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Regulating employees' off-duty conduct.

Whether employers can regulate employees' off-duty conduct is a particularly acute question for associations. First, many associations are advocates, representing particular positions. A staff person whose off-the-job behavior is at variance with the organization's stated goals and positions can be an embarrassment, a scandal, or worse. Second, it is frequently difficult in association work to draw the line between on-duty and off-duty conduct.

The answer is that employers, including associations, can regulate off-duty conduct. You need to tread lightly, of course, around protected rights to privacy, freedom to associate, and freedom of speech.

As guiding principles, remember that the off-duty conduct you regulate must be as directly related to the person's job as possible, and rules must be narrowly drawn and strictly applied. This means you should restrict as little off-duty conduct as possible, and if at all possible, find a way to stay out of employees' off-the-job lives and leave them free to engage in their preferred outside activities.

Associations may have rules against smoking, drinking, or using drugs on or off the job; rules against socializing with, dating, or marrying employees of suppliers, vendors, or competitors; policies against publicly taking any action or position contrary to the association's official stance; and requirements that staff comply with the association's code of ethics or standards of conduct, on or off the job. The two areas of off-duty conduct usually of most interest to employers are outside employment and conflicts of interest.

Covenants not to compete. A policy that forbids outside employment while on the association's payroll is perfectly legal and enforceable. In fact, the common law imposes on employees a duty of loyalty that is enforceable with or without an express written policy. Associations may also forbid employees to use association premises, equipment, and time to engage in any outside activity whether it's competitive or not.

A covenant not to compete with the association after the employee leaves is a different matter. It's frequently prohibited by state law, with very limited exceptions (e.g., for buying or selling a business or for owners or major shareholders in a business). Unless prohibited or restricted by state law, covenants not to compete are enforceable, but winning a suit is an uphill battle and unless the stakes are extraordinary, generally not worth the effort.

Conflicts of interest. Conflict-of-interest policies are enforceable and recommended. A policy against engaging in competing employment may be part of a conflict-of-interest policy. So may a restricted-dating policy.

A fundamental and essential part of every conflict-of-interest policy is disclosure. The employee must disclose every perceived, potential, or actual conflict. In many cases, the very disclosure of the possible conflicting interest may be enough to eliminate the problem.

Most state nonprofit corporation laws do permit what are called interested party transactions, provided there is full disclosure of all the facts and the transaction is a fair, arm's length, market value agreement. For example, an executive may sell the association a piece of land or a building provided he or she discloses his or her ownership and the sale is for market value.

Restricted-dating policies. These are not illegal, but the association must be extremely careful in drafting and enforcing them. Some employers have such policies for employees, primarily to avoid charges of sexual harassment. The better procedure is to avoid them, if possible. For example, if the publisher of the association's magazine is dating the president of a printing concern, rather than force the publisher to resign, it would be better to forbid the publisher to use that company or to have any decision-making role in selecting printing companies.

Drug and alcohol policies. The safest policy is to limit drug and alcohol regulations to work. Work means the association's premises and other places employees conduct association business. There may be extreme cases, however. You might dismiss an employee arrested for selling drugs in his or her spare time, although even here the safer course may be to suspend the employee-with or without pay-pending resolution of the charges. On the other hand, an association would be ill-advised to fire someone because he smoked marijuana over the weekend or she got drunk at her sister's wedding.

Keep in mind that the Americans With Disabilities Act (ADA)-which takes effect July 26 for employers with 25 or more employees-treats drugs and alcohol differently. Current drug users are not protected. Drug testing is not prohibited. However, drug addicts who have undergone rehabilitation or are undergoing treatment are protected. And alcoholics, including current abusers, are protected.

No-smoking policies. About half the states have now enacted legislation prohibiting discrimination on the basis of off-duty, off-premises use of tobacco products, so having a policy against hiring smokers or in support of firing them because they do smoke is not recommended.

Distinguish "smokers' rights" statutes from regulation of smoking in the workplace. An association has every right to regulate or even prohibit smoking on association premises or during working time. In fact, far more states have statutes regulating smoking in the workplace than have statues prohibiting discrimination against smokers. Addiction to nicotine is not a protected disability under the ADA.

Recommendations. Some forms of off-duty conduct may be regulated. An employee may be dismissed for engaging in prohibited conduct off the job. If you want to regulate off-duty conduct, follow these rules:

* Define clearly and precisely what off-duty conduct is covered. At the same time, leave room for the exercise of discretion and judgment within stated objective standards.

* Notify employees of what conduct is regulated. In the case of newly adopted policies, allow sufficient lead or implementation time.

* Justify and relate off-duty rules as directly as possible to the job and the workplace.

* Narrowly tailor and strictly construe rules against off-duty conduct.

* Never take any adverse employment action, especially dismissal, without first thoroughly investigating and carefully considering whether any other resolution is possible that satisfies the association's needs while leaving the employee free to pursue his or her outside interests.

* Check whether any federal or state law has a bearing on the policy. In this area, state law generally figures far more prominently because there are more state laws on the books.
COPYRIGHT 1992 American Society of Association Executives
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Legal
Author:Webster, George D.
Publication:Association Management
Date:Jul 1, 1992
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