Laid-off employees get litigious
A man reacts to being terminated from his job
TEXT OF STORY
Tess Vigeland: As we've continued to track the fallout of this economic crisis, we've noticed one profession turning lemons into lemonade -- attorneys. Bankruptcy lawyers are doing a lot of work, of course; so are securities specialists, especially those with client tied to Bernie Maddof's alleged Ponzi scheme. Today we hear that labor lawyers are also on a bit of a roll. Marketplace's entrepreneurship reporter Mitchell Hartman has that story.
Mitchell Hartman: With massive job cuts sweeping the nation, law partner Paula Barran of Portland, OR, says more employers are being sued for discrimination. Laid-off employees have more time to sit around and stew with the economy in a slump, and that's making them litigious. So companies should be careful.
Paula Barran: You want to make sure that as you are doing the selections, you have very defensible ways of selecting the people who are going to be laid off.
Barran says employers should have legitimate business-based criteria -- like cost -- for putting people on the list. Then, they should check that list twice.
Barran: If you find that you are laying off more minorities, more women, more older people, figure out why. Is it because they were the latest hired, and you're doing this by last in, first out. That's a pretty defensible way to do it.
But when layoffs are performance-based, companies risk lawsuits if women or minorities disproportionately get the ax. Virginia Keeny is a plaintiff's lawyer in Pasadena, CA.
Virginia Keeny: If it's a woman, can she see a pattern of women being singled out for layoff while younger men or men are being retained.
Keeny says an employer could also be getting rid of "squeaky wheels" in the workplace under cover of layoffs.
Keeny: You could have a wrongful termination where someone has been a whistleblower at work, they've raised complaints that the employer, for example, may be violating the law.
Employers might consider this advice from Paula Barran: offer a generous severance package; that'll encourage laid-off employees to sign an agreement not to sue you down the road.
I'm Mitchell Hartman for Marketplace.