would be a “violation of public
policy” to allow an employer to fire
an employee for:
When you see a court decision made on a “public
policy basis, that usually
means the court does not
have a clear legal rule to
base its decision on, but
is doing what is “right” in
the circumstances.
Usually very vague.
a.
Refusing to violate a law (text
examples: committing perjury,
indecent exposure)
b.
Exercising a legal right (text example: filing workmen’s
comp claim), responding to OSHA, EEOC, etc.
c.
Performing a legal duty (jury duty, report to police, etc.)
“Whistleblowing” is a special category
a.
b.
c.
Reporting illegal or irregular activities of fellow employees
or the company to authorities
Is in the best interest of the public, but usually not the employer
Probably not realistic for the employee to keep working
with the employer he/she reported to authorities
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I.
“LABOR LAW” – BACKGROUND
A. History
1.
General US labor law history reflects economic and social changes
a.
Much more violent before 1935
(1) Courts routinely granted injunctions against any strike
(2) Not much for employer to lose if there was strike
(3) Some very violent exchanges between labor and security
b. After NLRA, violence much less
2.
Labor union membership/power cycle
a.
After WWII, power very high (comparatively)
b. After 1970s, union membership decline
3.
Traditional power of unions is in factories, mines, construction
a.
Previously, fewer workers in service occupations
b. Ratio of factory to service workers changed (now more service)10
B.
Sequence of acts reflects development of major concerns
1.
NLR Act (1930s)
a. Authorized union activities, prohibited employer action against
b. Created NLRB to regulate (political appointees)
c. Specified “unfair labor practices” by employers (not unions)
2.
Taft-Hartley Act (1947)
a. Specified “unfair labor practices” by unions
b. Limited union actions with respect to employers and employees
3.
Labor-Management Reporting & Disclosure (Landrum-Griffin) (1959)
a. Directed at internal union activities
b.
C.
Principal provisions
(1) Detailed reporting on trust and pension funds
(2) Freedom for internal political activities
Principal issues for contemporary business
1.
2.
Certification elections (campaigns)
Contract-negotiation process
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II.
CERTIFICATION PROCESS
A.
Initial Activities
1.
2.
Getting “union cards” signed by employees
a. Can be initiated from inside or by established union
b.
Must target a particular group (“bargaining unit”)
c.
If enough signed cards (30%), then “election” set by NLRB
Fixing the bargaining unit
a. Try to find a group that has similar working conditions,
skills, etc
b.
3.
Can be a significant problem in the “team” production
facilities
Election to vote for or against unionization
a. Very detailed rules and procedures on who can do what
b.
Employer is precluded from giving new benefits, raises,
promotions, etc., unless it can show that they are routine
c.
More than 50% must vote for union
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III. CONTRACT NEGOTIATION
A.
Subjects of bargaining (mandatory)
1.
“Wages, hours, and other terms and conditions of employment”
2.
Some things are obvious
3.
Some things in any particular setting are not obvious
a.
“A company that subcontracts [some work] in order to
maintain its economic viability is probably not required to
bargain first; however, bargaining is mandatory if the subcontracting is designed to replace union workers with
cheaper labor.” How does one draw that line?
b.
Plant-closing
(1) Company not required to get approval of policy decisions
(2) May have to discuss “effect” of closing on workers
(3) A federal act requires employer to give 60-day advance
notice to workers when decision made to close plant or
other “mass layoffs” (29 USC § 2101 et seq. “Worker
adjustment and retraining notice”)
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B. Bargaining Process
1. Both sides present their initial positions
2. Both sides are required to “seriously consider” and “respond
to” the other’s proposals
a. “Serious consideration” means cannot reject immediately
but must study, discuss
b. Response normally must be more than “NO”
3. Parties are NOT required to reach an agreement
a. If “bargaining in good faith” reaches a point where
neither party is willing to make any further concessions,
an “impasse” is reached
b. Sometimes labor mediator called in to see if she/he can
produce some movement (not mandatory)
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C. If talks fail to result in agreement
1. Union strike
a. Distinguish between “economic” strike and “unfair labor
practice” strike
b. Employer can replace striking workers with temporary or
permanent workers
(1) “Right” of employee to go back to work depends on type
of strike
(a) Economic strike = no right to get old job back
(b) ULP strike = right to old job in most cases
(2) When there is a strike, re-hiring of striking workers always
an issue
(3) Replacing striking workers can be more difficult if:
(a) Higher skill level jobs
(b) Higher levels of unionization in industry
(c) Higher general level of unionization in area
(d) Frequently difficult to get new workers who will
confront picket line every day
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2.
Employer “lock out”
a.
b.
3.
Employer anticipates strike (for whatever reason) and impasse
Employer not in a position to hire replacement workers
If the problems affect “national interest” President can order
employer and union to go back to work for “cooling off period”
a.
b.
c.
Indicates a strong government interest in the problems
Federal government essentially becomes part of the bargaining
Still not forced to agree, but . . .
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