Debris
«chaque notaire porte en soi les débris d’un poète.»Archive for employment
Easterbrookian claptrap
In my Employment Law class today, I am covering intentional interference with the employment relationship, for which the students are reading Judge Frank Easterbrook’s opinion in Kumpf v. Steinhaus, 779 F.2d 1323 (7th Cir. 1985). The opinion is noteworthy, not so much for its treatment of the intentional tort issue, as for the tortured logic of Judge Easterbrook’s opinion.
In Kumpf, the former President and CEO of an insurance agency (who also owned 20% of the agency’s shares) sued after his job was eliminated in the course of a corporate merger. The merger was engineered by Steinhaus, the Executive Vice-President of the agency’s parent corporation, who became President of the post-merger agency. Kumpf contended that the merger was motivated, at least in part, by Steinhaus’s self-interest and that Kumpf’s resulting loss of employment was thus subject to legal challenge despite his “at-will” status.
Judge Easterbrook flatly rejects Kumpf’s theory, contending that, as an at-will employee, he enjoyed no protection from even bad-faith termination. Along the way, he offers a paean to the virtues of greed (which, as the casebook editors note,1 echoes the famous “Greed is good” declaration in the movie Wall Street). He also makes the following observation about the value of at-will employment:
The privilege to manage corporate affairs is reinforced by the rationale of employment at will. Kumpf had no tenure of office. The lack of job security gave him a keen motive to do well. Security of position may diminish that incentive.
In support of that proposition, Easterbrook cites, not Wisconsin law, but his former University of Chicago Law School colleague Richard Epstein’s article, In Defense of Contract at Will, 51 U. Chi. L. Rev. 947 (1984).2 Curiously, Easterbrook (like Epstein before him) fails to address whether the same incentives apply to life-tenured federal judges or tenured law professors.
In further defense of Steinhaus’s self-interested motives, Easterbrook offers the following observation (again unsupported by any authority under Wisconsin law):
Often corporations choose to align the interests of investors and managers by giving the managers a share of the firm’s revenue or profits. Commissions, the ownership of stock options, and bonuses all make managers and investors do well or poorly together.
Re-reading that passage this morning, I couldn’t help but wonder whether the investors in AIG (a.k.a. We the People of the United States) would agree with Judge Easterbrook’s certitude on the magical powers of bonuses to align executive and investor interests.
1Timothy Glynn & Charles Sullivan from Seton Hall, and Rachel Arnow-Richman from University of Denver.
2The casebook editors rightly question whether Easterbrook’s application of “Chicago school” law & economics, in a case goverened by Wisconsin common law, is faithful to the Erie doctrine. They further note that Easterbrook’s analogy to the “business-judgment rule” is entirely misplaced under the circumstances of the case, both because the rule (a staple of corporate law) applies to corporate directors, not corporate managers more generally, and because the rule specifically does not apply where the decision in question involves a self-interested transaction as was alleged to be the case in Kumpf.
Romance without finance ain’t got no chance
“Online dating coach” is an occupation so nonsensical that it could be the perfect synecdoche for early 21st Century American late capitalism.
Court holds federal law prohibits discrimination against transgender employees
Feminist Law Professors reports on an historic decision recognizing that an employer’s refusal to hire a qualified job applicant after learning she is transitioning from male to female violates the prohibition against sex discrimination in employment under Title VII of the Civil Rights Act of 1964:
After a full trial (described in previous posts here and here), the judge found that Schroer should prevail on both of the legal theories offered by her lawyers. First, the judge found that there was “compelling evidence that the Library’s hiring decision was infected by sex stereotypes.” On that basis, Schroer was entitled to relief under the line of cases beginning with Price Waterhouse v. Hopkins, 490 U.S. 228 (1989), which created the sex stereotyping doctine. In that case, the Court found that Title VII was violated when a woman was denied a job after being told to wear make-up and take a course at charm school. Evidence in the Schroer trial established that the negative reaction to Schroer grew out of her not fitting gender stereotypes by virtue of her decision to change genders.
More important was the second theory: that discrimination based on gender transition is literally discrimination based on sex. Schorer’s lawyers argued, and the judge agreed, that gender identity is a component of sex and therefore discrimination based on gender identity is sex discrimination. This might sound like a simple proposition, but previous federal courts have “carved [transgender] persons out of the statute by concluding that ‘transsexuality’ is unprotected by Title VII.”
This is very good news for everyone who believes that all workers deserve fair consideration and treatment from employers.
NASCAR discrimination lawsuit follow-up
SI.com reports that NASCAR has suspended two of the officials named in the Mauricia Grant race and gender discrimination lawsuit. According to SI.com, the two officials, whom NASCAR declined to identify, “have been placed on administrative leave for violating company policy”.
The SI.com story also contains this chuckle-inducing tidbit: one of the officials Grant accuses of harassment is named — I’m not making this up! — David Duke. He was fired before Grant filed her lawsuit, for what NASCAR says were unrelated reasons.
By the way, I should note that my focus on this story should not be mistaken for NASCAR-bashing. As a former employment lawyer and current employment law professor, I’m naturally interested in any high-profile employment discrimination case like this. But this story especially captured my attention precisely because I enjoy auto racing, including NASCAR (I like Joe Nemechek), and I hate to see the sport caught up in an incident that perpetuates the “redneck” image that leads so many to dismiss and disparage an exciting activity.
Former NASCAR employee sues over racist, sexist treatment
A lawsuit by a former NASCAR employee alleges a disturbing pattern of racist and sexist harassment and discrimination, including co-workers who referred to her as “Nappy Headed Mo” and “Queen Sheba” and told her she worked on “colored people time”, and a supervisor who made repeated references to the Ku Klux Klan. Mauricia Grant, an African-American female, was a pre-race vehicle inspector until she was fired after complaining about a hostile work environment. The allegations in her complaint paint a disturbing picture and suggest that NASCAR has some way to go in shedding its redneck image:
• Grant was forced to work outside more often than the white male officials because her ” supervisors believed she couldn’t sunburn because she was black.
• While riding in the backseat of her car pool at Talladega Superspeedway, co-workers told her to duck as they passed race fans. “I don’t want to start a riot when these fans see a black woman in my car,” she claims one official said.
• When packing up a dark garage at Texas Motor Speedway an official told Grant: “Keep smiling and pop your eyes out ’cause we can’t see you.”
• When she ignored advances from co-workers, Grant was accused of being gay. She also claimed co-workers questioned the sexual orientation of two other female officials.
Wal*Mart launches new market-based initiative to change law firm employment practices
Wal*Mart has written its outside legal counsel, complaining about recent pay hikes for law firm associates. The retail giant — which, coincidentally, labels its own wage-slaves “associates” — is unhappy that the firms have tried to pass along the cost in the form of higher billing rates. Wal*Mart — which, coincidentally, is currently the defendant in the largest-ever class action employment discrimination lawsuit — previously garnered praise for urging its legal counsel to increase gender and racial diversity among their attorneys.
Take this agreement, or shove it
The 9th Circuit U.S. Court of Appeals has lambasted mega-law firm O’Melveney & Myers (whose website boasts, “We are a values-driven law firm, guided by the principles of excellence, leadership, and citizenship”) over an unconscionable arbitration clause it imposed on employees. Having spent the past year litigating against OMM in a case over their client’s unconscionable employment practices, I must confess to deriving more than a little schadenfreude from this decision.
Illegal immigration takes its toll in the corporate suites
In a special report on “Immigration: The Human Cost“, the Onion News Network addresses the plight of corporate executives losing their jobs to low-paid illegal immigrants.
(Thanks to TomPaine.com for the tip.)
