When a company experiences a financial setback of the magnitude that More Beer, Incorporated had after its failed venture into internet marketing, it sometimes becomes necessary to reduce the workforce in order to mitigate the losses. The Human Resources (HR) Department faced a very difficult decision in choosing whom to fire, as there was a potential for legal action with each of the five candidates presented for possible termination. In addition, many of the candidates also had personality traits or issues in their personal lives that could have contributed to the decision.
In the ending analysis, however, one must remember that More Beer, Incorporated is a business, and the personnel decisions made herein must first serve the best interest of the company, not the individual. Therefore, after careful consideration, the HR Department has concluded that the best way for the company to survive the economic downturn is to terminate three of the five employees and internally transfer the other two, according to the following recommendation, effective at the start of the pay cycle three weeks from Monday.
Terminations The three individuals recommended for termination will all receive a severance package equal to one week’s salary for every year of service to the company, plus additional pay and benefits noted below. Each individual will be required to sign a waiver that releases More Beer, Incorporated, from any future claims against the company regarding their termination. The employees will be given 45 days from the date of notification to consider their respective severance packages.
All three employees will be required to sign a confidentiality agreement that stipulates they are not to divulge any proprietary information they may have acquired during their employment with More Beer, Incorporated. Mike Williams Mike Williams’ employment is recommended for termination because his particular area of expertise involves maintaining the computer systems which will be obsolete when that segment of the company closes. Therefore, his skills will no longer be an asset to the company.
His above average productivity, excellent attendance, and educational background indicate a strong work ethic that will be an asset to another organization. A Letter of Recommendation stating as much will accompany his severance package. In addition, Mr. Williams will receive all of his accrued sick leave, vacation, and holiday pay. In terms of post termination litigation, the company must ensure it is in compliance with Title VII of the Civil Rights Act as it pertains to race, as Mr.
Williams is of Asian descent, and he may allege that his strong accent was a reason for his termination. In Fragante v. City and County of Honolulu, the appellate court determined that “[a]n adverse employment decision may be predicated upon an individual’s accent when – but only when – it interferes materially with job performance” (Twomey, 2013, p. 450). Although other employees complained they had difficulty understanding his heavily-accented English, Mr. Williams’ primary job was with maintaining computers, which has no requirement for oral communications.
Accordingly, this argument should hold as a successful defense against both a disparate treatment and disparate impact claim, should Mr. Williams choose to pursue either of those allegations of unlawful employment discrimination. Phillip Price Phillip Price is also recommended for termination on the appointed effective date. The only positive contribution he made to the company was in the programming area, which is being eliminated. Mr. Price is an average performer, with an attendance record showing that he was absent nearly 43 percent of the time he was scheduled to work in the past two months.
His overall track record is average. His supervisors have documented all of these performance items. There is no apparent benefit to transferring him elsewhere in the company, especially since Mr. Price mentioned he feels he has been treated differently after recently announcing that he is homosexual. Mr. Price will likely argue his termination is a violation of Title VII of the Civil Rights Act as it pertains to sex. He may also claim disparate treatment or disparate impact. Title VII does not contain specific
language protecting against discrimination based on homosexuality, as both the Equal Employment Opportunity Commission (EEOC) and the courts “have determined that the word sex as used in Title VII means a person’s gender and not a person’s sexual orientation” (Twomey, 2013, p. 427). Still, in Oncale v. Sundowner Offshore Services, Inc. , the Supreme Court found that sex discrimination consisting of same-sex harassment is actionable under Title VII. To have a claim under Title VII, Mr.
Price would have to allege that his termination was solely based on “sex, ” thus bringing his case within the precedent set by Oncale. More Beer, Incorporated is an at-will employer, which means it is “free to terminate the relationship with or without cause,” (Twomey, 2013, p. 598), so his argument will be moot. Mr. Price will receive the severance package that consists of one week of pay for every year of service to the company. He had used all of his sick leave, annual and holiday leave, and so will not receive any additional pay. Sally James Sally James is the third employee recommended for termination.
While she is a very popular employee, and has longevity with the company, neither of those factors contributed to the company’s bottom line. Her productivity and performance were very good, but they were in a segment of the company that failed overall. Ms. James’ age, 55, puts her in a protected class, so the company must be wary of potential violations of the Age Discrimination in Employment Act (ADEA) and the Older Workers Benefit Protection Act (OWBPA). The company can use the “reasonable factors other than age” (RFOA) provision (Twomey, 2013, p. 536) as an affirmative defense of these claims.
Because Ms. James has been with the company for twenty years, the company is going to offer her an early retirement package that will include the standard severance offer of one week basic pay for every year of service to the company. In addition, she will be offered stock options in the company, enrollment in the company’s Tuition Assistance plan for her son for one full semester of college, and Social Security “bridge” payments until she reaches retirement eligibility age (Twomey, 2013. p. 546). Acceptance of the retirement package would require Ms.
James to waive any future claims against the under ADEA in accordance with the requirements set forth in the Oubre v. Entergy Operations, Inc. These requirements would include: 1. The waiver is part of a written agreement. 2. It makes specific reference to rights or claims under the ADEA and may refer to Title VII and all other claims. 3. It does not apply to rights or claims that may occur after the agreement is signed. 4. It is exchanged for value that is in addition to what the employee would otherwise be entitled to receive. 5. The employee is given written advice from the employer to consult with an attorney. 6.
The employee is given a 21-day waiting period to consider the agreement and a 7-day period to revoke the agreement. (Twomey, 2013, p. 548) Transfers The remaining two individuals on the list will be transferred to positions within the company effective immediately. They will retain their current salaries and seniority in the company. Margaret Jones Margaret Jones will be transferred to the Sales Department. Although the internet sales concept for More Beer, Incorporated was a failure overall, Ms. Jones’ contributions were significant, and she has demonstrated that she is a dynamic salesperson who can contribute to the company’s profits.
The decision to retain Ms. Jones was not made in any part because of her race and her affiliation with a local chapter of a civil rights group. To elect to retain or fire her based on her race or gender would be discriminatory, and would be in violation of Title VII of the Civil Rights Act on the basis of race or sex. The fact that she is perceived to be a ladder climber, out only for herself, or not a team player, has no bearing on the success of the company, and therefore has no consideration in making this business decision. Jenny Smith Jenny Smith’s multi-lingual status has been a boon to the company’s global marketing efforts.
Accordingly, she will be transferred to the Human Resources Department, Marketing and Public Relations Division. She will continue in that capacity if she chooses to return to work at the completion of her six weeks of maternity leave in compliance with the Family Medical Leave Act. That she is female and of Hispanic origin gives her protection under Title VII of the Civil Rights Act. The fact that she is currently pregnant puts her in a protected status under the Americans with Disabilities Act (ADA), the Rehabilitation Act, and the Pregnancy Discrimination Act.
In order to make a reasonable accommodation to the disability of her morning sickness, the company will permit her to work from home as necessary, which will reduce her absenteeism and increase her productivity for the company. Conclusion The decision to fire a group of employees is never a popular one, and is rarely a pleasant task. The Vice President of Human Resources for More Beer, Incorporated performed a detailed analysis of the candidates, and makes the above recommendations with the company’s financial future as the primary basis for its decisions.
Additionally, the HR Department had to consider potential legal ramifications of terminating these employees, even the ones who were ultimately retained. Finally, the profoundly distressing effects of terminations on the individuals were not lost, and every attempt has been made to mitigate the financial or professional impact wherever possible. References Twomey, D. (2013). Labor & employment law: Text & cases. (Fifteenth ed. ). Mason, OH: South-Western.