Favorite Firing: Discharged for Writing a Religious Book


cute-164323_640As I’ve written before, protecting religious freedom deserves special recognition in American society. (See here and here.) The First Amendment begins “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; . . .” Thus, religious freedom was the first right protected by the Bill of Rights. The Constitution’s protection of religion was extended to all levels of government in the Fourteenth Amendment.

I’ve been following the case of the former Atlanta Fire Chief who was fired after he published a book about his religious beliefs. See Cochran v. City of Atlanta and Mayor Kasim Reed, Case No, 1:15-CV-0477-LMM (N.D. Ga. December 20, 2017).

THE FACTS: Fire Chief Kelvin Cochran of Atlanta wrote a book entitled Who Told You That You Were Naked? Most of the book explained his thoughts on helping men become better husbands and fathers. But a few pages discussed his fundamentalist Christian beliefs related to homosexuality and sex outside of marriage. His opinions were certainly politically incorrect and even repugnant to much of American society today. As the District Court later stated, the book contained

“passages identifying those who engage in homosexual and extramarital sex as ‘naked’—or ‘wicked,’ ‘un-Godly’ sinners—whose deaths will be
celebrated.”

Chief Cochran self-published his book and gave copies to a few of his subordinates in the Atlanta Fire Department. One employee took the book to a union official, who took it to the city’s Human Resources Department. Human Resources launched an investigation to determine if Chief Cochran’s views as expressed in the book affected his departmental leadership.

Pending the investigation, Chief Cochran was suspended for 30 days without pay and told that he would need to attend sensitivity training. He says he was told he could not conduct media interviews during his suspension, but the city said he was told not to comment publicly at all. As outlined in the District Court’s opinion, Chief Cochran and members of the Georgia Baptist Convention and others launched a public campaign to get the Chief reinstated.

After his suspension and the city’s investigation, Chief Cochran was fired in January 2015.

There was no indication that Chief Cochran had any performance difficulties in his role as Fire Chief, nor was there any evidence that Chief Cochran had treated any employee or any member of the public with any disrespect or discrimination. However, the city feared that an employee might later allege discrimination and use Cochran’s book as evidence against the city.

After his discharge, Chief Cochran filed a federal lawsuit against the City of Atlanta and its mayor, alleging violation of his First Amendment free speech rights, retaliation in violation of his freedom of association right, unlawful prior restraint of speech in violation of the First Amendment, violation of his First Amendment right to the free exercise of religion, and violation of his Fourteenth Amendment right to procedural due process.

THE MORAL: Although Chief Cochran’s religious book was at the center of the controversy, the parties disagreed on how they stated its role in his discharge. As the District Court put it:

“Plaintiff contends that he was fired because of his religious speech—which is grounded in conservative Christian principles—in violation of the Constitution, while Defendants contend that he was fired because he did not comply with the City’s pre-clearance rules for outside employment [including publication of the book] and for facilitating a massive public relations campaign against the Mayor and the City. Defendants also contend that Plaintiff’s speech made the City potentially vulnerable to employment discrimination claims and substantial disruption.”

The case came before the District Court on cross-motions for summary judgment. The District Court granted each motion in part.

The District Court went through a lengthy analysis balancing the parties’ interests as required by the Supreme Court in Pickering v. Board of Education, 391 U.S. 563 (1968). Quoting Pickering, the District Court described the standard:

“‘To prevail under this analysis, an employee must show that: (1) the speech involved a matter of public concern; (2) the employee’s free speech interests outweighed the employer’s interest in effective and efficient fulfillment of its responsibilities; and (3) the speech played a substantial part in the adverse employment action.’ Id. If the employee establishes the first three elements, the burden then shifts to the government to prove by a preponderance of the evidence it would have reached the same decision absent the protected speech.”

Using this standard, the District Court found in the city’s favor and against Chief Cochran on several of his claims. The claims on which the city prevailed were Chief Cochran’s First Amendment free speech rights, freedom of association rights, and his claim of viewpoint discrimination. Because Chief Cochran was a supervisor, dissemination of his book in the workplace made it “not unreasonable for the city to fear” his views might cause “public erosion of trust in the fire department.”

The Court found

“In balancing all of the Pickering factors, Plaintiff’s speech caused such an actual and possible disruption that it does not warrant First Amendment
protection in the workplace . . . ”

And because Chief Cochran was an at will employee, the Court also found that his claim that he had been denied due process was not viable— he was subject to dismissal with or without cause.

To be frank, I think the District Court erred in giving so much credence to the disruption in the workplace, much of which was caused by the investigation itself. Also, the Court cited the social media campaign by plaintiff’s allies as evidence of disruption, but the plaintiff should not be held at fault because his situation was controversial in the city of Atlanta.

Although the District Court ruled in part for the city, the opinion also favored Chief Cochran in part, granting summary judgment for Chief Cochran on his prior restraint claim. The Court found that the city’s pre-clearance rules were an unlawful prior restraint and imposed “unbridled discretion” on city employees. Therefore, the Court held that the city’s decision to fire Chief Cochran for disseminating his book without approval “does not pass constitutional muster.” The city had not provided objective standards, and therefore the city could not require its employees to obtain permission before expressing their religious views.

As a result of winning on the prior restraint and unbridled discretion claims, Chief Cochran was eligible to receive his back pay and attorneys’ fees. In October 2018, several months after the District Court’s ruling, the City of Atlanta and Chief Cochran settled the case. In the settlement, Chief Cochran received $1.2 million.

This would have been a cleaner case had the Court recognized Chief Cochran’s religious expression rights more completely, but in the end, this was an expensive lesson for the city. And a good outcome for government employees who choose to express their religious beliefs, no matter how unpopular those beliefs might be.

Public employers should be careful when they restrict the speech and religious expressions of employees. Government employees should not face the chilling effect of possible discharge for expressing their religious opinions—whether in books, on social media, or in person. They should be free to state beliefs on their own time without fear of losing their jobs.

Under the Pickering framework, public employees, particularly those in supervisory positions, need to take care not to interfere with effective and efficient fulfillment of their agency’s responsibilities. But they should feel free to state their beliefs without fear of retribution.

What do you think about the protection of religious expression in the workplace?

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California Will Require Women Members on Corporate Boards: A Good Idea or Not?


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One of the most popular posts on this blog discussed the advantages of privately held companies having a corporate board with outside directors. I argued that outside directors can provide broader and deeper knowledge relevant to the business than company management can. If shareholders select directors with expertise the business needs, and if those directors develop ongoing knowledge of the business, the company will benefit.

My post dealt with private companies, but boards of directors can serve the same function in public companies of all sizes also. When board members bring expertise and when they develop ongoing company knowledge, they can contribute greatly to the company’s success.

Obviously, then, it is important for shareholders to choose wisely when electing board members. In the usual course of affairs, management (generally the CEO) proposes board candidates. But boards of larger and more sophisticated companies often have board selection committees that propose the candidates. However the candidates are selected, and shareholders then approve or disapprove the choices.

conference-2110768_640My premise is that who is on the board makes a difference.

So what happens when jurisdictions adopt diversity requirements for directors? California has just become the first state in the U.S. to require large companies to have female directors, Will that requirement help or hurt California-based companies?

California Senate Bill 826, which Governor Brown signed into law last month, mandates female directors on company boards. The stated purpose of the law is to advance gender diversity. SB 826 requires all publicly traded companies with headquarters in California to have at least one woman on their boards by the end of 2019. And by 2021, firms with at least five board members will be required to have two or three women on the board, depending on the total size of the board. If companies do not comply, they face fines of between $100,000 and $300,000.

About 94 publicly traded companies headquartered in California currently have no female directors and would be affected by SB 826, assuming they do not change their board membership by the end of 2019.

But will this law lead to improved corporate governance and financial performance?

It is tempting to say that companies should be able to locate sufficient women with the credentials to provide the expertise required. And most of the time that will probably be true.

It is also tempting to say that women provide a different perspective than men on management. And in the wake of the #MeToo movement, that is true in certain circumstances and about certain issues.

But I am cynical enough to believe that corporate management is usually not sufficiently broad-minded to look far enough for women capable of serving in board roles. I believe competent women exist, but some competent women will have backgrounds different than their male counterparts, and they might be passed over for consideration. And so, it is possible that the same women will be tapped repeatedly for board roles.

Moreover, female candidates selected after passage of SB 826 face the stigma of being “affirmative action candidates.” Their opinions may not be given the same credence that male board members’ opinions receive. The problem with any legal mandate is that it stigmatizes the very people it purports to help.

