Layoff and Temporaries

lynn7231

We may have to layoff 5-10 employees because we have lost a large client. The manager is fighting to keep a full time temporary employee from an agency. The temp has been with us for 3 months and is eligible to roll over to our payroll. The manager rates her higher than a lot of the department's full time staff. Has anyone handle this situation before? Does this pose any legal problems that anyone is aware of? We are in Ohio. Thank you.

Hatchetman

[font size="1" color="#FF0000"]LAST EDITED ON 03-14-02 AT 05:58PM (CST)[/font][p]I doubt that there is any legal requirement in Ohio on the order of lay off although I am not at all familiar with Ohio employment law, and it doesn't sound like there's a labor/union contract involved with your workforce. Does you company policy state anything about the order of layoff?

If your company's plan is to lay off 5 to 10 employees but keep an agency temporary, you may wind up with morale problems. The message you would be sending to all employees is, "Don't bother working for us as an employee because you have less meaning to us than an agency temp."

Margaret Morford

If some of those laid off are in protected classes and your temporay doesn't fall into some of those protected classes, I think you could open yourself to some discrimination charges in addition to the morale problem Hatchetman mentioned above.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]

System

I ran into the exact same situation a couple of months ago. Our production manager had to lay off about 11 people, but kept on a full time employee through a temp agency. Right after the layoff, he was planning to hire the temp employee. Because we have no contract with the temp agency that requires us to hire those employees after three months, we decided to wait another couple of months to hire that employee on. This gave us some time after the layoff, and our work in the production department also picked up at that point, so we needed to bring in additional people.

Hope this helps.

lrenoll

Last May we layed off 9 individuals in manufacturing. We had 3 temps working for us at the time. We looked at hiring them prior to the layoff, but they had too many hours left for the buyout. These individuals were excellent temps and much better then some of our employees. We kept them on and left go of some of our staff. We were very up front about this with everyone and told the employees. While there was some rumbling, with in a day or so things returned to normal. I think everyone realizes that during a layoff, you typically get rid of the weakest performers. The bototm line is no matter what you do or how well you do it, layoffs are a tough situation and morale will go down. It's how you respond that makes the difference. Stick to your guns.

awilliams

An employer should always hire the best person for the job. If that best person happens to be a temp employee, and you have to let go a permanent employee, so be it. The permanent employee had an opportunity to outshine the temp, failed, and so should be moved aside so the temp can continue to do good work for the employer. This is a business, not a feel-good session.

As for Margaret Morford's comments regarding a potential discrimination case, there will always be disgruntled employees who will look for a way to retaliate against the company if they are terminated. It is not illegal to hire a temp and lay-off a permanent worker (unless you have a union contract, then it might be breach of that contract). It is illegal to base your hiring decision on a protected characteristic, such as race, age, or ability. You will have the best chance of winning a discrimination lawsuit if you ALWAYS make hiring/firing decisions based on a legitimate business reason. Here, the legitimate business reason is that the temp is a better, more productive worker than the permanent employees. That is a perfectly good reason to hire her. You can bolster your legitimate reason by making sure that the temp's excellent performance and the permanent employees' poor performances are documented.

And there you have it!

Good luck!

Anne Hunter Williams
M. Lee Smith Publishers, LLC

Carol CA

We are a manufacturing company in California and have also had this same situation. I guess we were more gun shy because we did not keep any of our temporary workers when the time came for the layoff. Yes, some were better than the regular employees, but we had to cut so deep that we let good regular employees go too. Between the morale considerations of keeping temps and letting regular employees go and the legal considerations of potential discrimination lawsuits, we went the safe route. Lay offs are always hard, even on the "survivors". I also wouldn't want to be the California employer who had to get up in a court of law and explain why we kept a temp who was only with the company for a few months, but we let go regular employees who had been with the company for a long time. You would need awesome documentation showing what a superstar the temp was, and a file of disciplinary actions showing how bad the regular employee was. Even then, I doubt a jury would be very sympathic to the employer.

Don D

[font size="1" color="#FF0000"]LAST EDITED ON 03-18-02 AT 02:21PM (CST)[/font][p][font size="1" color="#FF0000"]LAST EDITED ON 03-18-02 AT 01:54 PM (CST)[/font]

I agree with Carol's analysis. Although, even in states outside California, I would not relish the idea of sitting on the stand trying to give credible evidence as to why I decided to retain a 3-month temp and let go a regular staff member. After all, you will be trying (unsucessfully I think) to convince a jury composed of people who likely aren't particularly fond of employers. She's right; you will be producing performance reviews and all the documentation you can muster in your defense. If you can't produce it, you'll be sunk! If you can, it better be darned good and more convincing than "The manager thinks the temp does a better job." I don't know whether you have a Reduction in Force policy but am assuming you do not have one and do not have a union either. AWilliams spoke in her answer of 'ability' being a 'protected' charasteristic. Not that I've heard of. And if it were, what measure of ability will you be explaining to the jury? The chances of an EEOC charge (age, race, sex, perhaps religion) are monumental if you decide to go with a temp instead of an EMPLOYEE. That coupled with the known reality of an ensuing morale problem would answer it for me and that would be to go by date of hire all things being equal. It also occurs to me that in situations where you have temps 'demanding' all the privileges and benefits that regular employees have, this would bolster that claim, since you may be giving them equal footing with employees at layoff time. All things not being equal, go with performance evaluations and other file documentation.