90 Day "Introductory" Evaluation Period=NEED HELP!
ivymosley
1 Post
We are a non-profit, "at will" employer. I recently created a 90 day evaluation form which I renamed 90 Day Introductory because of being a "at- will" employer. I just found out today that my direct supervisor (Chief Operating Officer) told another supervisor (executive manager) that they have the power to not activate or allow usage of the benefits that become eligible after 90 days if not satisfied with their employees performance. My question is how can you keep someone past 90 days and not pay the benefits you promised just because you are not satisfied with their performance while at the same time not terminating them?
Comments
Correct me if I'm wrong, but I think the benefit plan document itself sets out the rules for eligibility. If it says after 90 days, then the employee is eligible if employed on the 91st day. The best way to handle is to show the COO the plan document--he'll understand the idea of a contract. If its an ERISA plan not following the plan violates ERISA, I think.
Two things:
First: your COO is almost certainly dead wrong. I've never heard of a plan document allowing such a thing. BarbieW is correct that you could potentially end up with an ERISA violation. Or an E&O claim should the person end up ill and stuck uninsured while this is being resovled.
Second: In my opinion, you were right to get away from anything that suggests there is a probationary period. It has come up in court to the detriment of employers before. If you are an at will employer with a probationary period, you have some tough questions to answer. What's the difference between "at will" and "on probation"? If you are "at will" during probation, what are you after probation? If there's no difference, why is there a distinction?
In Texas, the Texas Workforce Commission has gone so far in conferences I have attended to suggest employers remove 90 Day Probationary periods from any handbooks.
[quote user="Teresa Kaliski"]AS LONG AS you insert the "at-will" language within the paragraph for the 90-day introductory period, you will not infer any obligation to maintain any employment relationship during those 90-days. Same thing goes for any period of disciplinary probation periods - again, always use the "at-will" language to infer that any periods of employment listed are not meant as a verbal or written agreement and either party can terminate the relationship.[/quote]
At will language
At-will language in conjunction with a distinction, by any name, as to one's employment status can be and has been challenged successfully. It's not enough to say "at will" but also "introductory", "probationary", or "not quite full grown yet". If the purpose of the distrinction is to indicate that a person is not eligibile for benefits until the end of that time frame, then I would say that's exactly what it means and perhaps point out that that the at-will doctrine is still in force. Leaving it open to interpretation as to what is meant by these various phrases is what gets employers into trouble.
TWC and probationary periods
With respect to TWC saying to abolish the term "probationary" from handbooks, it's good advice and particularly so because many of their investigators also love to ask if a dismissed employee was dismissed in their probationary period.
At-will employment doctrine
Every state in the union is an "at-will" state with the possible exception of Montana, depending on how you read their Wrongful Discharge from Employment Act. Since its inception, stemming from19th century Supreme court rulings and solidified in the last quarter of the 19th century, there have been a number of exceptions to the at-will doctrine, but all of them occurred after the middle of the 20th century. Thus, the "at-will" doctrine is regulated to some excent as is the "free market". Perfect at-will employment would not admit of any of the civil rights acts, FMLA, ADA, or any other protectionist legislation to interfere with the employer's right to dismiss an employee. The primary issue in employment termination is to ensure that the reason (or lack of reason) cannot be demonstrated to be an illegal reason and to sufficiently document it to demonstrate that the cause of termination was not an illegal cause if the employer's decision is challenged into the future. Every other cause of termination is acceptable under the law. From a practical standpoint, stupid and unfair reasons can end up being expensive because they are more likely to be challenged but they are stil legal to use as the basis of employment termination. That's true in every state except perhaps Montana. The at-will doctrine establishes that the employment relationship is a contractual relationship, which is covered by state law. That means that the nature of the relationship may be different from state to state but the primary difference is in the number of laws and the magnitude of their interference in the employer-employee relationship. California is an at-will state, just like Texas.
The Summary Plan Description (SPD) dictates the eligibility criteria and waiting periods established for enrollment in your benefit plans, which is usually based on number or hours worked per week (FT/PT status) and length of service (i.e. waiting period = 30/60/90 days).
Your COO may be thinking of a provision under the Cobra regulations, where it is possible not to offer continued coverage on your plan to employees who are terminated for gross misconduct (i.e. theft, violence in the workplace, etc.). This applies, of course, only to terminated employees, not to those that are performing poorly but are not terminated from employment.