Category Archives: Termination

(Out of date) Noncompete Agreements Banned as of September 4

Forms and Policies, Hiring, Noncompete, Termination, Trade Secrets, , ,

Update: Almost immediately after this post went live on August 20, 2024, a federal judge in Texas issued a nationwide injunction striking down the FTC’s noncompete ban. So much for my effots to try to help employers get into compliance before the deadline! So the FTC’s ban on noncompetes is blocked for the foreseeable future. As an employer, you don’t have to send the notices mentioned below. For now, you can still enforce a current noncompetition agreement against a former employee who takes a job with a competitor or sets up a business that competes with yours. However, it would be wise to consider other ways to protect your business’s trade secrets and work product because noncompetes will continue to remain controversial and the subject of a lot of expensive litigation in the future.

As I warned you in June, earlier this year, the Federal Trade Commission issued a rule banning employee noncompete agreements. The noncompete ban goes into effect on Wednesday, September 4, 2024. Despite many pending lawsuits, no nationwide injunction has been entered yet that protects employers from this ban. So now is the time to get into compliance.

What Agreements are Banned?

The noncompete ban prohibits employers from offering or requiring employees to sign any new employment agreement on or after September 4 that restricts the employee from competing with the employer when employment ends. In addition, the FTC rule prohibits employers from enforcing noncompete agreements that are already in effect.

The FTC final rule defines a non-compete clause as “a term or condition of employment that prohibits a worker from, penalizes a worker for, or functions to prevent a worker from” seeking or accepting employment or operating a business after the conclusion of the worker’s employment.

You are allowed to require your current employees to be loyal to their employer and not compete while still working for your company. But that duty of loyalty can be explained in a policy in the handbook, rather than in an agreement that requires additional legal consideration (usually monetary) and agreement of both parties.

There is one notable exception to the FTC noncompete ban. As an employer, you cannot enter into a new noncompete with a “senior executive” beginning on September 4, 2024. But existing noncompetes with senior executives can be enforced after the deadline. The FTC’s final rule defines “senior executive” as a worker who (1) earns more than $151,164 per year, and (2) is in a “policy-making position.”

Send Required Notice to Former Employees by September 4

Perhaps the most urgent part of the FTC rule is the required notice regarding the noncompete ban that you as an employer must send out. Before September 4, employers are required to send out a notice to anyone who has previously signed a noncompete that is now unenforceable (former employees) to let them know that the agreement is unenforceable.

Continue reading (Out of date) Noncompete Agreements Banned as of September 4 →

How Employers Can Do Everything Right

Discrimination, Documentation, Litigation, Management, Termination, Training, , , ,

University Medical Center in Lubbock won a big victory in an age discrimination case by doing everything right (suggesting to me that they followed the advice of their employment lawyers). Employers can learn eight important lessons from the Fifth Circuit Court of Appeals decision issued in the case of Salazar v. Lubbock County Hospital District d/b/a University Medical Center (opinion issued December 7, 2020).

Age discrimination cases are difficult for employers to win because the elderly make very sympathetic plaintiffs and the judges and jurors themselves are often older. But this case gives a blueprint to managers of how to dispassionately and carefully handle the termination of a poor-performing employee.

The allegations that plaintiff Rosemary Salazar asserted in this case sound really bad for the employer in an age-discrimination claim. Salazar had worked at the hospital for 27 years before she was fired in 2017 for poor performance and failure to change her behavior. She was 57 years old at the time of her termination and alleged not only was her firing discriminatory, but also that the same supervisor in her department fired three other long-time employees who were over the age of 60.

Salazar also claimed that she had been given good performance evaluations and that she had “received numerous raises for her job performance.” Finally she said that the employer did not follow its own progressive disciplinary policy in terminating her.

How did UMC manage to get a win the summary judgment motion and the appeal in this case? In a word: documentation.

Continue reading How Employers Can Do Everything Right →

Can an Employer Require COVID-19 Vaccinations of Employees?

Discrimination, Medical, Personnel Policies, Termination, , , , ,

Vaccinations for the COVID-19 virus began to be administered here in Amarillo for the first time on Tuesday, December 16, to hospital workers, and now employers are asking if they can require their employees to get vaccinated when vaccines become available to more of the public.

