Legal Alert

Unclear, Inconsistently Enforced Policy Supports Employee Discrimination Claim

May 11, 2022

Summary

Shortly after requesting an accommodation for his disability, an employee was terminated for violating company policy. But because the policy at issue was vague, ever-evolving, and inconsistently enforced, the Utah Court of Appeals held that the employer’s explanation for why it had terminated the employee was pretextual, holding that it was liable for discrimination and/or retaliation.

The Upshot

  • Company policies that are not clearly written and consistently enforced will support a claim for discrimination/retaliation in Utah state courts, as the plaintiff can argue that the employer’s justification for termination is mere pretext.
  • In seeking damages for discrimination/retaliation, employees are not entitled to “double recovery.” For example, an employee may recover lost wages, or the amount of funds they were required to withdraw from savings during the time that they were unemployed, but they may not recover both.

The Bottom Line

It is vital that Utah employers draft clear policies that are consistently enforced. A policy that is vague, evolving, or inconsistently enforced will support an employee’s claim for discrimination/retaliation. If you have not recently reviewed and updated your handbook, it is time to do so.

In the recent decision in Hexcel Corp. v. Lab Commission, the Utah Court of Appeals affirmed a decision by the Utah Labor Commission that Hexcel was liable for discrimination and/or retaliation when it fired an employee because of his disability and related request for accommodation.

Michael Pickard had worked as a maintenance electrician. He injured his back in an accident at work. After the injury, his doctor recommended that he not stand, sit, or walk for extended periods. Mr. Pickard requested that Hexcel accommodate his injury by allowing him to work eight-hour shifts, instead of his normal 12- hour shift. The employer denied the request because it was “short-staffed,” so Mr. Pickard resumed his normal work schedule.

Long before Mr. Pickard’s accommodation request, Hexcel had instituted a rule against sleeping on the job. However, this rule was not enforced. Later, the company circulated a memorandum expressing its intent to begin enforcing the no-sleeping rule and informing its employees that a violation would result in termination. Even after this, Hexcel’s enforcement of the no-sleeping rule was inconsistent. Some employees violated the rule, but were not terminated—or even disciplined—for their infractions.

In addition, the exact parameters of the no-sleeping rule were not clearly established. When employees asked about the rule, they were given conflicting explanations. Some were told that they could nap on their breaks as long as they were in the designated breakroom. Other workers were told that they could nap anywhere, as long as they were on a break. Hexcel never put these “evolutions and modifications” of the rule into writing.

A few months after the company denied Mr. Pickard’s request for accommodation, he was caught sleeping in a company truck during a brief break and was fired.

The Commission determined that Mr. Pickard had made out a prima facia case of discrimination on the basis of his disability, and that Hexcel’s allegedly nondiscriminatory basis for firing him based on the no-sleeping rule was pretextual, because the rule was “incoherent” and inconsistently applied. The Commission awarded damages for lost wages, out-of-pocket medical expenses, and the amount of withdrawals Mr. Pickard had made from his savings and 401(k) accounts to cover living expenses during the time he was unemployed.

The Utah Court of Appeals affirmed, finding that the Commission’s determination was supported by substantial evidence and was not clearly erroneous. The court modified the damages award, however. It concluded that in granting Mr. Pickard damages for lost wages, plus the funds he had to withdraw from his savings accounts to compensate for these lost wages, the Commission had given him an impermissible “double recovery.”

Although the court reduced the amount of Mr. Pickard’s damages, the Hexcel case serves as a warning and reminder to employers that taking an adverse action against an employee on the basis of an inconsistent, unclear policy can have serious consequences and lead to costly litigation. Fortunately, preventing successful discrimination/retaliation claims can be a simple matter of routinely reviewing and updating your company’s handbook, policies, and verifying consistent compliance with the same. Should you need assistance with this, the Labor and Employment attorneys at Ballard Spahr LLP have decades of experience in advising public and private employers in policies and compliance and any other labor-related issues that may arise. 

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