Minnesota Ct Enshrines Employment-at-Will Rule

The Minnesota Supreme Court has upheld the dismissal of a worker who was fired by her employer because she applied for unemployment compensation during a period in which the company failed to assign her work.

This would seem to be incongruous, given that the state of Minnesota has granted workers the right to file for unemployment compensation benefits.  However,in a harsh and divided decision. Minnesota’s Supreme Court said the state’s “employment at will” rule trumps a workers right to be free from wrongful discharge for having invoked her right to apply for state unemployment benefits.

The century old  “employment at will” rule is an arcane theory based upon a questionable premise – that employers and employees have equal bargaining power. Under this theory, employers can fire employees “for any reason or no reason” providing it is not an illegal reason, and an employee can quit for no reason.  Of course, in reality, the see-saw tilts heavily toward an employer, especially in an economy where there are three applicants for every job vacancy.

To put this in perspective, the United States is one of only a handful of countries where employment is predominantly at-will.  Most countries throughout the world allow employers to dismiss employees only for cause. Only Montana in the U.S. has rejected the “at-will” doctrine.

Should we ‘term’ her?

Jane Kay Dukowitz  was hired as a security officer in 2005 by Hannon Security Services to work a night shift.  She learned in November 2008 that a temporary daytime position was open for the holiday season, applied and got the position.  She was subsequently informed the position would end on Dec. 31, 2008  and that Hannon had  no work for Dukowitz in the ensuing months.

Dukowitz said she told her supervisor that she would need to apply for unemployment benefits “to make ends meet.” Her supervisor allegedly turned to another supervisor and asked, “should we term her?”— terminate her employment. Dukowitz said she begged them not to fire her and asked to be placed on a “floating shift” so that she could work when shifts became available.

Dukowitz was fired on March 13, 2009 after having applied for unemployment benefits.  Hannon cited her “poor work,”  “unwillingness to work weekends or nights” and the poor local economy. Dukowitz contends that she received positive performance reviews and never refused to work weekends or nights.

The dispute boiled down to the scope of the public-policy exception to Minnesota’s employment-at-will rule. Dukowitz argued that legal precedent established  a cause of action for wrongful discharge if an employee can identify a clear mandate of public policy that the employer violated when it discharged the employee.

The majority ruled that it is up to Minnesota’s legislature to “balance the competing interests of employers, employees, and the public to determine whether, and when, an employer violates the public policy of the state by discharging an employee.”  The majority noted that under  Minn. Stat. § 268.192, subd. 1 (2012) it is already a misdemeanor for an employer interfere with an employee’s application for unemployment benefits.

The majority also ordered Dukowitz to pay Hannon $1,361.35 in costs and fees, despite Dukowitz’ objection on the grounds of indigency.

Justice Wilhemina Wright, joined by Justice Alan Page, filed a dissent  in which they argued that “[a] common-law wrongful-discharge claim . . . would advance [Minnesota’s] public policy by fostering additional deterrence” of employers who decline to follow the requirements of Minnesota’s unemployment-compensation.”  She also argued that the legislature’s role in policy-making is “not exclusive” and the court has the power to both recognize and abolish common law doctrines. Justice Wright also noted most states  have expanded the public-policy exception to the employment-at-will rule to include both refusals to violate the law and reports of violations of law.

The majority’s decision in   Dukowitz v. Hannon  Security Services, No. A11-1481 (Minn. Jan. 2, 2014), was written by Associate Justice David R. Stras.

Political Environment Anti-Union

A new report by Center for Economics and Policy Research (CEPR) has concluded that union membership in the United States is at an all-time low because of the “broad national political environment” and not, as some have theorized, because of globalization and technological changes.

One reason that so many American workers are vulnerable to bullying, harassment, and unfair termination is the low rate of unionization in the United States.

There is no law in the United States against workplace bullying and non-unionized workers are the mercy of a judicially created rule of law called the Employment at Will rule, which means they can be fired for any reason – even a bad one – as long as it does not violate a collective bargaining agreement, the law, or a recognized public policy.

Whatever one thinks of unions, there can be no denying that unions mean clout for workers.  Unions represent workers at the bargaining table, and they defend workers in grievance proceedings. Unions historically have led the way toward improving working conditions for all workers.

“In half of the rich countries we studied, the share of the workforce covered by a collective bargaining agreement has remained constant or even increased since 1980 –despite being exposed to the same kinds of pressures from globalization and technology that we experienced here in the United States,” said John Schmitt, a senior economist for the CEPR in Washington, D.C.

In a, 11/17/11 report entitled Politics Matter: Changes in Unionization Rates in Rich Countries, 1960-2010, Schmitt and co-author Alexandra Mitukiewicz review unionization data covering the last five decades for 21 rich economies.

The report demonstrates that national politics are a major determinant of national unionization rates in recent decades, more important than globalization and the new economy.

The researchers found that  countries typically identified with social democratic parties – Sweden, Denmark, Norway, and Finland – generally saw small increases in union coverage and only small decreases in union membership since 1980. Countries such as the United States, the United Kingdom, and other liberal market economies with less protective labor-market systems have generally experienced sharp drops in union coverage and membership. Countries referred to as continental market economies, including Germany and France, saw small drops in union coverage and moderate declines in union membership.

Of course, this probably comes as no surprise to public sector workers who are fighting to retain union bargaining rights, or to unions battling to keep American companies from relocating overseas or to states that are hostile to unions.

According to the U.S. Bureau of Labor Statistics, the union membership rate in the United States -the percent of wage and salary workers who were members of a union–was 11.9 percent in 2010, down from 12.3 percent a year earlier. The number of wage and salary workers belonging to unions declined by 612,000 to 14.7 million. In 1983, the first year for which comparable union data are available, the union membership rate was 20.1 per- cent, and there were 17.7 million union workers.