Lawyers doubt effectiveness of new personnel records law

A surprise amendment to Massachusetts’ personnel records statute that requires employers to notify employees whenever a negative report is placed in their files is stirring the labor law community.

Lawyers who represent employees say the change to G.L.c. 149, §52C is based on good intentions, but essentially unenforceable because employees cannot sue employers who violate the notification requirement.

Management-side attorneys complain that the beefed-up law is burdensome, unclear and could needlessly ruin employer-employee relationships by exacerbating minor job performance issues that in the past would be tucked away in a file.

The amendment quietly went into effect Aug. 5, when Gov. Deval L. Patrick signed the Economic Development Reorganization Bill, which he touted as a vehicle to create jobs, support small businesses and “help Massachusetts continue to lead the nation out of recession.”

Labor law attorneys said they were “blindsided” and “shocked” by the amendment, which appears in Section 148 of the 134-page bill.

Republican Sens. Robert L. Hedlund, Michael R. Knapik, Bruce E. Tarr and Richard R. Tisei wrote and submitted the amendment, which was reportedly inspired by a police officer who was surprised to learn that his personnel file contained unflattering information that cost him a promotion.

The amendment requires employers to notify employees within 10 days of “placing in the employee’s personnel record any information to the extent that the information is, has been used or may be used, to negatively affect the employee’s qualification for employment, promotion, transfer, additional compensation or the possibility that the employee will be subject to disciplinary action.”

Under the amendment, employees can request to review their records only twice a year, not including views related to the filing of negative information.

That less controversial provision is meant to prevent labor organizations from “gumming up the works” with repeated requests to view personnel records during disputes with employers, said John Regan, executive vice president for government affairs for the Associated Industries of Massachusetts.

‘Not much you can do’

The freshly tweaked law lacks the teeth of the state’s Wage Act, which has a private right of action that lets employees sue employers for unpaid wages. Successful plaintiffs can collect triple damages plus attorneys’ fees.

Enforcement of the new personnel records law falls squarely on the shoulders of the Massachusetts Attorney General’s Office, which can impose sanctions of $500 to $2,500, though simply requesting compliance is expected to be the more typical response.

Last year the AG’s Office responded to 91 employee complaints and issued as many letters directing employers to follow various labor laws, according to spokesman Harry Pierre.

“In the vast majority of those cases we did get compliance,” Pierre said. He declined to comment further on lawyers’ concerns with the ambiguity and enforceability of the amendment.

Dahlia C. Rudavsky of Messing, Rudavsky & Weliky in Boston said she welcomes the amended law because it could better protect some of the employees she represents, but it “doesn’t really go far enough.”

“If something is being relied on for discipline, the employee needs to know about it,” she said. “But the attorney general already has plenty to do without having to do this as well.”

Another employee-side lawyer, Brian J. MacDonough of Boston’s Shilepsky, Hartley, Robb, Casey, Michon, said he rarely encounters potential clients with complaints about an employer mishandling a personnel file. More common are the suits built on allegations of discrimination, contract disagreements or wage issues, he said.

And though the law now contains more pitfalls for employers, MacDonough does not expect a spike in reported personnel records violations.

“It certainly increases the spectrum of enforcement for the attorney general,” he said, “but without a private right of action, I don’t think it’s going to have a significant impact.”

Scott Adams, a Groveland lawyer who represents employees, said employers have little, if any, incentive to follow the “inconsequential” 10-day notification requirement. The employers who comply with the law, he said, will be at a competitive disadvantage to those who do not.
“The lack of a private right of action means employers have free range to violate the law. Who’s going to do anything?” he said. “There’s really not much you can do.”

A 30-year veteran of Beacon Hill, Benjamin Fierro III of the Boston lobbying firm Lynch & Fierro said lawmakers may decide to strengthen the law with a private right of action, but only after what is currently on the books proves to be ineffective. Even then, the chances of another amendment are slim, he added.

“Given that this new law was a compromise between large employers and employee unions,” he said, “in my experience it makes it highly unlikely that the Legislature is going to revisit the issue anytime soon.”

‘A lot of questions’

Employer-side lawyers and their clients are left to wonder whether informal reports such as e-mails or managerial notes about employees need to be filed as personnel records, which would trigger the notification requirement.

“Clients for the moment have a lot of questions. Our clients are trying to do the right thing. They’re saying, ‘Tell us what to do,’” said Jaclyn L. Kugell of Morgan, Brown & Joy in Boston. “Some of these questions don’t have answers.”

Kugell believes employers do not have to place informal memos in an employee’s record, which would allow them to avoid the notification obligation. She acknowledges that a broader reading of the law requires any negative information that an employer gathers about an employee to be filed in the record.

“I have no idea that my interpretation is correct,” she said. “None of us really know.”
N. Jay Shepherd, a Boston lawyer who represents employers, shares Kugell’s concerns. He said the new law is “flat out bad” for his clients and “not very good” for employees, either.

“Now employers are going to be in a quandary,” Shepherd said. “Do they put things in a file like employment lawyers tell them to, or do they not put it into the file to avoid creating a situation?”

Shepherd said he and other employer-side attorneys typically advise clients to scribble notes on an employee’s tardiness, sour attitude or any other poor performance in case the issue becomes chronic and results in a firing. If the employee sues, the employer will be backed in court by the trail of notes.

But the notification requirement, Shepherd said, unnecessarily creates an “antagonistic” situation between employer and employee.

“Knowing this went into your file, how does that make your life any better?” he said. “It’s going to stress you out and get you thinking about what a jerk employer I have to put this in my permanent record.”

After learning about the amendment that “came out of left field,” Shepherd planned to sit down with his clients and reevaluate their record-keeping policies.

“We have to talk about their corporate culture. We’ll have to work out strategies on how to comply with the law and minimize the risk of problems from following the law,” he said. “It’s a bad situation. I just don’t see the benefit.”