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Legal tests for various employment law issues. Prepared for final examination in 2006 based on Rothstein & Lieban, Employment Law 5th ed.
Quick List for Final Exam AT-WILL PRESUMPTION RULE: “If you have a hiring for an indefinite period of time, the employment relationship is terminable at will be either side.” BOP is on party seeking to prove something other than an at-will relationship EMPLOYEE v. INDEPENDENT CONTRACTOR -right to control test -economic dependence/realities test -hybrid test I. Common Law TEST: "right to control" test: whether employer retains the right to control the manner and means by which the work is accomplished a. court looks to who controls the employee b. if not an employee, then you are independent contractor This test is best for Rs because is most restrictive and therefore is more likely to find that worker is an Ind K. This test is normally used in: CL cases: tort, contract Money cases: ERISA, tax Labor cases II. Factors in the right to control test from the Restatement of Agency: a. extent of control which the parties agree the employer may exercise over the details of the work; b. whether or not the worker is engaged in a distinct business or occupation (i.e., has his own business); c. whether, in the locality, the work is usually done under the supervision of the employer or by a specialist without supervision; d. the skill required (the more skill needed, the more likely you are independent k) e. who supplies the instrumentalities, tools and workplace 1; f. length of employment (if short, then independent k); g. method of payment, whether by the time worked [employee] or by the job [independent k]; h. whether or not the work is part of the regular business of the employer (if special job, then independent k); and i. parties subjective understanding of the relationship 1 this is a big factor for the courts III. "Economic dependence/realities" test: is the worker ultimately economically dependent on the business? More employee-friendly test; therefore use when repping E. When do the courts use this test: wage and hour claims FLSA2 Factors: a. nature [how?] and degree [when?] of control retained or exercised by the company; b. opportunities for profit or loss [entrepreneur vs. employee]; c. investment by worker in facilities and equipment; d. specialized skill required; e. degree of permanency of the work; and f. how integral are services to the company's business? IV. Hybrid test: i. judges pick and choose factors from each of these tests in order to decide when someone is an employee TRANSFORMING THE AT-WILL CONTRACT: Written/Express & Implied 1. Make it for a term 2. Make it for cause a. The “cause” must be an objective standard that could be measured by a judge and jury. b. A subjective standard (eg, “acceptable sales performance”) is too vague and may shift through time Written/Express Contracts Letter stating: you keep your job if x, y, z Oral agreement between R and E Employee manual Implied-in-Fact Contracts (argue straight oral K first, then move to IIF argument) Factors to look at for an implied term: o Personnel policies and practices o Longevity of service o Communications by R concerning the employment o Practices of the industry 2 Prof: one can argue that the economic realities test is not broad enough for FLSA claims. Because FLSA was passed to be very broad, one can argue that the test is not protective enough to vindicate the policy of FLSA. FLSA states that to employ means "to suffer or permit to work." Thus, if you permit people to work on your land, but don't direct them, you still might be under FLSA!! Prof reiterated this. Thus, if a person has the power to stop people from working, then maybe he is an employer. Contra: its in the statute, but no courts have used it, they have always done economic realities test. Challenges to existence of IIF Contracts: o Are the terms of the R communications clear and definite? o Lack of independent consideration? o Lack of mutuality o Statute of Frauds? does this type of contract fall under the statute of frauds? i.e., Ks that theoretically can't be performed in one year or less.3 if yes, are the writing requirements met? in writing signed by the parties o Parol Evidence applies to both oral and written communications when you have consummated a contract, then you can't introduce evidence of prior or contemporaneous communications (subsequent communications always come in). Must meet certain factors: o when does statement/writing occur?4 o what does statement/writing say? (if it doesn't have to do with a term of the contract, then parol evidence doesn't apply)5 o is the contract integrated? (i.e., do parties intend the contract to be full representation of their agreement?) If partially or fully integrated, then no contradictory terms can come in; however, sometimes explanatory evidence can come in. four-corners rule reasonable expectation of the parties rule (look for merger clause) TORT CLAIMS AGAINST EMPLOYERS -Wrongful discharge in violation of public policy -Finding/Defining a public policy: 1. clear, findamental, establish (usually in a statute) 2. must effect society at large 3. is the remedy precluded by an applicable statute? Or can it be brought along with a statutory claim? 