Insider H.R. Tips From SHRM, The Biggest H.R. Conference in the Country

Inaugural Article
By Mary, the Undercover HR Director (“On Your Side” in the Forums”):

I’ll be writing articles periodically when I have news to share with you or an opinion on current events.  I recently returned from The SHRM® 2010 Annual Conference and Exposition, held in beautiful San Diego, California. I thought you might like some insight into what those dastardly Human Resource folks are cooking up. I attended the Conference in my “day job” capacity as a Human Resources professional, and as your Undercover HR Director.  But first – a question: What do you call one hundred HR professionals on the bottom of San Diego Bay? A good start! No, wait – that’s lawyers. Lawyers on the bottom of San Diego Bay! (Apologies to Curt)
A little background: SHRM® stands for Society for Human Resource Management,
and it’s the world’s largest association of HR professionals, with over 250,000 members
in more than 140 countries. There were over 11,000 attendees at this year’s 3-day
conference attending training sessions on everything from “Diversifying the Leadership
Bench: Maximizing the Potential of All Employees” to “Bullying and Workplace
Violence” to my personal favorite, “RETALIATION – Coming Soon to an Employer
Near You!!”.
I have to say that of the 200+ training sessions available, not one was titled “Betraying
your Employees: The Art and Science of Deception in HR” or “Effectively Padding
the Personnel File Without Getting Caught” or even “Making Employees Miserable
101”. You may not believe me, but 95% of the sessions were positive! They had titles
like “People Are Your Business!”, “Valuing Experience: Strategies for Employing the
Older Worker”, and “Creating a Culture of Engagement”.
I’ve seen it time and time again: HR pros attend training and come home with a wealth
of positive recommendations for making their organizations more “people-centered”.
Then they’re hit with the reality of their top brass pushing back, saying that – although
People Are Our Greatest Asset – we’re not really willing to invest the time and money
in ensuring that our people are protected from bullying, retaliation and other adverse
employment actions. The organization weighs the cost of defending against a lawsuit or
governmental agency investigation and decides it’s cheaper to fight than to do the right
thing in the first place.
Many times it simply begins with a poorly-trained supervisor doing the wrong thing with
a protected-class employee. Then the supervisor misrepresents the facts to HR, which
accepts the supervisor’s version without an in-depth investigation and goes along with
the supervisor’s recommendation to terminate or discipline. This is further compounded
when it’s learned that the supervisor lied or was mistaken and upper management
defends the supervisor and upholds the discipline, rather than doing the right thing and
reversing the bad discipline. And that’s how discrimination claims and lawsuits are born.
Very few cases begin with the HR professional and the supervisor deciding together to
deliberately discriminate against an employee.
Most folks go into HR with the best intentions – to help others. I didn’t speak to a single
HR pro at the conference who said his or her goal was to screw employees over – even
in jest. But they all admitted they had a difficult time balancing the pressures from their
top management with the needs and rights of employees. Trading off a larger paycheck
to move up the food chain isn’t an excuse to ignore employees’ needs and violate their
legal rights. A true HR professional is not only technically competent in the field, but
finds ways to stand up for employees’ rights. A true HR professional doesn’t sell out
his or her principles even when ordered by management to discriminate or retaliate
against an employee. I’ve been the victim of retaliation by my boss and her boss for
whistleblowing activities – and that’s why I’m your Undercover HR Director.
Stay tuned – in my next article, I’ll fill you in on the latest topics putting Human
Resources managers’ knickers in a twist. I’ll tell you what advice HR managers
have been given to investigate questionable FMLA claims – including surveillance
– and why your employer not consistently following its own policies benefits you.

mary@undercoverlawyer.com

The Abusive Boss Who Got Sued For “Negligent Infliction of Emotional Distress”

Have you felt emotional distress at work because of the abusive way your boss treats you? Many of the people who contact me for help in dealing with a bully boss feel this way, and they want to sue their boss in court for all the workplace abuse he or she has inflicted.

When someone like this tells me they want to sue, the first thing they say is that their boss caused “a hostile work environment.” (If you still think you can sue for a hostile work environment, you need to sign up for my 7 Free Work Law Secrets Email Course). The second thing people want to sue for is “intentional infliction of emotional distress.” This also rarely works, and I don’t advise pursuing it, but…

…but a women named Gina Strong in Washington State recently has some success suing her boss for negligent infliction of emotional distress. Because she also sued her boss for intentional infliction of emotional distress (and lost on that one), her story is a great example of what legal claims can work if you want to sue your boss and which legal claims don’t (usually) work. Having a boss who did more than just call her names is where Gina’s story starts.

