Changing Legal Landscapes:

Employment Issues Affecting Your Business

Top Ten Texas Employment Law

Traps

First Trap:Something for Nothing -

Provisional/Probationary/Temporary Employees

Embrace the at-will doctrine

• The At-Will Doctrine in Texas– At-will is the rule in Texas

– Terminate relationship at any time, with or without notice, for any reason (or no reason) so long as it is not an illegal reason

– Creating probationary/provisional/temporary employee relationships waters this down

At Will Doctrine Still Supports Non-Competes

• Even at-will employees can sign non-competes– Consideration has to be something

like specialized training, confidential information, or goodwill (which included stock option plans)

– Even in absence of non-compete agreements, at-will employees owe common law fiduciary duties

– More on this topic can be found at Dave Evans

Second Trap:Ignoring Unemployment

Claims

The Benefits of Fighting UI Claims

• Free deposition

• May embolden a would-be plaintiff

• May impact your bottom line more than and longer than you think

Third Trap:Taking the Bait

The principle of the matter …

• Settle complaints quickly unless compelling reasons to do otherwise– Consider arbitration agreements for

every employee

– Litigation costs are crippling

– The Retaliation Hydra

Fourth Trap:Assuming too much

Just because you have employees, doesn’t make you an “employer” under all statutes• Just a few examples …

– Family Medical Leave Act • 50-employees/75 mile radius

– Title VII/Age Discrimination in Employment Act • 15-employee minimum

– Americans with Disabilities Act • 15-employee minimum

Fifth Trap:Not assuming enough

The gay marriage ruling I’ve heard so much about won’t affect my (small) business

…

Sixth Trap:Misclassifying

Independent Contractors

Independent Contractors Misclassification:

• Has both state and federal dimensions

• Hot button issue due to declining receipts and/or increased claims

• TWC has guidance both on UI and IRS– Slanted against ind. contracting

relationship

• When in doubt, treat as employees because TWC and IRS can change their minds

Seventh Trap:Misclassifying FLSA Exempt Employees

Fair Labor Standards Act

• Most violated employment law in the nation– Labels don’t matter– Agreements don’t matter– Salaries don’t (really) matter – Duties are the key factor (but impossible to

understand)– Damages can be staggering

Eighth Trap:Calling An Attorney Too

Late

Call Attorney Early in the Process

• Consultations should be free or low cost, but could help you avoid tremendous cost down the line.

• May be covered by insurance anyway

• Checks your blind-spot, especially with respect to comparative evidence

Ninth Trap:Getting Sued Away from

Home

Venue Issues

• Do not personally recruit in venues you would not want to litigate in

• Be careful what you say about a former employee to anyone, especially if they are from another town– Only confirm name, rank and serial

number• Consider choice-of-venue

provisions in all of your contracts, including employment contracts for certain workers

Tenth Trap:Paper Giveth, Paper Taketh

Away

Be careful what you document

• DO use paper to document disciplinary measures, even if not provided to employee.– Oral discipline with emails to file– Just the facts - leave details and

emotions out of the equation– Discuss content with recipient

before sending• Emails are like zombies, they

never die

Practice What You Print

• Let your practices dictate your policies, not vice-versa

• Mimic the Texas Workforce Commission’s “Handbook for Texas Employers” on-line

• Leave yourself room to manuever

Preach What You Print

• Train your management to follow policies

• Audit employment decisions, especially for comparative past treatment of other employees

• Remember retaliation is its own protected classification, and perhaps the most dangerous