Employment law horror stories

Learn from these bad office behaviors and management responses so that your company doesn’t make the same costly mistakes.
Lawfeature Issue 1

From the pages of In Business magazine.

Why do employers and employees make so many head-scratching or face-palm decisions in the workplace that affect employment and can potentially get them into legal hot water? With all the laws, rules, and regulations in place to prevent these missteps, why are businesses still making them?

Someone (though probably not the poet and playwright T.S. Eliot, even though the quote is often attributed to him) once said, “Most of the evil in this world is done by people with good intentions.” While perhaps not as colorfully stated, that’s the conclusion drawn by the employment law attorneys who shared some of their most unusual cases and the business lessons within.

“Having policies and procedures is necessary but it is not enough,” notes Jennifer Mirus, an attorney and co-chairperson of the Labor and Employment Law Group at Boardman & Clark LLP in Madison. “‘Horror stories’ continue to happen because we are all human beings, and human beings make mistakes. We all face a variety of stressors in our lives from many directions, and sometimes personal and professional struggles lead to serious lapses in judgment in our workplaces.”

“Employment laws are confusing, not intuitive, and always changing,” adds Leslie Elkins, a partner at Madison’s Kramer, Elkins & Watt LLC. “It’s easy to fall into a situation where a business owner believes it is in compliance with the law based on prior experiences or anecdotal evidence.”

When good companies go bad

We asked our employment law experts to share some memorable cases where employers or employees made some questionable decisions. Their stories have been edited to protect client identities, but the lessons they contain should be plain for all to see.

“We represented an employee who had been terminated while on medical leave under the Family and Medical Leave Act (FMLA),” recalls Colin Good, senior counsel at the Madison office of Hawks Quindel S.C. “During the course of our litigation, we discovered Slack threads between our client’s supervisors, who resided in North Carolina, that called into question her activities while out on leave. These activities included attending Packers preseason workouts with her young son in Green Bay.

“Unfortunately for the employer, you cannot discipline or terminate an employee who is out on medical leave, depending on the circumstances,” continues Good. “More unfortunate for the employer, you stand long odds of finding a sympathetic jury in Green Bay who will side with you
if your employees, who are vocal Carolina Panthers fans, are calling [former Packer] Eddie Lacy — and our client — fat over Slack threads. The case resolved prior to trial.”

In another case, Hawks Quindel represented a client who stood approximately 6 feet, 6 inches tall and weighed 400 pounds. The client had applied for a job that required him to wear a special insulated coverall so he could access refrigerated portions of the factory where he wanted to work. The employer refused to hire him because of his size, maintaining that the extra cost for an extra-large coverall was prohibitive. Unfortunately for the employer, explains Good, Madison has an ordinance that specifically prohibits discrimination on the basis of physical appearance. That case was also resolved prior to a hearing.

Not all cases are so easily resolved out of court.

“Early in my career, a small business owner engaged me to defend his company in a sexual harassment claim,” notes Troy Thompson, partner at Axley Brynelson LLP in Madison. “He was the only manager in the company and employed a small group of production employees who engaged in sexual banter in the workplace. He attended a business conference and was appropriately convinced that he needed to put an end to it. After informing his employees of the same, his only female employee approached him with a handwritten document entitled the ‘Love Contract’ and it stated that ‘[w]e the undersigned consent and agree that we may be engaged in rude, crude, and lascivious language at work.’” Shockingly, he and the employees signed it.

At some future time, the company discharged the female employee and she filed the harassment claim. “During my initial meeting with the owner, he disclosed the Love Contract,” Thompson recalls. “Suffice
it to say, I did not expect to see such a document! On one hand, it confirmed that the owner tolerated inappropriate harassing conduct in the workplace. On the other hand, it was evidence that some conduct was not unwelcome to the plaintiff, where the plaintiff had the burden of showing that the conduct complained of was unwelcome to her.

“Ultimately, I raised the Love Contract as a defense and it carried the day, resulting in a dismissal of the complaint,” says Thompson. “Although successful in that case, I do not advise any other employer to ever use any version of such an agreement. Instead, every employer has a duty to prevent and promptly correct any unlawful harassment.”

Another one of Thompson’s memorable cases involved a retaliatory termination claim by an employee who had an extra-marital affair with a woman he met on a website purportedly for married individuals looking for “discreet” affairs. Things did not go well for the employee, as the woman with whom he had the affair apparently became scorned and called his employer to claim that he brought her into the employer’s workplace and had relations with her there, notes Thompson.

“The employee initially denied bringing her into the workplace but later admitted he did so while continuing to vehemently deny having relations with her there,” Thompson explains. “The employer terminated the individual for his initial untruthfulness, but the employee claimed it was in retaliation for allegedly raising a safety concern about alleged stalker behavior by the scorned lover.”

