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Five States Most Likely to See Employee Lawsuits

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Businesses in California, Illinois, Alabama, Mississippi and the District of Columbia face a markedly higher risk of being sued by their employees compared to the national average, according to a study by Hiscox.

“Not only are employment lawsuits more likely in those states, but the likelihood of catastrophic verdicts is also significantly higher,” Mark Ogden, managing partner of Littler Mendelson, employment and labor law firm said in a statement. “Unlike their federal counterparts, where compensatory and punitive damages combined are capped at $300,000.00, most state employment statutes impose no damages ceilings.

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Consequently, employers in high-risk states must ensure that their workforces are adequately trained regarding workplace discrimination, harassment and retaliation and that policies forbidding such conduct are strictly enforced.”

The study found that a U.S.-based business with at least 10 employees has a 12.5% chance of having an employment liability charge filed against it. Businesses in several states, however, face a much higher level of exposure to litigation. California tops the list with establishments with at least 10 employees having a 42% higher chance above the national average of being sued by an employee. Other states and jurisdictions include the District of Columbia (32%), Illinois (26%), Alabama (25%), Mississippi (19%), Arizona (19%) and Georgia (18%). Lower-risk states for EPL charges include West Virginia, Massachusetts, Michigan, Kentucky and Washington.

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State laws can have a significant impact. For example, the employee-friendly nature of California law in the area of disability discrimination may contribute to the high charge frequency in the state.

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Discrimination cases filed at the state level in California are brought under the Fair Employment and Housing Act (FEHA).

FEHA applies to a broader range of businesses, covering any company with five employees, versus a 15-employee minimum for cases brought under federal law as outlined in Title VII of the Civil Rights Act, according to Hiscox.

Sanction Award Issued Against EEOC for Spoliation

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In a case we previously blogged about, EEOC v. Womble Carlyle Sandridge & Rice, LLP, (E.D.N.C. Mar. 24, 2014), Magistrate Judge L. Patrick Auld held the EEOC liable for spoliation sanctions based on the “negligence, if not gross negligence” exhibited by the charging party it brought suit on behalf of – one Ms. Charlesetta Jennings (Ms. Jennings).  When served with the bill of costs by Womble Carlyle, the EEOC objected to the amount as unreasonable.  In his decision, Judge Auld rejected the EEOC’s argument and ordered the EEOC responsible for $22,900 as the reasonable costs incurred by Womble Carlyle.

Background

The EEOC filed suit on behalf of Ms. Jennings in 2013 alleging that Womble Carlyle failed to accommodate her disability and subsequently terminated her employment because of the disability in violation of the Americans With Disabilities Act (ADA).  As the EEOC sought back pay on behalf of Ms. Jennings, Womble Carlyle served document demands and interrogatories designed to determine whether she properly mitigated her damages by seeking alternative employment. While being deposed in September 2013, Ms. Jennings testified that she had previously maintained a detailed log chronicling her efforts to obtain alternative employment while she was receiving unemployment insurance benefits; however, once these benefits ended in February 2013, she shredded the log. Further, she testified that she discarded additional material regarding her efforts to obtain employment in June of 2013 – which was after the EEOC had already filed its lawsuit on behalf of Ms. Jennings in January 2013.

Based on Ms. Jennings’ destruction of these documents, Womble Carlyle sought sanctions for spoliation of evidence, which the Court granted and ordered the EEOC to reimburse Womble Carlyle its costs and fees associated with having to bring the spoliation motion.  As a result, Womble Carlyle submitted a Statement of Expenses totaling $29,651.  The EEOC contested the $29,651 amount as unreasonable on several grounds, including its position that Womble Carlyle attorneys “duplicated their efforts” during discovery and that it should not have to pay for the time spent by one attorney reviewing the work of another, where both attorneys are experienced litigators.

The Court’s Decision

As the EEOC objected to the number of hours spent by Womble Carlyle attorneys in relation to the spoliation motion, Judge Auld held it was up to Womble Carlyle to “document the need to have devoted the amount of time for which it seeks compensation” through the submission of “reliable billing records, and…exercise of billing judgment” to deduct time “not properly shown to have been incurred in pursuit of the matter at issue or that is otherwise not reasonable in amount of necessarily incurred.”

Judge Auld rejected the EEOC’s contention that Womble Carlyle attorneys unnecessarily duplicated their efforts in drafting discovery and that it should not be forced to pay for the time spent by one attorney reviewing the work of another attorney “where both attorneys are experienced litigators.”  In doing so, Judge Auld held that after his review, the billing records of Womble Carlyle’s attorneys were reasonable given the nature of the sanction motion and were not duplicative.

Additionally, Judge Auld rejected the EEOC’s request that the Court should reduce by two-thirds the amount of costs since the Court only awarded monetary sanctions and did not grant the other two forms of relief requested by Womble Carlyle: dismissal of the back pay claim, and an adverse inference jury instruction (which the court reserved judgment on until trial).  Judge Auld held that “the fact that the undersigned Magistrate Judge declined to recommend one form of sanction…should not reduce the amount of the recommended sanction of reasonable expenses.”

