As employment lawyer Eric Meyer put it last week in his article on the subject, “
orange non-competes are the new black .” They are increasingly being used by employers everywhere against all types of employees – from “tech workers to sandwich makers.” Recent statistical studies indicate that one in four workers have signed a non-compete in their lifetime and 12.3 percent all workers are bound by one right now.
These numbers will understandably vary widely from state to state and from industry to industry. From my own experience working with hundreds of Texas employees in non-compete cases, it would not surprise me if the numbers are even higher for Texas workers.
In his article, Meyer indicates his surprise that so many employees who are presented with a non-compete agreement simply sign it without protest. He was also surprised by the relatively small percentage of employees who try to argue with their employer about the issue. The Washington Post article to which he refers notes the following:
“And overall, only about 10 percent of workers who’ve signed a non-compete ever try to argue over it, with most assuming that it’s either not negotiable or that doing so would cause tension with an employer.”
In my personal opinion, non-compete agreements are morally justifiable only in the most extreme cases — situations in which employees truly will be given access to real trade secret information that would obviously cause serious harm to an employer if it got into the hands of a competitor (think secret recipe of eleven herbs and spices). This is a very small percentage of workers. And yet we see that more and more employees are being asked and are agreeing to sign such agreements and thereby damage their ability to work in their chosen field should they be fired or choose to leave their employer. Why?
I think there are a few reasons for this phenomena:
So, given this state of affairs, what should an employee who is presented with a non-compete do to protect himself or herself? I’ll address this in a follow-up post next week. Continue Reading
Sources I trust say that defending a case through discovery and a ruling on a motion for summary judgment can cost an employer between $75,000 and $125,000. If an employer loses summary judgment (which much more often than not is the case), the employer can expect to spend a total of $175,000 to $250,000 in legal fees just to take a case to a trial. (Source) Obviously this will vary somewhat based on geography but, even adjusting for that issue, this is a crazy amount of money to spend defending your average employment discrimination case. The average employment case settles out of court for about $40,000. (Source)
Simply put, defending employment lawsuits costs too much. Why on earth are companies paying $75,000 to $250,000 to defend cases that, on average, can be settled for $40,000?
I have spent many years fighting against intentional civil rights violations in the workplace. Workplace discrimination is a terrible thing. It destroys careers, harms families, and is bad for the economy. And most people, I truly believe, are against it.
But what science is now showing us is that even very good, well-meaning people can discriminate at an unconscious level. According to this science, you are doing it right now as you read this.
You’re faced with around 11 million pieces of information at any given moment, according to Timothy Wilson, professor of psychology at the University of Virginia and author of the book Strangers to Ourselves: Discovering the Adaptive Unconscious. The brain can only process about 40 of those bits of information and so it creates shortcuts and uses past knowledge to make assumptions.
So how do we deal with this information overload? Our brains compensate by making assumptions (aka “stereotypes”) for everything…and everyone one we encounter. In other words, we are guided in our decision-making not just by the objective data we received but also by what we expect to be true. This can be an especially challenging problem for those who are trying to make hiring decisions in an ethical and unbiased manner. The hardest part of this is that we don’t feel or believe that we are allowing bias to color our perceptions…but it does anyway.
This issue effects every company across the country and it is a serious problem that can only be addressed by actively discussing it and taking active steps to acknowledge and eliminate our unconscious biases. This Fast Company article discusses the problem and some tactics that we can all use to combat it. It’s a good article and I commend it to your reading.
So if my biases are “unconscious” how can I do anything about them? After all, I don’t even know I’m being biased right? Well, not exactly. We know you are being biased. We now know that we are all biased. So the remedy is to change the way we make decisions so that these unconscious biases are limited by the systems we design. Taking pictures, names, etc out of hiring materials so that initial hiring decisions (or interview lists) are made without knowledge of the candidates’ demographic information is one simple example. Creating clear criteria for evaluating candidates before looking at their qualifications is another. More reliance on objective data and less reliance on your “gut” should be the goal.
The article discusses this in greater detail here. It is an important issue that I hope employers and HR specialists start to pay greater attention to.
