Employment – Failure to Provide Notice as Reason to Deny Employment Verification

Over the years, the Board of Ethical Review has noted that it is not uncommon for ethical issues to arise when an employee leaves an employer.

The departure of an employee to another company can raise ethical concerns, as can the situation when an employee moves to a competing company. On the surface, the departure of the employee might provide both companies with benefits by allowing the two companies to strengthen their relationship and enhance communications between the two companies, but conflicts can arise in the arrangement. The facts in this case identify a clear conflict, or at least the appearance of a potential conflict, faced by the employee involved in the transition.

In BER Case 99-6, Engineer A, was employed by the FGH Construction Company and worked closely with Engineer B who was an employee of LMN Supplies. LMN Supplies sold construction materials and supplies. Part of Engineer A’s responsibilities was to negotiate and approve bids by LMN Supplies that were submitted by Engineer B. LMN Supplies offered, and Engineer A accepted, an employment position with LMN Supplies. Engineer A submitted his resignation and gave two week’s notice to FGH Construction Company and was not asked and did not mention that he would be employed by LMN Supplies. For the next two weeks before leaving FGH Construction Company, Engineer A continued to negotiate and approve bids submitted by LMN Supplies.

In deciding that it was unethical for Engineer A to fail to mention to FGH Construction Company that he will be employed by its vendor LMN Supplies, the Board noted that under the facts, Engineer A’s primary obligation was to FGH Construction and not to LMN Supplies during the two-week period prior to his departure to LMN Supplies. Engineer A had a basic obligation to not do anything that would unduly prejudice the interests of either FGH Construction or LMN Supplies. However, by failing to provide full disclosure to FGH Construction, Engineer A’s actions had the effect of prejudicing the interests of both FGH Construction and LMN Supplies.

By not informing FGH Construction, Engineer A’s actions most probably raised some doubt in the minds of the supervisors and perhaps owners of FGH Construction about whether Engineer A’s continued negotiations and approval of bids submitted by LMN Supplies were somehow tainted and could have resulted in inflated costs to FGH Construction or other unearned competitive advantages for the benefit of Engineer A’s new employer, LMN Supplies. Also by failing to disclose the material conflict that existed concerning his new employment with LMN Supplies, Engineer A may have unwittingly planted “seeds of doubt” with FGH Construction and potentially damaged the goodwill that might have existed between FGH Construction and LMN Supplies. Based upon the facts as presented, FGH Construction might wrongly conclude that LMN Supplies somehow persuaded Engineer A not to disclose his new position with LMN Supplies during the two-week period in order to gain some advantages. Engineer A’s failure to fully disclose his new position with LMN Supplies, and to continue to negotiate and approve LMN Supplies’ bids to his current employer, was not in accordance with the spirit or the intent of the NSPE Code of Ethics for Engineers. His actions want for the highest standards of honesty and integrity expected of engineers, and were not circumspect.

While the facts in the present case are somewhat different than those in BER Case 99-6, there are elements in both cases that are instructive in the present facts: the importance of disclosure and the obligation to protect, and to not disregard, the interests of one’s current employer or former employer. In the present case based on the facts, it appears that while Engineer A had been physically present within the offices of ABC Engineering, Engineer A may not have acted professionally in the weeks and days prior to departing by failing to provide the notice and communications expected. As a full-time employee of ABC Engineering, Engineer A had an obligation to devote his attention for the benefit of ABC Engineering. By failing to provide timely notice or to demonstrate a serious level of commitment to the interests of ABC Engineering prior to and after his departure, Engineer A appears to have acted unethically.

At the same time, while the Board can understand Engineer B’s disappointment in the manner that Engineer A behaved prior to and following his departure from ABC Engineering, the Board also believes that Engineer B has an ethical obligation to engage in conduct consistent with the codes, rules, and laws relating to the practice of engineering. Those codes, rules, and laws may compel Engineer B to cooperate with the engineering licensure processes, including the factual work verification of Engineer A’s pending comity application. Certainly Engineer B is not compelled to go beyond what is legally required in providing the employment verification, but Engineer B must at a minimum meet the legal and regulatory requirements and be factually accurate in all reporting and verification.