In general, the answer is, yes, an employer can require employees to get vaccinated in order to provide employees and customers a safe environment. Medical and dental offices, schools, food production facilities, nursing homes and other high-risk workplaces will likely mandate vaccinations for their employees. But should other employers require COVID-19 vaccinations?

Duty to Provide a Safe Workplace

A Texas employer currently can legally require vaccinations to provide a safe workplace for their workers. No Texas law prohibits this. As for the relevant federal agencies, the Occupational Safety and Health Administration requires employers to provide safe workplaces. And the Equal Employment Opportunity Commission has just indicated in new guidance that it will not object to employers mandating vaccinations.

OSHA’s general duty clause requires that each employer furnish to its employees a workplace that is free from recognized hazards that could cause death or serious physical harm. A fully vaccinated workplace could provide that safety to your employees. And that mandate could protect you as an employer from federal intervention with the new administration in Washington, D.C. Employers can expect increased enforcement by OSHA under the Biden administration, so mandatory vaccinations will give your company a defense to any allegation that you did not make your employees safe from the recognized dangers of COVID-19.

The EEOC has recently issued guidance supporting mandatory vaccination. In new Equal Employment Opportunity Commission guidance on vaccinations released December 16 (question K5), the EEOC says that an employer can impose on its employees “a requirement that an individual shall not pose a direct threat to the health or safety of individuals in the workplace”.

Disability and Religious Objections

Texas employment is generally “at will”, meaning among other things, that an employer can set its own policies and an employee who does not like those policies can quit. Under current Texas law, that holds true with mandatory vaccinations, as long as Texas employers carefully handle two types of legal objections—disability and religious accommodation.

On Wednesday, the EEOC issued specific guidance about vaccinations at work (section K). As expected, the EEOC says that employers will be allowed to mandate COVID vaccines, with those two exceptions: (1) religious objections (Christian Scientists and some branches of Islam come to mind) under Title VII based on a sincere religious belief; and (2) disability (such as Guillain-Barré Syndrome) under the Americans with Disabilities Act.

Being an anti-vaxxer is not a religion, so that belief will not be enough to claim an exemption. Courts have confirmed in the past that social, political or economic philosophies are not protected under Title VII protection of religion, so unless an employee has a sincere religious objection or a legitimate disability, you don’t have to accommodate an employee’s failure to cooperate by allowing him/her to opt out of the vaccinations.

You do have to be careful as you address religious or disability objections to vaccination. The EEOC wisely points out in its new guidance (question K5):

Managers and supervisors responsible for communicating with employees about compliance with the employer’s vaccination requirement should know how to recognize an accommodation request from an employee with a disability [or religious objection] and know to whom the request should be referred for consideration.  Employers and employees should engage in a flexible, interactive process to identify workplace accommodation options that do not constitute an undue hardship (significant difficulty or expense). 

Continue reading Can an Employer Require COVID-19 Vaccinations of Employees? →
Employees and Covid-19

Ten Ways to Get Sued by Employees During a Pandemic

Compensation, Discrimination, Documentation, Employee Rights, Medical, Personnel Policies, Termination, , , , , , , , , ,

Even though the idea has been in the news recently, at the current time there is no absolute liability immunity for Texas employers from COVID-19-related claims made by employees who are exposed to the virus in your workplace or otherwise harmed during the pandemic. You can be sued for many different legal failures as an employer during this crisis, so you should know what the law expects of you right now.

The law firm of Fisher Phillips is maintaining a fascinating database of COVID-19-related cases filed so far in 2020. Their database shows that 38 COVID lawsuits have been filed in Texas for claims such as unsafe workplaces, discrimination, paid leave violations, retaliation and even wrongful death. I have no doubt those claims will continue to increase as employers struggle with all of the safety guidance and other rules burying them during this crisis.