4. tort must occur at DISCHARGE, not at another time -Benefits: -can sue employer with any number of employees -get 2-year tort sol 3 e.g., lifetime contract not within statute of frauds because party could have died; but a contract that says "employment for two years," the term is definite and despite possibility of death, the contract falls within the statute of frauds. 4 Prof: statement/writing means that the info could be oral or written 5 key: parol evidence applies when attempting to contradict a term of the contract -Wrongful discharge where “freedom of expression” is the public policy at issue -majority rule: infringement of 1st Amend rights can only be brought in context of public employment -minority rule: permits 1st Amend claim to be brought against private R -elements of claim in either context: 1. does speech prevent R from efficiently carrying out its responsibilities? 2. does speech impair E’s ability to carry out his own responsibilities? 3. does speech interfere with essential and close working relationships? 4. does manner, time, and place in which the speech occurs interfere with business operations? -Intentional Infliction of Emotional Distress -elements: 1. R acted intentionally or recklessly 2. conduct was extreme and outrageous 3. actions of R caused E emotional distress 4. emotional distress suffered was severe -NB: this is about the MANNER in which E fired, so even if fired for just cause, E may still have an IIED claim -Negligent Hiring -elements: 1. R owed a duty of reasonable care to 3d party 2. R breached that duty 3. breach was cause of harm to 3d party 4. 3d party suffered damages -KEY: was there a DUTY? -Two factor test: 1. what are the circumstances of the particular job? 2. was the harm foreseeable? -Jobs where harm foreseeable and so duty to check background: 5. transportation jobs 6. meter readers, exterminators, people getting into homes 7. people who work with children 8. people who work with public (eg, hotel emp) -NB: negligent hiring covers intentional torts; therefore, -R can be liable for out-of-work acts, unlike under respondeat superior -Negligent References -elements: 1. duty to disclose 2. breach 3. harm 4. damage -Majority Rule: absent special relationship, NO DUTY to disclose negative information -Minority Rule: duty to disclose if you start talking. -elements of duty under minority rule: 1. foreseeability of reliance and foreseeability of harm a. esp with facts showing a violent predisposition of employee 2. moral blame of Defendants 3. availability of alternative course of conduct 4. public policy considerations -Pre-Employment Screening Violations -if questions are protected under Const or statute, then R cannot ask them -examples: -religious beliefs -sexual preferences -R may ask questions in those areas ONLY if R has: 1. a compelling interest; AND 2. have a nexus with job description -Medical Questions and Genetic Testing -Genetic Testing not regulated; use ADA analysis -Medical Questions vary by stage of employment: 5. Preemployment (102(d)(2))6—most restrictive stage a. no medical exam b. no inquiries about disability i. not to worker, friends, insurers, etc ii. no question that would "likely elicit information about a disability" 1. e.g., "How many days of sick leave did you take last year?" is a prohibited question 2. but, "How many days off did you take last year?" is permitted 3. Can ask about illegal drug use; but cannot ask about taking prescription drugs. c. may ask if applicant can perform job-related duties (e.g., can you lift 50 pounds?) i. you can also ask applicants to demonstrate the ability to perform the task, but you must ask all applicants to do the performance test d. drug tests are permitted 6 long cite: 42 usc 12112(d)(etc) 6. Post-offer, pre-placement (102(d)(3))—employee entrance exam a. no you can ask any questions of the employee you want b. medical exam7 permitted if i. all employees are subject to the exam; ii. results are kept confidential; and iii. results used only in accordance with ADA 1. i.e., can only use if show that the employee cannot perform the essential job functions even with reasonable accommodation 7. Post-placement (current employees) (102(d)(4)) a. if the question is not likely to reveal a disability, then you can ask it.8 However, if it is likely to lead to discovery of information, then . . . i. NB: if a test is voluntary (i.e., get a cholesterol test if you want), then the test is valid b. medical exam and inquiries permitted if only if: i. job-related9 questions; and ii. it is a business necessity -Monitoring Es at work: Intentional Intrusion Upon Seclusion -elements; 1. must be an intentional intrusion a. majority rule: any sort of entry b. minority rule: some sort of physical entry 2. E had a reasonable expectation of privacy a. Did E receive advance notice b. How was R’s policy disclosed c. Did E consent d. Who owns equipment accessed? 