FACTS ABOUT EMPLOYMENT LAW


Employment At-Will

In Wisconsin, most employment is employment at-will, meaning that an employee may generally be discharged at any time for any reason. Many employees think that if they have worked at a certain job for many years and have had no negative performance reviews, they cannot be fired. This is not true. In most cases, an employer has the right to terminate an employee for almost any reason or, in fact, for no reason at all. Similarly, the employee may choose to terminate his or her employment at any time and for any reason.

However, there are some specific reasons an employer  may not use in its decision to terminate or otherwise change the terms or conditions of employment. They are set out on the following pages.

Discrimination

An employer may not discharge an employee or otherwise affect the terms and conditions of employment on the basis of age, race, creed, color, handicap, marital status, sex, national origin, ancestry, sexual orientation, arrest record, conviction record, lawful use of a product off work premises, or membership in the national guard, state defense force or any reserve component of the armed forces.  None of these bases may be used to make any part of your employment decisions.  The only exception to this is a bona fide occupational qualification (BFOQ), the need for which is very rare and difficult to prove.  An example of a BFOQ would be a job that requires an individual with no conviction record.

Employment discrimination takes many forms, including any prohibited action having an adverse effect on the terms or conditions of employment.  An example would be refusing to consider a woman for a job entailing overnight travel on the assumption she would have child care problems.  Another form of employment discrimination is allowing a sexually — or otherwise discriminatorily — intimidating or harassing environment to prevail.  For instance, allowing offensive jokes or racist remarks after an employee has complained about it.  An employer is required to provide all employees with a work atmosphere free from such intimidation or harassment.

Breach of Contract

While it is generally not the case, some employees do have a contract of employment with their employer providing for a specific term of employment, or promising that an employee will not be terminated unless good cause is shown. Employers who want to be able to terminate employees freely should not enter into employment contracts without legal advice.

Employees who are members of a union have a collective bargaining agreement which normally protects them from termination without just cause.

Courts have interpreted some employee handbooks as a form of written employment contract. This usually happens when the handbook makes specific assurances of continued employment, or provides for aspecified program of progressive discipline. For example, if the employer guarantees that an employee will receive a verbal and written warning and a suspension prior to termination, the courts will normally require the employer to follow through with those steps prior to termination. One should read through the employee handbook and understand its terms before meeting with an attorney.  It may be wise to have an older handbook redrafted to ensure that it will not be construed as an employment contract.
Sometimes, breach of contract occurs when an employer verbally makes promises to the employee which are not kept. An example would be an employee who is lured away from an existing job to take employment with a new employer, only to be terminated a short time later for no apparent reason.

Violation of Public Policy

Courts may also intervene in your employment decision when the discipline or termination of an employee violates public policy. Examples of this would include an employee being terminated for filing a worker’s compensation claim, for testifying against an employer in a court of law, or for refusing to violate a law, regulation or statute when requested to do so by the employer.

An employee is also absolutely protected by statute from being reprimanded or discharged for engaging in union activities.

The courts may also intervene on the basis of public policy if the employee “whistle-blows” against a co-employee or the employer for violation of some law or other standard. For instance, an employee who is reprimanded or discharged for reporting criminal activities of a co-worker or an employer to the authorities may have a wrongful discharge claim.

Our courts strictly construe employment issues to preserve the employment at-will status unless employment discrimination, breach of contract or violation of public policy is clearly proven. As an example, age discrimination is not proven merely by showing that the employee happened to be over the age of 40 and was terminated. The employee must prove that the employer terminated him or her because of age.

"Constructive Discharge"

“Constructive discharge” means that an employee quits, claiming that no reasonable person could or should endure the working conditions that the employee was asked to endure.  If appropriate, a court may interpret an employee’s quitting as if s/he had actually been unjustly fired given the unreasonable conditions under which the employee was working immediately before quitting. Some examples which would provide for a constructive discharge include working in a sexually intimidating or harassing atmosphere, substantially reducing an employee's salary or hours, requesting an employee's resignation, or demanding that an employee perform work for which s/he is not trained.

There are several state and federal laws dealing with employment issues.

STATE LAWS

The more commonly used Wisconsin state employment laws include:

Wisconsin Fair Employment Act (WFEA)

Prohibits discrimination in terms and conditions of employment on the basis of age, race, creed, color, handicap, marital status, sex, national origin, ancestry, sexual orientation, arrest record, conviction record, membership in the national guard, state defense force, or any military reserve unit, or the use or nonuse of lawful products off the employer’s premise during non-working hours. Applies to employers who have one or more employees. (§ 111 Wis. Stats.)

Wisconsin Family & Medical Leave Act (WFMLA)

Requires unpaid leave of up to six weeks per year for the birth or adoption of a child, and up to two weeks for a serious health condition of an employee or member of an employee’s immediate family. Requires continuation of whatever insurance was provided to the employee before the leave. Job reinstatement rights are protected. Applies to employers with 50 or more permanent employees.  (§ 103.10 Wis. Stats.)  All such employers must post a WFMLA poster in a conspicuous place. (30 day statute of limitations)

Wisconsin Employment Peace Act

Provides an employee with the right of self organization and the right to form, join or assist labor organizations; prohibits employers from interfering with an employee’s right to engage in any such union related activities. Applies to any employer having one or more employees. (Does not include the state or any political subdivision, but these entities are covered by the State Employment Labor Relations Act, which is similar in scope). (§ 111.01 Wis. Stats.) (One year statute of limitations)

Wage and Hour Laws

Requires payment of overtime, sets maximum hours and minimum wages, requires payment of wages to a terminated employee within the next regularly scheduled pay period, requires employers to produce and/or copy personnel files if requested in writing within seven business days. Applies to employers who have one or more employees. (§ 103 Wis. Stats.)

