Looking For Something?

Common Employment Law Claims

By nature, being an employer is filled with challenges and ever-changing risks. One of the biggest concerns to any organization, regardless of size, is the well-being of its employees. Skilled employees are the backbone of a successful organization. In the past, these valuable employees did not always get the fair treatment they deserved. As a result, Congress passed numerous laws to ensure that every person gets treated reasonably when at work.

Significant changes to past employment laws placed whole new areas of risk on employers, leaving them to redesign workplace policies in an attempt to limit their exposures. Employers today don’t just need to make sure that they follow all the rules, employees need to follow them as well. To manage this risk, most companies create a human resources team that is able to give advice and look out for the well-being of workers.

The landscape of employment law is continually evolving. With every new piece of legislation or court decision, employers learn about workplace discrimination and employee rights that previously may not have been relevant. To protect both employees and the company, management must stay up to date on the risks and issues inherent to the employer-employee relationship.

A majority of U.S. workers today are hired under the agreement of an “employment-at-will” clause. This clause states that either the employer or employee can terminate the employment at any time and for any reason (or no reason). This serves both parties by preventing long-term contracts from restricting either side’s future.

Since the 1960s, the employment-at-will agreement has steadily grown to favor employee rights. Anti-discrimination laws and various other laws have broken the idea that an employer can truly fire an employee at-will. Managers who hire or fire employees must realize the limitations of the employment-at-will policy, and that such a clause does not offer protection if any discrimination or bad faith can be proved in court.


“Wrongful discharge” is a claim made by workers whose employment was terminated because their government-protected rights interfered with the function of the company. Whistle-blowing, assisting a government investigation, using workers’ compensation and missing work for civic duties are all actions that employers have mistakenly tried to use to fire employees. Since these claims are eligible to collect punitive damages as well as lost wages, the HR team should make sure no employee is being fired out of revenge or convenience.

Similarly, there is the issue of firing employees without “just cause.” While the employment-at-will statement is meant to cover employers, everything from handbooks to workplace conversations can imply a contract of employment to workers. If employees have evidence that employers historically have only ever fired workers because of just cause, they could make a case that their own employment cannot be terminated without reason. To avoid such claims, employers need to make it perfectly clear that all positions are at-will and never promise or speculate specifics of future employment.

A final point to note is that many state courts have ruled that employment implies a contract of “good-faith” between the company and the employee. This contract is meant to help determine blame in a situation where no legal misdoings were technically committed. For these cases to reach court, the actions taken by either party must be very unscrupulous; a possible case could include the firing of an employee in order to ensure a different employee gets a promotion or sales opportunity.

Often reported as one of the most dangerous times for employers, the hiring process can be a drawn-out event where an inappropriate question can lead to expensive litigation for a company. The Americans with Disabilities Act and the Civil Rights Act promise all potential employees that no employer is allowed to discriminate against them for any reason.

Extensive in detail, the two acts comprise a vast number of rules and implications for the questions asked on applications and in interviews. No inquiries concerning race, religion, gender or family are to be asked; additionally, no questions about health or physical condition are to be asked unless pertinent to the requirements of the job. Reasonable accommodation must be made for applicants with special needs and no test that tends to discriminate against a protected class may be issued (unless the test is related to job requirements).

The best method to avoid the appearance of discrimination is to be as clear as possible about job requirements. When doing interviews, only ask questions directly related to the position and make no implication that the interview is a job offer. Small talk can be essential for getting a feel for an employee, but conversational questions posed during this time can be as much of risk as any official question. Interviewers should always prepare a list of official questions for an applicant to answer.

Non-criminal Action

Offensive and litigation-worthy actions against employees are not just limited to termination of employment. Ranging from assault to defamation of character, there are any number of civil offenses, or torts, that can land a company or a co-worker in a courtroom. The following are the most common:

Negligence – Though it comes in several specific forms, negligence is usually the suit that follows an incident the employer was indirectly responsible for. Negligence is typically claimed by employees who were affected by the actions of another worker. Affected employees blame employers for being irresponsible in their decision to hire (or continue to employ) an individual who is a known threat in the workplace. Alternatively, employees can also claim they were falsely fired or punished for actions the employer did not fully investigate.

