Hale v. Hyundai Motor Manufacturing Alabama, LLC (hereinafter HMMA)

On January 6, 2012 the Alabama Court of Civil Appeals released an opinion on the issue of collateral estoppel in a retaliatory discharge case based on the employee allegedly being terminated due to his filing a workers’ compensation claim. The Trial Court granted summary judgment in favor of the HMMA and Hale appealed. On appeal Hale argued that HMMA is estopped from arguing the discharge was due to misconduct because the unemployment board’s decision determined that the employee had not committed misconduct. The Alabama Court of Civil Appeals disagreed with Hale and affirmed the Trial Court’s ruling.

Hale was injured on the job and suffered from carpal tunnel syndrome. He underwent two surgeries and was returned to work at light duty. Subsequent to being released to light duty Hale missed nine days and took one day of bereavement leave. HMMA corresponded with Hale on numerous occasions indicating that he needed to provide documentation related to the nine absences and bereavement leave or it would result in his termination. Hale never provided documentation as requested and even admitted to this despite providing explanations. He was subsequently terminated on March 13, 2009 for violating HMMA’s absentee policy and violating the serious misconduct policy, which included serious and/or excessive violations of HMMA’s attendance policy and intentional misrepresentation or falsification of information regarding employment or reports to HMMA. Violation of the serious misconduct policy placed an employee outside the normal corrective action plan.

Hale sought unemployment benefits and on appeal it was determined, for purposes of unemployment, that Hale had not committed misconduct as defined by the unemployment statute: deliberate, willful or wanton disregard of the employer’s interests or of standards of behavior which the employer has right to expect of its employees. In making the determination the hearing officer stated that Hale had compelling reasons for the acts which he was discharged for. Therefore, the violation was not misconduct such that unemployment should be denied.

On appeal Hale asserted that the Supreme Court’s decisions in Wal-Mart Stores, Inc. v. Hepp, 882 So. 2d 329 (Ala. 2003) and Wal-Mart Stores, Inc. v. Smitherman, 743 So. 2d 442 (Ala. 1999) were controlling. In both of theses cases, the Supreme Court found that the employee was collaterally estopped from arguing he or she was discharge for a reason other than misconduct in a retaliatory discharge claim when they were found to be disqualified from unemployment benefits due to misconduct connected with their work. As such, Hale asserted that the "reverse argument is also true" barring HMMA from arguing that Hale was discharged for a legitimate reason because that reason was determined not to be misconduct that would disqualify Hale from receiving unemployment benefits. The Alabama Court of Civil Appeals disagreed because the issues are not identical due to the posture of the parties.

The Court of Civil Appeals ruled that the unemployment hearing officer found that Hale did not commit misconduct for purposes of unemployment-compensation statue: deliberate, willful or wanton disregard of the employer’s interests or of standards of behavior which the employer has a right to expect from its employees. However, that does not mean that Hale was not discharged for a valid reason under HMMA policies, HMMA’s reasons for the discharge were not legitimate and that HMMA terminated Hale for the sole reason that Hale filed a workers’ compensation claim. In Hepp and Smitherman, the unemployment decision found that the employee committed misconduct so there is a compelling conclusion that the employer had a legitimate reason for the termination. However, the reverse is not true. Alabama is an at-will employment state, so HMMA can terminated for any reason (aside from terminating solely because a filed a worker’s compensation claim), even if that reason does not amount to misconduct as defined in the unemployment context. As a result, HMMA is not collaterally estopped from asserting that Hale was terminated because he violated HMMA policies.

Black Creek , Inc. v. Woods

The Alabama Court of Civil Appeals affirmed the Etowah County Circuit Court’s ruling in a retaliatory discharge lawsuit with no opinion in Black Creek Inc v. Wood. The Trial Court awarded $50,000.00 to the employee based on his discharge being deemed solely the result of his filing a workers’ compensation claim. $30,000.00 of the award was allocated for mental anguish and $20,000.00 was for lost wages. Judge Moore concurred in the result, with writing.

In support of the mental anguish award, Judge Moore pointed to the plaintiff’s testimony that he suffered serious financial problems, sought psychiatric care, obtained medication for depression and suffered marital strife leading to a divorce. Judge Moore cited Montgomery Coca-Cola Bottling Co. V. Golson as support that the plaintiff’s testimony provided sufficient evidence that he suffered from mental anguish as a result of his termination.