There are also state laws regarding worker’s compensation and unemployment compensation which are beyond the scope of this guide.

FEDERAL LAWS

The more commonly used federal employment laws include:

Civil Rights Act of 1964 (Amended in 1991)

Prohibits discrimination in terms and conditions of employment on the basis of race, sex, color, national origin and religion. Applies to employers who have 15 or more employees. (42 USC § 2001(e))

Age Discrimination in Employment Act (ADEA)

Prohibits discrimination in terms and conditions of employment on the basis of age. Protects persons over the age of 40. Applies to employers who have 20 or more employees. (29 USC § 621)

Americans with Disabilities Act (ADA)

Prohibits discrimination in terms and conditions of employment on the basis of disability. Protects persons who are disabled or who are perceived as being disabled, who can perform the job with or without reasonable accommodation. Employers are required to provide reasonable accommodation if requested.  Applies to employers with 15 or more employees. (42 USC § 12101)

Family and Medical Leave Act (FMLA)

Requires unpaid leave of up to twelve weeks per year for either the birth or adoption of a child, or for a serious health condition of an employee or member of the employee’s immediate family. Requires continuation of whatever health insurance was provided to the employee before the leave.  Job reinstatement rights are protected. Applies to employers who have 50 or more employees, who can be employed at more than one job site, as long as the sites are within 75 miles of each other.  (29 USC § 2601) (Two year statute of limitations; three years if willful)

Equal Pay Act (EPA)

Prohibits gender-based wage discrimination for equal work. Applies to employers covered by the Fair Labor Standards Act (which is generally any employer engaged in any type of interstate activity).  (29 USC § 206)  (Two year statute of limitations; three years if willful)

Federal Labor Standards Act (FLSA)

General labor laws for all employers who engage in interstate commerce (which includes almost everyone) concerning minimum wages, overtime, record keeping, and youth employment standards. ( 29 U.S.C. 201; 29 CFR Parts 500-899)

GENERAL INFORMATION ABOUT PROCEDURE

Personnel File

The first thing many employees do if they suspect they are being treated unfairly is to request a copy of their personnel file.  An Employer then has seven business days within which to provide a copy of the file and can charge no more than the actual copying charges.  Certain documents need not be provided, however.  Employers should consult an attorney before providing any personnel file.  Failure to provide the personnel file in a timely manner will  subject the employer to fines ranging from $10 to $100 per day for each day of continued violation.

Filing or Defending A Claim

Unless otherwise noted above, discrimination claims, whether state or federal, must be filed within 300 days of the date the discriminatory action occurred.  Most discrimination claims are filed with the Equal Rights Division (ERD), a state agency, or the Equal Employment Opportunity Commission (EEOC), a federal administrative agency.  Wisconsin state employee claims are filed with the Wisconsin Personnel Commission.

The employee, called the Complainant, files a complaint with an administrative agency, with or without help from an attorney.  The employer, called the Respondent, will be notified of the complaint by the administrative agency and asked to respond to the complaint in writing.  Drafting these documents properly may make or break the case, and should not be done without consulting an attorney. 

The investigator for the administrative agency will contact those witnesses named by the parties who can provide information concerning the employee's claim. It is important that witnesses know that their names were given to the investigator, so they are prepared and can respond favorably and truthfully. The investigator normally sends named witnesses a questionnaire rather than contacting them personally or by telephone. This stage of the process normally takes many months and sometimes more than a year to complete. Your attorney should keep you informed of all significant developments.

Once an investigation is completed, the administrative agency renders a written decision on whether or not there is probable cause to believe discrimination has occurred.  If an initial determination of probable cause is issued, there will be a conciliation period during which the parties are encouraged to settle the matter. If settlement is not achieved, the case will be scheduled for hearing.  At the hearing,  evidence in the form of witness testimony and exhibits are introduced by each side.  These hearings are heard by an administrative law judge, rather than a jury, and are less formal than a court trial.

On the other hand, if the investigator initially determines that there is no probable cause to believe discrimination occurred, the employee may appeal and automatically has a right to a hearing on the issue of probable cause.

Federal or State Court

If the case has been filed with an administrative agency, the employee has the right to move the case to state or federal court in most circumstances. The advantage to doing this is that it gives the employee a right to a jury trial and, in some cases, compensatory and punitive damages. 

Claims involving breach of contract or violations of public policy are normally brought in state (circuit) court, in the county where the employer is located.  Employment discrimination claims under the Civil Rights Act or other federal laws may be presented in either a federal or Wisconsin court, and may be heard by a jury.  A claim brought in state or federal court is more formal than a claim before the Equal Rights Division, and is usually more costly to pursue or to defend.

Damages

What a successful employee can recover from an employment case varies with the type of claim made.  In employment discrimination cases filed with an administrative agency, successful employees who have been terminated are entitled to back pay with interest, job reinstatement and attorney fees.  In some circumstances, reinstatement is not an option, and a limited amount of front pay may be ordered.  There is no reciprocal provision regarding attorney fees.  If an employee loses, there is no requirement that the employee pay the employer's attorney fees.

With claims made under the Civil Rights Act or other federal laws, the employee is entitled, in many cases, to a jury trial and may be awarded front pay, liquidated, compensatory and/or punitive damages in addition to the other damages mentioned. Compensatory damages may include pain and suffering or mental anguish.

Generally, damages for claims of breach of contract or for employment decisions made in violation of public policy, attempt to put the employee back in the position s/he would have been in if the breach of contract or violation of public policy hadn't occurred.  For example, the employee might receive job reinstatement with back pay, or a sum of money to compensate him/her for the losses incurred because of the unlawful conduct. These kinds of claims, however, do not entitle an employee to attorney fees, as in employment discrimination claims.

 

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