On a more practical note, Wharton research shows that adding female directors to a board does nothing for company success. The gender composition of the board does not matter, for better or for worse, when it comes to improving financial performance.

The California statute will face legal challenges. Legal scholars, even those who believe the law is “well-intentioned,” have called the mandate unconstitutional, because the Supreme Court has previously ruled that the makeup of a corporate board is governed by the state where the corporation is is chartered, not where it is headquartered, which is what the California statute purports to cover.

The Wall Street Journal reports that 35% of new directors in Russell 3000 companies (one broad cross-section of public companies in the U.S.) have no female directors at present. So if laws like California’s SB 826 are passed in other states, the composition of many corporate boards will change. Perhaps it would be wise to wait to see what happens in California before more states jump on the board diversity bandwagon.

And will California’s mandates stop with gender diversity? What is to keep the liberal California legislature from mandating racial diversity? What about sexual orientation? Religion? Age?

In the meantime, public corporations in California will have to choose whether to comply or whether to fight the law. Privately held corporations in California remain free to decide for themselves the composition of their board, and even whether to have outside board members at all.

What do you think about requiring a diverse board composition?

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Managing Personal Crises and Work


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I had another topic planned for today’s post, but then life got in the way. A relative had a health crisis I had to deal with. This crisis made me decide to write about the ongoing struggle for balance between work and other aspects of life, a struggle that never ends, no matter what stage of our career we’re in.

This past week was certainly not the first time that personal issues have interfered with my professional plans. I raised two children while working full-time in a demanding professional job. When one of our children was ill, my husband and I often argued about who needed to to to work more and whose work responsibilities could be put on hold for a day . . . or two. Most of the time we were able to split the burden fairly equally, but it didn’t always work out that way.

Both my husband and I were fortunate because we had some control over our calendars . . . most days. But we each had some courtroom appointments and other meetings that could not be rescheduled.

We were also fortunate that, while we might get raised eyebrows from coworkers when we couldn’t be at work for family reasons, we were respected enough and we had others in our workplaces dealing with similar issues. Therefore, our careers were not seriously at risk. I think we both might have earned more over the years if we had not been viewed as professionals who did sometimes have to juggle family responsibilities, but we weren’t going to get fired over an absence or two.

For the past ten years I have been self-employed, working as a mediator and Human Resources consultant. Now I have even more control over my calendar, but I am also more dependent on the number of hours I work for income.

bulletin-board-3233653_640I was fortunate this week. I could instantly juggle my schedule to deal with the current health emergency. It meant I skipped one meeting and wrote this blog post off the top of my head instead of a post requiring some research. Some weeks I have obligations I would have difficulty rescheduling, but this week I could do it. So I did. Without any hesitation.

At this point in my life, I relish flexibility more than a higher income. And I know I am fortunate to have the resources to make that choice.

I encounter many younger professionals who haven’t yet had to make serious choices between work and other responsibilities. I also know many senior professionals who look askance at the decisions I’ve made to reduce my scheduled commitments—and therefore my professional status. There are days when my diminished income and role in the business world bother me, but most of the time I am happy with the trade-offs I’ve made.

What choices have you had to make over the years? What choices have others around you made? How do you feel about both your own choices and those of your coworkers?

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Be Afraid, Be Very Afraid: Anything in Your Past Can and Will Be Held Against You (Even Without Corroboration You Did It)


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My last post on the Senate confirmation hearings regarding the nomination of Judge Brett Kavanaugh to be a Supreme Court justice went live on September 10, 2018. Two days later, on September 12, an anonymous claim surfaced that he had sexually assaulted a teenage girl when he was in high school. Over the last two weeks, we’ve learned his accuser is Dr. Christine Blasey Ford of Palo Alto University.

Dr. Ford alleges a single instance of sexual assault more than 30 years ago when Judge Kavanaugh was still a minor and both of them were in high school. Many of the details surrounding her claim remain hazy, including the date (and even the year), the location, how many people were present, and who they were.

I do not mean to imply that the allegation does not involve a claim of serious misconduct. It does. But Dr. Ford’s delays in making this allegation, Senator Dianne Feinstein’s further delays in publicizing it even to other Senate Judicial Committee members, and the fact that Dr. Ford and her attorney have spent many days negotiating her appearance before the Senate Judicial Committee, all make it seem that the drama was primarily raised for political reasons.

