Get access to the exclusive HR Resources you need to succeed in 2018.
Sign up for free email newsletters and get more SHRM content delivered to your inbox.
Is your employee handbook keeping up with the changing world of work? With SHRM's Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Build competencies, establish credibility and advance your career—while earning PDCs—at SHRM Seminars in 14 cities across the U.S. this fall.
Gain the skills you need to rise to the next level in your career. Jon us at SHRM's Leadership Development Forum, October 2-3 in Boston.
Members may download one copy of our sample forms and templates for your personal use within your organization. Please note that all such forms and policies should be reviewed by your legal counsel for compliance with applicable law, and should be modified to suit your organization’s culture, industry, and practices. Neither members nor non-members may reproduce such samples in any other way (e.g., to republish in a book or use for a commercial purpose) without SHRM’s permission. To request permission for specific items, click on the “reuse permissions” button on the page where you find the item.
Learn invaluable lesson by conducting an employment litigation post-mortem.
Consider this tale of an employment lawsuit: A former employee asserted claims of sex discrimination, harassment and retaliation—sparking a long, expensive resolution process.
First in administrative proceedings, and then in court, the parties vigorously contested the dispute. After the trial court dismissed the sex discrimination and harassment claims on summary judgment, the case went to trial on the retaliation claim. The employer prevailed at trial, the employee appealed, and the parties subsequently settled the matter during the appellate process. Although the settlement amount was not huge, the employer’s litigation costs were well into six figures at that point.
Equally important, the entire process took four years to conclude and diverted considerable energy from management—energy that could have been spent on other tasks. For example, management and human resources staff spent several hundred hours in discovery, responding to endless requests for documents and information. Over a dozen depositions were taken; numerous interrogatories propounded and answered; numerous documents identified, produced and fought over; and multiple megabytes of computer information restored, tracked and sorted.
With signatures on the settlement documents and dismissal of the lawsuit, the company’s CEO quoted Thomas Hobbes’ famous dictum with a variation: “Nasty, brutish—and long.”
Not surprisingly, both the employer and its counsel wanted to put the experience behind them quickly. The former acted as if it had passed an enormous kidney stone. The latter put the case out of mind to make room for the next one—like freeing up space on a computer hard drive.
Unfortunately, however, this all-too-typical endgame meant the loss of a valuable learning opportunity.
Painful but Profitable
Whether an employer wins, loses or settles a lawsuit, it can learn important lessons by conducting a litigation post-mortem -- especially while the litigation experience is still fresh.
If the employer and its attorneys trade in their defenders’ hats for those of forensic analysts, the employer will gain insights that can help it prevent future claims and even improve its human resources and management effectiveness. Moreover, if the employer acts promptly, the pain of the recently concluded litigation will provide momentum for constructive change.
On the other hand, when employers wait to review the situation, the trail will grow cold and the momentum for change will dissipate.
Don’t make that mistake. Tap that momentum while it is hot because, in most cases, litigation will reveal plenty of room for improvement in how managers and HR staff communicate with employees; how they discipline, respond to conflict, and create, use and retain documents; and how they maintain consistency in policies, procedures and treatment of employees.
But only a post-mortem will bring those revelations into focus. In contrast to a legal defense, which strives to cast the employer’s position in its best light, the litigation post-mortem candidly identifies mistakes and their causes, determines how the problem could have been avoided, lists steps for improvement and develops an implementation plan.
I put the concept of the litigation post-mortem before fellow members of the Management Labor and Employment Roundtable and the Worklaw Network, two national associations of management-side labor and employment lawyers. From a wealth of responses around the country, I derived the following features that characterize a thorough post-mortem.
Audit HR Practices
While the sting of cross-examination still lingers, conduct an unflinching audit of HR policies, procedures and practices. Examine gaps between good management and reality, identify what made the employer vulnerable to claims and diagnose what continues to make it vulnerable using one of many available workplace audit programs and checklists. The challenge lies not in identifying the ideal audit tool, but in having the motivation to carry out the audit process. Post-litigation trauma provides powerful impetus to do so.
The employment law attorneys I have spoken with agree that any post-litigation review address the following areas:
Legal compliance. Do all policies, procedures and practices comply with Title VII of the Civil Rights Act of 1964, the Fair Labor Standards Act, the Americans with Disabilities Act, the Family and Medical Leave Act, other federal laws and applicable state laws? Are any policies obsolete? Are there any practices that create an unnecessary or avoidable risk of liability?
How well do management representatives understand workplace laws?
Consistent application. Are any policies inconsistent with actual practice? Many employment lawyers recount plaintiffs’ counsel having a field day cross-examining HR and management representatives about the employer’s policies, manuals, handbooks and checklists. Draw on those experiences to look for inconsistencies and contradictions, steps that were required but not taken, or actions that would be better avoided in the future.
