EMPLOYMENT LAW UPDATE
Summer, 2007
Two recent cases in New York and New
Jersey demonstrate the value of documented investigation of an
employee’s improper conduct to demonstrate the employer’s proper and
reasonable motivation to fire an employee – in these cases – for
theft. The New Jersey decision actually held that the employer’s
investigative report could be admitted as non-hearsay evidence of
the employers’ motivation.
The New York case is Posner v.
Sprint/United Management Co., decided by the U.S. District Court of
the Southern District of New York. Mr. Posner, 60 years old, had
worked as a Sprint account executive for twenty years. At one point
he activated a toll-free 800 number of a customer, Landstar, to
connect to his home. Sprint approved the arrangement so that Posner
was available to the account during off-hours and week-ends. What
Sprint did not approve, however, was the expansion of these hook-ups
on the accounts of other customers, connected to Posner’s son in
Texas, his daughter, and his cell phone. Sprint fired Posner for
theft of services. He sued Sprint, claiming age discrimination.
The district court was not impressed.
The only evidence of age discrimination was the simple fact that
Posner was 60 when he was fired. Although that fact creates a
presumption of discrimination, that presumption “simply drops out of
the picture” with the presentation of “overwhelming evidence” on
behalf of Sprint. The complaint was dismissed.
In the New Jersey case, Carmona v.
Resorts International, the state Supreme Court made two important
rulings in a case in which a plaintiff claimed that he was fired in
retaliation for a “whistleblowing” complaint he made three days
earlier. The first ruling is that the underlying complaint – the “whistleblowing”
-- must be made upon a good faith belief that it is true. The second
is that an employer’s investigative report of the reasons for the
firing is itself admissible to show the employer’s reasonable
motivation. Let’s look at the facts.
Reinaldo Carmona was hired in 1999 as a
front desk clerk at Resorts Atlantic City. In November 2001, he and
a fellow employee, William Santiago, filed a complaint with Resorts’
EEO officer, claiming unequal treatment under the medical leave
policy. They had little evidence to support the claim.
Simultaneously, Resorts was investigating suspicions that Carmona
and Santiago had regularly provided improper room upgrades to
customers and received tips in return. Resorts compiled an
Investigative Report, and fired both men for theft, just three days
after the men made their discrimination complaint.
Carmona and Santiago sued Resorts
alleging they had been retaliated against for “whistleblowing.” The
lower courts held that plaintiffs need not have a reasonable, good
faith basis for their underlying complaint. They also held that
Resorts’ Investigative Report was not admissible in evidence. The
Supreme Court ruled that both holdings were wrong. A plaintiff
cannot bring a retaliation claim if the underlying predicate claim
is not made reasonably and in good faith. Also, the Investigative
Report, including computer records, is admissible because it
demonstrates a non-retaliatory reason for the employees’
terminations. The case was remanded to the trial court for further
proceedings.
A careful investigation of the true
reasons for a personnel decision can save an employer from a
damaging discrimination or retaliation claim by an employee,
provided that the decision makers actually review and rely upon that
report. There are lessons to be learned here.
For comments on this article, or questions to John C. Lane:
