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Individual Personal Liability of Managers and Supervisors

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Individual Personal Liability of Managers and Supervisors Related to Employment Litigation State of South Dakota Risk Management Training August 2010 – PowerPoint PPT presentation

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Title: Individual Personal Liability of Managers and Supervisors


1
Individual Personal Liability of Managers and
Supervisors Related to Employment Litigation 
  • State of South Dakota Risk Management Training
  • August 2010

Pg 1
2
  • State of South Dakota Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • 1. GENERALLY MOST SUPERVISORS AND MANAGERS ACCEPT
    WITHOUT QUESTION THAT THE EMPLOYER IS
  • LEGALLY RESPONSIBLE FOR THE DISCRIMINATORY ACTS
    OF THEIR EMPLOYEES UNDER TITLE VII, THE AGE
    DISCRIMINATION IN EMPLOYMENT ACT (ADEA), THE
    AMERICANS WITH DISABILITIES ACT (ADA) (FMLA) AND
    OTHER STATUTES REGULATING EMPLOYMENT. (PRIMARY
    EEO LAWS).
  • SUPERVISORS MANAGERS UNDERSTAND THE NEED TO
    FOLLOW THE VARIOUS FEDERAL, STATE AND LOCAL
    EMPLOYMENT LAWS.
  • GENERALLY, MANAGERS AND SUPERVISORS ARE AWARE OF
    THE POTENTIAL COST TO THE EMPLOYER WHERE
    EMPLOYMENT ACTION CARRIES WITH IT THE POTENTIAL
    FOR A LAWSUIT.

Pg 2
3
  • State of South Dakota Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • HOWEVER, MOST SUPERVISORY MANAGERS WHO
    PARTICIPATE IN EMPLOYMENT ACTIONS, SUCH AS
  • DISCHARGE,
  • LAYOFF,
  • DEMOTION,
  • DISCIPLINE
  • OR WAGE ADJUSTMENTS,
  • DO NOT REALIZE THE POTENTIAL PERSONAL
    CONSEQUENCES OF THEIR ACTIONS.

Pg 3
4
  • State of South Dakota Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • THE PURPOSE AND INTENT OF THIS TRAINING IS
  • ENHANCE SUPERVISORY/MANAGER AWARENESS OF PERSONAL
    LIABILITY
  • PROVIDE YOU WITH STRATEGIES FOR AVOIDING
    LIABILITY FOR YOUR
  • YOURSELF AND YOUR EMPLOYER
  • PROVIDE TRAINING EDUCATION AND INFORMATION ON A
    CHALLENGING AND INTERESTING TOPIC.

Pg 4
5
  • State of South Dakota Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • THE MEANING OF PERSONAL LIABILITY
  • PERSONAL LIABILITY REFERS TO CIVIL ACTIONS
    BROUGHT BY AN EMPLOYEE APPLICANT/CLAIMANT
    (CLAIMANT) IN A COURT OR ADMINISTRATIVE TRIBUNAL
    AGAINST A PERSON (DEFENDANT OR RESPONDENT) IN
    HIS/HER INDIVIDUAL CAPACITY.
  • WHERE ANY MONETARY AWARD PROVIDED FOR THE
    CLAIMANT MAY BE SATISFIED FROM THE PERSONAL
    ASSETS OF AN INDIVIDUAL DEFENDANT.
  • THE PERSONAL ASSETS FROM WHICH A JUDGMENT MAY BE
    SATISFIED COULD INCLUDE THE DEFENDANTS HOUSE
    (SUBJECT TO ANY HOMESTEAD RIGHTS UNDER STATE
    LAW), PERSONAL BELONGINGS, BANK ACCOUNTS,
    INVESTMENTS AND OTHER ASSETS.

Pg 5
6
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • POTENTIAL RISKS FOR SUPERVISORS/MANAGERS AND
    OTHER EMPLOYER OFFICIALS MAY BE EXPOSED TO DUE TO
    THEIR ACTIONS. (PART ONE)
  • THE STRATEGY OF PLAINTIFFS COUNSEL TO SUE
    INDIVIDUAL SUPERVISORY EMPLOYEES IN THEIR
    PERSONAL CAPACITY.
  • 2. THE EMPLOYEE WHO SUES MAY HOLD AN INDIVIDUAL
    MANAGER RESPONSIBLE FOR ALLOWING AN ALLEGED ACT
    OF DISCRIMINATION TO OCCUR OR FOR COMPOUNDING OR
    IGNORING IT.
  • THE SUPERVISOR OR MANAGER IS USUALLY THE BEARER
    OF BAD NEWS LAYOFFS, CUT BACKS HOUR REDUCTIONS
    TERMINATIONS AND, BECAUSE OF THIS, MAY BE THE ONE
    THE PLAINTIFFS TARGETS.