Gina Strong’s Emotional Distress

Gina Strong worked in a school district print shop, where Jim Terrell supervised her. Terrell screamed at Gina every day. Terrell criticized her work in a sarcastic unprofessional manner. Terrell told blond jokes in Gina’s presence, and yes Gina was blond. Terrell even ridiculed Gina’s personal life: he made fun of her new house; he mocked her husband’s job; and he told her that her son would soon realize that she was a “bum” mother.

How did Gina respond to Terrell’s workplace harassment? She responded the in the same way as many of the people who are reading this article have have responded to their own abusive work environments: she vomited, she experienced anxiety attacks, she suffer from depression, and she even began to have a heart arrhythmia.

Gina went to the school district office and filed a harassment complaint against Terrell. A district office employee, Nichollet Koch “investigated” the allegations and found (like every other in-house investigation) that nothing Terrell did to Gina “rose to the level of illegal harassment.” In other words, the organization knew that Terrell was an abusive asshole, but it wasn’t illegal abuse. So, the school district didn’t punish Terrell. It “recommended” that Terrell take some classes to improve his “management style.” Gina was not satisfied.

After the district closed it’s file on the matter, something made the investigator, Koch, look further into Terrell’s behavior. Soon after the district office recommended that Terrell be terminated. Terrell resigned before that happened.

Three months after Terrell had resigned Gina filed a lawsuit against the district officer and Terrell as individuals (not as agents of the school district). Both defendants filed motions for summary judgment – which asks the judge to throw the case out before trial. The court did throw out the case, but Gina was not satisfied. She filed an appeal.

The Appeals Court considered whether Gina could sue her boss for Constitutional violations (the court said no), whether she could sue her boss for “intentional infliction of emotional distress” (the court said no again) and whether she could sue her boss for “negligent infliction of emotional distress” (the court said yes).

The Appeals Court noted that Gina did not allege that Terrell sexually harassed her, or that his conduct created a “hostile work environment based on sex”. Instead the court observed that “the majority of her claims related to Terrell’s method and style of supervision.”

Court Acts on Gina’s “Intentional Infliction of Emotional Distress Claim”

The legal claim of “intentional infliction of emotional distress” is a “tort” (which is not a dessert in this context). A “tort” is a civil wrong – as opposed to a criminal wrong. Torts come from the history of judges writing written decisions about why the judge decided in favor of one side and against the other side.

In the state of Washington, for you to prevail against your boss on the tort claim of “intentional infliction of emotional distress” (IIED for short) you must prove that:

1. Your boss engaged in extreme and outrageous conduct;

2. Your boss intentionally or recklessly inflicted emotional distress on you; and

3. Your boss’s outrageous conduct actually caused you to feel severe emotional distress.

The Washington State Supreme Court adopted these elements from a publication called the Restatement (Second) of Torts sec. 46 (1965). I’ll explain the Restatement more fully in another article, but for our immediate purposes all you need to know is that most states follow the Restatement; so most States, including your state, use the same three elements above for their tort of IIED.

Most people read the elements of IIED and think “Perfect! This is how I’m going to sue my boss!!” The elements seem to fit what their boss does to them. It just sounds right. Their boss purposefully puts them through hell, and they can’t sleep, feel depressed, suffer from anxiety, and begin getting ulcers.

The problem is, most of what your boss does to put you “through hell” does not meet the very high threshold of what it takes to qualify as “outrageous.” In Gina’s appeal the court decided that the first element of IIED, outrageous behavior, must be “so outrageous in character and extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.”

IIED, said the court “does not extend to mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities.” The court claimed to be sympathetic to Gina’s plight, but said that what her boss did was more in the vein of “insults” and “indignities” and did not cross the boundary into something “beyond all possible bounds of decency” and “atrocious”.

Victory! The Court Allows Gina’s Claim of Negligent Infliction of Emotional Distress

After dismissing her IIED claim, the court turned to Gina’s legal claim against Terrell for the tort of Negligent Infliction of Emotional Distress (NIED). This time, the Appeals Court decided that what Terrell did could possibly rise to the level of NIED, and therefore allowed Gina to take Terrell to trial on the NIED claim.

