In the past year, the Harvey Weinstein misconduct allegations that set up the #MeToo movement caused companies everywhere to make changes to their policies and agreements.
Faced with new liability concerns, employers also set about crafting the proper wording in both employment and severance agreements.
A Google example
In 2014, corporations took note when Google gave a reported $90 million in severance pay to executive Andy Rubin, an Android software creator. Rubin departed from the company under a cloud of possible sexual misconduct. He denied the allegations as well as the “wild exaggerations” about his pay. Still, the incident drove home the risks involved with terminations and payouts to employees accused of harassment or misbehavior.
Going for clarity
Employment agreements include the terms that apply to a severance payment in the event an employee departs the company. Because the #MeToo movement has gained such traction, employers want to tighten the language in their employment agreements so that their companies have less exposure to liability if a situation similar to the Andy Rubin matter crops up. These agreements normally contain language that focuses on policy violations, which can include issues such as sexual harassment. However, many companies want the language to be more explicit. For the most part, executives are on board with this idea; they are skittish about signing employment agreements with terms that are too broad.
Words count
Attorneys assist businesses in maintaining compliance with various state and federal agencies, such as the Fair Labor Standards Act, the Equal Employment Opportunity Commission and the Pennsylvania Human Relations Commission. In terms of liability, a business must protect itself with the proper policies and agreements. The firestorm caused by Harvey Weinstein and the resultant #MeToo movement has made companies much more cautious about whom they hire, how those employees behave and how employers can best manage any repercussions if the employee faces termination. It is important for an attorney to review employment contracts and any separate severance agreements to ensure the language is clear and that it protects the company’s interests.