I’ve narrowed the possibilities of a Texas employer getting sued during this global pandemic down to these ten mistakes:

Continue reading Ten Ways to Get Sued by Employees During a Pandemic →

Supreme Court Outlaws Discrimination Against LGBT Employees

Discrimination, Documentation, Employee Rights, Hiring, Personnel Policies, Termination,

The United State Supreme Court ruled today in Bostock v. Clayton County that employers may be sued for sex discrimination by LGBT employees under Title VII of the Civil Rights Act of 1964. This opinion resolves a long-time disagreement between the various federal circuit courts and unwieldy patchwork of laws that had protected LGBT employees in some states but not others, and Texas cities like Austin, Dallas and Houston, but not Amarillo.

The Court combined three cases, one in which a male county employee was fired for conduct “unbecoming” a public employee when he joined a gay softball league, one in which a private employer fired an employee just days after he mentioned he was gay, and one where a funeral home fired an employee who presented as male when hired, but later stated that she was going to live, dress and work as a female going forward.

After reviewing each of these job terminations, the Court decided 6-3 in an opinion written by Trump-appointee Justice Neil Gorsuch that an employer who fires an individual based in part on being gay or transgender (and by natural extension, bisexual or lesbian) violates Title VII’s prohibition on discrimination on the basis of sex. “An employer who fires an individual merely for being gay or transgender defies the law”, Gorsuch wrote.

The Court pointed out several important rules for employers to know (these apply to any discriminatory job decision, whether it is based on race, age, national origin, disability, religion, etc.):

Continue reading Supreme Court Outlaws Discrimination Against LGBT Employees →

Firing For Abortion is Discrimination

Discrimination, Employee Rights, Termination, , ,

Since abortion laws are such a hot topic right now, employers should be warned: firing a woman for obtaining an abortion is discrimination.

The Pregnancy Discrimination Act (“PDA”), which amended the federal discrimination law, Title VII, prohibits employers from taking adverse action against an employee “because of or on the basis of pregnancy, childbirth or related medical conditions”. The EEOC and the courts who have examined this question agree that this definition includes protection for women who chose abortion.

The Equal Employment Opportunity Commission guidance on the PDA states as follows:

Title VII protects women from being fired for having an abortion or contemplating having an abortion. . . . Title VII would similarly prohibit adverse employment actions against an employee based on her decision not to have an abortion. For example, it would be unlawful for a manager to pressure an employee to have an abortion, or not to have an abortion, in order to retain her job, get better assignments, or stay on a path for advancement.

While our Fifth Circuit Court of Appeals has not ruled on this question, the most recent court to examine this issue is a federal district court in Louisiana, which answers to the Fifth Circuit. In Ducharme v. Crescent City Deja Vu, LLC (E.D. La. May 13, 2019)(emphasis added), last week the judge plainly stated:

[A]n abortion is only something that can be undergone during a pregnancy. Title VII requires that “women affected by pregnancy, childbirth, or related medical conditions shall be treated the same for all employment-related purposes.” 42 U.S.C.A. § 2000e(k). A woman terminated from employment because she had an abortion was terminated because she was affected by pregnancy.

The judge in Ducharme found support for this decision in two earlier appellate cases. Doe v. C.A.R.S. Prot. Plus, Inc., 527 F.3d 358, 364 (3rd Cir.), order clarified on other grounds, 543 F.3d 178 (3rd Cir. 2008) (“Clearly, the plain language of the statute, together with the legislative history and the EEOC guidelines, support a conclusion that an employer may not discriminate against a woman employee because she has exercised her right to have an abortion. We now hold that the term ‘related medical conditions’ includes an abortion.”); Turic v. Holland Hosp., Inc., 85 F.3d 1211, 1214 (6th Cir. 1996) (“Thus, the plain language of the statute, the legislative history and the EEOC guidelines clearly indicate that an employer may not discriminate against a woman employee because ‘she has exercised her right to have an abortion.’).

There is another important lesson in this case besides understanding that abortion cannot play any role in an employment decision. The lesson for business owners, managers and supervisors is to think before you speak and keep your strong opinions about sensitive topics like abortion out of the workplace.