NIED is more often recognized in the workplace setting when “it does not result from an employer’s disciplinary acts or its response to a workplace personality dispute.” The elements of this claim are:

1. Boss had a duty to refrain from conduct that would foreseeably harm you;

2. Boss breached the duty of #1, and did engage in conduct that would cause you forseeable harm;

3. The boss’s conduct in #2 directly caused you harm

4. You actually were harmed (you are not exceptionally tough, and didn’t manage to shrug it off);

5. You have objective medical evidence that you experienced emotional distress (such as your doctor had to prescribe anti-depressants, sleeping pills, or high blood pressure medication).

In Gina’s case against Terrell, she claimed that he did the following things (#2) and had a duty not to (#1) which directly caused (#3) her actual harm (#4), and she also had seen a doctor who could verify her “emotional distress” harm. So, here are the acts that made up element #2, what the boss Terrell should NOT have done:

• He continuously made demeaning comments and jokes about her blond hair until she dyed it brown

• He mocked the house she purchased

• He mocked her husband’s job

• He called her a “bum mother”

• He spit in her face as he screamed at her for using the wrong bulletin board for union information

• He stood so close to her while screaming in her face that she feared he would strike her and felt his spit hitting her face

• He disconnected the telephone during the night shift so she could not call out of the print shop

Terrell tried to argue that these actions could not possibly amount to NIED, because they were all “workplace personality disputes” or were related to discipline in the workplace. The court didn’t buy that argument for a second.

The court pointed out that spitting in someone’s face can equal fourth degree assault. Making someone believe you are going to hit them can equal battery. Neither of these two things are a “mere workplace personality dispute.”

The court also pointed out that there was no way the boss, Terrell, could convince them that his comments were all work related. Terrell’s mocking of Gina’s personal life and taunts about her hair color were “rude, boorish, and mean-spirited and were not done in furtherance of legitimate work-related topics… Terrell’s conduct regarding [Gina's] personal life was not a workplace dispute, although it occurred in the workplace.”

The court then reversed the lower court, and ordered that Gina be allowed to go to trial in front of a jury on the NIED claim.

Undercover Lawyer’s Take Away Tips:

1. Don’t believe that you can sue a jackass boss for acting like a jackass by using “intentional infliction of emotional distress;” your best bet is, and always will be, to get yourself in a protected class.

2. You might be able to sue your boss for negligent infliction of emotional distress, but only if your state recognizes this tort and your boss is attacking you as a person and not as an employee.

3. Keep a journal, take notes, write everything down. It bears repeating that you need to keep dated quotes of what your boss says and does. To pursue an negligent infliction claim you will need to show that he or she lashed out at you in ways that are completely unrelated to workplace issues.

If you want to download the full case to read for yourself, or to highlight the NIED portion and hand to your HR Department when you turn in your own boss, you can view and print it here:

Does your boss attack you as a person, and not your work as an employee? Tell us about it in the comments section below.

Employment Law Academy Logo

I wanted to post a copy of the new logo for the Employment Law Academy, just to let everyone know that, yes, progress is being made!

You may also notice that the tag line “Join the Resistance” came straight from a forum member’s comment, which was something like “it feels like we all belong to the Resistance.”

Let me know what you think of it!

Does Your Abusive Boss Keep Notes About You Outside Your Personnel File?

Today’s post is an excellent question I received in the Undercover Lawyer Forum:

Question:

Answer:

One thing many employers often get wrong is what a “personnel file” is.  They think if an employee requests a copy of the personnel file, the employee only gets what is kept in a folder with “employee’s name” marked on it, and which is kept in a file drawer along with a bunch of other employees’ files.

Many employers mistakenly believe that if they keep documents about an employee’s performance some where else (like a “working file”, or in a notebook, or notes in an organizer) then those documents don’t really exist.  The employee is not entitled to those documents.

This is not correct.

If state law give you a right to a copy of your personnel file, then you get EVERYTHING that references your job performance — without any regard to where the documents are physically kept.  Formal personnel file, working file, wadded up notebook paper, post-it notes… it doesn’t matter!

If an employer denies that document outside of your personnel file exist and will not give you copies (even though you KNOW those documents exist), the your employer will not be able to use those ‘secret documents’ against you.

If your dispute with your employer goes to court and your employer continues to deny the documents exists, then your employer could face being sanctioned for discovery violations.  Such sanctions frequently include fines, prohibiting the use of the documents against you, and payment of some of your attorney fees.

Conclusion

Unless you have a witness who has seen the mystery documents, you may not be able to get those papers unless you go to court.  BUT, you will not have to fear those documents being used against you.  If your employer insists on keeping secrets about you, the court will deem those secrets to be non-existent.

Do you have a boss that keeps notes on employees and denies those documents exist?  Have you ever tried to get copies of your personnel files and been rebuffed?  Tell us what happened to you in the comments section below.

Avoiding the Axe (Pt. 1) — By Jenn S.

It is with great pride that I introduce a new attorney and columnist to the community of UndercoverLawyer.com.  Jenn S. is a small town employment lawyer who has been a big city employment lawyer, big corporation H.R. Rep, and for a time was even a rock music journalist!  She brings all these different backgrounds to her columns.

I met Jenn when we were both employed at a large law firm.  We’ve both since moved on to greener pastures (almost literally for her), but we’ve kept in touch due to a friendship forged in the trenches law firm life.  I’d say we both learned a LOT in those early years of our legal careers, but we’re both happy to be elsewhere now.

Jenn lives in a beautiful spot some where in the Mountain Time Zone; she has one young son, a husband, and a great sense of humor.  She’s worked in Human Resources for two gigantic national retail chains that you probably shopped at recently (Just today I was shopping in one, and drove by two separate locations of the other).

Jenn speaks in a casual, down to earth tone; you will enjoy her humor and her advice, which will be appearing twice each week here on UndercoverLawyer.com.  With that, Here is Jenn’s first article:

AVOIDING THE AXE: Part 1

As an HR professional and employment law attorney, I have heard more than my fair share of workplace nightmares. People are just going along, minding their own business when suddenly they are thrust into some horrific drama that ends in their termination – and they never saw it coming. The following tips are things that I have gleaned from experiences throughout my career and encourage all employees to follow them religiously. That is, if you want to stay employed.

DON’T touch people. This is almost always my number one tip when I conduct employee trainings. The rule goes for everyone but even more for the guys. Just don’t touch anyone – don’t pat on the back, or touch a waist, give hugs, massage shoulders, etc. Beyond the simple handshake, you should just avoid touching all together, if you possibly can. There are some nutty people out there who might interpret your supportive back patting as a come-on. Couple a few poorly-placed pats with one or two off-color jokes or emails and you might just find yourself fired for harassment, or at least accused and so mortified that you are forced to resign. If you MUST touch someone, touch somewhere very non-sexual – like the top of the shoulder. And don’t ever touch anyone’s hair – for some reason that is a particularly intimate gesture that people find invasive and just generally creepy.

DON’T get drunk at company events. If you tend to get a little “crazy” when you drink, you’d be better off just sipping ginger ale when in the company of workplace folk. Fun as it may be to go out and tie one on with the crowd, this is a danger zone, especially for women. A drunk woman is always viewed much worse than a drunk man – one might be amazed how quickly credibility and respect can disappear after a night of debauchery with the guys. Even more risky…if you get a little too “friendly” when you’ve had a few. Male or female – this is a veritable minefield that you should avoid at all costs. If you end up in bed with someone from work, you might as well start revising your resume because it will come back to haunt you and, depending on your position, it could cost you your job. Best advice – stay sober and you’ll stay hired.

DON’T get romantically involved with ANYONE from work. This tip goes hand in hand with the previous one. The best tip, really, is just to keep your sex life out of the office, period. Don’t mess around with anyone who is even remotely related to your workplace, be it a distant regional manager or your local union rep. Assuming the relationship does not result in matrimonial bliss (and chances are pretty high that it will not), you run many risks, including looking like the office tramp, being the focus of that nasty intra-office gossip, being accused of sexual harassment, or just being fired for acting, well…trashy. It can happen. I’ve seen it happen. So when it comes to work, just keep your pants on. There are plenty of people out there who are available for relationships that don’t work at your company. Find them.

DON’T utilize your work email or internet account as your own personal playground. Remember, those accounts do not belong to you – they belong to your employer. You should have no expectation of privacy. Your employer can read your emails and trace your internet activity all they want. So tempting as it may be to forward that sex-related joke or to visit questionable websites while you are on the clock, restrain yourself. You would be amazed at the seemingly innocuous emails that have landed people in the unemployment line.

DON’T be “best friends” with anyone at work. Another name for this tip could be “don’t trust anyone at work.” I hate to sound so negative because there are usually a lot of really good people in every workplace and we want to be able to trust people. But I learned this one by personal experience and was completely blindsided when my alleged “friend” threw me under the bus, so to speak. Generally, it is fine to have friendly relationships with people you work with but when you find yourself starting to really share your home life or your personal feelings about the company, the boss, or coworkers with another coworker – you are crossing into dangerous territory. Becoming too close to a coworker or supervisor leaves you vulnerable to attack should things suddenly go wrong. Keep your workplace relationships light – save the heavy stuff for your therapy sessions.

These are just a few of my best tips for avoiding trouble in the workplace and staying employed. Be on the look out for part two in the coming weeks – there are more pitfalls awaiting you!

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Questions for Jenn?  Have you seen someone torpedo their career with one of the foibles she mentions? Post your questions and stories in the comments section below.

10 Steps of Walking the Plank Toward Termination: STEP 4 Your Boss Switches From Harassing You In-Person to Harassing You In Writing

When your boss goes to Human Resources and asks “Can I fire this employee right now?”, do you know what the H.R. Rep always answers?  H.R. says, “What documentation do you have that shows your employee is not doing their job?”

You know what happens next?  Your boss looks down at his or her own feet, and their face starts turning red.  Then they look back up at the H.R. Person and say something like “Goddamnit, don’t we have at-will employment in this state?!  It used to be if someone didn’t do their job they got fired!  Plain and simple.  How come all you ever say is ‘no’?  Why don’t you ever help us get things done around here, instead of just putting up road blocks all the time?!”

The H.R. Rep responds to this tirade with something like, “I take it you have done no documentation of this employee’s performance? You know, like I taught all the managers to do in that little half day seminar last month?”

“I prefer verbal feedback and coaching.  The more informal type,” your boss says.  He’s referring to the last time he yelled at you.

“Well,” says the H.R. Rep, “did you document in your performance log the date and time of each of these verbal feedback and coaching sessions you had with your employee?”  The H.R. Rep says this with a slight grin, because they know what the answer is.

This is where your boss blurts out something like “F*ck! I’ll get your f*cking documentation,” and then stomps back to your department to start writing an email to you about your performance.  And the H.R. Rep?  This is when they cooly open a notebook and jot down the date and time your boss swore at them and admitted to not doing proper documentation.

Then the H.R. Rep calls a friend who is a H.R. Rep at another company.  They meet at a nearby Starbucks and sip lattes and complain about how everybody at their company hates H.R people.

Really, this is not an exaggeration.  Not at all.  This what happens between managers and H.R. Rep’s every single day, especially know that managers are under pressure to start cutting payrolls and reduce labor costs.

Watch for meetings between your boss and someone from H.R.  If you can see into the office, does your boss appear agitated?  Does the boss leave the meeting and immediately start writing?  And most important, does your boss send you a terse, or even angry letter about your performance soon after your boss met with H.R.?

These are all signs that your boss wants to let you go, and is trying to get it approved by H.R. first.

If you are not in a position to observe what meetings your boss has, and with whom, never fear.  There are other ways to tell.

• Does your boss send you emails, particularly about some aspect of you doing your job, with increased frequency?
• Does your boss send you a written memo about a deadline you missed (probably for good reason) instead of chatting with you and letting you explain?
• Does your boss ask you to sign or initial any memo that has anything to do with your performance, or any project you’ve been working on?

10 Steps of Walking the Plank Toward Termination: Step 2 You Have a New Supervisor

Note: If you missed Step 1 in this series you can read it HERE.

If a new supervisor takes over your department, brace yourself.  New supervisors change everything, and employees HATE that.

What you need to understand is that it is unthinkable to a new supervisor to not change everything.  A new supervisor feels like they need to PROVE that they were the right person for the job.  How do they prove it?  By making changes.

