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WASHINGTON-The U.S. government may be the first in history "that has tried to ban small talk," at least in workplace situations, according to the author of a new study of employment law.

That wry remark by Walter Olson, author of "The Excuse Factory," drew appreciative chuckles last week from an audience at the Cato Institute, a libertarian think tank in Washington. Mr. Olson, who received national attention for his previous study of the legal system, "The Litigation Explosion," dryly noted that the Equal Employment Opportunity Commission was "obliging enough" to issue its mental health guidelines (BI, May 5), just as his latest book, which deals with problems in employment law, was published.

The myriad rules, regulations and judicial interpretations that form employment law present employers with a "Kafkaesque Nightmare," said David Boaz, the Cato Institute's executive vp, as he introduced Mr. Olson.

"It used to be understood in America that a job was a contract," said Mr. Boaz.

But now "virtually anyone fired or not hired" can find some employment law under which to sue, he said. In many cases, "The legal system has been distorted to coddle the least deserving," Mr. Boaz said.

Mr. Olson gave numerous examples to bolster that contention, particularly regarding accommodations that must be made to avoid claims from poorly performing employees who claim to be the victims of a mental disorder. He cautioned his audience, though, that "mental health accommodation is just one very small corner of what lawyers call employment law."

Lawsuits over employment references have led to the "collapse

of the job reference system" in numerous industries and professions, Mr. Olson said. This, in turn, has led to threats to public safety and tragedy, such as when incompetent pilots have not been adequately screened and then have caused air crashes, he said.

Employment law is "why many employers have found themselves tongue-tied" in job interviews. "Ours may be the first government in history that has tried to ban small talk," at least in job interviews and in other workplace situations, he said.

"Employment law keeps getting more stringent every year," warned Mr. Olson. In addition, the mere filing of a job-related suit is likely to cause an employer financial woes. "To file a lawsuit, win or lose" is to inflict hundreds of thousands of costs upon an employer, he said.

Mr. Olson added that employment law, designed to protect workers, breaks every promise it implies. Fear of employment-related suits has prompted many employers to hire temporary workers rather than full-time employees whose age or other special status might serve as the basis for a lawsuit.

As employers attempt to meet the demands of employment laws, the workplace grows ever more bureaucratic and inflexible, he said. Employment laws can give an edge to skilled practitioners of office politics at the expense of other employees, he added.

Mr. Olson called for a return to an emphasis on "freedom of association," the doctrine that has traditionally governed U.S. workplace relationships. He cited a pair of Supreme Court decisions from the early part of the century upholding that doctrine.

"We did have it figured out then; it's not beyond our wits to figure it out now," he said.

Mr. Olson shared the podium with Ricky Silberman, executive director of the Congressional Office of Compliance-which oversees Congress' efforts to comply with employment laws-and a former employment official in Republican administrations. Ms. Silberman agreed with many of Mr. Olson's points and added a few critiques of her own.

She was particularly critical of what she considered an application of affirmative action that promotes "mediocrity" in the workplace. Ms. Silberman condemned the view of some affirmative action proponents that "if proportional representation is to be realized," only African-Americans can be judged against other African-Americans, women against other women and so on.