Employment Law Perna Spring 2016
National Labor Relations Act
Adjudication without courts
Pay attention to policy and implementation
Legal Rules that work in an Employee/er relationship
Immutable- parties cannot change by agreement
Default Rules- generally accepted rules unless both agree otherwise
Information: may be hidden risks an employee takes not know that an immutable rule could prevent
Psychology: employees underestimate the risk and so are underpaid for it
Public Good: fixing a harm to one worker effects all other workers in the environment positively
Third Party Effects: Insurance companies should have a say in it because they pay for injury
Norms and Preferences: safety as a societal requirements instead of optional
MOST IMPORTANT DEFAULT: employment at will: can term at any tie for any reason unless another agreement is reached
Union v. nonunion employees
Union workers are less than 10%
Private Non Union Workers: our focus
Determined by contract
Most terms determined by what parties want or need
Those with mental capital have no limits as far as their contracts
Those with low mental capital are minimum wage
Are there decisions (safety/discrimination/otherwise) that should be made by the state?
Contractor v. employee
Who has control of business?
Who invested in the business or has the most to lose?
Who has capital investment in the business?
Is the worker one of significant skill?
How temporary or exclusive is it?
Is the worker’s job an integral part of the business?
Are they dependent on the employer?
We should protect the low wage/low skill workers because they have less power
We should also protect third parties- who has the best position to prevent harm to third parties?
IRS has 21 factors to determine if employee or ICON.If ICON, must do own taxes and own liability
Filling in the Gaps of an employment K
Almost every single state starts with presumption of at will doctrine
Fire without terms at anytime
Fire without any reason
The question next is: How can it be changed and what limits on those changes?
Contract Erosions of Employment at Will
Satisfaction K: must fire based on good faith just cause
Unilateral K: acceptance of a party’s terms by performance
Bilateral K: negotiated and agreed upon K, both parties bargained
Express Modification of at will K, written and oral
Words are enough to make an oral K a lifetime K
SOF doesn’t stop it because it is not specifically outside a year.
Even though this was a lifetime K it IS ALSO AND INDEFINITE term K which can be termed for ECON downturn w/o being in writing
They did not fire him for valid reasons
Moral Hazards- when people are protected against getting fired, they’re unlikely to behave as well
Public policy expectation of being loyal and fulfilling his duties
Reliance and Implied in fact Terms of K
efinite term K can be terminated for economic down turn and would not have to be in writing
Probation period: EAW afterwards
Unilateral K- acceptance of one party’s terms by performance
Unless there is a clear and prominent disclaimer about the terms in a manual NOT being binding, then they are BINDING
New manual=new offer; showing up at work is acceptance
Work = new consideration AFTER A REASONABLE TIME TO ACCEPT OR REJECT
Overarching K; reliance is presumed even on those that don’t read it
Policy of manual: deter unionization and improving employee morale
Manuals aren’t static and neither are or-ee relationships- do we deal at arm’s length OR do we intervene to take over in a way that betters society and the relationship
An implied in fact K cannot be modified unilaterally. Must have
An offer to modify
Consent or acceptance
Consideration- here, continued employment is not enough
Middle ground: an employer may eliminate or modify prior uni statements by providing reasonable notice- this is when the manuals are handed out late
When providing consideration for an additional term, must show substantial hardship = consideration to where it’s obvious they agreed on a new term