As of this morning, September 24, 2018, when this post is published, it appears that Dr. Ford will testify about her assault charge on Thursday, September 27, before the Senate Judicial Committee. So as I write this, we don’t know the end of this story.

Dr. Ford appears to be a respected member of her professional community, just as Judge Kavanaugh is of his. When two opposing witnesses are both credible, and when the facts are so fuzzy, it is very difficult to ever determine the truth, even if they both testify under oath. Investigating any situation that occurred more than 30 years ago is challenging under the best of circumstances. Refuting—proving the negative of—a vague allegation about something that happened so long ago is almost impossible. (Perhaps this is why Senator Feinstein didn’t publicize the claim earlier.)

Based on what has been made public thus far, all that Judge Kavanaugh can say is what he has already said—he never behaved like that. He can’t claim he wasn’t at a particular place because the place hasn’t been identified. He can’t obtain denials from other witnesses, because the witnesses haven’t been clearly identified, though two males and one female who may or may not be people the accuser has mentioned have denied any knowledge of Judge Kavanaugh behaving in this fashion.

One of the most distressing aspects of this case for me is the grievous harm that can be done to a person’s lifetime reputation with so little evidence. In today’s 24/7 news cycle, social media publicizes every allegation almost instantaneously, and often presents these allegations as the truth. Things we did—or are alleged to have done—long in the past, in times and places we don’t even remember, can haunt us in ways these incidents never did before. We essentially cannot outlive anything we’ve ever said or done. Even if we deny we ever said or did it.

In some situations, when many witnesses allege someone engaged in similar wrongful behavior, as in many of the recent #MeToo claims against public figures, we can comfortably conclude that the misconduct probably happened in at least some of the times and places claimed. But where there is only a single wrongful act alleged, and when that act supposedly occurred over 30 years ago, it is hard to accept that the incident should have an impact on a person’s future, unless there is some further corroboration.

“I believe the woman” seems to be the accepted response to all claims of sexual harassment and assault these days. Though most allegations of sexual misconduct have some basis in fact, I have personally investigated at least two cases in which women did not tell the truth. I am therefore reluctant to automatically believe the claimant, unless there is more than just her word.

In one case I handled, a female employee claimed that a high-level male employee had harassed her repeatedly. When I first learned of the complaint, I leaped to the conclusion it was probably true and started thinking about how the company should handle the man’s exit from the company. But within thirty minutes after I started interviewing the complainant, she alleged that at least six or eight other men had harassed her, all in vague ways (“he looked at me weird,” “he smiled at me in the stairwell”). It became clear after very little questioning  that she was paranoid and mentally unstable. She might have believed she’d been harassed, but she was not credible to a rational person.

In another situation, another female employee claimed that her male supervisor had harassed her in a retail store where there were multiple people present. None of the other eleven employees in the store had seen anything untoward. Moreover, her allegation was made on the Monday after the Clarence Thomas hearings, giving me a strong suspicion she’d made a false claim because of what she’d heard over the weekend. It turned out the accuser wanted more work hours than her supervisor had given her, and thought her complaint would give her leverage.

In addition to my personal experience, there are other, more public situations of wrongful accusations of sexual misconduct. One notable example was the false claims against the Duke lacrosse players. Those young men saw their promising careers go up in flames, because a lying complainant was supported by an unethical prosecutor.

I am not saying Dr. Ford’s claim is false. Maybe it is and maybe it isn’t. It is entirely possible her memory is as she has described and he has forgotten whatever happened between them. In that case, neither of them would be lying. The testimony this next week—if it takes place—might prove convincingly what happened, if anything. Although if we only have her memory and not his, I doubt it.

What I am saying is that before an allegation about a single 30-year-old act stops the career of a man who has no other such blemish on his record, we should require more than one person’s say-so. We should require other witnesses, or contemporaneous documents, or corroborating physical evidence, or something else that makes us comfortable ignoring his thirty years of exemplary behavior.

Because if we allow a single, ancient, unverified and unverifiable claim against an otherwise upright citizen to besmirch his reputation, then none of us is safe. Our fathers and husbands and sons are not safe from allegations of long-ago harassment. Any of us might be slammed by a claim that we made a sexist or racist or homophobic comment in the past. Whether we did it or not. Whether we’ve changed and matured or not. Whether what we believed at the time was what most of society believed or not.