Harassment is possibly the biggest source of negligence claims. Employers are held responsible for the workplace environment. If direct acts of harassment from co-workers, vendors or customers are not dealt with immediately, claims could be made that manager negligence led to a hostile work environment. Any vendors and contractors should fill out signed agreements to abide by company harassment policies.

In all situations of reports of misconduct or punishment, it is essential that managers thoroughly investigate the situation and respond quickly and appropriately. Since litigation could be the result of punishing or not punishing the alleged offender, managers should document everything and discuss the situation with others only as necessary.

Personal Facts – Employers, especially those who do background checks, should take caution to prevent any breach of privacy. Any leak of an employee’s personal information can result in a claim for invasion of privacy. At any point when personal information is disclosed from employee to management, the employee should fill out a form of written consent.

Employers need to take special care while doing background checks during the hiring process; it is likely the most sensitive information that will ever be handled by the company. Application forms should clearly state the company’s requirement of a background check and present guidelines for how the information will be used.

Connected with this, tort suits will often be filed because employees thought they had private use of something that was, in fact, company property. The most common instance of this is email records. Employees have litigated their employers for firing them over company emails. Though usually unsuccessful if clear handbook policies are in place, these claims are avoidable by having employees sign disclosure agreements when they are hired. Additionally, reminders about company rights (email ownership, locker searches) should be posted around the workplace.

Often thought of in conjunction with slander, defamation of character can occur whenever harmful information about an employee is spread around an office, regardless if it is true. This most commonly happens with medical information, but could potentially be the result of a former employer reporting an unrequired piece of sensitive information during a reference check. In either case, medical and punitive records should be handled delicately and never disclosed unless special permission is obtained.

Lies – Lying, both by employers and employees, can cause sudden litigation for unsuspecting companies. The most obvious and avoidable forms of lying come in the form of fraud. Fraud is usually linked to promises of employment or change in type of employment. Companies that promise terms of employment far greater than they know they can provide are typical offenders in this area, but managers that promise unverified raises for completion of special training or schooling can be just as liable.

Fraud is easy to avoid, because it requires intention to mislead. Managers that honestly admit they cannot fulfill an earlier promise could possibly be subject to violation of an implied contract, but cannot be alleged of intentionally harming an employee by means of false information. As stated earlier, promises of future employment are always a risk and should not be made.

Attacks against individuals – The final area of employment law tort claims involves attacks on individuals. Intention to cause physical or emotional harm and unlawful detainment are grounds for the majority of these tort cases.

Assault, battery and emotional harm are all instances where an employer or co-worker makes a direct action against an individual. Threats constitute assault while physical contact composes battery. Cases of non-criminal assault and battery involve unwelcomed physical contact (often linked to sexual harassment.) Neither should be tolerated in the slightest, and any employee complaints should be addressed immediately. Criminal actions of assault should be handled by police.

Intentional emotional harm is as serious an issue, but the “intentional” aspect is difficult to establish. Accusations of an employee causing emotional harm should also be handled quickly, but intent should be established as well. At the very least, sensitivity training should strongly be considered for the offending individual.

Finally, unlawful detainment occurs when an employer or manager holds an employee against her or his will. Many times these detainments are the result of the employee being suspected of violating a law while at work. With no authority, an employer cannot hold employees against their will (unless they present a clear danger to society.) When a law has been violated, police should be contacted to deal with the issue.

Because there are so many types of violations that can occur in the workplace, employers should establish two different channels for employees to report complaints. This way, if one of the contacts is involved in the complaint, the employee still has a way to comfortably report the incident. Employers must take as many steps as necessary to ensure clear communication between management and employees.

The greatest threat to employers from employees usually starts with the employer making a mistake. An email or small talk might not be received as intended, or a general statement of idealism could be misconstrued as a promise. Employers and managers must take time to understand what can make them liable and, more importantly, why an employee has government-sanctioned protection from it.

As stated earlier, employees are an essential part of any business. For employers, the employer-employee relationship is ripe for potential miscommunications. Review your company’s handbook so you know what everyone is supposed to understand and what rights are to be expected.

