Work Matters

Wisdom from the trenches

My friend runs a restaurant and has been a manager with different companies since 1992. He shared a number of good ideas for management-side lawyers and our clients.

• Remember the real purpose of the human resources department. My friend once worked for a large company where the human resources department was trying to dictate the minute details of who he hired, how he did the paperwork for the hires and how he conducted the new-employee orientation. He went to the company president and exclaimed, "HR is making me dot the i's, when all I really want to do is sell the fries." He has a point. People in HR tend to see themselves either as hall monitors (grading managers' papers) or as business partners (making managers' jobs easier, not harder). I have seen more of the first and less of the second over the year, and that's not a good thing. Lawyers should adopt this practical  approach and work with HR managers to make it standard operating procedure in the workplace.
• Don't hire people for the best of times in an organization but for the worst. Ask whether they will have the character and endurance to cover your back and stick around when things go south. Everyone knows there are formal leaders in any organization. But management should look for the informal leaders, as well. My friend spotted informal leadership in a young hostess whose shift was over. She saw a huge crowd come in as she was leaving, and she came back to handle the rush -- on her own volition.
• Exhort, don't bully. Don't be a boss whose mind set is "mush, mush, mush." Be a leader whose philosophy is "row, row, row." The first may work in the short term, but it fails in the long term. Team-building, not threatening, is the way to move everyone forward toward the goal.
• Don't mess with an employee's family life. The gritty jobs are, for some employees, the best jobs they will ever have in their entire lives. Let me repeat that: ever, entire life. Some workers do not have promotions, more autonomy and more varied tasks to look forward to. As a result, work for them may not be -- as it is for many lawyers -- the alpha and the omega of their existence. Asking them to make sacrifices lawyers make routinely may not be reasonable. If someone needs time off for a family issue and you can swing it, let him take the time.
  This comes from a guy on the front lines, who needs to get the widgets out the door. Lawyers need to spend more time with guys like him.

Thumbs down to 1st Court grafting Ledbetter onto Texas Labor Code

Remember Lilly Ledbetter? She was a supervisor at a plant who alleged she did the same work as her male counterparts but was paid less. The thing is, she didn't know about the pay disparity at the time. When she learned of the shortfall, she filed a charge of discrimination at the EEOC. The U.S. Supreme Court found on May 29, 2007, in Ledbetter v. Goodyear Tire & Rubber Co. Inc. that she had not filed her charge within the statute of limitations (300 days) and rejected the idea that each paycheck she received triggered the clock anew. Congress did not like this result and enacted the Lilly Ledbetter Fair Pay Act of 2009. Now an employee's time to file an EEOC charge begins anew with each paycheck that is a manifestation of the allegedly discriminatory act of setting unequal pay. Here’s what’s interesting. On April 1, Houston's 1st Court of Appeals revived a discrimination claim and held in Prairie View A&M University v. Chatha that a federal law (the Ledbetter Act) applies to cases arising under the Texas Labor Code. But, argued the employer, the Texas Legislature considered and rejected amending the code to follow Ledbetter. No mind, said the 1st Court, "The State's public policy in the Texas Act [the Labor Code] is to execute the policy in Title VII." Sorry, I’m not buying that. Whenever a court starts relying on "public policy," you know it reached a results-oriented decision, not a reasoned one. I hope this goes to the Texas Supreme Court.

What culture can teach managers and defense counsel

Traveling on business has given me a chance to finish "The Culture Code: An Ingenious Way To Understand Why People Around The World Live and Buy as They Do" from Clotaire Rapaille. His take: When Americans ask someone what he does for a living, we are really asking, "What is your purpose?" The question for Americans, unlike for the rest of the world, goes to a person's fundamental identity. To quote Rapaille, Americans "believe that if we work hard and improve our professional standing we become better people." Translation: Some find salvation in a church, we find it in an office. But don't Americans really work for money? Rapaille says no: "Money is the proof of our goodness, not in itself the goal. . . . money alone is the worst reward for an American employee." (Reminds me of my blog post on Daniel Pink.) Rapaille says an American works for recognition and to prove herself as a worthy person, someone upon whom others can rely. For us, money is not the sole reward. Rapaille suggests when a worker gets a promotion, managers should give him new tools to help him do a more effective job; such rewards "give him a visceral sense that his identity is expanding." What about teamwork? Rapaille’s take is that the workplace needs teams, but managers should never reward teams for a job well done; instead, the rewards should go to individuals on the teams. Rapaille argues that the United States is an adolescent country, and Americans act like adolescents — even those in middle age. The prevailing view is that everything is about me, me, me. I agree with him. Job loss is so devastating to Americans because it is not the loss of a job but of our identity and of our ability to become better people. This is why employment cases are dangerous for employers; jurors know all this in their reptile brains. My job as defense counsel is to show jurors they need not worry that whatever befell the plaintiff will happen to them; rather, this particular plaintiff is an outlier, and he had the power to avoid his fate.

