Are Employee Text Messages Private?

Last week the U.S. Supreme Court unanimously ruled, in City of Ontario v. Quon, that the search of a police officer’s government issued pager, without a warrant, did not violate the Fourth Amendment. This case arose after a police department audited the text messages a police officer was sending and receiving on his pager. The department wanted to determine whether the per month character limit was sufficient to handle work-related messages. The officer was reprimanded after the audit showed that he was sending and receiving racy text messages on his department issued pager, while on duty.

In fearing that a broad ruling “might have implications for future cases that cannot be predicted,” the Court did not issue a “broad holding concerning employees’ privacy expectations vis-à-vis employer-provided technological equipment.” Rather, the Court’s ruling was narrow as it refused to decide whether the officer had an expectation of privacy. Rather, they assumed that there was an expectation of privacy in order to determine that the search was reasonable.

Despite the fact that Quon involved a government search on a government employee (with the resulting Constitutional issues), and the Supreme Court did not address the question of whether an employee has a reasonable expectation of privacy, employers can still take guidance from the case. Private employers should be aware that the Court noted that the search of the officer’s phone would have been “reasonable and normal in the private-employer context” because there was a legitimate reason for the search and “the search was not excessively intrusive.”

Given the rapid advances in technology and the proliferation of social media, employers should consider what extent they have the right to check on their employees’ communications. Companies should develop specific policies on employees’ use of computers, smart phones, and other devices owned by the employer, or in connection with work.

This article was written by Michael K. Hayes, Legal Clerk at Demorest Law Firm.

Court of Appeals Erodes Worker’s Compensation Exclusive Remedy Provision

The Michigan Worker’s Disability Compensation Act  (WDCA) was created in order to ensure that employees injured on the job would receive compensation for their injuries, while at the same time protecting employers from tort liability. An injured worker must generally pursue compensation through the worker’s compensation system, rather than in tort. Essentially, both employer and employee trade the uncertainty of recovery in a tort action for the certainty of a worker’s compensation claim. Moreover, the employee may still sue other, non-employer parties such as the manufacturer of a machine that caused the injury. This is a very high standard. Negligence—even gross negligence—is insufficient to hold the employer liable.

The only exception to this rule allows an employee to recover damages from the employer if the employee can prove that the employer committed an intentional tort. In order to prevail, the employee must prove the employer acted deliberately, and with intent to cause an injury. Intent to injure will be imputed to the employer if the employer (1) had actual knowledge that an injury was certain to occur and  (2) disregards that knowledge.

In a recent Michigan Court of Appeals decision (Click Here to See a Copy of the Court’s Decision), the court ruled that liability for an intentional tort may exist where “the employer subjects an employee to a continuously operative dangerous condition that the employer knows will cause an injury, that it knows employees are taking insufficient precautions to protect themselves, and that the employer takes no action to remedy the situation.” This case presented a unique situation where multiple injuries occurred, management knew of the injuries, solutions to preventing injuries were discussed, and no changes were made. This created a “certainty of harm” because the employees had no effective means of protecting themselves from injury.

The Court of Appeals, in noting that the employers could have prevented the injuries by adopting some remedial safety equipment, seemed to adopt a negligence standard. Had the employer taken certain safety precautions it would not be open to liability. Only time will tell whether this case  is the first step toward judicial erosion of the prior strict interpretation of the exclusive remedy provision.

This article was written by Michael K. Hayes, Legal Clerk at Demorest Law Firm.

Can An Employer Fire An Employee By Accepting a Resignation?

The Michigan Court of Appeals recently issued an opinion that will make employers think twice about resignation procedures for employees. In Robbins v. Sault Ste. Marie Tribe of Chippewa Indians (Click here for a PDF of the case), an employee had a written clause in her contract that she would receive two years’ salary if she were fired. The employee gave the employer two weeks notice of her resignation. After giving her employer notice, but before she could serve those two weeks, she was fired. The employer did not believe she should be entitled to the two years’ salary since she had already given her resignation notice. The Court disagreed with the employer and ruled in favor of the employee, and awarded her $204,576 in severance pay. In its decision the Court stated, “Where an employer terminates employment prior to the effective date of resignation, in the absence of a contractual provision allowing the employer to do so, he employment was terminated by the employer, not by the employee’s resignation.”

In order to avoid situations similar to the one above, employers should do one of the following: (1) Allow the employee to work through the resignation date; (2) Continue to pay the employee through the resignation date, but tell them that they do not need to actively work during this period; or (3) Add provisions to employment contracts or the employee handbook stating that after receiving an employee’s notice of resignation with a future effective date, the employer may  accept that resignation effective immediately.

This article was written by Mark S. Demorest, Managing Member of Demorest Law Firm.