In the end, no company is perfect and a mistake from a manager or employee could result in costly litigation, regardless of the court’s decision. Employment Practices Liability insurance can provide coverage for employer risks inherent to your organization and the unsanctioned actions of employees. Contact Warren G. Bender Co. to discuss your company’s exposure and how you can prepare for imminent risks.

Filed under: Employment Related Practices,Property & Casualty — Jillian Bender-Cormier @ 7:19 pm February 21, 2018

4 Steps to Protect Your Business From Fires

Fires can cause widespread devastation and are one of the biggest threats to any business. According to the National Fire Protection Association, there are over 130,000 non-residential fires every year that cause over $3 billion in property damage.

The best way to protect your business from a fire is to analyze your risk exposures and train your workforce on how to act. Even if you believe that your business is prepared for a fire, it’s important to review your fire prevention plan in order to make sure it’s up to date.

Here are four steps you should take to protect your business from fires:

1. Create an emergency evacuation plan. Your employees and customers should know how to leave your business at any time by locating a clearly marked, unobstructed emergency exit. You should also conduct an evacuation drill at least once every year to ensure that your employees know how to act.

2. Follow all of your fire code requirements.
Depending on your business’s size, industry and location, the fire code will require your business to take certain steps to prevent fires.

3. Install and maintain fire suppression systems. Make sure that your workplace is outfitted with automatic fire sprinklers and portable fire extinguishers. You should also make sure that fire extinguishers aren’t used after they have expired and that your workforce is trained to operate them.

4. Get in touch with local first responders. Establishing a relationship with your local fire department and providing them with your building’s floor plan will help ensure the fastest possible response time.

For more information on protecting your business from fires, contact us at (916) 380-5300 today.

Filed under: Property & Casualty,Recent Headlines,Safety — Jillian Bender-Cormier @ 11:17 pm January 17, 2018

Weed at Work: Legalization of Recreational Marijuana and Possible Effects on Workplace Policies

By Jackie Sudia, AIC, ARM, CRIS
Warren G. Bender Co.
January 17, 2018

On January 1, California joined several other states in legalizing recreational marijuana, also known as cannabis. As with prescription medication, alcohol, or any other substance that affects a person’s cognitive behavior, there are certain actions a person cannot legally do or safely perform under the influence of cannabis (e.g. driving). The ingredient in cannabis products believed to produce a psychoactive effect is Tetrahydrocannabinol (THC). While the psychoactive compound THC is relatively short-lived in the system, the inactive compound produced from metabolizing THC (carboxy THC or THC COOH) remains present in a person’s system for weeks. In a Standard 5 Panel Drug Test, the presence THC metabolites reveal whether the tested person has used cannabis within the prior three to six weeks. This means that, unlike testing blood alcohol levels, testing for the presence of THC metabolites cannot accurately determine if someone is under the influence. A ‘positive’ result for THC metabolites only shows that an individual has used cannabis within the last month or so, not when it was used, or how much.

As an employer, you may be asking how your company might continue to enforce a zero-tolerance drug policy specifically for the use of marijuana (cannabis). Let’s imagine that you have a situation where a manager suspects that an employee is under the influence of cannabis after they’ve returned to work from lunch. How could the manager be sure that the employee actually used cannabis before returning to work? An employee might smell like cannabis because they were near someone who was smoking. Smell is not a reliable indicator, especially given that many products containing THC are not smoked and/or have no odor. There are tinctures, infused foods, vaporizers, and capsules that have no smell. For this reason, learning to recognize the signs and symptoms of inebriation and being alert for unsafe behavior provides a broader and more useful assessment. As an employer, being prepared for changes to reasonable suspicion drug testing procedures could avoid wrongly accusing an employee.

Another scenario to consider is that if an employee uses cannabis while not at work on a Sunday, they are very likely to test positive on a Wednesday; the positive test doesn’t prove that they were under the influence on Wednesday. One school of thought is that employers can’t control the actions of employees while not at work; this has yet to be tested by California courts. That said, unfit actions or unsafe behavior at work are unacceptable hazards that an employer can control. These types of infractions are usually documented in an employer’s Employee Handbook and acknowledged by the employee. If an employee is observed acting in an unsafe or unseemly manner at work, they may be subject to corrective action regardless of whether or not they are under the influence of cannabis.

