Cost Club: Scenario one

The Cost Club Store wants to cut back on its employees. The general manager of the store fired two employees without giving any reasons. In a previous email, the general manager was advice to state the reasons for the termination of the two employees. The lack of reasons for termination can lead for the employees to file a claim for wrongful termination. This can lead for employees to be awarded compensation for damages and punitive damages. The executive of the Human Resource Department, Pat Quintana, is worried the Cost Club Store will lose this case. Her worry comes from the termination of the employees was not documented.

The Cost Club Store can be sued by the two employees for wrongful termination under Title VII. The Title VII of the Civil Rights Act of 1964 protects employees from being terminated for no reason and denial of employment because of discrimination against an individual's race, color, religion, sex, or nationality, (United State Department of Justice, 2012). The employees fired happened to be Hispanic, Pablo, and one African American, Sue, who happens to be also a female. Pablo needs to prove the general manager him to be terminated because of his nationality. Pablo stated he was employee of the month in 3 occasions, January, February, and July, he received two incentive bonuses, and acquired an annual merit increase last year. Pablo states also he worked harder than other employees and helped other employees with their work. Sue, in the other hand, is the only African American women in the group and was hired last. She has a demotion because of work performance. She state it is because the general manager is targeting her because of her color. Furthermore, she stated it is because she did not want to meet with the general manager after work hours.

These statements of both employees can cause the Club Cost Store to payout thousands of dollars. Even working in a right to work state, the company can lose this case if going against any law under Title VII of the Civil Right Act. The Civil Rights added more remedies to benefit employees in 1991. The remedies added were compensation for damages where "Money awarded to compensate the injured party for direct losses. Compensatory damages may include future pecuniary loss, emotional pain, suffering, inconvenience, mental anguish, loss of enjoyment of life, and other no pecuniary losses. Punitive damages are permitted when it is shown that the employer's action was malicious or was done with reckless indifference to federally protected rights of the employee" (United State Department of Justice, 2012). It is a recommendation that the general manager of the Cost Club Store has to document all employees. In this case of Pablo's firing, his work and attendance were on target. Sue's statements, on the other hand, have to be proven untrue. Her case can fall under the retaliation policy.

In the second email, the Chief Executive Officer (CEO) was looking for new ways to reduce employee cost. The Cost Club Store is 100% fulltime and part-time employees. The CEO wants to reduce the costs by hiring independent contractors and temp employees. If the company follows the laws, this can be accomplished. Initially, it is needed to review the contracts employees signed on orientation day. After reviewing and verifying that no employees signed an agreement, it is needed to follow the Work Adjustment and Retraining Notification (WARN). The notice needs to be given to employees 60 days prior to downsizing by more than 50 employees. Lack of following with WARN regulations can lead to employees recovering pay and benefits.

Temp employees and independent contractors are different from regular employees. Independent contractors are hired with the purpose