COVID-19 highlights need for greater job protection

The coronavirus pandemic has exposed many deficiencies in the social order. One of them is the fragility of the rights of employees.

The mass firings, layoffs and furloughs generated by the enormous impact of the crisis have provided a stark reminder of the limited job security of most employees in this country, including here in Minnesota.

But that reality is not as novel as the virus itself. Despite the relatively strong pre-COVID economy, last year saw a record number of corporate layoffs in this country, with most of them concentrated in large financial institutions, the media and a host of others, including many here in Minnesota, and continuing into the first part of this year.

The surge swept into Minnesota, too, including a number of companies such as Best Buy, 3M (which laid off 1,500 people in late January) and U.S. Bank, which announced a proposed layoff for later this year.

The reductions in force, or RIFs, have been a staple of the U.S. economy, in good times and bad, for quite a while. Rather than attracting derision, corporate executives who retrenched have seen increases in their corporate stock values, and rising salary and benefits.

Except for those rare, usually upper-level employees who have employment contracts, members of labor unions, and some working for government units, the bulk of employees toil on an "at-will" basis, which gives them minimal job security. Their legal rights are virtually nil under the longstanding legal tenet that enables employers to impose virtually any terms and conditions upon employees that they wish, including discipline demotions, layoffs and discharge with no legal onus.

Employees are, to be sure, not totally powerless.

Additionally, whistleblower laws, which have been bolstered by statute and court rulings in Minnesota in recent years, protect those who raise objection to illegal procedures in the workplace, providing some job security for employees in Minnesota and elsewhere.

The federal workers adjustment and rehabilitation (WARN) law requires 60 days notice before layoffs in large companies with more than 100 employees, when more than 50 employees are laid off, and mass layoffs in large companies with more than 100 employees/consisting of 50 or more lost jobs. One state, New Jersey, has gone so far as to require severance to victims of mass layoffs, but other states, including Minnesota, have not picked up on this approach.

But, contrary to popular misconception, there is no requirement that an employee be given any advance notice, two weeks or otherwise. Nor is there an obligation to pay severance.

Despite the inhospitable nature of the "at will" employment rule, employers infrequently, as a practical matter, terminate employees for a trivial reason. Good employees are hard to find, so employers generally refrain from firing without some solid justification, although, legally, they need not have any.

Sometimes, of course, other factors besides performance come into play, such as personality clashes and economics.

Efforts have been undertaken to provide similar protections in this country, without much success. Some have urged adoption of a proposal known as a Uniform Employment Termination Act (UETA), which has been making the rounds of the legislative chambers for a couple of decades. Basically, the law would provide that after a certain waiting period, usually two years, an employee cannot be fired without just cause, meaning sufficient justification by the employer with a legitimate reason for discharge, usually some kind of real financial urgency or serious abrogate conduct by the employee.

Only a few states have adopted the UETA or portions of it. It has been rejected or failed to make it to legislative floors in most states. In Minnesota, the proposed law has been dormant for years.

The latest round of COVID 19-induced employee retrenchment, including the record number of layoffs, may awaken the realization of the inherent imbalance in employment relationships in the workplace.

This recognition could encourage the legislative bodies, Minnesota's included, to give renewed consideration to some form of job protection for employees.

It is widely recognized that many facets of life, business, and work will be changed after the virus subsides. The new realities may provide an opportune occasion to provide greater workplace rights to employees.