In addition to legalization of recreational use, ‘medical marijuana’ is still being prescribed by physicians. Just like any prescription medicine that may impair a person’s ability to do his or her job, requiring a note from the prescribing physician with job restrictions while using the medication provides documentation resolving any ambiguity. Providing a detailed job description including the employee’s essential job functions can help support the next action you to take.

It’s important to note that cannabis products are still against Federal Law. Federal law applies to work performed for the federal government or which takes place on federal land and more. Drivers subject to Department of Transportation (DOT) Regulations are not allowed to test positive for THC metabolites no matter what state they are in.

Future court cases in California will eventually shape the way each situation should be handled. How your company decides to deal with these changes will define your company’s future liability, insurance costs, and reputation. Being educated on this subject and developing an action plan will help you protect your business and preserve your working relationships. We recommend you seek the guidance of your legal, insurance, human resource, loss control, and safety professionals.

Disclaimer: The information in this post is provided for general informational purposes only. No information contained in this post should be construed as legal advice from the Warren G. Bender Co. or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.

Filed under: HR,Property & Casualty,Safety — Jillian Bender-Cormier @ 11:08 pm

143 Million People Potentially Affected by Equifax Data Breach

Equifax, one of the largest credit reporting agencies in the United States, recently announced that it had been the victim of a cyber attack that may have compromised the personal information of 143 million people. Between May and July 2017, hackers were able to exploit a weak point in Equifax’s website that gave them access to information such as Social Security numbers, birthdays, addresses and driver’s license numbers. Additionally, Equifax stated that 209,000 credit card numbers were stolen.

Experts believe that the data breach is severe and widespread enough to affect anyone with a credit report. And, because hackers were able to target personal information, your business could be susceptible to cyber attacks—especially attacks that rely on social engineering and personal details.

The following is a list of steps you should take to protect your business and employees:
• Assure your employees that your priority is to protect their best interests and the business as a whole.
• Have your employees check to see if they were affected by the breach. Equifax has set up a website to help individuals determine if any of their personal information may have been stolen. All affected U.S. customers can sign up for a free year of Equifax’s TrustedID Premier service to help prevent identify theft and monitor credit reports.
• Instruct all of your employees to change any passwords that they use for work and to avoid passwords that they’ve used before.
• Tell employees to remain skeptical of any business requests that aren’t made face to face. Hackers often use personal details obtained from a data breach to disguise themselves as a trusted source and make a malicious request for money or information.

The recent data breach demonstrates the importance of commercial cyber insurance and a well-trained workforce. Contact Warren G. Bender Co. today for more details on how cyber insurance can protect your business.

Filed under: Property & Casualty — Jillian Bender-Cormier @ 9:12 pm October 25, 2017

Advanced Planning for Hurricanes and Other Disasters

Hurricanes Harvey and Irma caused widespread damage and forced businesses to close their doors and focus on the immediate safety of their employees and customers. Unfortunately, once a hurricane, flood or other disaster passes, a business isn’t necessarily out of danger. Recovering from a disaster can be extremely expensive, and many workplaces don’t have a plan in place to implement important safety and continuity policies.

Even if your business wasn’t affected by the recent hurricanes, any type of disaster can lead to devastating damage and prolonged business interruptions. Taking the time to plan ahead for a worst-case scenario can help give your business the time it needs to protect your employees, property and finances. Here are some steps you can take to prepare your business for a disaster:

• Learn the types of disaster that are most likely to affect your area.
• Inspect your insurance policies to see if there are any gaps in your coverage. For example, some policies may only provide coverage if a business suffers physical damage.

Call us at (916) 380-5300 for resources and toolkits that can help you create a business continuity plan. We can help you establish a plan that takes a number of important topics into consideration, including safety, health, communication, property protection, recovery and employee training.

Filed under: Personal Insurance,Property & Casualty — Jillian Bender-Cormier @ 9:00 pm