New Corp Legal Scenarios
September 14, 2011
New Corp Legal Scenarios
In this Article the subject addressed is the New Corp Legal Scenarios describing three legal encounters involving the organization. In the scenarios management expects substantive answers, not simply recommendations to refer matters to an attorney. The majority of businesses in the United States do not have counsel on staff, and management does not want to spend money obtaining advice until after an assessment has been provided. Each scenario will need to have New Corp liabilities identified. Legal principals such as case and statutory law supporting the assessments need to be provided. In addition, identification of specific regulatory compliance issues, how those issues should be addressed, and how New Corp must manage the legal risks will be cover for each scenario. Legal Encounter 1
Liabilities and Rights
The termination of an employee comes with discussions about liability and rights of both the company and the individual receiving the termination. This article concerns New Corp and an employee to be known as Pat, in an at-will state and what liabilities and rights of both parties come into play. At-Will Employment
The definition of at-will from the National Conference of State Legislatures is that an employer can terminate an employee at any time for any reason, except an illegal one, for no reason without incurring legal liability (NCSL, 2011). Also in the definition employees have the right to leave a job at any time with no reason and with no adverse legal effects. Because New Corp is an at-will company conducting business in the state of Vermont, the organization can terminate any employee for any reason. Pat by signing a document acknowledging he understood the New Corp was an at-will employer has no recourse. Liability to New Corp in this case is nil. Because New Corp is an at-will employer they reserve the rights to terminate Pat at any time for any reason.
New Corp management was correct and made no statement that Pat was unsatisfactory in his performance. If New Corp management made the accusations that Pat’s performance was unsatisfactory, New Corp would have to follow their Notice of Unsatisfactory Performance/Corrective Action Plan and issue Pat a notification and suggest a corrective action to fix the issue. Pat’s Liability and Rights
Pat believing that New Corp was wrong for terminating him because of failure to adhere to their policy on unsatisfactory performance may think that his rights were violated. Pat may also think that New Corp committed a violation under the Intentional infliction of emotional distress. When New Corp termination came so early in his employment, Pat believes that the distress inflicted on his family and self warrant compensation. Pat will have a hard time convincing his rights were violated when New Corp terminated his employment. New Corp was within their rights to terminate and Pat should incur no liability in this case.
Legal Encounter 2
Liability Action and Principals
This situation where a relationship developed between a supervisor Sam and subordinate Paula can result in termination of both parties. As the issue relates to supervisory and subordinates, it is highly likely that the supervisor of this romance will be the one to be moved from this position or fired from the company. Cite: Barbee v. Household Automotive Finance. In a real-life case, a supervisor was fired for violating the company policy on dating subordinates. For companies to stay out of the personal lives of employees, implementation of new wording is changed to “if your relationship with other employees hampers our ability to do business – or your ability to do your job - you will be subject to disciplinary action” (Giuliano, 2009, p. 1). With this wording, the organization stays to the matter of business and not personal lives of employees. Burden on Management
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