Win by doing the math and helping a court answer the simple question first

Here is an interesting case from the U.S. District Court for the Western District of Texas in San Antonio. In Benitez v. City of San Antonio et al. a female employee sued, claiming a violation of the Equal Pay Act and Title VII. She asserets that a male employee, who held the same job as she did, made more than her in salary -- to the tune of $6,604. But the court tossed the case because the employer pointed out that, if her tuition reimbursements from the employer were factored in, she made more than him. The court held on March 29 that under the Equal Pay Act "wages" included fringe benefits, and tuition was a fringe benefit. When it was counted, she was paid $4,253.71 more than the male. The court held that this reasoning applied to the Title VII claim as well and granted judgment on the entire case. The employer did not go to one of the hardest issues first -- Was their work comparable? -- but to the simplest -- Were they paid the same?). The case reminds me of what Vince Lombardi did at the start of every football season. He got a football and assembled the team. He then held the football over his head and said, "Gentlemen, this is a football." It was his way of reminding them to stick to the basics.

The role mistaken beliefs play in retaliation and hostile environment claims

Can a retaliation claim be based upon an incorrect perception? How about a hostile environment claim? Let's take the first question first. On Feb. 24, the U.S. District Court for the District of Columbia issued an opinion in Johnson, et al. v. Napolitano about a Secret Service agent’s claim. Her deposition was noticed in a class-action suit against the Secret Service in which her husband, also a Secret Service agent, was a member. She was not a member of the class-action suit. She claimed the Secret Service retaliated against her because it thought, by virtue of the notice, that she was a member of the class claim. The Secret Service moved to dismiss for failure to state a claim. The court denied the motion and adopted what it called the "perception theory of retaliation": An employer violates the law if it erroneously believes an employee is engaged in protected activity (such as being a member of a class action) and retaliates on that basis. The court's opinion notes that the 5th Circuit rejected this theory in McKinney v. Bolivar Medical Center (2009). But I am not so sure. In a 2007 hostile environment claim, EEOC v. WC&M Enterprises Inc., the 5th Circuit looked at this situation: An employee of Indian descent allegedly was harassed at work shortly after Sept. 11by co-workers who believed he was an Arab; the employer argued that this incorrect belief absolved it of liability. The 5th Circuit rejected this argument and held that a discrimination claim can be based on an erroneous belief about an employee’s race or national origin. When you think about it, this makes sense. Otherwise, ignorance is rewarded twice: the first time when the discrimination occurs and the second when the wrongdoer gets off.

Texas values clash in noncompete case high court agrees to hear

On April 9, the Texas Supreme Court granted review in Marsh USA Inc, et al. v. Cook, a case that will impact forever Texas law on covenants not to compete. The issue, when you cut to the meat of the coconut: Can money serve as consideration for an employee’s agreement not to compete after leaving employment? Here is what occurred, according to the opinion by the 5th Court of Appeals, which was hearing the case on appeal from partial summary judgment: Rex Cook worked for Marsh USA Inc. in a high-level position and was awarded stock options. Before exercising them, he had to sign off on a noncompete. He signed, he exercised, he left. Marsh sued him, seeking enforcement of the noncompete. The 5th Court refused to enforce, holding that Texas law requires the consideration given to the employee to consist of the employer's confidential information. Why? The 5th Court understood Texas law to say that noncompetes are designed to protect confidential information given the employee — just that and only that. Essentially, the court adopted a restrictive view of when noncompetes are enforceable. But Marsh argued in its petition for review that this view is too restrictive and pays too little attention to an employer's interest in preserving its goodwill. It argued for a broad view of covenants, contending that giving money to an employee to work harder translates to increased goodwill for the company, and that bought-and-paid-for goodwill deserves protection by way of a noncompete. The stakes are high. Cook's reply to Marsh's petition hits the nail squarely on the head: Marsh’s "argument would allow an employer to impose on an employee a covenant not to compete in exchange for any benefit the employer provides to incentivize the employee to work hard and build the company." Marsh similarly homes in on the key issues, asserting the 5th Court’s opinion "creates an environment hostile to economic development" and warning in its petition that "Employers like Marsh, whose goodwill exists in the form of customer relationships, may have to consider relocating to states that clearly and consistently protect goodwill." In one corner, the Texas value of doing what it takes to allow individuals to make their own way in the world, with as few restraints as possible; in the other, the Texas value of promoting business and giving an individual the freedom to make a deal, money in exchange for a noncompete. Don’t be fooled for a minute. This case is cloaked in legalisms but the issues go deep -- way deep.

