Breach Of Contract And Violation Of Code Of Conduct: What You Should know

When ex-employees sued Google for violating ‘Don’t Be Evil’ clause

Does your company have a code of conduct? I’ll bet it does — or something similar. Most companies do. Does your code of conduct ask your employees to “say something” if they see something they believe violates that code of conduct? Suppose one employee does exactly that.

What if that employee is someone you weren’t too fond of before that report? You might have been considering terminating that employee for a while. Then you do. Then the employee sues. Included in the employee’s complaint is what seems to be a breach of contract claim– based on that very provision in the code of conduct.

Wait. What? Is that really a basis for a lawsuit? We might be finding out soon enough. Google is involved in just such a claim now. Read on…

You’ve probably been hearing about Google having issues with employees seeking to organize, and complaining of discrimination.  About a month, three former Google employees fired in 2019 sued Google. Here, in a nutshell, is what went down.

As you may know, Google’s motto for many years has been — or at least was– “Don’t be evil”. While it renamed itself “Alphabet” in 2015 and appears to have moved away from its motto, “Don’t be evil” is still included in the company’s official code of conduct. Specifically, the final line of the code of conduct (which employees are expected to sign as a condition of employment) says: “Remember… don’t be evil, and if you see something that you think isn’t right – speak up!”

Three employees, Rebecca Rivers, Paul Duke, and Sophie Waldman, apparently decided to take that provision seriously. Three software engineers protested Google’s decision to sell cloud computing software to Customs and Border Protection (CBP). What’s wrong with that? At the time, CBP was caging migrants and separating parents from children. In August 2019, the three employees circulated a company-wide petition, requesting that Google not cooperate with CBP or ICE.  On November 26, 2019, Google allegedly fired all three employees within minutes of each other.

The employees sued in state court in California, alleging not only retaliation but also a breach of contract, based on the “Don’t be evil” provision, as well as violation of California public policy. (California sued then-President Trump in 2019 over the indefinite detention of immigrant children.)

Google claims it fired the three software engineers for leaking “confidential” information to the press, and for engaging in “systematic searches” for information “outside the scope” of their jobs. While the employees acknowledge in their complaint that “a Businesslnsider article disclosed that Google &||offered CBP a free Anthos trial”, they state that none of them disclosed that or any other confidential or even similar information to the press.

Google is also facing a lawsuit by the National Labor Relations Board (NLRB) that also arises out of the firing of the same three employees, alleging that it fired them for engaging in labor organizing activity, which is protected under the National Labor Relations Act.

OK, so we have a few items to unpack.

First, can your company be sued based on its code of conduct? That depends on whether the code of conduct is a contract. If, as the employees seem to be alleging, the provision(s) in question are not just in a code of conduct, but are also included in an actual contract signed by the employee and the employer, then yes –at least in theory. Let’s come back to that in a moment.

What if it’s not in a signed contract, but just part of a code of conduct? That will depend on how the code of conduct is written. It could be interpreted as an implied promise by the employer not to retaliate against someone, who in good faith protests what it believes to be wrongful conduct by the employer. In that case, the retaliation in question, while it might not be prohibited under any law, is a breach of contract. (A court would have to interpret the code of conduct (and/or an actual, express contract) and the relevant facts.)

Those are some of the key issues.

What does that mean for the rest of us, though?

Well, you might want to re-think your code of conduct. Does it contain any similar mottos, such as, “Do the right thing”? Does it define or give examples of the “right thing”? Chances are, Google’s Code of Conduct does not define what constitutes “Evil”.  Vague or ambiguous provisions can give rise to exactly the type of dispute in this case. “Don’t be evil” makes for a great sound byte, but it’s also open to a lot of argument.

Google’s definition of “evil” is probably not the same as that of its employees. For that matter, each of its employees may well define it differently. So, avoid vague, ambiguous terms, whether in an express employment agreement, an employee handbook, or code of conduct.

Now, I know I’ve said this before, but it bears repeating here: If you’re looking to terminate an employee, you need to take certain precautions. You especially need to do so if your employee has been protesting certain company decisions and organizing other employees in that protest. That activity is likely protected under the National Labor Relations Act.
You could then be defending a wrongful termination lawsuit by your employees and another proceeding involving the NLRB, thereby, fighting on two fronts, as Google is now.

If Google’s allegations about the employees are true, how could it have avoided this mess? One possibility might have been a severance agreement with a release of claims. At best that would only have avoided the employees’ lawsuit, though. What about the NLRB’s lawsuit. How Google fares there will depend on whether it has documentation that its employees leaked confidential information.

What can you do to make sure your company doesn’t find itself in a similar situation? Here are some possibilities:
 

This article originally appeared here.