The key to a successful, challenge-proof reduction in force is using objective, measurable factors to determine who stays and who goes. That greatly reduces the likelihood that a former employee who loses his job to a RIF will win a discrimination case.
Recent case: Victor, who is black, worked as a financial advisor trainee for Merrill Lynch.
Early on, he received a written “letter of education” based on conduct that occurred during an official visit to the Democratic Republic of Congo. He had bought dinner for several government officials without first getting company approval. During that trip, he was also observed spending considerable time with another financial advisor who had previously charged the company with discrimination.
Victor was terminated as part of a reduction in force that affected 200 financial advisors. He sued, arguing that the real reason was his association with the other advisor and not his performance.
But Merrill Lynch showed the court the criteria it had used to pick the layoff candidates. Among the crucial factors were things like hitting sales goals and earning bonuses, two categories in which Victor had come up short.
The court tossed out his case, reasoning that Victor couldn’t show—through his sales numbers—that he was at least as successful as the lowest-performing individual who had kept his job. (Jarvis v. Bank of America, No. 1:10-CV-896, MD NC, 2012)
- Inappropriate nicknames can lead to bias lawsuits
- Creating an effective blog policy to limit employer liability
- One stupid comment doesn't create hostile environment
- Economic conditions require worker layoffs? Be honest about reason for termination
- Worried about reining in religious tension? Don't ban all discussion of faith