In regards to the lost wages award, the employer argued that, by receiving Social Security Disability benefits, the employee was estopped from asserting that he was able to work. The employer cited the case of Bleir v. Wellington Sears Co. which held that if an employee is discharged as the result of a workers’ compensation claim but is unable to return to work, he cannot recover lost wages. The employer acknowledged that it did not affirmatively plead estoppel as a defense and that, if not plead, the defense would be waived. However, it alleged that the pleadings should be amended pursuant to Rule 15 (b) of the Alabama Rules of Civil Procedure to conform to the evidence presented at trial. The employer argued that the Social Security Disability evidence would be relevant toward proving the defense of estoppel and it was tried without objection at trial. Judge Moore stated that this evidence also went to prove whether or not any lost wages should be offset by the Social Security Disability award. Therefore, because the employee would not have known that he was trying the estoppel issue, Rule 15 (b)�@was not triggered.

Judge Moore also stated that the lost wages were from the date of termination until the plant closed in late 2001 or early 2002 and the Social Security Disability did not begin until October 2003, which would date it back to October 2002 pursuant to 42 U.S.C § 423 (b) and 20 C.F.R. § 404.621. Although it is true that the employee cannot receive workers’ compensation benefits for lost wages due to an inability to work and compensatory damages for lost wages in a retaliatory discharge claim, the burden is on the employer to prove overlapping compensation. In this case, the employer did not present any evidence as to what portion of the $20,000.00 lost wages award, if any, was related to the period that the employee received Social Security Disability benefits. Therefore, no evidence was presented to support estoppel or an off set of the lost wages award.

Released 03/25/2011

Gibson v. Staffco L.L.C.:

On October 11, 2010, the Alabama Court of Civil Appeals released an opinion dealing with the survivability of a workers’ compensation retaliatory discharge claim.

The employee filed a workers’ compensation claim along with a retaliatory discharge claim against his employer in October of 2008. In July of 2009, the employee died of an unrelated cause. His wife was joined as a plaintiff to represent the estate of the employee in the case. The lower court granted the defendant’s motion to dismiss both claims. The wife filed an appeal as to the retaliatory discharge claim.

Under the Alabama Workers’ Compensation Act, benefits survive a death which is not related to the compensable injury when the degree of the disability has been agreed upon by both parties or ascertained by the court. In order for a tort claim to survive, it need only be filed prior to the death of the plaintiff. The Alabama Court of Civil Appeals found that a claim for retaliatory discharge stemming from a workers’ compensation action is to be treated as a general tort claim and so reversed the judgment of the trial court and remanded the case for further proceedings on the retaliatory discharge claim.

My Two Cents:  Although the RD claim survived the dismissal, it will be difficult if not impossible for the estate to prevail without the testimony of the plaintiff.  If the decedent employee was deposed before his death, then the deposition can be used in place of live testimony at trial.  If not, then the employer will likely win the case by way of summary judgment. 

Ex parte Ray Keith Wood:

On Friday October 29, 2010, the Supreme Court of Alabama handed down a decision concerning retaliatory discharge in a workers’ compensation claim.

The employee suffered an injury to his left forearm. He had surgery in May 2000, and was returned to work on June 12, 2000. The employee left work early on three occasions in June to undergo physical therapy. The employer created two written warnings for these occasions, but neither written warning was given to the employee.

The employee came to work on June 20, 2000, and told his employer that he needed to see his doctor again. He was referred to the human resources manager, who told him that she did not have time to deal with him at that moment. The employee muttered a derogatory comment that included an expletive; which was witnessed by two co-employees. The employee left work at 8:00 a.m. and was overheard by a supervisor saying that he was leaving before he slapped the human resources manager and that if she did not want to talk to him that he would go home. The human resources manager informed the plant manager that the employee had left without permission.

The employee was fired and he filed a retaliatory discharge claim in addition to his workers’ compensation claim. The workers’ compensation claim was settled but the retaliatory discharge claim went to trial. The trial court (sitting without a jury) found that the employee had made a prima facie case of retaliatory discharge and that the reason the employer gave for firing him was pretextual. The trial court entered a judgment in favor of the employee. The Alabama Court of Civil Appeals reversed the ruling of the trial court and remanded the case with instructions for the trial court to enter a judgment in the employer’s favor. This ruling was appealed to the Alabama Supreme Court.

The Alabama Supreme Court reversed the ruling of the Alabama Court of Civil Appeals. At trial, the plant manager (who had fired the employee), testified that the employee was fired for his use of foul language and for leaving work early, without permission (both of which were violations of company policy). The human resources manager however, testified that the employee had been fired solely because he left work early without permission. The employee testified that no mention had been made of his inappropriate conduct at the time he was fired. The Alabama Supreme Court found that the trial court had been presented with enough evidence to conclude that the reason given for firing the employee was pretextual and that the true reason for his firing was retaliation for the employee’s workers’ compensation claim.