COBRA Coverage and Termination Due to Gross Misconduct

Under The Consolidated Omnibus Budget Reconciliation Act (“COBRA”), employees and their families are not entitled to COBRA coverage under the employer’s group health plan when an employee is terminated for “gross misconduct.”  There will be no qualifying event under COBRA unless the voluntary or involuntary termination of employment is for reasons other than gross misconduct.

However, the term “gross misconduct” is not specifically defined in COBRA or in regulations under COBRA. Therefore, employers should be very cautious about withholding COBRA benefits when an employee is terminated for misconduct.  Whether a terminated employee has engaged in “gross misconduct” is a determination for the Courts and will depend on the specific facts and circumstances of the situation.  Employers should be aware that there can be serious consequences for failing to comply with COBRA if an employee’s misconduct is not deemed “gross misconduct”.

There are certain offenses that clearly constitute gross misconduct, and have been deemed so by Courts.  Generally, it can be assumed that being fired for most ordinary reasons, such as excessive absences or generally poor performance, does not amount to “gross misconduct.”

This article was written by Natalie C. Najarian, Associate at Demorest Law Firm.

What You Need to Know About Severance Agreements

Contrary to popular belief, employers are not obligated to provide severance pay upon an employee’s termination of employment due to a layoff. If an employer does choose to provide severance pay, it should be accompanied by a severance agreement.

The most important provisions in a severance agreement are those regarding payment, non-competition, and the release of claims. In a severance agreement, the employee typically agrees to accept payment in exchange for agreeing to release employer from claims he or she may have against employer. It is also very typical for a severance agreement, like many employment agreements, to include a non-compete provision. An agreement not to compete should be reviewed for reasonableness, which will vary depending on the specifics of the situation.

It is recommended that employers offer the terminated employee a reasonable period of time to consider signing a severance agreement with a release. A release is unenforceable unless the employee voluntarily executes it, i.e., the execution is not the result of duress or coercion.

Employers should make sure to have legal counsel draft or review their severance agreement to ensure that the employer is adequately protected. Employees should consult legal counsel before signing a severance agreement to ensure that the agreement terms are fair and reasonable.

This article was written by Natalie C. Najarian, Associate at Demorest Law Firm.

The Impact of Reicher v SET on The Michigan Sales Representatives Commission Act

The Michigan Sales Representatives Commission Act (“SRCA”), MCLA 600.2961, (Click here to view) provides protection for sales representatives from the company he is selling for (“principal”).  The statute provides that representatives are to be paid what they are owed in a timely manner, and that intentional non-payment of commission by the principal will result in “an amount equal to 2 times the amount of commissions due” up to $100,000.00.  According to the statute, a sales representative cannot waive his or her rights under the SCRA by signing a contract.

A recent Michigan Court of Appeals ruling in the case Reicher v SET Enters, Inc (click here to view) decided that a settlement agreement between the representative and principal after the representative was terminated and had filed a lawsuit against the principal can negate the non-waiver rule.  In other words, when Reicher decided to settle his claims against the principal he signed away his rights to protection under the SCRA.  When the principal breached the settlement agreement, the statutory penalties under the SCRA did not apply.  Reicher was limited to the damages for breach of contract.

The non-waiver provision will still apply to a contract or agreement establishing or modifying the business relationship between the principal and the sales representative, but does not apply to post-termination agreements.

McNeil v Charlevoix County: An Exception to Michigan’s Employment At-Will Doctrine

On July 21, 2009, the Michigan Supreme Court ruled in McNeil v Charlevoix County, 2009 Mich. LEXIS 1572, that a local health agency had the authority to require employers to adhere to a more strict regulation regarding workplace smoking than was required under state law. In addition, the Court ruled that (a) the local regulation gave employees a private right of action to seek the regulation’s enforcement and prohibit employers from retaliating against the employee, and (b) the local regulation prohibited an employer from discharging, refusing to hire, or otherwise retaliating against an employee for exercising his or her rights under the regulation.

Among other arguments, the Plaintiffs contended that the regulation violated the common-law right of an employer to discharge an employee at will and, therefore, was void.  However, the Michigan Supreme Court rejected the argument, citing the well established case, Suchodolski v Michigan Consolidated Gas Co., and holding that an employer is not free to discharge an employee at will when the reason for the discharge contravenes public policy. 412 Mich 692, 695 (1982).

Michigan is an “employment-at-will” state.  This means that private sector employers can hire and fire employees for any reason, unless that reason is illegal.  Likewise, employees can quit for any reason.  Exceptions to this rule include when an employment contract exists or when the reason for discharge is against public policy, as was the case in McNeil v Charlevoix County.

