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Do Your Employees Know What “Loyalty” Means?

Employees owe a responsibility to those who sign their paychecks not only to avoid breaches of this duty of loyalty, but also to avoid placing themselves in circumstances that could call their loyalty into question.

September 19, 2012

In almost all states (Ohio included) all employees owe their employer a "duty of loyalty," which, in the words of one court, means "a duty to act in the utmost good faith and loyalty toward his [or her] employer." According to another court, "[A]n … employee is prohibited from acting in a manner inconsistent with his … employment and is bound to exercise the utmost good faith and loyalty in performance of his obligations." Examples of employee misconduct that courts have found to be in breach of this duty of loyalty include acting in competition against one's employer, giving away company property, using company funds as one's own, taking bribes or kickbacks, and reaping secret profits.

A story I read yesterday serves as a good reminder that employees owe a responsibility to those who sign their paychecks not only to avoid breaches of this duty of loyalty, but also to avoid placing themselves in circumstances that could call their loyalty into question. While appearing on a local sports radio station yesterday, Philadelphia Eagles running back LeSean McCoy said the following about the replacement referees working in place of the locked-out regular officials: "One of the refs was talking about his fantasy team, like 'McCoy, come on, I need you for my fantasy.'"

It is highly doubtful, even laughable, that an NFL referee would change a call to help his fantasy football team. Yet, this official exercised very poor judgment in cracking this joke. Employees must avoid even the appearance of a breach of their loyalty to their employer. Should this official lose his job or suffer some other discipline for this lapse in judgment? Probably not. Should the NFL talk to him and remind him of the importance of these issues? Absolutely.

Do your employees understand this issue? When you conduct training of your employees, you might want to consider tossing a discussion of these concepts into the materials.

Written by Jon Hyman, a partner in the Labor & Employment group of Kohrman Jackson & Krantz. For more information, contact Jon at (216) 736-7226 or jth@kjk.com.