Here are the Employment Law Reader Entries for October 6, 2014:
Here are the Employment Law Reader Entries for September 22, 2014:
Shell Oil Co. and Motiva Enterprises LLC, which markets Shell gasoline and other products, have agreed to pay $4,470,764 in overtime back wages to 2,677 current and former chemical and refinery employees as a result of investigations by the U.S. Department of Labor that found violations of the Fair Labor Standards Act.
The department’s Wage and Hour Division conducted investigations at eight Shell and Motiva facilities in Alabama, California, Louisiana, Texas and Washington, which found that the companies violated FLSA overtime provisions by not paying workers for the time spent at mandatory pre-shift meetings and failing to record the time spent at these meetings.
“Employers are legally required to pay workers for all hours worked,” said U.S. Secretary of Labor Thomas E. Perez. “Whether in the international oil industry, as in this case, or a local family-run restaurant, the Labor Department is working to ensure that responsible employers do not experience a competitive disadvantage because they play by the rules.”
The Wage and Hour Division’s Houston District Office coordinated investigations with the Gulf Coast, New Orleans, San Francisco and Seattle District Offices to ensure nationwide compliance by Shell and Motiva. The findings revealed that those eight Shell Oil and Motiva refineries failed to pay workers for time spent attending mandatory pre-shift meetings. The companies required the workers to come to the meetings before the start of their 12-hour shift. Because the companies failed to consider time spent at mandatory pre-shift meetings as compensable, employees were not paid for all hours worked and did not receive all of the overtime pay of time and one-half their regular rate of pay for hours worked over 40 in a workweek. Additionally, the refineries did not keep accurate time records.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour. Workers who are not employed in agriculture and not otherwise exempt from overtime compensation are entitled to time and one-half their regular rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and it prohibits employers from retaliating against employees who exercise their rights under the law.
Source: US Department of Labor
Here are my Reader picks for today, September 16, 2014:
The Equal Employment Opportunity Commission (“EEOC”) has filed suit against Taprite Fassco Manufacturing, Inc., a San Antonio-based supplier of CO2 regulators in the soda and beer industries, in a case related to a similar case recently filed against the same employer by The McKinney Law Firm. Here is a copy of the EEOC’s press release regarding their filing.
SAN ANTONIO, Texas -Taprite Fassco Manufacturing, Inc., a San Antonio-based supplier of CO2 regulators in the soda and beer industries, violated several federal anti-discrimination laws in its treatment of one of its quality control inspectors, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit it filed today. The EEOC said the company subjected the woman to gender and disability discrimination and unlawfully retaliated against her for complaining.
According to the EEOC’s lawsuit, after the quality control inspector, a longtime employee, raised questions to management concerning wage disparity between the sexes among workers at Taprite Fassco’s San Antonio plant, management disciplined and demoted her into a less favorable and lower paying assembler position. The employee was physically unable to perform the new job because of her diagnosed rheumatoid arthritis and carpal tunnel syndrome.
The EEOC also charged that Taprite Fassco denied requests for accommodations that would have permitted the employee to continue working, thus violating the Americans with Disabilities Act (ADA). The EEOC said that even after she filed a complaint of discrimination alleging sex discrimination under both Title VII of the Civil Rights Act of 1964 and the Equal Pay Act, Taprite Fassco opted to pay her male replacement (whom she initially trained) substantially more than she was compensated for performing essentially the same work.
The EEOC’s San Antonio Field office filed suit (Civil Action No. 5:14-cv-00801) in U.S. District Court for the Western District of Texas, San Antonio Division, after first attempting to reach a pre-litigation settlement through the agency’s administrative conciliation process. The EEOC seeks back pay, compensatory damages and punitive damages for the victim, as well as injunctive relief.
“Enforcing laws that require equal pay for men and women performing the same jobs is a priority for the EEOC,” said David Rivela, senior trial attorney in the EEOC’s San Antonio Field Office. “Our employment statutes also safeguard workers from reprisal when the employees address managers about potentially unlawful practices. The EEOC will vigorously prosecute employers who retaliate against employees for simply seeking answers about their opportunities and protections.”
We bring you the best articles in employment law and related workplace HR issues.
Here are our picks for today, September 10, 2014: