Employment Skinny
I. Independent Contractor
a. Matter of how much control is asserted over worker
b. IC are not considered employees and are not eligible for benefits
c. 6 Lauritzen Factors
II. Joint Employers
a. Economic Reality Test – goal is to expose outsourcing relationships that lack a substantial ecomomic purpose, and only allow employers to use that relationship when there is a strategically-oriented contracting scheme
b. Employee leasing
III. At-will
a.
b. Exceptions
1. Express Modification
1. Specific term contract – most obvious
2. Reliance and Implied in Fact Contracts
1. No express contract to begin with; more focus on employee behavior
2.
3. Manuals – can sometimes be used as implied-in-fact contracts erasing at-will employment
1. Demasse Majority Factors
– Notice
– Understanding
– Affirmed consent
2. Demasse Minority
– continuing employment is consideration and continuing to work is acceptance
3. Middle Ground
– must provide notice of policy changes
4. NC – only one rare case that has implied a contract from a manual
IV. Torts
a. Wrongful Discharge in Violation of Public Policy – Recognizes some job protection to a protected employee for a public policy reason
1. Refusing to commit unlawful acts; ex – refusing to commit perjury (Petermann)
1. Extended to employees who in good faith attempt to find out if the act is illegal (Johnston v. Del Mar); not all courts would recognize this; also, some courts don’t allow for ignorance of the law as an excuse, therefore require employee to be right
2. Sabine, limits to criminal acts
2. Exercising a statutory right; ex – filing for workers’ comp (Frampton)
1. Weakest third party injury argument
2. Source of public policy is of concern, often needs to be statutory, but sometimes may be only guidelines, (Wright did not allow guidelines)
3. Fulfilling a public obligation; ex – jury duty (Nees)
4. Whistle blowing – ex – reporting unlawful conduct to inside/outside authorities
1. This is a growing category
2. Not all states recognize, some states have statutory protection
3. May be extended where non-acting third party employee blew whistle, and court extended protection to acting employee; Rare
· Sarbanes Oxley Act – a response to Enron/Sherron Watkins, WorldCom like incidents, only applies to publicly held companies; includes internal reports to supervisors as long as they have the authority to investigate; partially waives certain attorney-client communications; not going to be many prosecutions, mainly to act as a deterrence.
5. Employee in protected employment class (NC)
1. Statute provides public policy protection, but claim is alternate to a Title VII claim
b. Cases that fail to connect generally have good public policy but lack connection with public policy in favor of employment
1. Stockholder/employee sues when he is fired for not selling his stock back to company
2. P.122 note 3 gives many examples that are not recognized
c. State Public Policy vs. Federal Statute
1. Battle between state and federal public policy – P.126 NC had no obligation to use its tort system to bolster federal policies; most courts would probably go the other way
2. Middle Ground – Demonstrate that the federal law has an impact on the citizens of the state
d. Statute vs tort protection – state that have statutory claims are less likely to provide for a tort claim because the legislative intent is more obvious, and probably going to be more constraining
e. IIED – Egregious Behavior
Different from wrongful discharge bc don’t have to be discharged, can bring against supervisor, and also after a rightful discharge but in a wrongful manner
1. IIED – must be intentional
1. Intent to cause distress (ax murderer standard)
– Or reckless disregard
2. Extreme and outrageous – beyond all possible bounds of decency tolerated by society
3. Causation
4. Actual emotional distress that is severe so no reasonable man could endure
– Some states require physical manifestation
Agis, established an IIED claim by allowing it to survive 12-b-6
2. Special Relationship – lowers intentional standard due to position of power, à NIED
1. Negligent, a reasonable person should have realized actions would have caused emotional distress
2. Minority of courts would use this lowered standard
Bodewig v. K-Mart
f.
have to quit first before they pursue any other employment; also, at-will doctrine allows employers to fire at anytime
5. Ends at termination, unless there is a duty not to compete
6. Safe harbor – don’t contact customers or employees until termination. In reality, advice client of risks associated each choice
i. Misappropriation of Trade Secrets – it must be shown that a defendant has been unjustly enriched by the improper appropriation, use or disclosure of a “trade secret”
1. Trade Secret – tough cases – what is are trade secrets?
1. Derives independent actual or potential commercial value from not being generally known or readily ascertainable through independent development or reverse engineering by persons who can obtain economic value from its disclosure or use; and
2. Efforts that are reasonable under the circumstances to maintain its secrecy
3. MIA, held customer lists were trade secrets
2. Misappropriation
1. Most states require actual, rather than threatened misapprop.
2. Improper acquisition of trade secrets can be actionable
3. Proper acquisition if …
4. Distinguish MIA from Jet Currier, Jet Courrier’s customer lists were not secrets bc you could just open phone book and look up banks
3. NC’s trade secret six factors
1. Extent to which the info is known outside the business
2. Extent to which it is known to employees and others involved in the business
3. Extent of measures taken to guard the secrecy of the information
4. Value of information to business and its competitors
5. Amount of effort or money expended in developing the information, AND
6. Ease or difficulty with which the information could property be acquired or duplicated by others
4. Don’t have to physically take
If just memorized, tough to prove you wrongfully took
