Employees from Hell

A look at problems employers face from employees seeking legal suits, and some ways to guard against such suits.

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A legal climate that has arisen from a legitimate need to protect employees has, unfortunately, made suing one's employer a no-lose proposition. Here's a sampling of sometimes-unbelievable horror stories about . . .

Last year Daniel Kriek* hired the "sweetest little old lady you'd ever want to meet." This year he wishes he never had. The founder of seven-year-old apparel maker Alpha Blouse Corp. (ABC) met the woman when she called on ABC for a job "at any wage, just to finish out my time." Kriek put her to work cleaning desks, hardly suspecting that the time she had in mind was exactly 10 working days. Employed on June 1, 1993, she requested a furlough on June 15. "You just started!" Kriek thought -- but didn't have the heart to utter. "When you're ready to come back," he said instead, "give us a call."

The woman never phoned. But her lawyer did. His little old client was filing a claim against ABC, the solicitor informed Kriek, because she had gotten double carpal tunnel syndrome, a job-related debilitation that prevented her from performing work of any kind. But not to fret: generous severance pay would be recompense enough for her to drop the claim. "How can you get carpal tunnel from 10 days behind a duster, even if you swing the feathers wrong?" Kriek demanded. The answer came months and "lots of legal fees" later, when the case, contested to the end by the incensed founder, was settled on the courthouse steps. "She knew what she was doing, big-time," an embittered Kriek concludes. "She was going for $20,000 per wrist." His investigation revealed that she'd engaged the lawyer before applying to ABC.

One bad apple in an otherwise contented and loyal workforce? Perhaps. But more likely, as bitten-from-below entrepreneurs like Kriek are discovering, just another wise-to-the-system worker exploiting modern employment statutes for reward and vendetta. And why not? When venerable institutions like IBM and GM can lay off tens of thousands with a single impersonal decree, you can't expect some sweet little old lady to care for Alpha Blouse.

Legislation such as the 1991 Civil Rights Act and the Americans with Disabilities Act (ADA), plus the de facto revocation of a business owner's long-presumed prerogative to dismiss employees whenever he or she feels like it, "is intended to protect a class of people that needs to be protected," grants lawyer Joseph J. Ortego, a commercial litigator in Uniondale, N.Y., specializing in the corporate side of wrongful-termination cases. A major side effect, however, has been that "the laws give leverage to plaintiffs who don't have genuine causes of action. It puts a chill in an employer's mind to have to discharge someone, because the employer can end up getting sued for wrongful dismissal."

It also puts a bee in less-scrupulous lawyers' bonnets about where to hustle clients. After a California company terminated two employees, they went to file unemployment claims, as was their due. While in line they were approached by a lawyer who promised them, "I can get you a better deal than hanging around here will." Charging post-termination stress, the employees filed multi-thousand-dollar claims against their employer. And once a law firm gains a reputation for collecting on such workplace complaints -- at contingency rates that sometimes exceed 50% -- "the line forms at their door," says Ortego.

In part because California's notoriously liberated compensation laws placed on employers an excessive burden in litigation and insurance costs, many businesses left the state. California attempted to redress the imbalance by, among other restrictions, disallowing stress claims filed after termination. But that didn't stop an employee of another small company, who, in anticipation of being fired, brought in a lawyer while he was still at work to establish grounds for job-related stress. The employer countered by bringing in a doctor, who refuted the allegation by issuing the employee a clean bill of health. The two specialists canceled each other out. "After a lot of wrangling back and forth," says the business's owner, "all that happened was that our insurance premiums went up."

To be fair, insists Lonny H. Dolin, a law partner specializing in employee litigation at Dolin & Modica, in Rochester, N.Y., in situations that involve allegations of job injury, it's not always the employee who should be blamed so much as the system. "Workers' comp rewards an employee if he's worse off, and requires an employer to counter that he's not hurt at all. It doesn't motivate the right behavior, which would be to get the person back to work as soon as possible."

Whether federal and state statutes have triggered a countrywide rise in illegitimate and fraudulent claims is debatable. Says Dolin, "What I'm seeing is that individuals who feel they may have been wronged are now more comfortable picking up the phone and calling attorneys. In a climate where the guarantee of finding other work is no longer there, the willingness to explore whether or not something unfair happened is greater because it's an economic necessity."

What Ortego is seeing, on the other hand, is bolder exploitation of opportunity. "Employees angle for severance because they have nothing to lose. And not only do they sue your company, they sue you personally. An owner of a small business can't deal with going to court on a regular basis like a big business can."

Whatever the motive is, arithmetic dictates that more laws inspire more lawsuits. Now ostensibly aggrieved employees go for broke against even the most modest enterprises. And instituting an action is so easy -- a matter of filling out a form -- that vengeful employees can, virtually without cost, get the courts to put muscle in their grudges by acting as their own lawyers and enjoying the same subpoena power as $200-an-hour counsel.

"That technique is particularly effective," Ortego notes. "The first thing the plaintiff does is depose the other employees. They're nervous and distracted. Then they start to relate to the employee who's been discharged, thinking the same thing could happen to them."

And it needn't be just a civil complaint. In a recent instance, the management of a $5-million equipment-repair service outside Philadelphia was criminally served by a piqued employee. The company had been patiently tolerating that worker's taking unannounced absences beyond the company's specified annual allotment. The worker's grounds were that his bursitis flared up unpredictably and rendered him useless. One day the company's operating officer happened by the worker's home and was astounded to see the absentee vigorously polishing his car with the supposedly incapacitated arm.

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