Dillard’s Inc. v. Kenneth Gallups:

On September 10, 2010, the Alabama Court of Civil Appeals released this opinion in which it considered whether a retaliatory discharge claim (that stems from a workers’ compensation claim) arises under the Alabama Workers’ Compensation Act.

The case involved an arbitration agreement signed by the employee. The language of the agreement required that any alleged retaliation for filing a protected claim for benefits (or exercising a protected right) was to be arbitrated; but claims for injuries covered by workers’ compensation were not to be arbitrated. The trial court in ruling for the employee found that a retaliation claim based on a workers’ compensation claim was "an injury covered by workers’ compensation" because it arose from the Act; and so was not subject to arbitration under the agreement.

On appeal, the Court of Appeals found that in accordance with previous case law, retaliatory discharge claims are treated as traditional tort claims and so this claim would not arise under the Alabama Workers’ Compensation Act. Since the retaliatory discharge claim did not arise under the Act; it was covered by the provision in the agreement that mandated arbitration for the filing of retaliation claims. The Court reversed the opinion of the lower court and remanded with instructions to compel arbitration.

An Etowah Count Jury returned a defense verdict in a retaliatory discharge claim on September 30, 2009.

At trial, the evidence revealed that the employee was working for a lawn service company when he injured his left knee. According to the employer, the employee returned to work almost immediately with no medical restrictions. However, upon his return the employee was not completing jobs that were assigned to him and was having conflicts with other employees. As a result, the employer alleged it began to lose customers and terminated the employee. At the time of the termination, the employer stated that it was unaware of the status of the employee’s workers’ compensation claim.

According to the employee, he had returned to work at light duty and was undergoing physical therapy when the employer terminated him. At that point, the employee filed a lawsuit for workers’ compensation benefits and also claimed retaliatory discharge. The workers’ compensation claim was settled and the employer defended the retaliatory discharge claim stating that his termination was not the result of the workers’ compensation claim. Upon hearing the evidence and arguments, the jury returned a defense verdict.

M & J Materials, Inc. v. Isbell:

On May 7, 2010, the Alabama Court of Civil Appeals released this opinion wherein it reversed the trial court’s decision to deny the employer’s motion for judgment as a matter of law. Specifically, the evidence at trial revealed that the employer’s stated reason for terminating the employee was because he possessed a firearm on the employer’s premises. The judge denied the employer’s motion for judgment as a matter of law and the jury returned a verdict in the amount of $5,000 in compensatory damages and $70,000 in punitive damages. The Court of Civil Appeals reversed the judgment because the employee failed to rebut the employer’s showing that the termination was based, in whole or in part, upon the employee’s reported open possession of a firearm. Although the employee offered witness testimony that other employees brought firearms to work and were not disciplined, it could not be shown that the other instances were brought to the attention of management. The employer, however, offered evidence that an employee who reportedly brought a hunting knife on the premises was discharged. Since that particular employee had not filed a workers’ compensation claim, it could not be shown that the rule against weapons on the employer’s premises was applied in a discriminatory manner (i.e. only against workers’ compensation claimants).

Early last year in the Circuit Court of Etowah County, the trial judge entered judgment in favor of a plaintiff in her retaliatory discharge claim but awarded her no compensatory or punitive damages.

In the beginning of September 2004 the employee was injured while working for her employer but she did not immediately file for workers’ compensation benefits. Later that month the employee received a letter stating that she was terminated because of her recent performance and not to contact the other employees directly.

In January 2005 , the employee filed for workers’ compensation benefits and that claim was eventually settled in December of 2006. However, during this same time period, the employee also filed a retaliatory discharge claim alleging that she was fired in retaliation for filing a worker’s compensation claim. The employee also alleged that the employer breached an oral contract by not providing her with a third of the business.

After a trial on the merits, the jury found in favor of the employer on the breach of contract claim and in favor of the employee on the retaliatory discharge claim but awarded no money in either compensatory or punitive damages.

Black Creek, Inc. v. Ray Keith Wood:

On March 12, 2010, the Alabama Court of Civil Appeals released this opinion wherein it reversed a denial of a motion for a judgment as a matter of law (JML) from the Circuit Court of Etowah County and remanded the case for the trial court to enter a JML in favor of the employer. 

In February of 2000, the employee pulled a muscle loose from his left arm while working as a machinist for the employer. The injury needed surgery and, after determining that it was work related, the employer’s workers’ compensation insurance carrier authorized the surgery. The surgery was performed on May 5, 2000. On June 8, 2000 the doctor that performed the surgery released the employee to light duty work.

