by Gabriel Conroy
We’ve had plenty discussions on the “meta” of labor regulations, contemplating whether one side wants the least advantaged among us to earn the lowest wage possible under the worst possible conditions and whether the other side wants such people to live a life of ceaseless idleness and unrelenting despair. No one seriously wants either. So here I offer a different kind of “META” discussion, the Model Employment Termination Act, to be exact, a model law based in part on a “for cause” Montana law passed in 1987. It’s a regulation I support with qualifications.
A summary can be found at the above link, but the short version is that it replaces “at will” employment with “for cause” employment. “At will” means the boss can fire you any reason, for no reason, or for a bad reason. “For cause” means the boss has to give a good reason before firing, usually poor job performance or lack of work. In practice, pure “at will” employment does not exist and probably never has existed in the United States. Take a look at anti-discrimination laws, for one example. But it seems to be the default doctrine of the employment world. The META would make “cause” the default.
The advantages to the worker seem clear. The META compels the boss to have a reason to fire someone. Recourse is acquired by an arbitration process and in a successful challenge the employer must pay the employee’s attorney fees. One supporter of the META has also suggested, that “for cause” law puts teeth in civil rights statutes because a racist boss, for example, won’t simply be able to fire someone and claim a non-racist reason for the firing. [Source: Glenn Solomon, You Could Be Fired for Reading This Book (2004)]
There are disadvantages for the worker, too. Very small businesses are exempted altogether. The META provides for a one-year probationary period before the worker can get the benefit of “for cause” protection, which seems an invitation for employers to fire someone on day 364 and rehire them on day 366. We could theoretically outlaw that practice or lower the probationary period. But all rules would have ways to be gotten around. We see that in another provision. The META states “the employee has to have worked for the employer at least 520 hours during the 26 weeks next preceding the ter¬mination.” That’s an average of 20 hours per week. What’s to prevent employers from hiring someone at 18 hours per week? What’s to prevent erratic scheduling?
The arbitration process, too, has disadvantages. The burden is on the employee to prove the firing wasn’t merited. Recourse under META (not sure about the Montana law) is limited to back pay and reinstatement or a severance package. No employee is going to get a windfall by invoking her rights under the law.
The promise that attorney’s fees are recoverable seems like the type of thing that sounds nice in theory but in practice isn’t something to count on when weighing the costs of whether it’s worth it to pursue one’s rights. There’s also the Google problem. If Jane/John Doe vs. Jerk Employer somehow shows up on a search when Jane/John applies for their next job, they might not get a callback for an interview because they’re “the type of person who sues their employer.” I’m not sure what a workable solution to those problems would be.
When it comes to getting future jobs, I wouldn’t be surprised if applications start having (if they don’t already) a “were you ever fired for cause from any job.” I can easily imagine scenarios in which formally performance-oriented job terminations sound legit and are difficult to contest in arbitration, but don’t tell the whole story.
As far as future jobs are concerned, my old concern about labor regulations increasing the cost of hiring people or encouraging “off the books” hiring won’t go away. If one cannot be assured of being able to get rid of a bad employee, then they might think twice before hiring. That’s the cost. To my knowledge, the META contains no provision abolishing opportunity cost. Even for me, though, with all my “kowtowing to ‘job creators,'” such objections seem weak. Employers generally fire people for reasons. Why not make them responsible for their actions?
My true nightmare scenario is unlikely, but possible. Could the slope slip so that workers can no longer quit “at will”? In a world where most states will have already adopted some form of the META, could a “national employer rights committee” emerge to promote laws that forbid an employee to quit “precipitously” or “without good cause”? Maybe we won’t have a reprise of “criminal breach of contract” statutes. But what about giving the force of law to what is now the “business courtesy” of a two-week’s notice, itself an example of how in practice employment is not today purely an “at will” proposition for workers? Or worse, what about permitting an employer to sue his/her former employee for breach of contract, or other types of damages?
But we have a Thirteenth Amendment. And the nightmare does not seem to have yet arrived in Montana or Canada, which, I’ve recently learned is a “for cause” regime. And as it is now, the META passes the “smell test” for me. Therefore, I think states should adopt something like it.
[Picture: WPA Pink Slip, via Wikipedia.]