Jimmy Walker joined your new Internet sales force in June 2009, immediately after graduating from college. He turned down several better-paying job opportunities to get into your new innovative company. As compensation, Walker agreed to a lower starting salary and stock options. However, the options do not vest until he has been employed for three years, which means that Walker forfeits all his stock options in the event he leaves the company before June 2012. In November 2011, as a result of a serious financial crisis, your company is considering downsizing the workforce to reduce the operating expenses. The board is considering firing Walker, despite his good performance, primarily because he is the most recently hired, at-will employee. However, you (as the CEO of the organization) fear a lawsuit, especially given that Walker has less than one year to go before he can vest in his stock options.
- Should the board fire Walker? Why or why not?
- If Walker is terminated, on what bases can he sue the company? Will he prevail in his suit? Why or why not?
- How could you have structured the relationship with Walker differently in order to avoid a potential lawsuit