Monthly Archives: September 2017

Does the First Amendment Apply at Your Company?

Does the First Amendment protect an employee in Texas, allowing him to say whatever he wants on the job–to take a knee in protest, to write a manifesto about how women don’t belong in the tech sector, or to tell the CEO of his company to “kiss my a—, Bob”?

Not a chance. The First Amendment to the Constitution of the United States of America says:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

By prohibiting Congress from passing laws that abridge freedom of speech, the Constitution did not limit a private sector employer’s right to fire an employee (on the other hand, government employees have some First Amendment protections).

In addition to no constitutional bar, businesses in Texas are protected because Texas follows the “at will” employment rule, meaning a private employer can fire an employee for a good reason, a bad reason or no reason at all, including firing an employee because the employer didn’t like something the employee said, either out loud or symbolically.

So, if Jerry Jones had decided to fire any Dallas Cowboy who kneeled during the National Anthem before the Monday Night Football game, the First Amendment would not have protected the player. Neither would Texas law. Interestingly, Jones came up with an inoffensive compromise by encouraging his players to kneel before the anthem to protest racial injustice and even kneeling with them. By the time the anthem played, the whole team was standing in unity, with arms locked together.

Google also was unhampered by the First Amendment when the company fired an employee in August for writing a manifesto blasting Google culture of diversity. Particularly, the employee argued that women occupied fewer leadership positions in the tech industry because of unsuitable personalities. For example, he said that women are more anxious, and therefore unable to handle the stress of high-powered leadership positions. He concluded that efforts by Google to place more women in technology and leadership were “unfair, divisive, and bad for business.”

However, the First Amendment’s application is not the end of the inquiry. There are other laws besides the First Amendment that an employer has to consider (in consultation with the company’s employment lawyer) before firing an employee for expressing herself.

  • Is the employee’s speech related to the employee’s religion? Employers even in the private sector cannot discriminate on the basis of religion and also must accommodate a person’s religion. The discrimination laws always trump the “at will” rule.
  • Is the employer allowing one group to express themselves but not another protected class? For example, if only African-American players for the Dallas Cowboys had kneeled during playing of the Star-Spangled Banner, but some white players failed to put their hands over their hearts, Jerry Jones may have faced a racial discrimination lawsuit if he had fired only the kneeling players for disrespect.
  • Are you punishing any employees for speaking a language other than English at work? For safety or productivity purposes, there may be a limited way in which you can do this during actual work time, but it is a very tricky area of the law and you don’t want to attempt this without serious consultation with your employment attorney.
  • Is the employee complaining about a safety violation, a crime or other public policy matter? In that case, there may be whistleblower statutes that protect the employee.
  • Is the employee expressing problems with wages, hours, shifts, policies or other terms and conditions of employment with other employees? Then the National Labor Relations Act may prohibit you from firing the employee because she is participating in “concerted activity” under this labor statute, even in a non-unionized workplace. This is what happened with the coal miner who sent a paltry bonus check back to the CEO with the words “kiss my a–, Bob” on them. A court made the coal company return that employee to work after he was fired, because his protest was protected concerted activity involving his pay.
  • Texas employers are prohibited from taking adverse action against an employee based on who the employee voted for or for refusing to reveal how he or she voted. Employers must allow employees time off to vote and to take leave to attend a local or state political convention and cannot threaten or retaliate against the employee for such attendance.

Interestingly, there are times when an employer almost has no choice but to fire an employee for expressing himself. For example, if an employee is sexually harassing another employee with lewd comments, suggestive emails and/or pornographic pictures, the hostile environment the harasser is causing with his words and actions may require the employer to fire him after completing an investigation, both to protect the company and the victim.

Employers Must Use Revised I-9 Form Beginning September 18

The very important I-9 form, which verifies a new employee’s identity and eligibility to work in the United States, has been revised again. Employers must start using the revised form on September 18, 2017.

The revision, marked “07/17/17 N” and carrying an expiration date of 08/31/19, has to be completed only by new hires. You do not have to go back and get all of your current employees to recomplete an I-9 just because the form changed after their hire date.

Employers must complete an I-9 form on each new employee within 3 days of hiring. This process started in 1986 as part of the Immigration Reform and Control Act, which prohibits employers from taking on a new employee without verifying the employee’s identification and eligibility to work legally in the United States.

The verification is done by reviewing the employee’s identification and employment eligibility documents, such as a passport, a permanent resident card, or a driver’s license and social security card, and completing the I-9 form. There is a very helpful employer’s guide available online that shows you what a valid document is supposed to look like. Doing your due diligence requires that you consult that guide each time you look at a new employee’s documents.

Because of the views of the current administration, employers can expect an increase in enforcement of immigration laws, including more frequent ICE audits of your I-9 compliance. There are expensive penalties if you as an employer cannot produce accurately completed I-9 forms for each of your current and former employees.

The minimum fine is $216 per error on an I-9 and the maximum is $2,156 per error (including current employees and former employees) for each paperwork violation. That means that a single I-9 form which has multiple errors could cause the employer to be responsible for multiple penalties per form. If ICE determines that the employer has failed to accurately complete I-9s on at least 50% of its employees, the maximum fine of $2,156 will be levied on the employer for each form.

You must keep an I-9 form on every active employee as long as the employee works for you. For a terminated employee, you must be able to produce an I-9 for three years after the hire date or one year after termination, whichever is later. To make it easier to remember, most employers wait to purge I-9 forms until three years after an employee’s termination.

