Why Bad Employee Behavior Needs to Be Punished

Man gropes female colleague; man sues their employer.  That’s the basic story line from a recent backsidescase out of Pennsylvania, where an EMT named Mitchell was accused by a colleague (Witt) of touching her in seriously inappropriate ways (grabbing her buttocks and getting dangerously close to even more private areas). Upon determining that Witt’s claim had merit, the city of Pittsburgh, for which they both worked, fired Mitchell. That was the right course of action . . . wasn’t it? Yes and no.

Here’s the problem: Mitchell was a 61 year-old black man who claimed disparate treatment in this firing, pointing to a situation where two paramedics, who were younger and white, had each struck a patient and received suspension (not termination) as a result. According to the U.S. District Court for the Western District of Pennsylvania, striking a patient is of “comparable seriousness” to groping a co-worker. So, in being only suspended (not fired), the white employees were treated more favorably than Mitchell, leading to employer liability for disparate treatment based upon membership in a protected class. Continue reading Why Bad Employee Behavior Needs to Be Punished

Record Retention Policy: Why It is in Your Company’s Best Interest to Have One

Bunch of Papers by Seiichi Kusunoki - Visual Maintenance*
Bunch of Papers by Seiichi Kusunoki – Visual Maintenance*

There are good legal and practical reasons for your company not to hold onto every document that comes across its proverbial desk. There are also good reasons not to destroy documents too hastily. Instead,  you can adopt a well-considered record retention policy that dictates which documents are retained, for how long, and when to destroy them. Working with your legal counsel to draft the policy will help ensure the proper timeline for document destruction and help you avoid legal headaches.

First Things First – What is a Record?

Records include essentially all documents created or kept by the business in paper (or other tangible format) or electronic form. This includes paper-based documents, e-mails, electronic files and programs, desk calendars and appointment books, photographs, plans, maps, diagrams, and various other vehicles for the transmission of language, images, plans, and numbers.             Continue reading Record Retention Policy: Why It is in Your Company’s Best Interest to Have One

OfficeMax and The Cost of De-Personnel-izing Personalized Marketing Lists

OfficeMax, a photo by RetailByRyan95 on Flickr.
OfficeMax, a photo by RetailByRyan95 on Flickr.

Collecting tons of detailed information about potential customers in order to target your marketing to them seems like a good idea at the time . . . . And, it well may be. But, OfficeMax has a cautionary tale for all of us about the risks of cutting the human element out of marketing.

As reported by numerous news outlets, including  the Los Angeles Times and The Huffington Post, OfficeMax used information gleaned from a third-party provider of customer mailing lists to address an envelope to a father who had tragically lost his child with the designation “daughter killed in car crash” on the line of the address block following the father’s name. Can you imagine receiving such a letter after the heartache of losing a child?

Continue reading OfficeMax and The Cost of De-Personnel-izing Personalized Marketing Lists

Matching Farm Product Supply and Demand is Easier Than You May Think

The specialized farm-to-consumer marketplace is growing in popularity, but both farmers and consumers still sometimes have difficulty finding each other. Direct marketing through farmers markets and local word-of-mouth is one way to for producers and customers to match up.  FarmMatch.com is another way.

FarmMatch.com is a map-based online matching service that helps buyers and sellers of farm products in the U.S. easily locate one another, providing free advertising for those selling farm products (including farms, buying clubs, farmers markets, and restaurants) and allowing consumers to locate and communicate with multiple providers regarding the products they want to purchase. Because it is map-based, it is easy for consumers to find local producers. Continue reading Matching Farm Product Supply and Demand is Easier Than You May Think

How to Avoid Becoming an Accidental Creditor

SuckerIf you’re playing a poker game and you look around the table and can’t tell who the sucker is, it’s you.

– Paul Newman

Don’t be suckered into giving your customers credit – unless you intend to be a creditor, which requires complying with the large number of consumer credit laws that apply to credit transactions with consumers.  Otherwise, you could find yourself on the wrong side of an expensive life lesson in the form of a regulatory action or  consumer lawsuit for failing to comply with those laws.

Is it really possible to accidentally grant credit to a consumer?

Yes, it is possible to become an accidental creditor. This can happen if you regularly allow your customers to pay in installments or if you impose a late fee that is couched in terms of “interest.” (See this post for more on how to charge late fees legally.) This stems from the definition of “creditor” under federal law, which defines a creditor as someone who: Continue reading How to Avoid Becoming an Accidental Creditor

It’s Official: “Natural” is Still a Meaningless Marketing Term

imageThe FDA recently reaffirmed the meaninglessness of the term “Natural” in food marketing and labeling, in its January 6 letter to 3 separate courts considering false advertising claims against food manufacturers for dubious use of the term. The FDA’s unwillingness to settle the issue has a long and storied past, as summarized below.

