Monthly Archives: August 2009

Protecting Your Company from Departing Employees

Termination

I may be naive, but I believe that most employees leaving one job for another want to leave in as amicable a way as possible. Most of them have no intention of stealing your trade secrets, unfairly competing against you or hurting your business in any way.

But then there are the other departing employees. They are the ones who take your customer preference lists, use your resources to set up a competing business, steal your trade secrets or sabotage your computer system as they leave. These are the bad apples that we have to address in non-competition agreements and confidentiality statements.

I think one of the most effective ways to protect your company from these pirates is to have a written policy explaining to your departing employees what is and is not proper behavior at the time of termination. You might want to include some or all of the following:

  • You may not take, copy nor provide to anyone outside of the company our list of current or prospective customers or [name other confidential documents];
  • You may not use our resources (computers, e-mail, telephones, offices, etc.) to start or run your own business or to aid or communicate with your new employer;
  • While you are still employed here, you may not encourage our customers, employees or vendors to end their relationship with us and join you in any new business or other company;
  • You cannot publicly announce your new position or business until you have left our employ;
  • You cannot remove files, manuals, papers or other documents from our premises if they belong to the company or address company business;
  • You cannot transfer any company information or data electronically to another employer or to yourself off premises or to any disc, flash drive, or other electronic storage device;
  • You may not delete, remove or destroy any data from the company computer system prior to your leaving your employment;
  • On your last day of work, you must return all keys, credit cards, laptops, cell phones, or other equipment that belongs to the company. You may request to remove personal information from this equipment under the supervision of a company representative;
  • If you have not already done so, you will be allowed to remove personal items from your office at a mutually convenient time after work under the supervision of one of our managers

This list certainly won’t address every way in which a departing employee may pilfer valuable information or equipment from your company, but it should get you started thinking about the problems you’ve had in the past which you would like to avoid from now on. If you have had more serious piracy in your workplace, such as the misappropriation of trade secrets or patented processes, you will want to consult with an employment attorney about an enforceable employment agreement that includes a noncompetition provision, as well as other protections for your intellectual property.

Keep An Employee Disciplinary Log

Discrimination,

In the May 2009 San Antonio appeals case of Cantu v. Frito-Lay, Inc., the employer beat a discrimination charge by a former employee because the company kept good records of the kinds of disciplinary action applied to employee misconduct and the reasons such actions were taken.

I often advise employers to keep a running log of each time the company issues a written warning, a suspension or a termination so that it is clear whether employees are being treated equally for similar misbehaviors. The Cantu case provides a good example of the importance of that information.

Kirk Cantu worked as a route salesman for Frito-Lay. He stocked bags of chips in HEB grocery stores. He was seen by a store employee tampering with the “sell by” dates on bags of chips that were later found to be stale. He was banned from servicing any HEB stores at the insistence of HEB, which led to his termination from Frito-Lay.

Cantu sued for gender discrimination, comparing his situation to that of Sandra Casso, a route salesman for Frito-Lay who serviced one HEB store. Casso was related to the store manager and told the store personnel that the manager was pregnant. The store manager asked that Casso be reassigned to another store, but did not want Casso reprimanded. Frito-Lay allowed Casso to bid on another route rather than terminating her employment.

Cantu claimed that he was treated differently than a similarly-situated female who had also been barred from servicing an HEB account, and therefore argued that he had been discriminated against on the basis of his age and gender (Cantu was 53 and Casso was under 40).

The Texas Supreme Court has previously ruled that to be a “similarly-situated” employee for comparison purposes in discrimination cases, the circumstances must be comparable in all material respects, including similar standards, supervisors and conduct. Therefore, the court said that not only does it have to examine the ultimate disciplinary action (both barred from servicing an account, yet one was fired while the other one wasn’t) but also the underlying circumstances.

In other words, to prove discrimination because of disparate disciplinary measures, the plaintiff has to prove that the misconduct he engaged in was nearly identical to that engaged in by a female that the company retained. Cantu was unable to demonstrate that Casso’s misconduct was nearly as serious as his, and therefore he was unable to demonstrate discrimination.

How does an employer assure that it can successfully defend such cases? By making and keeping very good records of the reasons that each employee was fired (or not fired) for misconduct and then showing the court that the employer has been consistent in applying disciplinary measures across all ages, races, genders, etc.

That requires a good log that each manager can access and review before deciding what disciplinary measures to take in an individual situation. If the log were to show that three people before were fired for lying on an application, then the manager would know that lying on an application is a firing offense.

However if the log showed that only the employees who lied about relevant past employment (by claiming experience they didn’t really have) had been fired, while those who lied about schooling (by claiming they had a high school diploma when they only had a GED) had not, the manager will have direction about which offenses are considered serious firing offenses and which are not as serious.

You can’t rely on all of your managers to know of or remember what disciplinary action was taken with each employee, or even the circumstances surrounding the misconduct. But it is easy enough to create a running log that each of them can access and add to as part of the normal disciplinary process. This simple step could assure a win if the company battles a claim of discrimination.