Just ask Brendon Eich.

Is that the type of world you want to live in? I don’t.

LATE-BREAKING: As of Sunday evening, September 23, 2018, a second allegation has surfaced of sexual misconduct by Judge Kavanaugh, this time in his college days. In addition, Judge Kavanaugh has his old calendars which might cover time of the alleged high-school incident. Obviously, this story continues to develop.

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An Open Letter to Senators Regarding Supreme Court Nomination Hearings


OldSenateChamber_bannerimageDear Senators:

I have followed a lot of Supreme Court hearings over the last forty years. They are getting worse, and they make every one of you on the Senate Judicial Committee look bad, as well as the rest of you who make unsubstantiated comments about the judicial nominees. Those of you supporting the candidate sound smarmy, and those of you objecting to the nominee seem unhinged.

The downturn in civility displayed in Senate nomination hearings began with Judge Robert Bork in 1987. Judge Bork was a well-respected jurist and professor, albeit definitely a conservative. Plenty of legal scholars had disagreed with Judge Bork’s interpretations of the Constitution before he was nominated, but for the first time a judicial nominee was savaged within minutes after his nomination was announced.

The Clarence Thomas hearings in 1991 became a full-on “he said, she said” debate over allegations of sexual harassment, of the type that can rarely be resolved to anyone’s satisfaction, and certainly not in the circus atmosphere that prevailed during those hearings. The allegations against Justice Thomas were not resolved, and no one really expected them to be resolved—the intent was to smear the nominee’s character.

Neil Gorsuch got off reasonably easily during his confirmation hearings in 2017. But when Senate Democrats attempted to filibuster the vote by the full Senate, Republicans completed what the Democrats had begun for lower court nominations and abolished the filibuster for Supreme Court appointments. So there is no point in worrying about a super-majority. When one party controls the Senate and the Presidency, that party’s nominees are likely to be confirmed.

Judge Brett Kavanaugh has been run through the wringer this past week. Both conservatives and liberals have attested to his qualifications for the Supreme Court. Nevertheless, he has been called, among other things, a racist and a white supremacist.

During her confirmation hearings in 2009, Sonia Sotomayor was raked over the coals for speeches in which she had commented that she hoped “a wise Latina woman with the richness of her experiences would, more often than not, reach a better conclusion” than a white male. While the Republicans’ reactions to Justice Sotomayor’s comments were an overreaction to her prideful statement about her heritage, her statements more clearly revealed bias than the current allegations against Judge Kavanaugh.

Judge Kavanaugh has been accused of being a racist for writing a memo on racial profiling that said the government should not engage in racial profiling. He has been accused of having white supremacist beliefs because one of his former clerks—a Mexican-American of partially Jewish descent—made a (probably involuntary) gesture that looked like a white supremacist symbol.

The Senate Judicial Committee is scheduled to vote on Judge Kavanaugh’s nomination on September 13, and there will later be debate on the full floor of the Senate soon. I fully anticipate that the allegations against Judge Kavanaugh are not over yet. Our nation will have to tolerate more of this indecent character assassination by Senators.

Both parties need to dial it down during these judicial hearings. Way down.

There is no point in Senators trying to show that any judicial nominee is evil incarnate. It is highly unlikely that Satan would ever be nominated to the Supreme Court, even by a President of the opposite party as you.

The Constitution gives Senators the power to “advise and consent” to judicial appointments. The Constitution doesn’t say you need a reason to withhold your consent.

So just vote against the individual. It is your right as a Senator. As Colin Kaepernick now advocates, just do it.

Don’t needlessly slander the character of the nominee to make your base happy. It belittles you more than the candidate.

Sincerely,

A concerned and irritated citizen with moderate knowledge of the nomination process

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Readers, what about our current judicial nomination process irritates you?

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Labor Policy Changes Under the Trump Administration


Most of the news about the Trump Administration in recent days has involved developments arising out of the special counsel’s investigation. But as Labor Day approaches, it is worth examining what the administration has accomplished in the labor arena. Many stories about changes in regulations are getting less media attention than they might have, had we not had daily stories about sensational prosecutions or pleas and inflammatory tweets about Russia’s meddling and campaign finance violations.

