August 17, 2000

RATIONAL BASIS AND LAYOFF EXCEPTIONS

Dear Human Resource Professionals, Managers, and Employees:

The subject of this newsletter is not a specific topic within the law, but is a general concept of law. It is a concept, however, that is important to all managers of employees whether they manage within the public sector or the private sector. It is a concept that must be at the heart of all decision making as without it liability will result. The concept of which I speak is that of a rational basis. It is important at all times, but is of immediate concern as we speak of layoffs and exceptions to layoffs. Also addressed herein is the concept of an employee as an asset to taxpayers.

The stock-in-trade of managers of employees is the drawing of distinctions between and among those employees. Employees are assigned duties, they have leave approved and disapproved, they are disciplined and terminated, they are promoted and not promoted, they are granted and denied merit increases, they occupy positions that are selected for layoff, and they are affected by exceptions approved in layoffs. State laws, federal laws, the State Constitution, and the United States Constitution insist that the basis for drawing the distinctions not be age, sex, race, national origin, politics, religion, disability, or the exercise of state or federal rights, and, in the case of disciplinary actions and terminations, be for "cause". If the adversely affected employee shows that he or she is a member of the group protected by the particular law or constitutional provision, then the manager must show that there is a rational basis for the action about which the employee complains. Without such rational basis, a judge or jury may likely find fault and resulting dollar liability.

We are all familiar with the concept of "cause" in effecting disciplinary actions and terminations. Because of the requirements of constitutional due process, we know that we must have detailed reasons which we furnish to the employee at the time of taking the action. Without those detailed reasons, we cannot take an employee's wages or job. Conversely, where the employee accuses the manager of using a proscribed reason as the basis for the decision, i.e. accuses the manager of discrimination, then the employee must give the detailed reasons for the belief of such discrimination. What unfolds at trial is a contest between the manager’s asserted cause for the disciplinary action and the employee’s asserted cause for the prohibited discrimination. Events show that when state managers use this concept of "cause", they do so with a great deal of success.

This contest described above is very similar to that which takes place outside the realm of disciplinary actions where aggrieved employees assert that the basis for a decision about which they complain is one of the prohibited reasons identified above. What occurs is the contest between the employee’s facts supporting their conclusions and the manager’s facts supporting a conclusion of a rational basis for the action. These contests are the same whether they occur before the Civil Service Commission, occur before state courts, or occur before federal courts. Employers in both the public and private sector have learned hard lessons that "gut" feelings, unsupported subjective conclusions, and other intangibles cannot overcome a showing that a decision was based upon a proscribed factor.

This showing of the manager of a rational basis for the action need not necessarily be based upon the day, date, time, and place required for effecting a disciplinary action, but facts must be capable of being shown. Examples from the jurisprudence are proof of counseling, whether memorialized by formal memoranda or established by corroborated testimony, annual performance evaluations, production and other performance measures, and violations of clearly known policies that were not condoned. As a practical matter, the degree of proof necessary to show a rational basis for what might be called a non-substantive action such as the denial of a merit increase is going to be substantially less than that required regarding a more substantive action.

Exceptions to the layoff process are going to necessarily be considered more substantive employment actions. They have the potential of denying someone the right to bump into a job with an accompanying greater loss of pay than would otherwise exist. These exceptions are authorized by Civil Service Rule 17.3. To be granted, the exceptions must be based upon a rational basis that can be established by proof at trial. Historically, these exceptions have been based upon the exceptional qualifications of one or more employees, or upon the unique and critical function of one work unit. It is quite possible, however, for performance factors to be a component of an exception. These performance factors must be capable of being established at trial just as any other rational basis. These performance factors cannot be based upon gut feelings or intangible considerations. It occurs in both the public and private sector that a manager will assert the need to get rid of an employee who is said to be a poor performer, but who has received from the manager good evaluations and no counseling memoranda. Action taken against such an employee is at the employer’s peril.

Employees are assets to be used by a manager. They are assets that are utilized for the benefit of the taxpayer. Usually, the longer an employee remains employed the greater is the value of that employee because of training and experience. The taxpayers have more invested in such an employee than one with less employment time. All things being equal, an employee with more employment time is a greater asset to the taxpayers than one with less time. Just what tips the balance so that all things are no longer equal is the meat of the concept of a rational basis. An exception to a layoff that would favor a less senior over a more senior employee must take these concepts of value and rational bases into account.

In summary, all government decisions involving employees should be based upon some legitimate governmental interest, i.e., a rational basis, that is capable of being demonstrated. As a practical matter, the degree of such showing should be considered less for non-substantive actions and greater for more substantive actions. Exceptions to layoffs fall more toward the more substantive end. Please do not hesitate to present a request for an exception to a layoff where you believe a legitimate governmental interest is served by the exception. In formulating such exception, however, be mindful of the above concepts.

For the attorneys, the following citations support the above: Reeves vs. Sanderson Plumbing Products, Inc., 99-536 (U. S. 6/12/00), ___ S. Ct. _______; Casarez vs. Burlington Northern/Santa Fe Company, 97-1135 (5^th Cir. (Tex) 1/14/00), 201 F. 3^rd 383; Brown vs. Bunge Corp., 99-60144 (5^th Cir. (Miss.) 3/28/00), 207 F. 3^rd 776; Deffenbaugh-Williams vs. Wal Mart Stores, Inc. 97-01685 (5^th Cir. (Tex) 156 F. 3^rd 581; Marceaux, et al. vs. State, et al., 97-0273 (La. App. 1^st Cir. 9/25/98), 720 So.2d 29, writ denied 98-3134 (La. 2/25/99), 728 So.2d 10; Sibley vs. Board of Supervisors of Louisiana State University, 477 So.2d 1094 (La., 1985); Thoreson vs.

Department of State Civil Service, 433 So.2d 184 (La. App. 1^st Cir. 1983), writ denied 440 So.2d 726 (La., 1983); Varnado vs. Department of Employment and Training, 95-0787 (La. App. 1^st Cir. 6/28/96) 687 So.2d 1013, writ denied, 97-0312 (La., 3/27/97) 692 So.2d 394.

Sincerely,

Robert B. Boland, Jr.
General Counsel