It doesn’t matter to your new supervisor that everything was working just fine, thank you very much.  Your new supervisor is going to make changes for change’s sake.  Your supervisor believes that their changes prove that they are making their mark, shaking things up, raising the bar, blah blah blah.

In your new supervisor’s mind, this is now their kingdom, their way of doing things, their staff, their leadership style, and it’s purpose is to demonstrate to the world that they are awesome.

If you are a man, image a new coach of an NFL team.  Is he going to bring in his own staff?  Is he going to run his own plays or the old coach’s plays?  The new coach is going to completely revamp everything and install his own system.  If the team then wins more games, it will prove that the coach and the coach’s way of doing things are better than the last coach, and the new coach gets all the credit.

What do you call a coach who doesn’t change any systems, uses all the same people, and follows all the plans of the former coach?  A place holder.  Coaches who change nothing are merely “place holders” in between the really high caliber coaches.  You know, the ones with “vision.”

I’m not saying your new supervisor is supposed to see themselves this way, or that it’s a good thing.  I’m not saying that you should accept all these changes; not at all.

I’m just trying to explain what’s going through your new supervisor’s mind.  This really is how they see themselves.

Now, my own spouse and my own mom don’t care much for sports analogies.  Some women do (which is cool), but to women like my spouse and mom, sports analogies just doesn’t make sense.  So I’ll use another example that won’t apply to all women, but might be more meaningful than a sports analogy (can you tell I’m trying hard to not be discriminatory?).

Pretend for a moment that you just bought a house.  Your new house is in a slightly better neighborhood, and is slightly bigger than your current house.  After you sign the loan papers and get the keys, you are free to make any changes you want.

Are you going leave all the same wallpaper that the previous owner put up?  Will you keep the same odd paint colors that the previous owner chose?  Are you going to arrange your furniture in the same pattern and places that the old owner put their furniture?

Of course not!  You want to leave your mark on the house, and make it into your home.  You want to “make it yours” by choosing your own colors, arranging your own furniture your own way.  What would you think of someone who moved into a house and didn’t change a thing?  You’d probably think they were incapable.

And that’s what your new boss is afraid of — appearing incapable of doing the job.  Being capable of doing the job (in their mind) means doing it their way, with their people, in their style, and measuring everyone according to their scale.

Again, I’m not saying your new supervisor should do this.  I just want to warn you; they will do it.  They actually believe that their success or failure as a supervisor depends upon whether or not they change things around.

A new supervisor means new standards, new procedures, new priorities, and probably more new faces.  Also, if you really got along well with your old supervisor, getting a new supervisor will be especially hard.  Your old supervisor knew you, trusted you, and let you do the things you are good at.

Your new supervisor doesn’t know you, doesn’t trust you, and wants you to do the things that will make him or her look good.  And those tasks may NOT be the things you are good at.

If you start to feel or see this kind of conflict, beware.  Especially if you’ve had a few run-ins with your new supervisor, and then he or she begins referring fondly to people from their former organization.  If that happens I guarantee that your new supervisor is thinking about bringing people from their old company over to the new company, your company, and giving those people your job.

New Supervisor = Warning, changes on the way

New Supervisor + Conflict = Red Alert, discipline on the way

New Supervisor + Conflict + Comments about former coworkers = terminations on the way

Have you ever dealt with a new supervisor, or seen one change everything — even though the old way was working?  Tell us about it in the comments section!

The Dumb Money is Betting On Sunny Skies

FRIDAY UPDATE: “The U.S. lost more jobs than forecast in August and the unemployment rate climbed to a five-year high of 6.1 percent, a sign that the economic slowdown is worsening.” (Full Article).

“Foreclosures accelerated to the fastest pace in almost three decades during the second quarter as interest rates increased and home values fell, prompting more Americans to walk away from homes they couldn’t refinance or sell.”  (Full Article).

Betting on Sunny Skies?

If you need a job in order to pay your bills, this isn’t the best of times.  Today the federal Labor Department announced that unemployment claims increased more than the “experts” had expertly predicted.  Other cheerful facts about the state of the U.S. economy:

• Unemployment rolls are at a five-year high
• 3.4 million Americans were collecting unemployment last week
• U.S. companies cut 33,000 jobs in August, 2008.
• Today’s Dow Jones average plunged 340 points, sending the S&P 500 into it’s longest losing streak since January.
• Wall Streeters are starting to talk about a “financial tsunami.” (Full Article)

Now if you’re like me, you have about $1.27 invested in stocks, bonds, and mutual funds.  So what does all this Wall Street hand-wringing matter to people with microscopic portfollios?

