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Pro-Active Protections for Employers

October 1, 2002 Articles Litigation

While there has been a significant increase in employee lawsuits over the last 10 years, there are still various avenues of protection available to employers.

Agree in Advance Regarding Post-Employment Conduct. An employer and employee can agree in advance that an employee will not engage in unfair competition with the employer, solicit the employer’s clients, raid the employer’s workforce, or disclose confidential business information during or following employment. Such agreements may include any or all of these prohibitions and may vary in scope, duration and content. A properly prepared and executed non-compete, non-solicitation, non-piracy or confidentiality agreement is enforceable to the extent necessary to protect a legitimate business interest.

Avoid Punitive Damages and Create a Defense to Harassment & Discrimination. In 1998, the United States Supreme Court declared employers responsible for preventing work-related harassment and discrimination through policies, training and appropriate responses to complaints. The Court simultaneously pronounced protections for employers that take these preventative steps. Now, if an employer can demonstrate that it (1) has a well-drafted policy prohibiting discrimination and harassment, (2) ensures that each employee receives a copy of the policy, (3) provides appropriate training for management and employees, and (4) follows its policy, then the employer will have a complete defense to certain lawsuits by employees who have failed to report alleged harassment or discrimination. Further, an employer that makes such a good faith effort to prohibit harassment and discrimination would not be subject to costly punitive damages. Employers that do not comply with the Court’s dictate may be held liable for unreported harassment and discrimination and may owe punitive damages. Crafting the right policy and providing management and employee training sessions that promote internal resolutions rather than litigation are essential.

Avoid Unemployment Compensation Claims for Short-Term Employees. Employers with an appropriate written policy and a written pre-employment sign-off by employees can avoid unemployment compensation payments for employees who are terminated based on performance deficiencies during the 90-day introductory period.

Conduct Statutory Background Screening and Gain Presumption against Negligent Hiring. Florida law offers a “safe harbor” presumption that protects employers from negligent hiring lawsuits if the employers follow certain background screening steps. Negligent hiring lawsuits hold employers responsible for the intentional acts, including crimes, of their employees, even if those acts were outside the scope of the employees’ duties. If prior to hiring employees the employers conduct the statutory background investigations and the investigations do not reveal information that reasonably demonstrates the unsuitability of the employees, the employers are presumptively free of negligence.

The statute’s steps are: (a) obtain a criminal background investigation from the Department of Law Enforcement; (b) make a reasonable effort to contact references and former employers concerning the suitability of the applicant for employment; (c) require the applicant to complete a job application that includes questions concerning whether he or she has ever been convicted of a crime, details concerning the type of crime, date of conviction and the penalty imposed, and whether the applicant has ever been a defendant in a civil action for intentional tort, including the nature of the intentional tort and the disposition of the action; (d) obtain, with written authorization from the applicant, a check of the driver’s license record if relevant to the work; or (e) interview the prospective applicant. Despite the use of the word “or,” it is recommended that employers take all of these steps and document each step prior to hiring an employee. Some businesses and positions require additional screening.

We can provide additional information relating to these steps as well as the laws governing screening, hiring, interviewing, and characteristics that employers should not consider when making employment decisions.

Scrutinize Offer Letters and Agreements. Offer letters to applicants or new employees may constitute binding contracts of employment. All agreements, including offer letters, should be carefully drafted to provide for various contingencies and reviewed to ensure that the employer is not bound to promises it did not intend to make.

Designate Exempt vs. Non-exempt Positions. The Fair Labor Standards Act (FLSA) rules determine whether a position is exempt or non-exempt from the FLSA’s record-keeping, minimum wage and overtime payment requirements. Simply paying an employee a generous salary does not make the employee exempt or excuse the employer from the payment of overtime or keeping time records. Further, employers and employees cannot waive these requirements. Therefore, employers should ensure proper classification in order to avoid fines, injunctions from further violations, and suits for money damages for failure to comply with the FLSA. The Department of Labor website provides helpful compliance information.

Ask for Help. We provide clients management and employee training, agreement and policy preparation, human resources counseling, employment law compliance reviews, and other employer assistance in preventing and resolving employee disputes. In the event of litigation, we defend employers in all facets of employment litigation. We seek to prevent employee suits and improve management and staff relations.