Even though the judge’s opinion acknowledged that a woman choosing abortion is protected under Title VII, the ex-employee in Ducharme did not prevail on her claim against her employer in part because she failed to demonstrate that her employer actually fired her for the abortion instead of the on-the-job drinking. A significant part of the court’s reasoning was based on the fact that the employer who did the firing, Ms. Salzer, did not actually demonstrate an anti-abortion bias:

Perhaps most fatal to plaintiff’s pregnancy discrimination claim, however, is the complete absence of any support for any alleged anti-abortion animus by Ms. Salzer. Here, it is uncontroverted that Ms. Salzer had never said anything about abortion or religion to Ms. Ducharme at any time during their 18-month relationship. Ms. Ducharme does not dispute that when she informed Ms. Salzer that she was planning on undergoing an abortion, Ms. Salzer did not attempt to talk her out of it and did not say that she disapproved of the decision. There is no evidence that prior to that, Ms. Salzer had ever said anything to suggest to Ms. Ducharme that she would disapprove of the abortion. Ms. Salzer had never said anything political about abortion. Ms. Ducharme did not think of Ms. Salzer as religious.

So the employer did not:

  • Say anything about abortion or religion to Ms. Ducharme at any time during the 18 months Ms. Ducharme worked there;
  • Try to talk Ms. Ducharme out of her decision to have an abortion;
  • Express disapproval about Ms. Ducharme’s decision;
  • Generally talk about her religious or political views in the workplace.

Consider how differently this case could have gone if the employer was a known abortion opponent who lectured his/her employees on the evils of abortion, strongly objected when an employee asked for time off for an abortion and then fired that employee soon thereafter. That employer’s words and actions on this sensitive medical, religious and political issue would definitely come back to bite the employer in a discrimination case.

Or consider the flipside. What if the employer were very strongly in favor of abortion rights and did not want a top-performing female employee to lose any work time to pregnancy and a maternity leave? That employer’s statements encouraging the employee to end the pregnancy “for the good of the business” and to increase the employee’s chances of advancement could also be strong evidence in a pregnancy discrimination case.

The lesson is that your workplace is not the right place for a boss to pontificate on religious and political hot topics. As an employer, you can be you without hostility or stridency towards who your employees are or what they believe. Successful leaders create more welcoming, tolerant workplaces and give fewer lectures.

Four Steps to Protect Your Company’s Secrets When Employees Leave

Documentation, Forms and Policies, Hiring, Termination, Trade Secrets, Training, , , , ,

What can you do to protect your company secrets when Angela, your vice-president of sales, announces she is leaving your company and going to work for your competitor? Is there a way to keep Angela from telling her new employer all about your customers’ preferences, your company’s proprietary pricing, or the new business line you are exploring?

Truthfully, the day Angela announces her resignation is way too late to adequately protect your company’s most important secrets. Your efforts to safeguard your formulas, recipes, passwords, marketing plans, customer lists or other information you would like to keep confidential should have started before Angela was even hired.

There is no time like the present to begin taking at least four concrete actions if you value your business secrets:

  1. Physically protect your confidential information. Remember the urban myths that the secret recipe for KFC chicken or the formula for Coca-Cola were locked in a safe somewhere in company headquarters? According to Fox News, those are actual precautions taken by these companies. “The recipe [for Coca-Cola] lies in a vault in a downtown Atlanta SunTrust Bank vault and only two executives at a time have access to it.” As for KFC: “’Colonel Harlan Sanders’ Original Recipe eleven herbs and spices are inscribed in pencil on a yellowed piece of paper inside a Louisville, Kentucky safe’, says KFC spokesman Rick Maynard. ‘The safe lies inside a state-of-the-art vault that is surrounded by motion detectors, cameras and guards.’” Corporate espionage and theft of trade secrets is big business these days. These two food companies are serious about safeguarding their trade secrets. Are you as careful with yours?
    1. Do you at least have good password procedures, firewalls and cyberthreat protection, files marked “confidential”, inventories of your laptops and other equipment, and limitations on which employees have access to the keys to your business kingdom?
    2. Do you teach your new employees what information is confidential, how to protect it, remind employees frequently about their confidentiality obligations, and take immediate action if there is any breach in confidentiality?
    3. Do you prevent employees from downloading company documents onto flash drives or leaving the premises with your files?
    4. If you don’t take serious measures to protect your trade secrets, you really shouldn’t expect your current or departing employees to care either. Plus, the new Texas Uniform Trade Secrets Act doesn’t even recognize information as a trade secret unless the owner can demonstrate that the business has taken reasonable measures to keep the information secret. So without active measures to protect the secrecy of your proprietary information, you are helpless in the courts when your secrets are stolen.