WHY DOES WALL STREET MATTER TO NON-WALL STREET PEOPLE?

It matters because these hand-wringing wall street types are the ones who say “Ford could save a Gazillion dollars by laying off 3/4 of their work force.”  And big industrial companies listen to Wall Street.  And then every day working people start getting “non-retained.”

The extra hand-wringing today, Thursday, is because tomorrow the Labor Department announces the August employment report.  Before today, the expectation for the August Employment report was glum.  After today’s news the outlook is more akin to economic suicide.

One report ended with this sunny summary: “Households may cut spending as employment prospects dim, property values decline and credit becomes harder to get.” (Full Article)

IF YOU HAVE A JOB, NOW’S THE TIME TO KEEP IT

Protect your job from desperate bosses and harassing managers who want to appear cost conscious by finding any excuse to cut people from your organization.  Sign up for my 7 part mini-course and you’ll receive 7 work law secrets via email, all of them straight from my authoritative eBook, “Work Laws Exposed.”  Sign up in the green box on this page.

Go To Trial or Settle Your Case?

Whether or not to take a case to trial, especially an employment case, can be a gut wrenching and life changing decision.

Make the right decision, and you vindicate yourself, prove your boss wrong, and walk away with two or more years’ worth of wages in your pocket.

Make the wrong decision, and you spend $15,000 in costs (not the attorney’s fee, but the attorney’s trial expenses), and you walk away with nothing to show for it besides 2-4 wasted years of your life.  And a gloating ex-boss.

So, it’s obviously a HUGE decision.

That’s why I want to tell you about how the decision to go to trial was studied by scientists, and what they found out about what is usually the right decision, what what is usually the wrong decision.

There article is from the Journal of Loss Prevention, and like most information about going to trial, it’s written for employers (who can pay scientists to study things for them).  But, there’s lots of good info here for employees — and even some good news about employment lawsuits in particular (see highlights).  Here’ the piece:

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NEW STUDY CAN HELP YOU DECIDE WHETHER TO GO TO TRIAL

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A new study of civil claims between 2002 and 2005 finds that most plaintiffs who go to trial instead of taking a settlement offer end up with less money than if they had taken the settlement offer.

According to the study, the plaintiff made the wrong decision by proceeding to trial in 61 percent of the cases. Defendants made the wrong decision far less often – 24 percent of the cases. Jonathan D. Glater, “Study Finds Settling Is Better Than Going to Trial,” The New York Times (Aug. 8, 2008).

Commentary and Checklist

Whether an employer is on the plaintiff side in a lawsuit or the defense, the vast majority of cases do settle; estimates put the number between 80 and 92 percent.

Deciding to go to trial comes with a hefty price tag if the decision results in a loss. On average, getting it wrong cost plaintiffs about $43,000 and, although wrong less frequently, defendants paid a much greater price when they erred: $1.1 million.

This study is the largest of its kind to date and examined trial outcomes over a 40-year period – although the data for the losses was only from 2002 through 2005. The research shows that over time, poor decisions to go to trial have actually become more frequent.

There are a variety of reasons why an individual or an organization may refuse to settle a lawsuit. One reason is that they may not fully understand the chance and consequences of a loss at trial. Another is that, emotionally, they may not want to let go of the fight – no matter what the consequences.

Interestingly, plaintiffs are more likely to roll the dice and go to trial when they have hired an attorney on a contingency fee arrangement. In other words, if there is no monetary settlement in the plaintiff’s favor, the plaintiff does not pay for the lawyer’s services.

Missing from the survey are the costs and fees associated with going to trial. In some instances, the fees and costs associated with trial may exceed the verdict.

In the employment context, plaintiffs are more likely to find a jury that identifies with them (most jurors are or were employees); therefore, less risk is involved when employers settle with plaintiffs/employees so long as they do so quickly before expenses and emotions spiral out of control. To that end, here are some things to consider:

Take your emotion out of the decision on whether to settle or try a case. You should make a business and not an emotional decision.

When considering the costs of going to trial, make certain that you add fees and costs.

Your time and the time of your people responding to discovery requests and attending depositions should also be considered when deciding to extend litigation.