Typically, when ICE appears for an I-9 audit, they will require that you produce I-9 forms for each current employee and any employee terminated in the last three years. You are given 72-hours’ notice to pull all of these forms together, which is why many employers store the I-9 forms together rather than in each employee’s individual file.

Six Steps to Preventing and Reacting to Employee Embezzlement

This week’s local headlines involve the city manager of Sunray, formerly the police chief and city manager of Panhandle, being accused of employee embezzlement. Rob Roach was arrested this week after an investigation by the Texas Rangers for alleged theft by a public official of property between $30,000 and $150,000.

I have no idea about Mr. Roach’s guilt or innocence, but the news did remind me about one of the most disappointing things about my 30 years of law practice in Amarillo, Texas–the large number of times I have had to help an employer who has been ripped off by a trusted employee.

I have seen employees use company credit cards for personal purchases (how many law firms need to be buying diapers at Sam’s?), steal cash paid by a patient for a medical visit, forge signatures on checks made out to the employee (one trusted employee did this while her boss was undergoing chemotherapy), turn in fictitious business expenses, and create false company payrolls or bank accounts.

Unfortunately, employee embezzlement is not unusual in our area, but it is often preventable. We Texans tend to be trusting people, but you wouldn’t just leave the front door to your house open with a sign pointing out where you keep the good jewelry. As a business owner or manager, you should be just as wise about protecting your business and your livelihood from thieves.

Here are six steps that you can take to help curb any embezzlement by your staff:

  1. Set the tone. Do you as a business owner or manager demonstrate integrity in how you do business? Your employees are taking their cues from you. If you cheat on your taxes, overcharge your customers or rip off your suppliers, don’t be surprised if your employees begin to feel that they are entitled to cheat you as well.
  2. Hire well. If an employee is going to be handling money in your business or given a company credit card, be sure to do a criminal background check (following all the Fair Credit Reporting Act requirements for doing so). Check all of the applicant’s references and past employers, asking specific questions about the potential employee’s integrity.
  3. Reduce the opportunity for theft. Guard which ones of your employees will have access to company goods and cash. Protect your keys, passwords, and access to your checks, your online banking and all accounting records. Use the built-in protections of your software. Quick Books, for example, will allow you to set up limited access for certain functions so that no employee has free rein with all of your bookkeeping. Require weekly or monthly balance sheets, budgets and profit and loss reports and study them carefully. In addition, train yourself to use your accounting program so you can randomly double-check things yourself.
  4. Utilize more than one person for the bookkeeping. You should have checks and balances in place, such as having a different person sign the checks than the one who printed them. If your customers pay in cash, your system for receiving the deposits, writing receipts, and reconciling the cash to the accounts must be clear and followed religiously. Cross-train more than one person for each job so that there is someone always available to audit the other’s handling of the money. Take a cue from banks, which often require their financial personnel to take vacations lasting at least one week so that another person can review the absent employee’s money-handling and lending procedures during that break.
  5. Watch employees who are at risk. Triggers such as gambling, addiction and family stressors often proceed employee theft. You must be aware of what is going on in your employee’s lives outside of work if you want to prevent misconduct inside of work. Also, keep in mind that many of your employees have financial problems every day, even without specific triggers. It is just a fact that Americans tend to live beyond their means. Providing free financial education and guidance may not seem like your job, but it could prevent an employee’s desperate attempt to embezzle from you.
  6. Consider surveillance of your workplace. While audio recordings create potential federal wiretapping issues, you can always install video surveillance of your workplace. You can also search employee emails and physical surroundings, like desks. Of course, you need to talk to your employment lawyer before starting these activities to get the proper consents and notices and make sure you are not violating privacy rules, but if you believe some surveillance or searching is the best way for you to protect your property, you should explore this option.

Despite all precautions, you may someday suspect that an employee has embezzled from you. If you are unfortunate enough to be ripped off by an employee, here are the six steps to reacting to the theft:

  1. Internal investigation. You can put an employee you suspect of embezzlement on a suspension while you investigate. Get help from your employment attorney as you gather documents and talk to coworkers so that you understand exactly what happened and how much was stolen.
  2. Confront the employee. Before you fire the suspect, have a face-to-face meeting with the employee to allow the employee to explain, if possible. If the evidence still demonstrates that the employee is guilty, then talk to the employee about a confession (in writing) and repayment of the debt. Once caught, some employees are ashamed and cooperative. However, do not block the employee from walking out (you will be accused of false imprisonment) or defame the employee by sharing information about the theft with those who have no pressing business need to know.
  3. Fire the employee. Don’t worry about a wrongful termination suit or unemployment claim. Clear evidence of theft by the employee is one of the strongest defenses to any kind of legal complaint by a former employee. However, be very careful about deducting your losses from the employee’s final paycheck. The employer has the burden to demonstrate that the employee is personally and directly responsible for the theft before the deduction can be taken, so make sure your evidence is solid.
  4. Alert your insurance company. Most business insurance policies include an employee theft provision. You may be able to recoup some of your losses with insurance. File a claim with the insurance company and provide it with the evidence. Just understand that often the insurance company will insist that you also involve the police.
  5. Prosecute the theft. Your insurance company may require this before reimbursing you for your losses. More importantly, you need to prosecute to prevent the employee from doing this to another employer. Getting away with a theft once makes it more likely the employee will steal again.
  6. Analyze and correct your procedures. Do a deep dive into your security vulnerabilities that led to the embezzlement. Did you allow one person too much access? Were you sloppy with your checks and balances? Did you fail to review your credit card statements? You need to understand why this happened and how to prevent it in the future.