Case One John worked as an employee for McGraw-Hill Publishing Company for fifte
ID: 350957 • Letter: C
Question
Case One
John worked as an employee for McGraw-Hill Publishing Company for fifteen years and
had worked his way up to the position of production designer at a salary of $5000 per
month. John’s job was to design the layout for art books, and one day his boss informed
him that the company was going to initiate a new line of mathematics textbooks of
innovative design according to Ministry of Education standards and that they were going
to devote all their efforts to producing and marketing this new and special form of
mathematics textbooks, and that they would discontinue their art books as they were
not big moneymakers. John was informed that if he wanted to stay with the company,
he would have to take a job in a new production design department assembling the
work of freelance artists’ designs in preparation for the actual publication. His pay rate
would be unchanged, although the job was far less demanding and was not the level of
work which he had currently been doing as an art designer. Over the years, John had
acquired quite a reputation as a production designer in the industry, and he informed his
boss that he was not interested in doing anything else but production design work. He
was then told that he would be paid until the end of the month but would not have a job
after that time.
A term of John’s employment contract prohibited him from working for any other
publishing company anywhere for a period of five years after leaving the employment of
McGraw-Hill. John ignored this provision and immediately went to work for one of
McGraw-Hill’s competitors, Nelson Thomson Publishing. John sued for wrongful
dismissal.
As McGraw-Hill prepared its case, it discovered that during the last seven years of his
employment, John had been freelancing (working part-time) and using his production
design skills for another company, Pronk Publishing, which published a wide variety of
books outsourced from other publishers. [They were a production and design house, but
did not publish books of their own.] Upon looking at many of the books that John had
worked on at Pronk, it became clear that many of the books produced by Pronk bore a
startling resemblance to the production designs which John had produced for
McGraw-Hill. The copyright pages of the books clearly stated that John had been the
production designer. McGraw-Hill then counter-sued John.
In 700words Explain the legal positions and legal obligations of each of the parties. Would it make any difference to know that
almost all the editors and production designers at McGraw-Hill did freelance work?
Explanation / Answer
In the given case, McGraw-Hill is changing their strategic direction and focusing more on mathematics books than art books. John is given an option to take a different role but he refuses the new role. McGraw-Hill made a decent effort to retain John. However, since he refused, there was no need for John in the company and McGraw-Hill gave him almost a month's notice to find a new job.
Legally, McGraw-Hill has not terminated John wrongfully. The company did not discriminate or retaliate for John's refusal to work on mathematics books. Considering, McGraw-Hill's legal obligations, if they gave adequate notice of termination as per hiring contract, followed their process of termination and paid John adequately for his services till the last day, there is little scope for having a case of wrongful dismissal. McGraw-Hill was well within their rights to downsize given their new focus and John's refusal to follow the strategic direction.
From John's perspective, it was his legal obligation to inform McGraw-Hill of his freelance assignments. When you are employed by a company, your ideas and work are property of the company. However, John's work with McGraw-Hill was similar to his freelancing assignments and it is a clear case of copyright problems and conflict. Also, since most of the editors and production designers do freelancing, it would be better to know the direction regarding freelancing in employment contracts prepared between McGraw-Hill and employees. In John's case, McGraw-Hill's lawsuit could be held if they are able to establish the similarity of John's work for McGraw Hill and Pronk Publishing. It is not legal on John's part to provide same work to two companies in similar lines of business.