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How HR Has Weathered the Changing Legal Climate

January 1, 1997
Related Topics: Miscellaneous Legal Issues, Featured Article
Seems like the good old days weren’t always such good old days. Back in 1922, workplaces were run like mini-despotisms. Subject to the whims of employers, workers had few rights: You either did what you were told or you left. We’ve come a long way since then. In fact, some would say today’s workplace is the other side of the looking glass: Employees now have the upper hand in employment law and aren’t afraid to give employers a good swat from time to time.

Robert F. Millman, managing partner at the Los Angeles office of Littler, Mendelson, Fastiff, Tichy & Mathiason, reflects on how changes in society have affected workplace law over time, and highlights the most important laws of the past 75 years.

What was workplace law like in the early ’20s?
At the turn of the century, you had all these immigrants coming in from all over the world. We know that historically there were terrible sweatshop conditions that existed for many of these immigrants. Twenty women would be sitting at sewing machines in a small room with unbearable temperatures and so forth. All this ultimately gave rise to the concept that employees could band together and assert rights against their employers.

What was the result of this idea?
In 1935, the U.S. Congress passed the Wagner Act, now commonly known as the National Labor Relations Act. The basic act allows people to unionize, allows them to do so without interference from employers. Employers aren’t allowed to threaten or interrogate or spy on employees relative to their union sympathies.

What happened after this period of unionization?
I’d say in between 1935 and 1955, unionized labor in the private sector held a mighty hand with respect to the economy of the United States. Most of the great industrialized America as we knew it at the time was subject to union contract. Interestingly enough, it all jibed with the U.S. war effort. Between 1941 and ’45, the country was galvanized in an effort to defeat the Axis powers. The notion was that everyone was banding together not [only] to improve wages and hours and working conditions, but also to save the free world from the perils of Nazism and so forth.

What happened after the war, in the late ’40s and the ’50s?
Subsequent to the Second World War, the civil rights movement slowly but surely began to take hold. The notion [was] that African-American men and women helped out with the war effort as well, yet blacks weren’t being treated appropriately in the American economy. We see in the early ’50s this notion of civil rights beginning to take hold.

How did this cultural trend play itself out in the workplace?
It ultimately led to, in 1964—and it is remarkable that it took place literally 100 years after the Civil War had ended—the U.S. Congress passing the Civil Rights Act of 1964. The Civil Rights Act prohibits discrimination by virtue of someone’s race, creed, color, religion or national origin. It was really the first landmark labor statute to be passed by the U.S. Congress since the 1935 passage of the Wagner Act.

What changes did the Civil Rights Act usher in?
I look to 1964 as a bell-ringer year because what we’ve seen evolve between 1964 and 1997—a period of 33 years—is an extraordinary growth in the passage of statutes and regulations all aimed at assisting employees, at allowing employees to assert more and more rights in the workplace and have more and greater protections in the workplace. Quite frankly, we sit today in a literally unparalleled time with respect to the myriad statutes and regulations that employees can take advantage of.

What are some of the laws you have in mind?
We’ve seen statutes passed such as the Age Discrimination in Employment Act in 1967, which said that no employer could discriminate against an older person, defined as 40 and up.We’ve [seen] passed over the years Occupational Safety and Health Administration (OSHA) statutes and regulations. We have a federal OSHA agency whose responsibility it is to make certain that workplaces are safe and free of unhealthy conditions. In addition, various states have enacted their own laws, some of which are far more sweeping and comprehensive than the federal statutes are relative to protecting employee rights.

What are some other big laws of the more recent past?
When the Americans with Disabilities Act (ADA) was passed—a major, sweeping piece of legislation—it talked about the fact that U.S. employers weren’t going to be allowed to discriminate against disabled Americans. As long as the [person] can perform the "essential function of the job," the employer has to allow that employee to do the job, and to reasonably accommodate that person so that he or she can do the job. We also have a Fair Labor Standards Act on a federal level, and various states have their own statutes, mandating how many hours in a week someone can work, when one’s entitled to overtime and which employees are and aren’t eligible for overtime.

What about the most recent issues?
Sexual harassment has become a very big issue. We know men and women have been sexually harassing each other from the time of Adam and Eve. Certainly what has gone on in the workplace in 1996 is nothing new in [comparison] to what went on in 1935 and 1945, but the rules of the game today are such that you can’t get away with it. [Awareness of the problem] has tremendously modified the way men and women conduct themselves with each other at work. Also, there’s the Family and Medical Leave Act passed during the Clinton administration, which allows people unpaid time off [after a child’s birth or adoption] or to care for themselves, a family member or child who’s very ill.

What does employment law look like today?
We’ve seen the demise of the at-will doctrine in an employment setting. The basic concept was, for a nonunion employer, that you could fire someone at will. You can analogize the erosion of that over the past 20 or 30 years to an employer having a large block of granite. That block is symbolic of an employer’s absolute right to fire someone at any time, for any reason. Today what the employer really has is a few pebbles in the hand—because today we have causes of action for breach of contract, breach of implied contract, defamation, invasion of privacy, intentional infliction of emotional distress, fraud, deceit, assault and battery, sexual assault and so on.

What next?
We’re seeing new and arising torts called negligent retention and negligent supervision and negligent training. [For example], if an employee is acting out and threatening to harm people, is the employer acting reasonably if he or she continues to employ that person? What if that person does act out and [harms] someone? You might face a lawsuit of negligent retention—you shouldn’t have retained that person—or negligent supervision. Or you haven’t appropriately trained that person.

What’s the toughest part of employment law for employers today?
The number of employee rights is expanding exponentially. And in many states you’re talking about the specter of jury trials and punitive damages—unlimited punitive damages [in some states]. They amended the Civil Rights Act to allow for jury trails and punitive damages up to $300,000 for any employer in any of the 50 states. I think what’s been a hard blow for employers is the use of jury trials and the ability of jury trials to second guess employers with respect to their employment actions, and getting hit for big damage awards and punitive damage awards. Every time [employers] go in front of a jury it’s a total crap shoot. Employers are winning cases they should lose and losing cases they should win. It puts your entire HR function under a micro-microscope.

Any chance of that changing?
I don’t see that changing in the immediate horizon. In the aftermath of the O.J. Simpson trial, certainly in California, there’s a lot of talk about jury reform. The Supreme Court continues to dance around the head of a pin on this issue of punitive damages. But I think they’re working toward some notion of awareness and rationality vis á vis this whole punitive damage issue, because that’s something that needs to be worked out and resolved.

And in the meantime?
It’s more important than ever that employers engage in prevention, working aggressively to train employees on how to avoid pitfalls and how to put together policies, practices and procedures in compliance with the law. Train front-line supervisors so they don’t make mistakes, so you don’t wind up facing one of these lawsuits.

Workforce, January 1997, Vol 76, No. 1, pp. 159-162.

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