Here are a few of the more significant changes in labor policy under President Trump:

DOL seal.pngFair Labor Standards Act: Although the 80-year-old Fair Labor Standards Act remains largely unchanged, the Department of Labor has again started using DOL opinion letters, which the Obama Administration had abolished. Opinion letters provide guidance that employers can rely on for interpretation of the regulations, so returning to this practice is a help. Moreover, many of the Bush Administration opinion letters have been reinstated.

Furthermore, in June 2017 the Trump Administration withdrew the Obama-era interpretation on joint employment. The joint employment interpretation—designed to make large franchisors liable for the practices of independently owned franchisees—was roundly criticized by employers, so the return to the former DOL interpretation of when joint employment arises is a welcome relief for employers.

The Trump Administration has also rolled back rulemaking under the white collar overtime exemption and the tip pooling regulations. In both cases, DOL is now attempting to provide employers with broader exemptions and greater relief from regulation.

Still, any changes to current FLSA regulations are likely to engender future litigation, so even if DOL’s Wage & Hour Division issues favorable changes, employers will have a long time to wait until there is certainty in this area.

Broader Range of Health Plans for Small Businesses: As a result of a Trump executive order seeking to reverse or limit portions of Obamacare that can be addressed by regulation, DOL has proposed letting more small firms and individuals form association health plans (AHPs). Large businesses have the market power to get good discounts from health care providers; the proposal is intended to let small businesses, including self-employed workers, pool their populations to get similar discounts through an AHP. Under this proposal, companies or individuals involved in the same type of business or located in the same region could band together to form AHPs.

Any attempts to broaden access to healthcare insurance should be encouraged, even if they do not satisfy all the benefit coverage requirements or other restrictions of Obamacare. More choice in insurance options will help employers of all sizes attract and retain employees.

Union Negotiations: The Trump Administration has pushed federal agencies with unionized workforces to reopen collective bargaining agreements with their public unions. Agencies have also been directed to move swiftly to fire poor performers. The Administration argues it is trying to streamline costly government bureaucracy and improve accountability of the federal workforce.

As with changes under the FLSA, litigation over these changes is likely. (In fact, on August 25, 2018, just as I was finalizing this post, a district court judge overturned some of the executive orders implementing them.)

In Janus v. American Federation of State, County, and Municipal Employees, Council 31 (Sup. Ct. June 27, 2018), the Supreme Cout ruled against public unions in a different context (deciding that public employees could not be forced to pay union dues). This decision weakens public unions, and arguably indicates possible Supreme Court support for government efforts to push back against such unions. However, it remains to be seen whether the Court would help the Trump Administration roll back previously negotiated collective bargaining agreements.

And nothing in Janus changes how the NLRB deals with issues between private employers and their unions, which would be a more helpful area of focus during the next two years of the Trump Administration.

nlrb logoRestrictions on Employee Use of Employer Email: One helpful development for private employers that the Trump Administration has undertaken is that the National Labor Relations Board (NLRB) has invited briefs on whether it should overrule Purple Communications, Inc., 361 NLRB 1050 (2014). The Board held in that case that employees had a presumptive right to use employer email systems on nonworking time for organizing and other protected communications under the National Labor Relations Act.  In Purple Communications, the Board overruled its earlier decisions holding that employers could maintain union-neutral policies regarding permissible uses of their email systems, even if these policies had the incidental effect of limiting use of those systems for union–related communications. Presumably, the NLRB is now considering a return to the holding of those prior cases.

This and other NLRB actions could have far-ranging impact on employers’ efforts to maintain union-free workplaces. However, NLRB policy in recent decades has tended to shift with the party affiliations of the five NLRB members, so whatever the current administration does could once again be overruled.

Application of Religious Freedom Principles to the Workplace: DOL is attempting to make it easier for federal contractors to claim religious beliefs as a defense against anti-LGBTQ discrimination complaints. Recent directives state that the federal government has a duty to protect religious exercise, not to impede it. The Administration has instructed the Office of Federal Contract Compliance Programs (OFCCP) not to condition federal contracts “upon a recipient’s willingness to surrender his [or her] religiously impelled status.” Rather, faith-based organizations should be permitted to compete on a level playing field for federal contracts.

There will be a rulemaking process, so the impact of these directives may not be known for some time.

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All in all, there have been some helpful changes at the DOL, the NLRB, and other labor policy-making agencies. However, much of the Obama Administration’s overreach in the labor arena remains in place.