On June 12, 2000 the employee returned to work, but during that week his work was sporadic with his time card showing he left work early three days to attend physical therapy. The employer had a policy that required employees to attempt to schedule their doctor and physical therapy appointments either before or after work and to notify their supervisor if those arrangements could not be made. Due to his failure to report his absences and use of foul language to his supervisor the employee was issued several disciplinary warnings. On June 20, 2000, the employee became upset with his supervisor, used foul language in the presence of other employees, and left the job. 

In August of 2000, the employee filed a workers’ compensation claim and also a retaliatory discharge claim. The two claims were severed and the workers’ compensation claim was eventually settled. After a trial in December of 2007, the trial court entered judgment in favor of the employee and awarded $50,000 in damages. The employer moved for JML at the close of the employee’s evidence and also at the close of the trial and both were denied. The employer appealed.

The Court of Appeals concluded that the employer had a legitimate reason for discharging the employee and that the trial court erred in not granting the motion JML. The case was remanded to the trial court with instructions to enter JML for the employer.

James Nichols v. Material Delivery Services, Inc.:

On January 15, 2009, a Shelby County jury returned a verdict against an employer and assessed $75,000.00 in compensatory damages and $225,000.00 in punitive damages. At trial, it was the position of the employee that he was fired solely in retaliation for filing a workers’ compensation claim which is not allowed in Alabama. It was the position of the employer that he was actually fired for waiting 6 hours to report his injury and not solely because he made a workers’ compensation claim. The employer has 42 days from the date of the verdict to file an appeal.

On June 25^th, 2009, a Jefferson County jury returned a verdict in favor of the employer in a retaliatory discharge lawsuit. It was uncontested that the plaintiff was terminated after making a workers’ compensation claim. However, it was the employer’s position that the employee was fired for failing to report for available light duty work. Specifically, the plaintiff injured her back at work and began receiving benefits. In the meantime, her doctor put her on modified duty. She subsequently received a letter from her employer informing her that they had implemented a light duty program and that she needed to drive to the company’s headquarters to start light duty. The plaintiff complained that she did not want to drive because it was a long way from her home and she was concerned about back problems while driving. Her physician, however, had not put any limitations on driving distance. As an alternative, the plaintiff asked to perform light duty closer to her home. This request was denied. When the plaintiff did not appear for light duty as directed, the employer sent her a letter terminating her employment for failing to comply with the absenteeism policy.

The plaintiff filed suit against her employer alleging retaliatory discharge. She claimed the light duty program was implemented only after she filed her workers’ compensation claim. The employer denied this allegation citing that their workers’ compensation insurance provider had suggested the light duty policy three or four months prior to its implementation. The jury ultimately sided with the employer.

Black Creek, Inc. v. Ray Keith Wood

On July 31, 2009, the Court of Appeals reversed the trial court’s ruling in favor of the plaintiff’s retaliatory discharge claim based on his filing a workers’ compensation claim. The Court of Appeals held that the defendant/employer should have received a Judgment as a Matter of Law.

The Court of Appeals held that the employee did not present substantial evidence that the employer’s basis for the termination was pretextual or false. The employer presented evidence that the employees use of foul language on the job and leaving work with out permission lead to the employee’s termination. The employee argued that "other employees did it", referencing the use of foul language, and they were not terminated. The Court of Appeals stated that this was not enough to prove the employer applied its policies in a discriminatory manner. This was further supported by several supervisors testifying that foul language was not acceptable.

Therefore, the employer established that the plaintiff’s workers’ compensation claim was not the sole basis for his termination.

Ex parte Gadsden Country Club:

On January 16, 2009, the Alabama Supreme Court released this opinion wherein it denied the employers’ petition for a writ of mandamus. Specifically, the employee sued for retaliatory discharge pursuant to§ 25-5-11.1, Ala. Code 1975. As a defense, the employer asserted that it fired the employee for leaving work after the accident that resulted in his on-the-job injury without first seeking medical attention, in violation of both his supervisor's instructions and GCC policy. The employee successfully convinced the trial court to strike this defense because the Alabama Department of Industrial Relations had already considered and rejected the defense at an administrative hearing concerning the employee’s unemployment claim. The Alabama Supreme Court denied the employer’s petition because it was determined that an post trial appeal rather than a petition for mandamus relief was the proper recourse.

As a practice pointer, it is important to take unemployment hearings seriously. The administrative law judge’s findings could determine whether you succeed or fail in a subsequent retaliatory discharge action.