Employee problems can lead to legal troubles

Consult with attorney on employee complaints

Every new year brings new laws — including some that all employers should know about. But more important than keeping up to speed on personnel legislation is staying abreast of legal case precedents.

Lou Ann Koval, an attorney with the Milwaukee law firm Beck, Chaet, Molony & Bamberger, says common law tort claims are something every staffing supervisor should keep an eye on. One recent case, in particular, should be noted: the so-called Seinfeld case.

In this case, McKenzie v. Miller Brewing, a man discussing specifics of an episode of Seinfeld offended a female employee. She complained to her superiors that she was being sexually harassed by the comments made about the episode. The employer fired the man. He sued Miller Brewing and the employee who filed the complaint and won millions of dollars, as well as reinstatement.

"This case shows the difficulty employers have in addressing employee complaints," says Koval. "Miller was in a catch 22 situation — the employee complained about sexual harassment, so Miller took action. But then they were sued by the employee who claimed Miller tortuously interfered with his employment relationship."

What’s the answer? Koval says you must be sure to have competent counsel on board and a human resources department — even if it is only one person — who will address employee complaints. "If you have a complaint come in, contact the attorney immediately," she advises. "Don’t try to solve the problem yourself first."

One of the mistakes that Miller made was trying to come up with another reason for the dismissal, she says — for instance, not performing up to par or violating some employee policy that is usually ignored. "You have to be careful about these kinds of pretext. The honest answer always comes out, and the employers look like they have blood on their hands. That’s what happened in the Seinfeld case."

There are other types of cases to be aware of, too, she says, such as defamation cases and cases related to reference checks on potential new hires. "Most practices just can’t afford to fight these cases to the end. The problem then becomes discouraging every disgruntled employee from suing you in hopes of getting a nuisance settlement."

Again, your legal counsel should be able to advise you when it’s a good idea to take an aggressive stand in order to discourage like claims, she adds. Koval says that while case law will have more of an impact on your practice than most of the new legislation, there are some new laws you should be aware of. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 went into effect in October 1997. Basically, this requires you to let your state know about every new hire you make. Aside from a bit of additional paperwork, this should have little impact on the practice you work for.

The same applies for the Health Insurance Portability and Accountability Act, also known as the Kennedy-Kassebaum Bill. Koval says the paperwork for this is heavier. "Just make sure you follow through on it," she says.

You should also be aware of changes in state personnel laws and whether those state laws supersede federal legislation. Your state bar, state chamber of commerce, and even your state medical association or local chapter of the Medical Group Management Association may be able to help you in determining what laws are coming into effect in the near future.