3. Intrusion was highly offensive to the reasonable person a. Manner of intrusion b. Reason for the intrusion TORT CLAIMS AGAINST EMPLOYEES -Duty of Loyalty Breach -elements: 1. must be currently employed by R at time of alleged breach 7 known as an "employee entrance exam" 8 I.e., first step is to determine whether a prohibited question was asked. 9 This tends to be the inquiry where the action; it is normally easier to make the business necessity argument 2. E competes with R concerning the subject matter of his agency during his employment a. Examples: i. Starting a new business that competes with R ii. Stealing customers while still employed iii. Stealing coworkers while still employed -Noncompetition Agreements, Breach of -elements: 1. is the contract enforceable at all? a. Restraint is no greater than needed: i. Duration ii. Geographic schope iii. Activity restricted not overly broad b. Is R’s interest in the prohibition outweighed by the hardship to E? c. Any state law overlay? i. Oregon: permits at time of hire and promotion ii. California: never permits 2. if enforceable, should a negative injunction issue? a. Sliding scale: i. Likely success on the merits & legal remedies inadequate; OR ii. Serious questions of law as to who will prevail & substantial likelihood of irreparable harm -Trade secrets disclosure -elements of the Uniform Trade Secrets Act: 1. Do we have a trade secret? a. Has value derived from not being known by others b. Party seeking to protect it has taken reasonable efforts to preserve secrecy of information 2. Was the secret misappropriated? a. Suing downstream user (ie, another company) i. New user knew or should have known that the trade secret was acquired by improper means b. Suing the E who misappropriated: i. Disclosure or use of trade secret without R’s consent; and ii. E used improper means to get it; or iii. E should have known he acquired the secret under circumstances giving rise to a duty of secrecy; or iv. E acquired info by accident, but should have known it was a trade secret DISPARATE TREATMENT McDonnell Douglas Framework E proves prima facie case Member of a protected group Qualified for job Suffered adverse employment action Circumstances give rise to an inference of discrimination R produces legitimate, non-discriminatory reason E maintains the burden of proving R’s reason is a pretext for discrimination Price Waterhouse Framework E proves prohibited reason was motivating factor for employment decision R may reduce damages (but not liability) by proving R would have taken the same action anyway HARASSMENT BURDEN: Quid Pro Quo R is strictly liable Hostile Work Environment (Harassment from Public) E proves that harassment was severe and pervasive (subjective and objective see p. 33) such as to alter the terms and conditions of employment E proves R knew or should have known of the misconduct AND R failed to take immediate and appropriate corrective action once prove harassment, do analysis of who was harasser Supervisor/Non-Supervisor Harassment Standards Supervisor is harasser: R maintains burden of showing exercised reasonable care to prevent and correct promptly sexual harassment AND E unreasonably failed to take advantage of corrective measures Coworker/Customer is harasser: E bears burden of proving R knew or should have known of the misconduct AND R failed to take immediate and appropriate corrective action Constructive Discharge Standard Where E shows that there was a hostile work environment and then quits, claiming constructive discharge, E must show that: o Conditions became so intolerable that a reasonable E in P’s shoes would have felt compelled to leave DISPARATE IMPACT BURDENS E demonstrates that a business practice causes disparate impact on protected group Burden of persuasion shifts to R to demonstrate job-related and consistent with business necessity Burden of persuasion shifts to E to demonstrate the existence of an equally effective test that has smaller impact on protected group Opposition/Participation Prima Facie Case E participated in Title VII proceeding or opposed unlawful practice of R; R knew of the opposition/participation; E suffered adverse employment action; AND Causal connection between treatment and opposition/participation giving rise to inference of discrimination Burden shifts to R to Articulate a legitimate, non-discriminatory reason for adverse action Ulitmate burden shifts to E E then must show this was a pretext and real reason was opposition/participation in Title VII claim
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