Envy in the workplace: Beware the green-eyed monster

Have you ever envied a co-worker? It is human, but it's unproductive. Envy is “the green-eyed monster which doth mock/The meat it feeds on,” writes William Shakespeare in "Othello." I just read "Envy at Work," a piece in the April issue of the Harvard Business Review by Tanya Menon and Leigh Thompson. In a study they cite, researchers asked a group of managers at a company to review two sets of plans and told them they had a $10,000 budget to allocate. They told the managers that one set of plans came from an external source and the other from an internal source. Guess what? The managers allocated more to the external plans. Why? They believed they would lose status if the internal plan was adopted because a co-worker generated it. Another study showed that Company A liked a concept of Company B, so much so that it bought Company B. Once the purchase went through, though, the managers began to dis their new colleagues. It was the same phenomenon: If a good thing lies outside one's organization, it's easy to admire. When that same good thing becomes part of one's organization, it can become threatening. Given this dynamic, what to do? The authors suggest we focus on ourselves, not others. That's good advice. Years ago, I watched a press conference with the golfer Tom Watson at a high-stakes tournament. A reporter asked him how he handled the pressure. Watson evenly said words to the effect that, when he was out there, it was him vs. the course. I never forgot that. The authors also suggest people should think about themselves in a positive light. This could be a useful exercise for perfectionist lawyers accustomed to looking for flaws. In an experiment, researchers told a group to devote some time to reviewing a rival's ideas. The researchers asked half the group to list some of their own accomplishments before doing so. That group devoted 60 percent more time to reviewing the rivals’ ideas. Recalling our own achievements helps us to put aside our feelings of envy and realize that our nature is to work together, not against each other. I leave you with a thought from Marcus Aurelius: "For we are made for co-operation like feet, like hands, like eyelids, like the rows of upper and lower teeth. To act against one another then is contrary to nature and it is against nature to be angry and to turn away."

Why lawyers and doctors need to work to end hierarchy

Readers know how much I dislike hierarchy. I am reading "The Checklist Manifesto" by surgeon and writer Atul Gawande. His view of doctors and hierarchy is the same as my view of lawyers and hierarchy: They love it. Doctors see themselves as riding to the rescue in the operating room. Gawande argues, though, that doctors need to change the story they are telling themselves. Mistakes occur because others in the OR are afraid to speak up. He believes a true team does a better job than one leader with a bunch of cowed followers. One study required everyone in the OR to introduce themselves to one another by their first name. He says all OR members embraced this idea -- except the surgeons. But when they finally caved and started to do it, performance got better, not worse. The work world is moving rapidly to less hierarchy, not more; to more true teamwork, not less; to having everyone work toward their potential, not toward the lowest common denominator.

More food for thought in the 5th Circuit's retaliation decision

Well, Easter brunch was migas, a Bloody Mary and re-reading Smith v. Xerox, which I initially blogged last week. As the waiters cleared the dishes, I decided to delve more into the case, which involves a retaliation claim and lots of interesting food for thought. The 5th U.S. Circuit Court of Appeals rejected the company's argument that a court should consider only events occurring after the plaintiff filed her EEOC charge. The court said, "Smith's allegations cannot be parsed and considered in a vacuum." Here’s why I think the court came out that way: The plaintiff and her supervisor had a contentious relationship before she filed an EEOC charge. A jury could infer in such a context that the charge was the last straw for a fed-up manager. The court also took away the $250,000 award of punitive damages, noting there is no useful litmus test for determining when punitive damages are warranted. When you think about it, an appellate court never should reverse an award of punitives. After all, the jury already has found that the employer made a conscious decision to retaliate; retaliation is not done by accident or negligence. But the court again may have taken human nature into account, saying, in effect, that if there is competing evidence of why the employer did what it did, then punitive damages are not warranted. I think the 5th Circuit’s reasoning is this: If an employer just hauls off and fires an employee after he or she engages in protected activity, then it is more likely that the employer was motivated by impermissible intent. In contrast, if there is a cushion of facts and reasons between protected activity and termination, it is less likely the employer was motivated by naked retaliatory impulses. I had more to say on this case, but the waiters brought dessert. As Malcolm Forbes said, dessert is my favorite vegetable.