Tuesday, May 13, 2014

Walgreens Loses Summary Judgment in Case Where Employee Stole Food Due to Disability

Josephina Hernandez worked for Walgreens for 18 years when one day, while stocking shelves, she began shaking and sweating from low blood sugar.  Hernandez did not have any candy with her to combat the low blood sugar so she opened a $1.39 bad of potato chips that was in the cart and ate some.  She did not notify or request assistance from a manager before opening and eating the chips.  After about 10 minutes, when she started feeling better, Hernandez then attempted to pay for the chips but no one was at the register to ring her up, so she put the bag under the counter and went back to work.  The assistant manager discovered the discarded bag under the counter and asked whose they were and Hernandez admitted they were hers.  The assistant manager reported Hernandez to the Store Manager.

Hernandez then went on vacation for two (2) weeks and upon her return, she met with Walgreens loss prevention and was asked to write a statement about the chip incident where she wrote, "my sugar low, not have time."  Hernandez was then suspended and then subsequently terminated for taking the chips in violation of Walgreens' policy, as there is no "gray area" or "discretion" under the policy.  Hernandez was diagnosed with diabetes five (5) years after beginning work for Walgreens and Walgreens knew about Hernandez's Type II diabetes and allowed her to possess candy in case of low blood sugar, keep insulin in the break room refrigerator and take additional breaks to test her blood sugar or eat because of her diabetes.  However, Walgreens' anti-grazing policy is so strict that all managers in the district "consistently" terminated any employee for theft regardless of the employee's rank, employment history, or the value of the items taken.

Hernandez filed an EEOC complaint after her termination and the EEOC investigated and then brought suit against Walgreens, claiming Hernandez was terminated in violation of the Americans with Disabilities Act (ADA) and Title VII.  Walgreens filed a motion for summary judgment, arguing that Hernandez's termination for theft was not in violation of law.  The EEOC countered that Walgreens failed to accommodate Hernandez's known disability which caused the complained-of conduct.

Reasonable Accommodation

Walgreens argued that it can never be a reasonable accommodation to require an employer to accommodate employee theft under case law and the EEOC's own guidelines and relied heavily on Raytheon Co. v. Hernandez, 540 U.S. 44 (2003), which is a case where the Supreme Court held that the employer's application of its neutral no-hire policy was, by definition, a "legitimate, nondiscriminatory reason under the ADA."  Id. at 51-52.  However, the district court held, Raytheon did not directly address the question raised here:  whether an employer under the ADA is required to make a reasonable accommodation with respect to an employee whose disability caused that employee to violate a company's workplace rule. 

The court then discussed the other cases Walgreens attempted to cite as precedent and persuasive along with the EEOC guidelines they attempted to use against the EEOC.  However, as the court pointed out, each guideline cited had language about the rule being "job-related and consistent with business necessity."  Thus, the court concluded, whether it was business necessity to treat Hernandez the same as other employees who had been fired under the anti-grazing policy when Hernandez claims taking the chips was necessitated by her medical condition is a question of fact for the jury.    The court further opined that Walgreens had not established that Hernandez's conduct was "stealing" as a matter of law, much less stealing as contemplated by the EEOC guidance.  Furthermore, the court stated, "[u]nder the Ninth Circuit case law, misconduct resulting from a disability has to be considered as part of Hernandez's disability sand creates a question of fact as to whether Hernandez's disability was causally related to her termination.  In other words, whether or not Hernandez's disability was, in fact, a cause of her misconduct is a question of fact for the jury.  Similarly, whether Walgreens should have been required to 'accommodate' her stealing as a 'reasonable' accommodation is for the jury to determine."  Therefore, summary judgment was DENIED.

Hernandez's Failure to Manage Her Disability or Request an Accommodation

Walgreens also tried to argue that Hernandez's failure to accommodate her own disability on the day in question--by failing to have candy on her as allowed by Walgreens--should insulate their termination decision.  Again, the court held that Walgreens was citing distinguishable case law that failed to establish, as a matter of law, that Hernandez's failure to control her diabetes validated Walgreens' termination decision.

Walgreens also argued that the EEOC's failure to accommodate claim fails as a matter of law because Hernandez never sought the accommodation of eating food without first paying for it from Walgreens and did not give Walgreens the opportunity to accommodate her when the need allegedly arose.  The court held that whether Hernandez was really suffering from a hypoglycemic attack that required her to eat the chips and whether the timing of the attack reasonably prevented her from seeking an accommodation from her managers beforehand are questions of fact for the jury to decide.

This is a fairly interesting case as there are good arguments on both sides here with the court holding that there are issues of fact with respect to all of the claims to proceed to a jury.  On the one hand you have the plaintiff who did what she had to do to combat low blood sugar and apparently had no time to seek manager approval before eating the chips that were nearby.  On the other hand, you have an employer trying to uphold a policy to the utmost to discourage employees from stealing a penny worth of their merchandise.  Employers are certain to be in an uproar over the thought of an employee having a claim--let alone a claim for punitive damages--against them when they fire an employee for something like theft, but how can we expect an employee with a disability to jeopardize their health out of fear of being fired over a $1.39 bag of chips?  Odds are this case will settle, or, even if it doesn't, it may not be appealed out of fear of creating precedent given the 9th Circuit's existing precedent holding that an employer's reason for terminating an employee in cases like these must "disclaim any reliance on the employee's disability in having taken the employment action."  Dark v. Curry County, 451 F.3d 1078, 1084 (9th Cir. 2006).  In this case, because Walgreens could not disclaim any reliance on Hernandez's disability and instead claimed a uniformly-applied policy, Hernandez did not need to show pretext because they did not show a LNDR.

The case is EEOC v. Walgreen Co., Case No. 11-cv-04470-WHO (N.D. Ca.)

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