Wisconsin Hospital’s Good-Faith Belief Wins Discrimination Case

April 23, 2014

Under Wisconsin’s employment-at-will doctrine, employ­ers generally can terminate employees for any reason not pro­hibited by law. Of course, there are legal and prudent limits to the employment-at-will doctrine. For example, it is widely known that federal, state, and some local laws prohibit employ­ers from terminating employees because of their age.

When an employee claims that she was unlawfully termi­nated because of her age, an agency or a court will scrutinize the employer’s explanation for the termination decision. When that occurs, it is important for the employer to substantiate its explanation. At the same time, the question is not whether the decision was wise or well considered but rather whether the employer genuinely believed its asserted reasons for the termi­nation. The Wisconsin Labor and Industry Review Commis­sion (LIRC) confirmed that principle in a recent age discrimi­nation case.

Facts

Sue Perkins worked as a healthcare professional for Rogers Memorial Hospital from the time she was 58 until age 65, when the hospital terminated her em­ployment. The employer identified three incidents to support its decision. Specifically, the hospital claimed that Perkins (1) failed to immediately notice and act on a patient’s abnormally high blood pressure, (2) copied a patient’s medical information from one form to another, and (3) failed to accurately assess a patient. Perkins dis­puted each of those claims.

In the first incident, Perkins claimed that when she reported to work, other medical staff informed her that the patient was stable and eating breakfast. When the patient returned from breakfast, Perkins discovered that the patient’s blood pressure was high and immediately called for a doctor. Regarding the second incident, Per­kins claimed that she copied a patient’s medical infor­mation from one form to another at the direction of a doctor because the doctor could not read the informa­tion on the original form. Perkins did not intend to dis­card the original form; she simply intended to comply with the doctor’s directions. In the third incident, it ap­peared that the hospital relied on information it received from a nurse over information it received from Perkins.

When there is a factual dispute in the workplace, the employer is permitted to make a credibility deter­mination and decide which version of events it finds more credible. When an employer makes an employ­ment decision based on a genuine belief that a particular set of facts is true, it generally cannot be found to have a discriminatory intent, even if its belief was misplaced or mis­taken. Courts are not supposed to sit as a “superpersonnel de­partment” to second-guess employers’ business decisions.

The hospital proceeded with Perkins’ termination based on its understanding of the incidents. Perkins filed an age dis­crimination complaint claiming, among other things, that the hospital terminated her because of her age.

LIRC’s Decision

In analyzing the case, the LIRC noted that Perkins was in a protected age class (i.e., 40 or older). However, there was little evidence in the record to support an inference of age discrimi­nation. For example, the LIRC found no proof that younger em­ployees were treated more favorably than Perkins. There was no evidence of age-related comments by anyone who influenced the termination decision. The person who was principally re­sponsible for the termination decision and the individual who replaced Perkins were also in a protected age class. The LIRC concluded that those facts undermined Perkins’ claim.

In dismissing Perkins’ claim, the LIRC noted that the im­portant factor was whether the hospital honestly believed its nondiscriminatory reason for the termination, not whether the decision was accurate. If an employer provides a nondiscrimi­natory reason for its actions, the employee bears the burden of showing that the reason is a pretext (or lie) to cover up unlawful age discrimination. A pretext inquiry focuses on whether the employer’s stated reason for its decision is honest, not whether the decision is accurate or good for business. Perkins v. Rogers Mem. Hosp., ERD Case No. CR201100383 (LIRC, 2/28/14).

Bottom Line

Employers sometimes rely too heavily on the employment-at-will doctrine to support a quick termination decision without properly documenting the issues leading to the discharge. That does not make the decision unlawful or inappropriate. How­ever, relying on employment at will can unnecessarily open the door to credibility disputes that a court or an agency may have to resolve. Never leave it in the hands of a judge!

If you do the work on the front end to prevent credibility disputes from arising, you will be in a much better position to defend against future claims. The best way to do that is by implementing a formal approach to employee performance and discipline management. The focus should be on helping em­ployees be successful by letting them know what your expecta­tions are, how they can meet those expectations, and the conse­quences for ongoing performance deficiencies.

Despite the employment-at-will doctrine, the fair employ­ment laws frequently require employers to provide a legitimate nondiscriminatory reason for their actions. A formal approach to employee performance and discipline management is an ex­cellent way to substantiate the reasons for your actions. More important, it helps employees reach their full potential.

This article was featured in the April 2014 issue of the Wisconsin Employment Law Letter, which is edited by Axley Brynelson Attorneys Saul Glazer and Timothy Barber and published by BLR®—Business & Legal Resources. Reproduced here with the permission of BLR®—Business & Legal Resources.

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For more information about "Wisconsin Hospital’s Good-Faith Belief Wins Discrimination Case," contact Troy D. Thompson at tthompson@axley.com or 608.283.6746.