Continue reading Four Steps to Protect Your Company’s Secrets When Employees Leave →

What Can I Say? Giving References in Texas

Discrimination, Hiring, Termination, ,

Just when you thought you’d heard the last of Fired Felicia, you get a call from Felicia’s prospective employer, who is diligently checking Felicia’s references. What can you as an employer in Texas legally say about Felicia?

Employment lawyers like me have been telling employers for years to remain close-lipped, giving only dates of employment, job title, and last rate of pay. Safe, but almost deceptive in its reticence. We advise this taciturn approach because of our fear that you will say too much and say something defamatory.

Why do I have that fear? Because in a small city like Amarillo, or really anywhere in West Texas, we spend a lot of time on the other end of the reference spectrum. Instead of reticent, we are gleefully chatty.

Hiring managers around here will pick up the phone, ask for their friend who works at Felicia’s last employer, and find out all about Felicia’s problem pregnancy, Felicia’s attitude problem, or Felicia’s suspected but unconfirmed alcohol dependency. That’s when my head explodes as an employment lawyer who is trying to keep the company out of legal hot water.

The rules of references must be one of the most misunderstood areas of human resources. But in Texas, it really shouldn’t be that hard. Here are some simple guidelines: Continue reading What Can I Say? Giving References in Texas →

10 Facts Texas Employers Should Know About Unemployment

Compensation, Forms and Policies, Litigation, Personnel Policies, Termination, , ,

Do I have to pay unemployment on my employee who just quit/resigned/got fired/was laid off?

During most of my thirty years as an employment lawyer, I have been asked that question at least once a week. Here are ten basic facts that every employer in Texas needs to understand about our state’s unemployment system: Continue reading 10 Facts Texas Employers Should Know About Unemployment →

Transgender Woman Protected From Sex Discrimination, Court Decides

Discrimination, Employee Rights, Litigation, Termination, , , , , ,

The U.S. Sixth Circuit Court of Appeals ruled last month that Title VII of the Civil Rights Act of 1964 prohibits an employer from discriminating against a transgender woman “on the basis of sex” and also ruled that the supervisor’s belief that gender transition “violates God’s commands” is not a defense to employment discrimination.

The Sixth Circuit, which decides federal cases brought in Kentucky, Tennessee, Michigan and Ohio, reviewed the firing of Aimee Stephens from her job at a funeral home in which she had originally worked as a male in the case of EEOC v. R.G & G.R. Harris Funeral Homes (U.S. 2018)

After she was diagnosed with gender identity disorder, Stephens told her boss, Thomas Rost, that she was planning to transition to female. Her boss fired her. Rost stated during the lawsuit that he terminated Stephens’s employment because “he was no longer going to represent himself as a man” and that a person’s sex is “an immutable God-given fit”.

The Sixth Circuit decided, like the Second and Seventh Circuits (covering New York, Vermont, Connecticut and Illinois, Indiana and Wisconsin, respectively) before it, that a company violates an employee’s civil rights if the employer fires that worker on the basis of sex, including sexual orientation and gender identity.

The funeral home where Stephens worked hoped that its termination of her would be protected by the Religious Freedom Restoration Act and the U.S. Supreme Court’s case of Burwell v. Hobby Lobby (U.S. 2014).

However, almost three decades ago. the U.S. Supreme Court had already rejected the argument that a supervisor’s religious squeamishness was sufficient to overcome the civil rights laws. The United States Supreme Court ruled in Employment Division v. Smith (U.S. 1990) that a person may not defy neutral laws of general applicability even as an expression of religious belief. “To permit this,” wrote conservative Justice Antonin Scalia, “would make the professed doctrines of religious belief superior to the law of the land, and in effect to permit every citizen to become a law unto himself.”

Despite this long-standing Supreme Court precedent, the funeral home argued that the presence of a transgender employee would require Rost to leave his job, because forcing him to work with a transgender person was an infringement of his religious rights and also would “often create distractions for the deceased’s loved ones”. Continue reading Transgender Woman Protected From Sex Discrimination, Court Decides →