“Natural” is the single most frequently-used marketing claim on U.S. food products, despite the fact that it is virtually meaningless. I think its general appeal and brevity make it an enticing word for food marketers, particularly on the package label, which is prime real estate. Brevity is not only the soul of wit – it is the soul of marketing. Coupling this with a history of defying definition, the term “Natural” stands in a category by itself when it comes to ambiguous and misleading terms used on food labels.       Continue reading It’s Official: “Natural” is Still a Meaningless Marketing Term

Shedding Light on the Importance of Having an Accurate Privacy Policy

Brightest Flashlight2Goldenshores Technologies, LLC developed The Brightest Flashlight Free app, which allowed users to use their mobile devices as a flashlight by simultaneously activating all of the device’s
light sources. According to the FTC, this app was downloaded millions (tens of millions, actually) of times.  At the same time it was lighting up the user’s world, The Brightest Flashlight Free app was enlightening third parties to the user’s personal information, including precise geolocation and unique device identifiers. As described by the FTC:

While running, however, the application also transmits, or allows the transmission of, data from the mobile device to various third parties, including advertising networks. The types of data transmitted include, among other things, the device’s precise geolocation along with persistent device identifiers that can be used to track a user’s location over time.

All of which would be fine and dandy if the app had appropriately disclosed to users what it was doing, but the FTC says it didn’t – and filed a complaint against Goldenshores. According to the FTC’s complaint, Goldenshores told users in its privacy policy that personal information collected by the Brightest Flashlight Free app would be used by the company for various internal purposes, but “failed to disclose or failed to adequately disclose” that the app transmitted that personal information to third parties, including advertising networks. Continue reading Shedding Light on the Importance of Having an Accurate Privacy Policy

The Cost of Careless Advertising – FTC’s “Operation Steer Clear”

false advertisingOn Thursday, the Federal Trade Commission (FTC) announced settlements with various automobile dealers in “Operation Steer Clear,” which the FTC touts as a nationwide sweep of false advertising claims against dealers.

What standards did these auto dealers collide with?

The FTC alleged various misrepresentations in its complaints against the dealers (“alleged” because these cases were voluntarily settled, not adjudicated).  These alleged misrepresentations, inaccuracies, and false statements were found in print, Internet, and video advertisements. Wherever you advertise, accuracy and compliance with various consumer protection regulations are advisable.

Many of the alleged violations were for statements that were obviously false, like advertising the vehicle for $5,000 less than the offering price or falsely asserting that consumers had won sweepstakes prizes they could collect at the dealership. Assuming the allegations are true, these merchants had to know their statements were untrue. I’m sure none of my readers commit that type of obvious misrepresentation, so I’ll focus on the advertising violations that are perhaps a bit more subtle.auto dealer

The more subtle (alleged) violations involved requirements found in federal leasing and financing laws – i.e., the Truth in Lending Act and its implementing regulations (Regulation M for consumer leasing and Regulation Z for consumer lending). Under these laws, when certain terms are contained in advertising (so-called “triggering terms”), other terms must necessarily also be included in the ad. Continue reading The Cost of Careless Advertising – FTC’s “Operation Steer Clear”

3 Ways to Make Sure Customers Who Pay Late Don’t Create Even More Headaches for You

imageYou rightly expect your customers to pay their invoices on time. But, understanding human nature, you prepare for late payments by letting them know you will charge a late fee if they don’t pay on time.  You may ultimately end up bringing them to court. To make sure your righteous quest to get paid doesn’t end up getting YOU in hot water, here are three things you can do:

1. Be sure your contract with the customer provides for payment of a late fee. If you have not contracted for it, you may not be able to assess it. The customer has to know that paying late will result in extra fees.

2. Check your state law for limits on the late fee that may be assessed.

3. Be careful not to inadvertently bring the transaction under the requirements of your state’s consumer credit laws. This can happen primarily in three ways: Continue reading 3 Ways to Make Sure Customers Who Pay Late Don’t Create Even More Headaches for You

Can a Business Make Consumers Arbitrate Disputes?

Question: Can a business make consumers arbitrate disputes the consumer may have with the business?

Answer: Only if the consumer agrees to it. But, this agreement may be done at any time.

arbclauseAlthough there is a federal law that supports the right to agree to arbitrate disputes – the Federal Arbitration Act – at  its heart, arbitration is a matter of contract. In order to have their disputes decided in arbitration, the parties to the dispute must agree to arbitrate it. This agreement often happens at the time the contractual relationship is formed, whether that is through a software licensing agreement, loan agreement, purchase agreement, service agreement, or some other agreement between the business and its customer. If there is no pre-dispute arbitration agreement, the parties can agree that the dispute should be decided in arbitration after the dispute arises.  One way or another,  for disputes to be decided in arbitration, the parties must agree to settle their dispute in the arbitration forum. Continue reading Can a Business Make Consumers Arbitrate Disputes?