Pg 6
7
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • POTENTIAL RISKS FOR SUPERVISORS/MANAGERS AND
    OTHER EMPLOYER OFFICIALS MAY BE EXPOSED TO DUE TO
    THEIR ACTIONS. (PART TWO)
  • BY SUING INDIVIDUAL SUPERVISORS/MANAGERS
    PERSONALLY THE PLAINTIFF CREATES ADDITIONAL
    PRESSURE ON THE EMPLOYER TO SETTLE THE CASE DUE
    TO FEAR OF PERSONAL LIABILITY.
  • 5. BY SUING INDIVIDUAL MANAGERS PLAINTIFF MAY
    CREATE A CONFLICT BETWEEN THE EMPLOYER AND ITS
    SUPERVISORS/MANAGERS, LEADING TO FRICTION BETWEEN
    THE PARTIES WHICH COMPLICATES THE DEFENSE.
  • 6. SUING INDIVIDUAL MANAGERS PROVIDES THE PARTY
    BRINGING THE SUIT WITH ADDITIONAL OPPORTUNITIES
    TO PREVAIL.

Pg 7
8
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • POTENTIAL RISKS FOR SUPERVISORS/MANAGERS AND
    OTHER EMPLOYER OFFICIALS MAY BE EXPOSED TO DUE TO
    THEIR ACTIONS. (PART THREE)
  • KEY IMPORTANT AREAS OF POTENTIAL EXPOSURE
    FOR INDIVIDUAL SUPERVISORS/MANAGERS INCLUDE THE
    FOLLOWING
  • VIOLATION OF THE EMPLOYEES FMLA OR FLSA RIGHTS.
  • 2) ENGAGING IN OR ALLOWING OTHERS TO HARASS
    INTIMIDATE OR DISCRIMINATE AGAINST AN EMPLOYEE
    UNDER THEIR SUPERVISION.
  • 3) INTERFERING WITH AN EMPLOYEES EXERCISE OF
    THEIR RIGHTS.

Pg 8
9
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • POTENTIAL RISKS FOR SUPERVISORS/MANAGERS AND
    OTHER EMPLOYER OFFICIALS MAY BE EXPOSED TO DUE TO
    THEIR ACTIONS. (PART FOUR)
  • SUMMARY
  • EMPLOYMENT RELATED ACTIONS CARRY WITH THEM THE
    RISK OF LIABILITY.
  • THIS CAN RESULT IN LEGAL ACTION AGAINST THE
    EMPLOYER AND AGAINST INDIVIDUAL SUPERVISORS AND
    MANAGERS.
  • BEST PRACTICE --- CONSULT AND GET SUPPORT OF THE
    EMPLOYER BEFORE TAKING ACTION.

Pg 9
10
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • THE LEGAL DEVELOPMENT OF TYPES OF RISKS TO WHICH
    SUPERVISORS/MANAGERS AND OTHER EMPLOYER OFFICIALS
    MAY BE EXPOSED TO DUE TO THEIR ACTIONS.
  • LAWS PROHIBITING DISCRIMINATION IN THE WORK
    PLACE
  • TITLE VII, THE ADEA AND THE ADA-AA PROHIBIT
    EMPLOYERS FROM DISCRIMINATING ON THE BASIS OF
    RACE, COLOR, RELIGION, SEX, NATIONAL ORIGIN, AGE
    OR DISABILITY WITH RESPECT TO TERMS, CONDITIONS
    OR PRIVILEGES OF EMPLOYMENT.
  • ONE STRONGLY DEBATED AND LITIGATED OF THE THE
    ISSUES IN THESE LEGAL ACTIONS IS WHETHER THERE IS
    PERSONAL LIABILITY FOR INDIVIDUAL EMPLOYEES OF
    THE EMPLOYER FOR THE PROHIBITED ACTS OF
    DISCRIMINATION.

Pg 10
11
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • THE GOOD NEWS !!
  • MOST OF THE U.S. CIRCUIT COURTS OF APPEAL WHICH
    HAVE ADDRESSED THIS ISSUE HAVE HELD THAT THERE IS
    NO PERSONAL OR INDIVIDUAL LIABILITY FOR
    EMPLOYEES, MANAGERS OR COMPANY OFFICIALS IN
    LAWSUITS BROUGHT PURSUANT TO TITLE VII, THE ADEA
    OR THE ADA-AA.
  • THE BAD NEWS!!
  • THERE ARE A NUMBER OF FEDERAL COURTS THAT HAVE
    HELD THAT THERE IS PERSONAL OR INDIVIDUAL
    LIABILITY FOR MANAGERS, EMPLOYEES OR OFFICIALS
    UNDER THE FEDERAL EMPLOYMENT DISCRIMINATION LAWS.

Pg 11
12
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • THE NOT SO GOOD NEWS !!
  • THE QUESTION OF INDIVIDUAL LIABILITY FOR
    SUPERVISORS/MANAGERS/ OFFICERS IS NOT SETTLED
    LAW. UNTIL THE SUPREME COURT OR CONGRESS ACTS TO
    RESOLVE THE CONFLICTING RULINGS HANDED DOWN BY
    THE FEDERAL JUDICIARY THIS ISSUE REMAINS
    UNRESOLVED.
  • WHAT IS THE STICKING POINT?
  • THE KEY ISSUE TURNS ON THE DEFINITION OF
    EMPLOYER. THE CONGRESS DID NOT MAKE A DEFINITIVE
    DEFINITION OF EMPLOYER WHEN IT PASSED THESE
    LAWS. THIS LACK OF CLARITY HAS LED TO THIS
    DILEMMA FOR EMPLOYERS AND THEIR SUPERVISORS AND
    MANAGERS.