Employers should encourage the current administration and Congress to pursue business-friendly policies designed to keep the economy growing. Perhaps the likelihood of continued media attention on the special prosecutor’s investigation will enable more good regulatory work to move labor laws and policy in directions conducive to business and employment growth.

But employers should also remain mindful of the need to comply with labor laws and regulations currently in effect.

What labor policies would you like to see changed and why?

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Planning for a Mediation: Determining your WATNA, LLATNA and MLATNA to Get to Your BATNA


business-3152586_640Corporate executives and Human Resources professionals sometimes find themselves representing their employer during mediations. I’ve been not only a mediator, but also a corporate representative and an attorney during mediations. In all these roles, I came to see the importance of preparing for the mediation.

Just as you would for any negotiation, it is important to know what you and your company are trying to achieve. (If you’re an attorney reading this, it is just as important that you know what your client needs to achieve.

There are lots of materials written about knowing your BATNA (Best Alternative To a Negotiated Agreement) before settling a case. But how do you decide what your best alternative to settling the case is? Remember that your BATNA cannot be dependent on anything the other party in the case does—it must be something that you can control or that you think will probably happen regardless what the other party does.

Determining your BATNA can’t be done in a vacuum. It is often easier to start by determining your WATNA — the worst alternative to a negotiated agreement. Sometimes, the worst alternative is the company goes bankrupt. Other times, it’s a huge PR debacle. Or maybe the worst that can happen is only that the company loses some money, but it isn’t a significant hit to the bottom line.

Only by deciding the maximum amount at stake can you decide how important this case is, and thereby decide how much to throw into settlement. (Note that though I might talk in terms of money, there are often other important resources at stake also—reputation, intellectual property rights, etc. Those must be put in the equation when valuing the case also.)

Other important considerations in determining the BATNA are LLATNA and MLATNA. I have seen parties to mediations get hung up on the least likely outcome in the case—their LLATNA (Lease Likely Alternative To a Negotiated Agreement). They see a 2% chance of winning big, and that’s all they can focus on. But your LLATNA should not determine your BATNA.

By contrast, the MLATNA is the Most Likely Alternative To a Negotiated Agreement. It is a much more useful concept.

For example, If the outcomes to an employment lawsuit could range from the employer winning its attorneys’ fees (with a 2% likelihood of occurring) to losing $1 million plus the plaintiff’s attorneys’ fees of $150,000 (with a 5% likelihood of occurring), the MLATNA might be losing $100,000 plus the plaintiff’s attorneys’ fees of $150,000 as well as your own (with a 40% likelihood of occurring). Or the MLATNA might be winning the case, but having to pay your own attorneys’ fees of $150,000 (also with a 40% likelihood of occurring). Now you have a range to work with—the case is worth at least $150,000 and up to at least $400,000 (the damage award of $100, plus $300,000 to cover both sides’ attorneys’ fees.)

Clearly, it is important to have some advance discussions with your attorney about the range of outcomes in a case and the likelihood that each might happen. Attorneys will not commit to specific outcomes, but they should be knowledgeable enough to talk in ranges both of verdicts and probabilities. Only after assessing the possible outcomes in the case—as well as the likelihood that each might happen—can you decide what you are willing to settle the case for.

You might go with a simple weighted average of the possibilities for your walkaway point. Or you might decide that the WATNA is so bad that you will lean toward settlement at (almost) any cost short of that. Or you might feel optimistic and look only at cost of defense as the settlement value of the case. But the point is, you need to consider all the possibilities.

Once you’ve looked at the range of outcomes, what do you do?

You and your counsel should discuss your mediation strategy. Where do you want to start your settlement offer? How do you get the other party talking in your settlement range? What do you have to offer that has no cost or is of little importance to you, but very important to the other side?

Then take your planning to the next level: What do you disclose to the other party in a general session? What do you disclose to the mediator in caucus? Who should be present at the mediation to maximize your credibility and persuasiveness to the other side?

* * * * *

The purpose of this post is to emphasize the importance of planning prior to a mediation. When planning, you need to consider and evaluate the possible outcomes of the case. Then set your strategy to land you in the settlement range you desire.

But be flexible. You don’t know what you don’t know. You might learn new facts during the mediation that cause you to rethink the possibilities.

When have you planned effectively for a mediation or other settlement discussion? What worked for you?

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