“But that’s not our policy.”
How many times have you heard this or repeated this to someone else in the workplace? Clear, consistent policies help shape reasonable expectations among partners, managers and co-workers. But inconsistent policies -- or inconsistently applied policies -- can lead to trouble.
Consider the written agreements you have with your employees or independent contractors, or the agreement among the owners of the business, such as a shareholders’ agreement or operating agreement. How are the provisions in these contracts working with or against you in order to remain compliant with your own policies? Do the written agreements create legal obligations that are inconsistent with your internal policies?
For example, imagine an employment contract with an executive that provides a right to notice and the opportunity to cure (or “fix”) an alleged “for cause” termination event. How does that reconcile with a company-wide policy calling for immediate termination for failing a random drug-screen, or for embezzling corporate funds? Both policies seem reasonable, but both conflict with the terms of the executive’s written employment contract.
Best practice is to regularly review your policies, rules, and regulations as well as your written agreements. Consistency and uniformity will keep competing provisions from placing you in the impossible position of having to reconcile two conflicting courses of action.
Call our office at (248) 477-6300 if you have any questions about the legal issues impacting your business’s policies and the written contracts signed with employees or third parties.