Make certain that your attorneys continually communicate with the plaintiff or their attorneys. Good communication and professional demeanor will always allow for a better settlement offer.

When mapping your defense, make certain that settlement is always an option and that settlement is explored as early as possible before fees begin to escalate.

This informational piece is part of “The Loss Prevention Journal” published on August 18, 2008.

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Notice the figure of $43,000 if a plaintiff loses at trial?  I think that’s high, but not totally unrealistic for an employee-plaintiff in an employment lawsuit.  Usually the plaintiff-attorney absorbs a large portion of those costs.

However, if you are considering hiring an attorney to take your case against your employer, YOU MUST CHECK WHO PAYS COSTS, especially if you lose.  If you win, costs are just deducted from the winnings.  If you lose, it can empty your savings, your retirement, even sap away your home equity.

The final nugget in this article I want to comment on is the portion about how some people may not want to settle because they don’t want to let go of the fight.  How likely would you be to fall into that trap?  How likely would your BOSS be to want to keep fighting because they like to fight?

Please tell us if you have seen any of these happen at your own work, whether to yourself or to people around you who took on the company — how did the managers react?  Did the case settle or go to trial?  Or, are you trying to hire an employment attorney?  What traits are you looking for?

-Curt K (The Undercover Lawyer)

Bad News: No Home Sales = No Emergency Cash

Why are people so concerned about their jobs right now?  Because they see the “For Sale” signs going up all around them — and they know the reason is because these neighbors can’t afford their mortgages any longer. Billionaire investor Warren Buffett said Friday the economy continues to be in a recession, by his definition, and will continue to be for at least several more months. (Full Article Here.)

U.S. Fed Chief Ben Bernanke said Friday that “the financial storm that reached gale force” last year “has not yet subsided, and its effects on the broader economy are becoming apparent in the form of softening economic activity and rising unemployment,” . (Full Article Here.)

That certainly appears to be the case in my own neighborhood.  I live in a sub-division that was built five years ago.  There are far more homes for sale right now than any time in the prior five years.  And all those homes are staying on the market longer. With few of any signs displaying “Sold” across the top, families like mine can no longer easily access their equity which serves as the emergency fund for so many people who live without the fat savings accounts that financial magazines breezily discuss — as if everybody has one.

The truth is that most people, myself included, make money from working at my job.  The only other way I “make” money is through the appreciation of my home.  Now, with home appreciation cut off, I have to rely more than ever on my job.  And I know I’m not alone in worrying about keeping a regularly paycheck coming in for my family, because more people than ever ARE losing their jobs.

The U.S. Dept of Labor announced that “Year-to-date layoff figures in 2008 were the highest January-July totals since 2003.”  The region that suffered the most was the Midwest, followed by the South and West.  All areas suffered, just to a lesser degree. The largest economy in the west is California, and that state recorded the highest number of initial unemployment claims filed due to mass lay-offs in the month of July with 33,250 people out of work, largely due to layoffs in administrative and support services and in educational services. The next highest numbers of mass layoff claims were in Michigan (27,672), Ohio (19,402), and Kentucky (11,907). (Full Article Here.)

The Overland Park, Kan.-based firm, the local-phone service provider in 18 states.  And what does it blame these problems on? The slow down in housing, just like everyone else.

People are worried because they are awake and listening, and they see what their neighbors are going through. With most people unable to access the equity in their homes, the regular paycheck becomes the sole and crucial source of income. Now more than ever it’s important to protect your job with every tool available. For example, you can increase your education, so that you offer more skills to your employer.  Or, you can simply work harder and more efficiently, so that management views you as an indispensable part of the company machine. Some people, however, are in a situations where the boss or manager are already deciding who to let go; you may not have time to increase your skills through education or make a new impression through working harder. If you are in the latter case, it’s important that you maximize all the legal protections the law gives to employees. Even “At Will” Employees can protect themselves at work through the use of protected classes.  To learn more about protected classes and how anyone can qualify for their protection you can read my free 7 Part Report on the Secrets of Work Law.  Part one comes to you immediately, and all you have to do is sign up with your name and email address in the green box at the top of this page. My next post will address how supervisors and managers are themselves feeling the stress of the economy; bookmark this page and return Wednesday to learn more about how to respond to the economic stress that your own boss feels.

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