July 02, 2004

Job Transitions -- Cans of Worms versus a Few Loose Ends

The latest issue of the ACC Docket (available on-line to Association of Corporate Counsel members only) has an amusing-but-serious article by Adobe's Philip Strauss about the challenges of moving into an in-house counsel job. (Scroll down to page 5 of the PDF.) One of his comments was:

When you step into a new in-house job, you will inherit someone else's work (you will also leave some unnamed heir an inheritance of your own in your previous job).

That reminded me of an old Navy saying: Whenever you relieve [take over] in a billet [job], it seems like you inherit a real can of worms that the previous guy left for you. But then two or three years later when you're relieved by the next guy, you yourself leave just a few loose ends to tie up. I guess it's all a matter of perspective.

July 2, 2004 in Leadership and Management | Permalink | Comments (0) | TrackBack

June 14, 2004

Counseling an Employee for Poor Performance?
Consider Getting a Signed Written Acknowledgement

In an age-discrimination lawsuit against American Airlines by a former employee, the court recently denied American's motion for a summary judgment dismissing the case. The court's reason offers a lesson for managers and HR personnel.

The former employee, one Walker, claimed he had been fired during a post-9/11 reduction in force because of his age. American Airlines responded with evidence that Walker had been a poor performer. Walker replied that American's performance argument was merely a pretext.

Walker supported his pretext contention in part with his affidavit that he never knew he had received low performance marks. (He also introduced evidence that other, younger employees in comparable positions had serious employment problems yet were not terminated.) The court concluded that Walker had produced enough evidence of pretext to entitle him to have a jury hear his case; it denied American's motion for summary judgment.

POSSIBLE LESSON: If you're counseling an employee because of poor performance, consider 1) writing up an accurate summary of the counseling, 2) asking the employee to sign it, 3) giving him or her a copy, and 4) keeping the signed original for the employee's personnel file. (If the employee refuses to sign, consider making a written note of the employee's refusal.) That should provide at least some ammunition to help refute a later claim that the employee never knew about the performance issues.

CITATION: I couldn't find the court's opinion on-line. The case is Walker vs. American Airlines, Inc., No. Civ.A 4:03-CV-46-Y (N.D. Tex. June 9, 2004), summarized in this BNA Corporate Law Daily report ($).

June 14, 2004 in Leadership and Management, Litigation, Record-keeping | Permalink | Comments (0) | TrackBack

September 23, 2003

Hope They Didn't Spend All the Money

Shortly before Enron filed its bankruptcy petition, it made accelerated payments of deferred compensation to certain executives, to the tune of some $53 million. Yesterday, a bankruptcy judge ruled that those payments had to be thrown back into the general pot that will be shared by the unsecured creditors. See this Associated Press story for more details.

The execs apparently will be entitled to their proportionate share of the unsecured-creditors' pot. Any guesses on how much they'll eventually see?

The basis for the judge's order seems to have been that the deferred-comp payments constituted "avoidable preferences" under the Bankruptcy Code. For some general information on that subject, see, e.g., a site called Moran Law.

September 23, 2003 in Bankruptcy, Leadership and Management | Permalink | Comments (1) | TrackBack

September 20, 2003

Good Personnel Records Save the Day for A & F

Abercrombie & Fitch fired one of its New York City security supervisors for poor performance. She filed a lawsuit, claiming among other things that she had been fired because she was African-American.

A&F; won the case without even having to go through a trial, primarily because the fired employee's manager had kept good personnel records to document her poor performance over several years.

A&F; moved for summary judgment, which is a judgment without a trial based on undisputed material facts. The purpose of a trial is to establish the facts on which a judgment will be based. If either party can show that the "material" (outcome-affecting) facts are not genuinely disputed, then legally there's no need for a trial, and the judge can simply render judgment.

* * *

It appears that the fired security supevisor's performance wasn't stellar. According to the court's opinion, during one evaluation period the fired supervisor had busted only nine shoplifters and fingered only one employee thief, while others in the same job had busted between 109 and 317 shoplifters. Moreover, in the fired employee's store during that period, the overall theft rate was more than 9%, while the company-wide average was only 5.67%.

* * *

Poor performance, however, didn't necesarily mean that A&F; would win. To defeat A&F;'s summary judgment motion, the fired employee had merely to come forward with at least some non-trivial evidence that A&F; had intended to racially discriminate against her. That would have shown the existence of a genuine issue of material fact. This in turn would have entitled the fired employee to have a jury hear the evidence, evaluate witness credibility, and weigh the conflicting evidence. The jury then would decide whether A&F; had racially discriminated against her.

* * *

In their summary-judgment motion, A&F;'s lawyers wielded a not-so-secret weapon. For several years, the fired woman’s supervisor at A&F; had regularly met with her to review her performance. He had prepared written evaluations showing poor performance, and had provided her with copies. He had also prepared written performance-improvement plans for her, and had gotten her to sign them. All those documents presumably were in the woman’s personnel file. A&F;'s lawyers used them, along with the supervisor's affidavit, in support of A&F;'s motion for summary judgment.

A&F; thus was able to put forward solid, documentary evidence that it had indeed terminated the woman for poor performance. Note that A&F; didn't try to rely solely on its manager's hindsight recollection about the woman's performance, which her attorney doubtless would have characterized as self-serving. Instead, it brought contemporaneous documentary evidence to bear.

* * *

In rulling on A&F;'s summary judgment motion, the judge focused on A&F;'s documentary evidence and its manager's affidavit, and on the fired employee's failure to put forth any substantial evidence of discriminatory intent. The judge ruled that there was no genuine dispute concerning any material fact, and threw out the fired employee's case. (Khan vs. Abercrombie & Fitch, Inc., Sept. 17, 2003)

September 20, 2003 in Doing It Right Pays Off, Leadership and Management, Litigation, Record-keeping | Permalink | Comments (0) | TrackBack

September 17, 2003

Yet Another "You Fired Me Because I Blew the Whistle" Case Settled for Almost $1M

The press is reporting the settlement of yet another wrongful-termination case grounded on a former employee's claim that she was fired for whistleblowing. The employer paid nearly $1 million -- almost half of which goes to the fomer employee's attorney, according to the employer's Web site -- after having spent more than $300K defending the case. See this story at the law.com Web site. This story illustrates the hazards of letting an employee go if the employee had any connection at all with uncovering alleged corporate improprieties.

The story is also a nice opportunity to recall the wisdom of keeping fair and accurate written records to document employee performance. If you're a manager who wants to get rid of a worthless employee, don't believe that your cheery smile and golden voice alone will convince a jury that the employee really did deserve firing. Juries often discount witness testimony, especially by defendants seen as trying to make excuses for their actions. Juries also tend to believe written business records and other contemporaneous documentary evidence. So if you keep decent records about your employees, you'll be better armed if you ever find yourself in a lawsuit -- and good records might even help you be a better boss.

September 17, 2003 in Accounting, Leadership and Management, Record-keeping | Permalink | Comments (0) | TrackBack

August 24, 2003

NY Times: Some Dot-Com Refugees
Learned Career-Enhancing Lessons

There's a very interesting article in today's New York Times (free subscription required). It explores some of the practical business lessons learned by former "corporate types" who defected to dot-com companies but then later returned, chastened, to the corporate world.

August 24, 2003 in Leadership and Management | Permalink | Comments (0)