Pg 12
13
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • THE FMLA AND THE ISSUE OF SUPERVISORY/MANAGER
    LIABILITY
  • IS THERE INDIVIDUAL LIABILITY UNDER FMLA??
  • WHAT IS THE STICKING POINT?
  • 1. THE FMLA IS NOT A DISCRIMINATION LAW. IT IS
    AN ENTITLEMENT LAW AND A VERY COMPLEX LAW ON TOP
    OF THAT.
  • 2. AN EMERGENT ISSUE IS WHETHER THERE IS PERSONAL
    LIABILITY FOR THE EMPLOYERS SUPERVISORS/MANAGERS/
    OFFICIALS FOR THEIR ACTIONS AS REGARDS THE FMLA?

Pg 13
14
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • IS THERE INDIVIDUAL LIABILITY UNDER FMLA??
  • DARBY V. BRATCH, NO 01-2006WM. IN THIS CASE THE
    8TH CIRCUIT COURT OF APPEALS (WHICH COVERS
    ARKANSAS, IOWA, MISSOURI, MINNESOTA, NEBRASKA,
    NORTH DAKOTA AND SOUTH DAKOTA)RULED
  • THE FMLAS DEFINITION OF EMPLOYER ALLOWS FOR
    INDIVIDUAL LIABILITY BECAUSE IT INCLUDES ANY
    PERSON WHO ACTS DIRECTLY OR INDIRECTLY, IN THE
    INTEREST OF THE EMPLOYER. WITH THIS DECISION
    THE 8TH CIRCUIT JOINED THE 7TH CIRCUIT (ILLINOIS,
    INDIANA, AND WISCONSIN IN CONCLUDING THAT
    INDIVIDUAL LIABILITY DOES EXIST UNDER THE FMLA.

Pg 14
15
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • FLSA COMPLIANCE ANOTHER CHALLENGING AND RISK
    LADEN ISSUE FOR EMPLOYERS
  • THE FLSA IS A VERY COMPLEX LAW, RECENTLY AMENDED,
    AND DIFFICULT TO UNDERSTAND
  • SAME DEFINITION OF EMPLOYER AS DOL USES FOR FMLA
  • PERSONAL LIABILITY CAN ATTACH

Pg 18
16
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • WHAT IS THE STICKING POINT??
  • THE FMLA DEFINITION OF EMPLOYER IS MODELED ON
    THE DEFINITION CONTAINED IN THE FAIR LABOR
    STANDARDS ACT (FLSA) WHICH PROVIDES FOR PERSONAL
    LIABILITY OF COMPANY MANAGERS AND OFFICIALS IN
    THE EVENT AN EMPLOYEES RIGHTS OR ENTITLEMENTS
    HAVE BEEN VIOLATED UNDER THESE LAWS.

Pg 15
17
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • FMLA SUPERVISOR/MANAGER LIABILITY ISSUES
    WHERE THE RUBBER HITS THE ROAD
  • THE FMLA IS ENFORCED BY THE UNITED STATES DOL THE
    SAME AGENCY THAT ENFORCES THE FLSA.
  • BECAUSE OF THE DEFINITION OF EMPLOYER ADOPTED BY
    DOL LIABILITY FOR SUPERVISORS UNDER THE FMLA IS A
    POTENTIALLY DISASTROUS DEVELOPMENT FOR EMPLOYERS
    AND THEIR SUPERVISORS/MANAGERS/OFFICERS.
  • 3. TO ADD THE POSSIBILITY OF PERSONAL LIABILITY
    FOR THOSE WHO MUST MAKE THE DIFFICULT DECISIONS
    UNDER THIS STATUTE IMPOSES A HEAVY BURDEN.

Pg 16
18
  • State of South Dakota
  • Risk Management Training
  • August 2010

Effectively Managing The Potential for Personal
Liability of Managers and Supervisors Related To
Employment Litigation
  • FMLA COMPLIANCE A CHALLENGING AND RISK LADEN
    ISSUE FOR EMPLOYERS
  • THE FMLA IS A VERY COMPLEX LAW, RECENTLY AMENDED
    AND DIFFICULT TO UNDERSTAND.
  • IN SHORT THE LAW IS ALREADY A CHALLENGE.
  • FOR THE DOL TO ADD THE POSSIBILITY OF PERSONAL
    LIABILITY TO HARDWORKING SUPERVISORS/ MANAGERS/
    OFFICERS MAKING A GOOD FAITH EFFORT TO COMPLY
    WITH THE FMLA IMPOSES AN ADDITIONAL AND
    UNNECESSARY BURDEN.

Pg 17
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