October 16, 2009

Where Did Goliath Go Wrong?

Wal-Mart loses $2 million dollar discrimination case.

The Massachusetts Supreme Judicial court upheld a jury award and reversed the denial of punitive damages last week. How did such a big company end up in such hot water? What can be learned from Wal-Mart's loss? The simple answer - Wal-Mart management failed at basic employment practices.

The case involved a female employee who had worked for 10 years as a pharmacist. The employee worked as a "temporary" pharmacy manager for over 13 months. Unlike other pharmacy managers, who were male, she was not paid the manager differential and was given less bonus pay despite persistent complaints. Ultimately, she was fired with Wal-Mart claiming she left the pharmacy unattended thereby allowing a pharmacy technician to forge a prescription for a controlled substance. The alleged incident occurred five months before Haddad was promoted to "temporary" manager and 18 months before she was terminated. This allegation opened the door to a defamation claim. Wal-Mart could not overcome the excellent evaluations Haddad had received over the prior ten years. There were instances of male pharmacy managers committing more grievous violations of policy that had gone unpunished, adding to the conclusion that Wal-Mart used the incident as a pretext for termination. Back pay, defamation and retaliatory discharge-not a good place for an employer to be.

Best Practices for Employers:

1. IF YOU HAVE RULES - FOLLOW THEM
   Perhaps most damaging were the findings that Wal-Mart did not regularly adhere to its own personnel policies. Having up to date policies-as Wal-Mart did-is meaningless if they are not implemented systematically and followed to the T.
2. INVESTIGATE EMPLOYEE COMPLAINTS
   The plaintiff promptly notified the employer that she was not receiving the pay she was promised. Had managers treated this complaint seriously, this case would not have occurred. Check out our website under News at www.foleylawpractice.com for information on an upcoming seminar: Internal Investigations-Best Practices.
3. DO NOT COMPLICATE TERMINATIONS
   Wal-Mart had a policy of progressive discipline but did not follow it. The original termination notice was dated the day before the interview with the employee.
4. AVOID DISPARATE TREATMENT
   Other pharmacists (mostly male) committed similar conduct without discipline.
5. DEFINE AND COMMUNICATE EXPECTATIONS
   There was no policy prohibiting the behavior that led to the termination.

Wal-Mart converted a straightforward at-will employment relationship into a dream case for plaintiff's counsel. Don't miss the basics!

The Extended Workplace - Federal Workers Can't Text and Drive

President Barack Obama banned the nearly 3 million federal employees from texting while driving. The executive order mandates no texting while driving federal vehicles, using government supplied devices, or in private vehicles on official business. The ban follows the Transportation Department's statement that almost 16 percent of fatal crashes occurred last year when a driver was interrupted, an increase from 11 percent in 2005. Permanent restrictions on use of mobile phones and electronic devices for train operators are expected, as well as restrictions on commercial truck and interstate bus drivers and revocation of commercial licenses of school-bus drivers convicted of violating texting rules.

Employees who drive on company business are a liability for their employer. Even without laws prohibiting texting while driving, the behavior could be considered negligent and put your company on the line. A policy disallowing texting and emailing while driving is a best practice. We recommend that our clients expand their current electronic communication policy to address today's mobile workplace.

Workplace Violence

After the arrest in the Yale University graduate student murder, the Chief of Police stated that the case was not about urban crime, University crime, or domestic crime but an issue of workplace violence. Media attention has highlighted the serious problem of crime at the workplace, including threats of crime from the outside like domestic violence and from co-workers.

What can an employer do to prevent violent crime at the workplace?

• Establish workplace and domestic violence policies;
• Train managerial and supervisory staff to recognize the signs of domestic violence and to take threats and complaints at the workplace seriously;
• Utilize leave and benefit policies to accommodate affected employees' need for flexibility in their schedules;
• Discipline abusive employees who demonstrate violent behavior at work;
• Encourage employees to make use of employee assistance programs for counseling and referrals;
• Ensure that adequate levels of security are maintained in the workplace and that security personnel are provided with photographs or descriptions of an abuser;
• Relocate an affected employee to a safer work space, install a panic button or other security devise at the employee's work station;
• Encourage employees who are being threatened at work to let you know of the threat so that specific precautions can be taken to ensure the employee's safety.

The Takeaway:

• More and more employers are recognizing that the personal problems of employees, like domestic violence, can drastically affect job performance and, in turn, the bottom line. In addition to its economic ramifications, domestic violence can put other employees and management at personal risk when a perpetrator comes to the workplace searching for his or her intended victim. Watch the interactions between co-workers-nasty emails and inappropriate threats over policy enforcement may have been the missed signs at Yale. Unfortunately, these issues are more than an annoyance and can become serious.

And Now For Some Good News...

The 2009 version of the "Employer's Guide to Understanding Massachusetts Workplace Law," is now available. Simply click here to view and print the Guide. Workplace law continues to be dynamic, and we want to free you from the burdens and risks of deciphering extensive labor relations and employment law standards. We hope the 2009 edition of our Guide helps you identify potential legal issues before they arise and assists you in developing best employment practices.

You can reach us at 508-548-4888 or info@foleylawpractice.com.