Internal communications. Examine how well management communicated expectations. Did employees know what was expected of them? Did they know the importance of meeting expectations and the consequences of failing to do so? Were employees given the information they needed to be successful? How well did the employer distribute information so that employees did not engage in destructive speculation about management’s goals or motives?
Opportunities. Were opportunities lost that might have prevented the problem or turned a negative workplace relationship into a positive? Once the problem surfaced, were early opportunities to solve it lost? Intervening before anger and bitterness spike can help keep matters out of the legal system.
Things done right. What behaviors helped to defend the claim or to prevent it from becoming worse than it was? Too often, senior management fails to recognize the good things managers and HR professionals do, thus failing to encourage future positive action. The litigation post-mortem provides an opportunity to recognize and reinforce helpful approaches.
In addressing the value of the litigation post-mortem, employment litigators repeatedly emphasize documentation. The greater the time lag between the employment decisions being challenged in court and the court’s adjudication of those decisions, the greater the need for good documentation.
Memories fade day by day, yet litigation drags on year by year. One lawyer recalled a case in which a black claims adjuster contended that his discharge had been racially based. Given the high turnover in the position and the three years that had elapsed in litigation, his supervisor could not recall whom he had hired to replace this employee.
Fortunately, the HR department maintained a form requiring supervisors to identify the individual whom a new hire was replacing. In this case, HR retrieved the form with the plaintiff’s name on it. It showed that he had been replaced by another black employee. The supervisor submitted an affidavit describing his routine practice of completing this form in the hiring process, and that clinched summary judgment for the employer.
To increase the likelihood of such positive outcomes, take a hard look at document generation and retention—that is, when documents are created and how they are preserved.
Defense lawyers articulated some recurrent themes in this area:
Create documentation right away
If a communication to an employee is important and could affect his or her status, preserve it in a contemporaneous writing. It may be an “internal” document—a memo to file, journal entry or note, or an “external” document such as a memo given to an employee summarizing an important conversation with the supervisor.
Make it accurate
As obvious as it may seem, this bears repeating: Documents must be accurate. Several employment attorneys recalled their chagrin at sugarcoated performance evaluations that came back to haunt an employer in litigation.
Maintain a training file
When conducting anti-harassment, job skills or other training, document who attended, what subjects were discussed and what handouts or policies were distributed. Otherwise, employees will adamantly maintain that they did not know the standard of expected behavior, never received the information for where to report an internal complaint or did not get the necessary training to perform the job from which they were removed.
Make Training Count
Management training is potentially of great value, but if it is not delivered with a sense of urgency, it may not produce the hoped-for benefits. Managers pulled out of their workplaces to be taught communication skills may be more apt to worry about work piling up in their absence than about improving their ability to set expectations and hold employees accountable.
As a result, once the training session ends, they may revert to a front-of-the-nose perspective. Lessons may well fade from memory before they can be converted into habit.
The conclusion of a lawsuit can create the sense of urgency necessary to reinforce training if senior management forcefully communicates its resolve never to undergo a similar ordeal and emphasizes the need for managers to improve their skills. The lawsuit serves as both a source of information about areas for improvement and a source of leverage to motivate meaningful change.
One employment lawyer shared a positive post-litigation training experience: Following several years of litigation with the Equal Employment Opportunity Commission, the employer’s law firm and HR department created a customized training program based specifically on the lessons to be learned from that lawsuit. Managers were able to ask questions and confront specific issues raised in the case and their significance for both HR and management in moving forward. (When using case-specific training exercises, employers may want to protect the identity of the individuals involved even if that is a matter of public record. A bigger issue is to make sure the case is fully resolved so there is no chance of the training becoming evidence in ongoing litigation.)
Another employer and legal counsel created a post-litigation training program that included mock depositions and a mock trial involving HR and management representatives. Managers attending the program got to see up close how their mistakes in dealing with employees get exploited in litigation. The employer subsequently reported that the program had a substantial positive impact and created a “unique opportunity” for making managers focus closely on the consequences of their action or inaction.
These examples stand in sharp contrast to the following situation reported by another employment defense lawyer: A manager triggered a pregnancy discrimination lawsuit by telling an employee that she was terminated because she was pregnant. After the claim settled, counsel recommended training for the manager. It didn’t happen. Instead, the manager later fired another pregnant employee and produced an even more expensive lawsuit.
A litigation post-mortem will shed valuable light on an employer’s problem-solving practices. In light of the litigation, probe whether management avoided the problem until it could no longer be ignored. Was management proactive, reactive or just plain inactive?
What are the employer’s policies and procedures regarding internal investigations and conflict resolution? Were they followed? Even if not unionized, did the employer maintain an open door policy or grievance process? Employment attorneys have indicated that an internal grievance process may be useful not only in heading off claims but in confirming employees’ positions in writing before a plaintiff’s attorney has coached them.
