A. Can't cover all the substantive law

B. Concentrate on practical suggestions you can use

C. If these suggestions had been followed, most of my cases
would never have been brought or could easily have been disposed of.

A. Four most common ways to get sued and how to avoid them

B. How to document your defenses

C. How to keep your policy manual from biting you

D. How to hire and how to fire

A. Wrongful discharge

B. Claims for unpaid leave and overtime

C. Defamation

D. Discrimination and sexual harassment

Formerly, punitive damages were available. Foley eliminated
punitive damages making this less attractive to plaintiffs. However,
these cases are still being brought for compensatory damages.

A. Theories
 
1. Breach of express contract
 
a. Oral or written contract

b. Personnel manual or memoranda

c. Job application
 

2. Breach of implied contract.  Where the circumstances give
rise to reasonable expectation of tenure on good behavior

3. Covenant of good faith and fair dealing used to be
grounds for tort damages. It does not turn at will to
tenure.

4. Negligent or intentional infliction of emotional
distress  

B. How to Avoid
 
1. Most suits are brought because:
 
a. Litigant is motivated

b. Triable case 


2. Avoid motivating employees
 
a. No surprises
 
(1) Document and review with employee areas
needing improvement.

(2) Review needn't be all negative

(3) Signed reviews are a good practice 


b. Don't put off the inevitable.
 
(1) Procrastination is the biggest problem
causing:
 
(a) A bigger emotional investment in the job

(b) A buildup of resentment

(c) A stronger case for implied in fact
tenure--longevity a factor in
determining whether an implied in fact
contract exists

(d) More time to make a mistake

(e) Possibility of enhanced damages for
emotional distress  

(2) Best time to terminate is during the
probation period
 
(a) Don't extend the probation period
without a really good reason

(b) Don't keep a questionable employee
without formally extending the
probation

3. Make the case untriable
 
a. Strengthen and document the key defenses

b. Preserve the "at will" relationship

c. Use the probationary period

d. Document the existence of good cause

e. Document the lack of bad cause

f. Get a good release 


C. Preserving the "at will" relationship
 
a. Presumed by statue where no definite term (Labor
Code Section 2922)

b. Can be rebutted by:  


(1) express written agreement

(2) express oral agreement

(3) implied in fact agreement 


D. How to rebut tenure
 
1. Watch what you say!
 
a. Orally - praise is okay, promises are not.

b. Read the policy manual and personnel memos  


(1) Make any vague promises or assurances?
Eliminate them.

(2) Contain any specific causes for discharge?
Include a disclaimer.  

2. Get periodic acknowledgments of the "at will"
relationship
 
a. Job application

b. Policy manual

c. Periodic reviews

d. Annual acknowledgment of reading of manual and
explicit disclaimer  

E. Acknowledgment - sample annual acknowledgment
 
1. Should contain both magic words and plain language and
both acknowledgments and agreements

2. Specific points  


a. That continued employment only so long as bothemployer
and employee wish

b. Termination for any reason or for no reason, i.e.,
no showing of good cause required

c. No contrary promises or statements have been made


3. Value--Can be dispositive of claims based on facts
accruing on or before their date.
 
a. Must be periodic, at least once a year

b. Need not cause a morale problem  


(1) Can be part of routine performance review

(2) Certification of reading of the policy manual 


F. Use the probationary period

G. Have and document good cause and warnings. This is
different for contracts with a term (Labor Code section
2924)  


1. Backup defenses

2. Reasonable belief may be good enough

3. Good causes  


a. failure to perform

b. reduction in force

c. misbehavior

d. failure to follow proper instructions 


4. Include non-exclusive list of causes in policy manual


H. Document lack of bad causes. An employee often claims bad
motive on the part of one or more managers
 
1. Always involve more than one manager.

2. Where complaints involve someone who is immune from
that complaint.  


a. gender

b. race

c. personal conflicts 


I. Get a release
 
1. Can be dispositive if
 
a. Properly drafted to give fair notice of all claims

being released

b. Voluntary

c. Employee given an adequate opportunity to consider

with the advice of counsel 


2. Can be part of severance agreement

3. If you're going to offer a severance benefit, like
extended medical coverage or a severance payment, you
might as well get something for it!  

J. Summary of Preventative Measures
 
1. Avoid motivating employees
 
a. No surprises

b. Don't put off the inevitable 


2. Make the case untriable by strengthening and documenting the
defenses
 
a. Preserve the at will relationship
  (1) Watch what you say and write

(2) Get

4. Factors that may be considered in promotions. Make it
clear that they are nonexclusive and do not guarantee
anything.

5. Lists of vacation days. Say that they may be changed
with or without notice.

D. Analyze the entire manual
 
1. Is any of it superfluous? Eliminate.

2. Look for "employer shall" or "employer will." Change
all the "shalls" and "wills" to "mays."

3. Look for anything that looks like a promise and take it
out.

4. Look for anything that, taken in isolation, might
create an expectation of tenure, modify it, and tack on
a specific disclaimer.

5. Carefully review and update the manual at least once a
year.

6. Distribute it and get an acknowledgment at least once a
year.

7. Keep a file with all revisions of the policy that will
allow you to say which version was in effect at any
given time. The acknowledgments must be specific
enough to enable you to identify the exact document to
which it refers.

XII. Summary


A. Four areas of frequent claims
 
1. Wrongful discharge

2. Unpaid leave and overtime

3. Defamation

4. Discrimination and Sexual Harassment

B. How to avoid these four areas
 
1. Treat people equally and fairly

2. Documentation and acknowledgment

3. Don't procrastinate or surprise

4. Don't say anything to anyone about employees

5. Hire and fire using sound procedures

6. Get a good release
 

C. Use your employee manual wisely, read it for traps, keep it
updated, make it required reading, and get and keep your
acknowledgments
X



DISCLAIMER: I have entered government service and, as of September 1, 2008, am no longer engaged in the private practice of law.  Therefore, this site is no longer being maintained,  may not be accurate, and should not be relied upon.  It is not now and was not ever intended as legal advice.  It is being provided for historical purposes, and for the benefit of those lawyers who are capable of independently verifying the information and judging the opinions in it, and then reaching their own conclusions.  You are strongly advised to consult qualified legal counsel before adopting any of the ideas or suggestions in this material, which may or may not be applicable in your jurisdiction or to your specific situation, and may no longer be accurate or prudent in any case.  The opinions and statements at this site were solely my own.  They were not and are not those of, nor were they nor are they made on behalf of, any agency of government or anyone else.

Copyright © 1998-2008 Vincent DiCarlo