Incredibly, the employee pursued a termination claim in federal court while trying to conceal from his wife the fact of his affair, Thompson adds. “Upon my attempt to subpoena his wife to deposition, the employee promptly dismissed his complaint. One of the takeaways here is that one cannot keep a personal matter ‘discreet’ by making it part of the public record in federal court litigation.”

Elkins of Kramer, Elkins & Watt says a common practice she sees among business owners is pulling employment contracts and handbooks off the internet and using them for their own business.

For example, Elkins had a client who came to her with an employee handbook to review. The client was a small business with about five employees and the handbook stated that the business would provide paid maternity leave pursuant to FMLA for all employees. FMLA requires compliance by private employers with 50 or more employees employed in 20 or more workweeks in the current or previous calendar year.

“So, my client with five employees with the FMLA language in its handbook would not be considered a covered employer and would therefore not be bound by the mandates of FMLA,” Elkins notes. “Yet, courts have found handbook language to be binding,” Elkins continues. “So, by placing the FMLA language in the handbook, my client was obligating itself to provide 12 weeks of paid maternity leave to all employees, regardless of tenure with the company, despite not being required to do so by law.”

Fortunately, the error was caught before anyone tried to cash in on the generous benefit and the handbook language was changed.

Elkins also says clients are frequently surprised upon learning that their “independent contractor” is actually an employee. “I have had several clients who believed that they engaged the services of an independent contractor to perform various types of work, and then lo and behold that client receives a notification from a government agency — most commonly the Wisconsin Department of Workforce Development’s Unemployment Insurance Division — alleging that back taxes and fines are owed,” says Elkins. “The clients are typically shocked when we speak, and state things like, ‘But I have a contract that says the worker is an independent contractor,’ or ‘But this is common in my industry.’ Just calling someone an independent contractor does not make them such, and likewise just because someone else in the industry is doing something one way certainly doesn’t make that action legal.”

Mirus of Boardman & Clark offers examples of what can happen when a manager says too much or doesn’t do enough.

In one case, a client had a remote office in another part of the state, she says. A female employee had a problematic performance history and was being considered for termination. One day, she arrived at her manager’s office, upset and on the verge of tears. She reported to her manager that a newly hired male employee had made an egregious sexual remark to her about her body and came toward her like he was going to inappropriately touch her. The manager, who was fairly new to his role and who had not had thorough anti-harassment training, told the employee he would ‘take care of it’ but did not immediately report the issue to HR or get any advice on how to proceed.

“The manager was particularly frustrated by the situation because it had just taken him over four months to fill the job with the newly hired male,” Mirus notes. “With these conflicting issues, the manager did nothing and hoped the issue would ‘blow over.’ The following morning, there was a regularly scheduled all-team meeting and when the female employee walked in, the only remaining seat was right next to — you guessed it — the newly hired male. As one can imagine, things did not blow over, legal claims were brought, and a difficult negotiation settled the matter.”

In another case, Mirus says a company was hiring for particular position. One of the job candidates shared in his interview that he had been absent from the workforce for some time due to health issues, but that those issues had been resolved and he was excited to formally get back to work. The hiring manager, who had not received training in equal employment and anti-discrimination issues, was gossiping in an open area about the candidate to her best friend at the company and jokingly stated that she was pretty sure that the health issues were mental-health issues. “The hiring manager did not realize that an employee sitting around the corner from where she was gossiping was the candidate’s next door neighbor,” Mirus adds. “The hiring manager was terminated, and the candidate was hired.”

Heed their advice

While the takeaways from the above stories should be obvious, our legal experts offer some more general suggestions to steer clear of dubious behavior.

“My best practical advice is to foster a culture of servant leadership where leaders are committed to the service of others and helping them accomplish their dreams,” says Thompson. “Leadership is personal, not positional. It doesn’t matter what one’s station is within an organization. Everyone has the ability to affect the organization’s culture and success. With one word, one can lift up or tear down, so lift up!”

For employees, know your rights, recommends Good. The Wisconsin Fair Employment Act prohibits employers from discriminating against employees on the basis of the following: age, arrest and/or conviction record, ancestry, color, national origin or race, creed, disability, genetic testing, honesty testing, marital status, military service, pregnancy or childbirth, sex, sexual orientation, and use or nonuse of lawful products off the employer's premises during nonworking hours. Furthermore, cities like Madison provide additional protections against discrimination on the basis of source of income, physical appearance, and homelessness.

For employers, advise your management and human resources employees about the various laws which may apply in Wisconsin or larger cities, Good adds. “Moreover, inform all employees that their use of work computers or devices may be monitored at all times,” he adds. “Don’t write something on a work computer or device you don’t want read in court.”

“Commit to excellence in everything you do and lead with integrity,” concludes Thompson. “Many small employers without a strong technical understanding of the law have avoided claims, despite being out of compliance with the law, simply by treating their employees with dignity and respect. Remember, integrity never had a bad day!”

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