In cases of employee termination, the post-mortem should focus closely on the employer’s policies, procedures and practices regarding how the decision to discharge is made and executed. Do the employer’s discharge procedures and practices help contain terminations as short-term problems, or do they exacerbate the risk of transforming them into long-term problems? If the employer provides severance, does it require the employee to sign a release of claims? (For a detailed discussion of how to secure enforceable releases of claims, see the two-part series on that topic in the December 2003 and January 2004 Legal Trends columns.)
Employment litigators observe that when defending an employer’s decision to fire someone, the issue often is not what the employer did but how the employer did it. One lawyer shared a story of a Catholic nursing home, whose executive director was a nun. The home’s office manager was Jewish. The executive director was reluctant to confront the office manager’s serious performance deficiencies. Eventually, the problem became so severe that the executive director discharged the office manager. Reluctant to the end to hurt the office manager’s feelings, the nun told the Jewish employee she was being terminated because she did not “fit in.”
The terminated employee used this statement as the basis of a religious discrimination claim. The post-mortem lesson? Honesty is still the best policy—especially when it comes to employee feedback.
Scrutinize Defense Process
The litigation post-mortem should examine the defense process itself. What was the working relationship between defense counsel and management and HR representatives? Were the legal services provided cost effective? Did the attorneys understand the employer’s goals and work diligently toward achieving them? Were the company officials chiefly responsible for working with the attorneys able to balance the demands of the litigation process with their other work responsibilities? Were in-house personnel used cost effectively to reduce the overall litigation expense? If there were unemployment compensation proceedings, did the employer take advantage of them to pin down the employee’s position before the employee had been coached by outside counsel, or did the employer exacerbate the problem by making misleading or incorrect statements that were used against the employer in a court proceeding?
Examine the approach the employer used to defend the claim. Did the employer go to excessive lengths—as one employment litigator put it, buying a Cadillac when a Volkswagen would have done just as well?
Did the employer—and legal counsel—get so emotionally caught up in the adversary process that they ignored early opportunities for settlement? One employment litigator observed: “Many employers refuse to settle—or litigate like pit bulls—because of a high-minded principle, yet eventually lose sight of it after spending so much principal. They would have been better off to have asked at the outset of litigation: ‘Is it really worth a half a million dollars to teach a foolish ex-employee a lesson that he or she will probably never understand anyway?’ ”
On the other hand, another attorney observed that “scorching some slither-lidded parasite lawyer” may be necessary to avoid his “feeding at the settlement trough for the next 10 years.”
The point of focusing the microscope on the defense strategy is to acknowledge that there is no one-size-fits-all approach to claim defense. Based on what it learns in the post-mortem, the employer should carefully think about what is truly in its overall best interest and be sure in the future to retain counsel who thinks likewise.
Pay for What You Get
If you are serious about a litigation post-mortem, pay legal counsel to help you conduct it. Having shelled out an enormous sum in litigation fees, you might be tempted to accept your law firm’s offer to do it for free. The value of the lessons to be learned, however, is too great to be left to mere client courtesy.
Instead, insist on paying for the time with the same expectation of first-rate analysis and advice. If done properly, this may well be your last litigation post-mortem. Make it count.
Author’s Note: The author wishes to thank those who contributed their advice and anecdotes in connection with this article. Without them, the employment litigation post-mortem would have been just “bare bones.” Larry Bridgesmith, Waller Lansden Dortch & Davis, Nashville, Tenn.; Candy Dale, Hale Farley Oberrecht & Blanton PA, Boise, Idaho; James Dale, Moffatt Thomas Barrett & Fields, Boise, Idaho; Kenneth Diamond, Winterbauer & Diamond, Seattle; John Doran, Bryan Cave LLP, Phoenix; Susan Fentin, Skoler Abbott & Presser, Springfield, Mass.; Mary Ann Oakley, Holland & Knight, Atlanta; Rich Paul, Paul Plevin Sullivan & Connaughton, San Diego; David Riewald, Bullard Smith Jernstedt Wilson, Portland, Ore.; David Safon, Benetar Bernstein Schair & Stein, N.Y.; Barbara Stephenson, Gilkey & Stephenson, Albuquerque, N.M.
Jathan Janove is a partner in Janove Baar Associates LC, a Salt Lake City-based employment law firm, and is a member of the Management Labor and Employment Roundtable and Worklaw Network. He defends employers in litigation and helps prevent workplace claims through training, consulting and development of HR policies and practices. He is currently publishing a book with SHRM based on his training program The Seven Deadly Sins of Mismanagement.
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Please sign in as a SHRM member before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
SHRM Seminars are coming to cities across the US this fall.
SHRM’s HR Vendor Directory contains over 10,000 companies