We often see a lot of questions related to employment law on cafepharma's message boards. The questions include issues related to RIFs, severance agreements, at-will employment, whistleblower law etc. We thought our users would find it useful to hear an experienced attorney's take on dealing with these issues.
We were fortunate to speak with Michael Filoromo. Michael is a partner with the whistleblower and employment law firm Katz, Marshall & Banks, LLP, in Philadelphia. He has helped achieve successful outcomes for numerous clients under the Sarbanes-Oxley corporate whistleblower protections, the False Claims Act and the anti-discrimination and retaliation protections of Title VII of the Civil Rights Act and corresponding state laws. He regularly represents whistleblowers in the pharmaceutical, healthcare, nuclear, railroad and aviation industries. Mr. Filoromo is the secretary of the Eastern Pennsylvania chapter of the National Employment Lawyers Association. He can be reached at firstname.lastname@example.org.
CP: Michael, thank you for taking the time to speak with us. To begin, I think a lot of employees who are at-will employees believe that if they are fired or if they are being pushed out of their company unfairly, there is little they can do if there is not some form of discrimination or if the employee is not aware of some wrongdoing on the part of the company. Is that correct?
Michael: Most employees are employees at will. Under the at-will employment principle, employees can be let go for many reasons, including performance or simply because their supervisor or company doesn't like them. A termination can be for no reason or a bad reason, as long as it doesn't fall into the bucket of illegal reasons.
The illegal reasons for terminating an employee fall into a few categories. In the case of someone with an employment contract for a specific term – someone who is not an at-will employee – one such reason would be breach of contract. This might occur where, for example, the company fired someone for a reason not allowed by the contract, or did not follow required steps to give the employee a chance to improve his or her performance prior to termination. Not too many employees in the pharmaceutical industry will fall into this category because most do not have a contract for a defined term.
The other main category of illegal reasons includes discrimination and retaliation. Discrimination includes unequal treatment on the basis of, for example, race, age, sex, national origin, or disability. Retaliation occurs where someone has spoken up about illegal conduct and has suffered an adverse action as a result. For example, if a pharmaceutical employer retaliates against an employee for objecting to practices that violate federal regulations, such as the regulations prohibiting off-label marketing of drugs, or the payment of kickbacks to physicians to incentivize them to use a drug, the employee may have recourse under a number of federal land state laws.
In a case where there is truly just a personality conflict between an employee and management, the employee might not have much leverage when negotiating a settlement. However, there are still a number of reasons to consult an attorney in a situation where an employee feels they are being treated wrongly, or if they have already been let go. An experienced attorney will look at the larger picture and put the events in context. It may turn out that the employee does have some protected status that they were not aware of.
For example, if the employee in question is female and is the only female in the sales district, she might have been treated differently by her manager and not given opportunities to succeed. Perhaps the male members of the team are regularly invited by the manager to networking and social events where the female is not invited, and those events lead to more business opportunities that she does not receive. Maybe she is held to a different standard in some aspect. If those things happened because she is a female, then she may have a discrimination claim.
As you know, the pharmaceutical industry is high pressure, and it is highly regulated. So there are a lot of places to misstep or to be pushed over limits. A pharma employee may come to us and say they don't understand why their manager or company suddenly doesn't like them, but now they are out of a job or soon to be out of a job. Well it may turn out that the employee has pushed back against calling on doctors that can only write their drug off-label. Maybe that is where the relationship began to decline. In that instance, there may be a claim for retaliation under something like the False Claims act or state law.
Sometimes the employee may not realize there is a possible claim until an attorney looks at the events and the chronology. That’s why it is often worth getting an opinion early on.
CP: How about an instance when an employee is let go and they can't claim a protected status, is there a reason to seek counsel in that case?
Michael: It would still be a good idea to have an attorney look over the severance agreement. For example, there may be non-compete issues, there may be language about what the company can say about the employee, etc. Some of these things can have significant long-term implications for future employment, so it is a good idea to have the severance agreement reviewed by an attorney.
You may not be able to negotiate any additional severance but it can very useful to get advice on these important non-monetary terms of the agreement.
CP: When an employee initially consults with an attorney, can the attorney give them a good idea of the costs involved?
Michael: Ultimately, a lot depends on the scope of the attorney's representation. If it is just reviewing documents and advising an employee behind the scenes, or if there will be some negotiations prior to filing a lawsuit, then an attorney can usually give you a pretty reasonable idea of the costs. They will usually be fairly contained and well-defined.
If litigation is involved, costs can rise quickly. An attorney can give you an estimate and analysis, but any change in the needs of litigation can add significant cost.
Estimating potential upside can be more difficult than estimating costs. If an attorney says, “I can definitely get you x,” that is not necessarily correct. There are many variables, not least of which is the company’s willingness to settle based on evidence that the employee may not have, or based upon other internal and external pressures of which the employee may not be aware. But an attorney can give you an idea about how strong your claim is based on the facts that we have right now and the law as it exists.
CP: With respect to age discrimination is there a particular age at which an employee could file a claim?
Michael: Federal law (the Age Discrimination in Employment Act) grants protection after age 40. In a lot of cases a 40-year-old will have managers older than they are making employment decisions, but that does not mean that the employee does not have an age claim. It comes down to determining if the company took adverse action against you because of your age.
You are often looking at comparative data with age discrimination cases, perhaps more so than in other individual discrimination cases. When there is a reduction in force (RIF) of a specific group in the company, the company must supply employees with among other things, the job titles and ages of the eligible individuals in the affected group or unit of the organization who were selected for termination and those who were not. The law at issue is the Older Workers Benefit Protection Act (OWBPA).
If the situation doesn't fall under the OWBPA, then you have to make educated guesses about the ages of employees who have been let go. In cases where an attorney is involved in negotiating a settlement, the attorney can ask the company’s attorney for the information. If a company is confident in its position or just wants to be more transparent, they may give you the information. If a lawsuit is filed, then the attorney can compel the company to provide the information through the discovery process.
End of part one.
In the second part we will discuss employee protection from retaliation and other facets of whistleblower cases. We will also talk about when to get an attorney involved in employment related issues – sooner rather than later.