Michigan is not one of the thirty states that has adopted smoker’s rights laws.  Therefore, while most Michigan private sector employers may be permitted to hire or fire an employee based on their smoking habits, a regulation like the one highlighted in this recent Michigan Supreme Court decision provide employees who smoke certain rights even in the at-will employment setting under the public policy exception to the Michigan at-will employment doctrine.

This article was written by Natalie C. Najarian, Associate at Demorest Law Firm. Click here to view her professional resume.

What You Need to Know About the Bullard Plawecki Employee Right to Know Act

Under the Bullard Plawecki Employee Right to Know Act, employees are entitled to review their personnel records, make copies of those records, and file written statements clarifying or protesting any documents contained in their file. An employer’s use and disclosure of employee records are regulated by this Act as well.

The following are some of the important provisions of the Employee Right to Know Act that every employer should be aware of:

(1) Employers must make the personnel records of both current and former employees available to those employees upon written request, but not more than 2 times per year.

(2) Not all records are considered “personnel records” available for review by the employee.  Only records kept and used by an employer in determining an employer’s qualifications for employment, promotions, transfers, additional compensation, or disciplinary action must be available to employee for review.  Records that are not required to be open for review include, but are not limited to:  employee references, employee medical records if available to employee by other means, personal information regarding a third party which could be an invasion of privacy, and documents related to employer staffing plans.

(3) Employers may charge that employee for reasonable copying charges.

(4) If an employee disputes any of the information contained in his or her personnel file, the employee is entitled to submit a written statement explaining his or her position.  If either employer or employee knowingly put false information in the personnel file, legal action may be taken to remove such false information.

(5) An employer is prohibited from using in a judicial proceeding any personnel record information which was intentionally not included in the personnel record, but should have been as required by the Act.

(6) Any violation of the Employee Right to Know Act by an employer is grounds for a civil lawsuit.  A court may order the employer to comply with the statute and award an employee damages, including reasonable attorney’s fees and costs.

This article was written by Natalie C. Najarian, Associate at Demorest Law Firm. Click here to view her professional resume.

The Basics of Worker’s Compensation

Workplace safety is a serious issue for all companies. For some jobs there are extreme risks involved everyday. This can be scary for employers because of potential liability.
Worker’s Compensation Laws have been in effect for nearly a century, but few employers fully understand them. In Michigan, Worker’s Compensation Laws have five major features: (1) Worker’s Compensation is mandatory for all employees; (2) Worker’s Compensation is a no-fault system; (3) Worker’s Compensation benefits are limited to workers injured on the job or because of the job; (4) Benefits available from the employer are limited to the statutory amounts; and (5) In general, Worker’s compensation is the only remedy available to an injured worker for workplace injury. This is the tradeoff for no-fault compensation to injured employees.
It is important to note that an employer cannot be sued for money damages in addition to Worker’s compensation benefits, except in situations where the employer does not have the required insurance or where the employer intentionally injures or kills the employee.
If an employer is uninsured, the injured employee is entitled to recover cash benefits in addition to any worker’s compensation benefits that the court provides.
Michigan Courts have stated that in order for injury to be deemed “intentional”, the employer must have either made a conscious decision and taken action to injure the employee based on that decision, or the employer must have had no doubts the employee would be injured by a certain activity and have done nothing to stop it. This is more than negligence or even recklessness. This high standard is seldom overcome to allow a lawsuit against an employer for tort damages.

Working Minors Must Be Supervised by an Adult, Or Serious Penalties can be Assessed

School is out and many minors are looking for summer jobs.  Employers should be aware that special rules apply when employing a minor (any person less 18 years of age).  For example, a minor may not be employed unless the employer or another employee 18 years of age or older provides supervision.  Supervision means being on the premises to direct and control the work of minors and to assist in case of an emergency.  Generally this requires the supervisor to be within sight and sound of the minor.   Even a very mature seventeen year old cannot be allowed to work without adult supervision.

Failure to properly supervise a minor in the workplace is a violation of both the Michigan Youth Employment Act and the Health and Safety (MIOSHA) standards.  A violation of the Michigan Youth Employment Act is a misdemeanor and punishable by imprisonment of not more than 1 year or a fine of not more than $500.00 or both.

Serious penalties also apply for employing minors in occupations involving cash transactions after sunset or 8:00 p.m., whichever is earlier, without the required supervision. A violation of this particular provision of the Michigan Youth Employment Act is a misdemeanor and punishable by imprisonment of not more than 1 year, or a fine of $2,000 or both.  Repeated violations may lead to imprisonment for up to 10 years and a fine of not more than $10,000, or both.

This violation of the law could also possibly lead to civil liability if a minor were injured as a result of the lack of supervision.

This article was written by Natalie C. Najarian, Associate at Demorest Law Firm. Click here to view her professional resume.