Judge Auld, however, did reduce Womble Carlyle’s cost application by $6,600 because it failed to demonstrate why it spent 12 more hours on an 11 page reply brief with six exhibits than it spent on an 18-page opening brief with 16 exhibits.  Additionally, Judge Auld reduced the cost award by $151 based on certain block billing entries which were insufficient to meet Womble Carlyle’s burden to support its fee request.  As a result, Judge Auld held the EEOC liable for a total of $22,900 of Womble Carlyle’s costs and fees associated with the spoliation motion.

Implications for Employers

As this case demonstrates, decisions made regarding the preservation of evidence issues at the beginning of, and even leading up to, litigation can have very serious implications, whether in the form of sanctions, an adverse inference at trial or even outright dismissal.  This decision (and Judge Auld’s prior decision) should be added to employers’ defense toolkits, as the preservation of documents and information is a two-way street that employees (and the EEOC) must also follow once litigation is reasonably foreseeable – or proceed at their own peril.

This blog was previously published by Seyfarth Shaw LLP.

Why Employees Quit—And How to Keep Them

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Why Employees Quit

Employee turnover creates tremendous risk—resources are lost in recruitment and training, productivity lags with insufficient staffing, intellectual property can be exposed, and no company wants to get a reputation as a place where no one can stay very long. Further, the implications for workers comp, lawsuits and insurance extended to employees can cause headaches long after a desk has been cleared out.

A few recent studies highlight some of the biggest factors contributing to employee turnover resultant human resources risk, and what managers can do to keep staff and avoid risk.

Why Employees Leave

A new “exit survey” conducted by LinkedIn among members from five countries found that top reason workers left their jobs was because they wanted greater opportunities for advancement. In a related study from the social network, the number one reason employees who were not actively seeking a new job would be willing to leave was for better compensation or benefits. Regular performance reviews and assessments that open up opportunity for advancement in both responsibilities and salary can help keep employees engaged—and prevent feeling they have to stray to stay on top.

Room to Improve

Another recent study from LinkedIn found that 69% of human resources managers thought that employees were well aware of internal advancement programs. Yet only 25% of departing employees said they knew about these opportunities. In fact, of those who stayed within the company and found a new position internally, two thirds found out about the opportunity through informal interaction with coworkers. Strengthening formal retention and advancement programs and improving awareness of these initiatives may go a long way toward getting employees to use them.

Why New Hires Quit

One in six employees quits a new job within six months — and 15% either make plans to do so or quit outright within that time frame, according to Time. HR software company BambooHR found that the primary factor was “onboarding problems”—in other words, HR or managers are failing to properly orient new hires and integrate them into the workplace. This may seem silly, but they could have reason to feel this is a fatal flaw: research from John Kammeyer-Mueller, associate professor at the University of Minnesota’s Carlson School of Management, found that there is only a 90-day window for settling in. If your new employee is not caught up to speed by then, you may see them walk out the door.

Getting Employees to Stay

CareerBuilder surveyed thousands of workers recently to gain insight into why they decide to stay or go. Of those who plan to stay at their jobs, the top reasons they did not want to leave included: liking the people they work with (54%), having a good work/life balance (50%), being satisfied with the benefits package (49%), and feeling happy with their salary (43%). Of those who are unhappy, however, 58% said they plan to leave in the next year. Making sure these bases are covered is a strong step to keeping your top talent at their desks.

Check out the infographic below for more of LinkedIn’s insights into why employees leave, and what you lose when they go:

Mudslide Was Forewarned, Experts Assert

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Shutterstock/Dan Schreiber. Mudslides scar Washington hillsides.

Even as rescue teams search for more bodies in the aftermath of the March 22 mud slide in Washington, records show that while the area is prone to these disasters, homes were allowed to be built there anyway.

The slide, triggered by excessive rain, has claimed 24 lives so far and 176 are still unaccounted for, the Associated Press reports.

Snohomish County Emergency Management Director John Pennington said during a news conference on March 24 that the slide was “completely unforeseen” and that it “came out of nowhere.”

In a 1999 report filed with the U.S. Army Corps of Engineers, however, geomorph­ologist Daniel J.

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Miller and his wife, Lynne Rodgers Miller, warned of “the potential for a large catastrophic failure” in the area, according to the Seattle Times.

“We’ve known it would happen at some point,” Daniel Miller said. “We just didn’t know when.” He added that after a mudslide in 2006, he was surprised to find that more building was allowed in the area just weeks later. “Frankly, I was shocked that the county permitted any building across from the river,” he told the Seattle Times. “We’ve known that it’s been failing,” he said of the hill. “It’s not unknown that this hazard exists.

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”

The area has a history of mudslides. After two earlier slides on the hill in 1949 and 1951, recommendations were made to permanently divert the Stillaguamish River or build berms to reinforce the slide area.

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Howard Coombs of the University of Washington, however, concluded that any fix was likely to be temporary.

A thousand-foot berm was built in the fall of 1960, but it was mostly destroyed by high water in the Stillaguamish the following year, according to state records. Other barriers that were built were also destroyed by mud, the report said.

Tracy Drury, an environmental engineer and applied geomorphologist said there have been discussions over the years about whether to buy out property owners in the area, but that the talks never became serious proposals, The Seattle Times reported.