What to know about layoffs and the law

Nobody likes to be shown the door by the boss. Sometimes it's unfair. Occasionally it's illegal.

Layoffs go along with lean times. Firms commonly cast big workforce cuts as "downsizing" needed just to keep afloat.

Announced job cuts reached an unprecedented 162,867 in March, according to Challenger, Gray & Christmas, an international outplacement firm. That's up 60 percent from February, and up 192 percent since March 2000.

Who goes and who stays? The reality: Firms have a lot of leeway in deciding.

"It's somewhat like Florida election law - when you really get down to it, it's not all that clear," says Jonathan Levy, an attorney at Fair Measures, an organization that trains managers on employment practices. "This is why employment lawyers are well employed."

The first thing such workplace-law specialists look for is an employment contract, mostly held by executives or union workers. Most people are employed "at will," which means they can quit or be fired at any time for any reason - as long as it's not an expressly illegal one, like firing someone because they are Filipino or pregnant or old.

"The fact of the matter is that employers can do things that are 'unfair.' If there's an irascible supervisor who tends to fly off the handle and fire people, it won't seem fair, but it's not actionable," says Noel Ragsdale, professor of law at the University of Southern California in Los Angeles.

People can be laid off for poor performance, she says, even when they think they are doing well. Just because the supervisor did not fire a warning shot before firing someone does not mean an employee can sue, Ms. Ragsdale adds.

The law does protect workers in some specific cases, however. If a worker is fired in retaliation - say, for blowing the whistle on unsafe work conditions, or filing a workman's compensation claim - a case can be brought as a "public policy exception" to the rights of employers to fire at-will workers.

Another exception: cases that involve discrimination. Federal law prohibits discrimination based on any of 10 characteristics: gender, age, race, national origin, religion, citizenship, veteran/military status, pregnancy, family or medical leave, and disability.

In addition, states have their own laws and definitions. California, for example, includes in its protections marital status, medical condition, and sexual orientation.

"If you're an at-will [employee], the question is not whether the employer had a good reason, it's whether they had an illegal reason," Ragsdale says, and the burden is on the employee to prove that.

"The employer just has to come up with a legitimate, non-discriminatory reason. The reason can be that you're an Aires, and the manager doesn't like Aires. It might be a crazy reason, but it won't be because of being Asian or being female," she says.

In cases of downsizing, employers have a clear and legitimate reason to let workers go. But how the company decides which employees to lay off can be discriminatory.

"If 60 percent of the workers who got laid off are over 40, but only 10 percent of the workforce is over 40, that may be a problem," Mr. Levy says.

Even when poor performance is the stated reason for letting workers go, the underlying way of evaluating performance can discriminate against certain groups.

In cases where companies use grades or "forced rankings" to evaluate employees' performance, the system itself is not necessarily negative, says Robert Freedman, president of Organization Resources Counselors, a human-resources consultancy in New York. "But if the bottom 10 percent of employees all happen to be black or women or disabled, you can have a problem," he says.

Ford Motor Company, Conoco, and Microsoft are all facing large lawsuits right now from employees in protected groups who claim they were fired because ranking systems unjustly targeted them.

If you think you have been fired illegally, legal experts say, the first thing to do is gather evidence to prove that the reason the company gave for firing you is not the real reason.

"If a manager has terminated someone for being late, but there are three other people who are late more often and still have their jobs, the employee [may well believe] there must be another reason," Levy says.

Those who think they may have been fired for an illegal reason can file a complaint by visiting a local branch of the Equal Employment Opportunity Commission (www.eeoc.gov), a federal office that investigates these claims.

The process is free, will make an employer pay attention to the problem, and is faster than a lawsuit. States also have their own antidiscrimination offices.

The legal process, on the other hand, can be long, costly, and draining - although in some cases, workers who prove they were fired illegally get big money in damages.

"There's going to be a lot of work and a lot of turmoil," Ragsdale says. "So you have to make a tough assessment about whether you're willing to hang in there for a couple of years and fight about it."

(c) Copyright 2001. The Christian Science Monitor