Most employment discrimination claims require the employee to prove that the employer's stated reasons for the adverse action are a pretext. By statute claims based on Tennessee discrimination and retaliation claims require employees “demonstrate that the reason given by the defendant was not the true reason for the challenged employment action and that he stated reason was a pretext for illegal discrimination or retaliation. Tenn. Code Ann. § 4-21-311(e); Tenn. Code Ann. § 50-1-304(g).
Courts define pretext to mean a "lie", more specifically, a lie designed to hide the real reason for a decision. In discrimination claims, the "real reason" needs to be discrimination, of course, so a lie alone won't suffice. St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 511 (1993).
What's hard for folks who are not familiar with employment law to understand is that showing the facts that led to an employee's termination were incorrect does not necessarily mean the employer lied. An employee must show "more than a dispute over the facts upon which the discharge was based." Braithwaite v. The Timken Co., 258 F.3d 488, 494 (6th Cir. 2001). So, a factual dispute about whether the fired employee shoved a co-worker doesn't make the employer's stated reason pretextual. Same for when the employee denies having made the payroll data errors the employer cited as the basis for his termination. Majewski v. Automatic Data Processing, Inc., 274 F.3d 1106, 1117 (6th Cir. 2001) ("Majewski's assertion that he did not delete the payroll wrap is insufficient to call into question ADP's honest belief that he did.").
An employer's honest mistake can itself be a legitimate nonpretextual reason for firing an employee. Today's unpublished decision in Smith v. Towne Properties Asset Management Co. Inc. demonstrates this. Smith worked for Towne, an Ohio apartment management company. She lived in one of the apartments rent free. A co-worker accused Smith of theft in the form of not paying for gas, electricity and parking. Towne investigated, even talked to one of the prior owners (who had employed Smith before them) and asked if the prior owners had agreed to free utilities and parking for Smith (he said no). Shortly after Towne fired Smith, one of the other owners said she believed Smith was entitled to the free utilities and parking.
So, it turns out that Smith probably had not stolen utilities (at least not intentionally). She sued Towne under the ADA and FMLA. Towne won. It prevailed because while it was mistaken, its investigation was reasonably informed and established Towne honestly believed, at the time it made the decision, Smith had misappropriated utilities.
Smith argued Towne's mistake was too obvious to be unintentional, that is, if an employer's "mistakes in its investigation" are so "blatant," that can raise doubts about the honesty of the employer's reasons. But blatant mistakes are hard to prove, especially when the employer carefully documents the steps it took to investigate the employee's misconduct.
Here, Smith argued Towne made a blatant mistake by not talking to her before firing her. But it is settled precedent that an employer ordinarily does not have to interview an employee before a termination decision. Of course, there may be times it is a good idea to talk to an employee, this case shows why. On the other hand, in a theft investigation, giving an employee the opportunity to deny stealing is often a pointless exercise.
Towne did not reconsider its position when it learned there may be doubts about the reason why Smith wasn't paying for utilities. The court said this didn't matter because there was no evidence Smith ever asked for her job back after being fired. Had she, Towne might have had a more difficult time in the litigation. It didn't necessarily have to take her back if she had asked, but Towne would have needed to come up with a legitimate reason for the refusal that was based on more than its prior mistake.
Reading between the lines, there was more to this story than Towne being mistaken. Towne went with theft as a stated reason but Smith was apparently a manager, so Towne could have justified the decision on less sensational grounds. Employers can rightly expect managers to adhere to a higher standard. So when Smith asked Towne for a letter itemizing her compensation and the letter she received did not mention free utilities and parking, Towne could have justified later firing her for continuing to receive the "free" perks even if Smith believed she was entitled to them. As long as it treated nondisabled managers the same, Towne can expect managers to be proactive and forthright.
Employers don't always have to go with the most sensation reason for terminating an employee. Sometimes, particularly with a manager, going with the simplest explanation - we've lost trust in you - and explaining why - is better.
Courts define pretext to mean a "lie", more specifically, a lie designed to hide the real reason for a decision. In discrimination claims, the "real reason" needs to be discrimination, of course, so a lie alone won't suffice. St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 511 (1993).
What's hard for folks who are not familiar with employment law to understand is that showing the facts that led to an employee's termination were incorrect does not necessarily mean the employer lied. An employee must show "more than a dispute over the facts upon which the discharge was based." Braithwaite v. The Timken Co., 258 F.3d 488, 494 (6th Cir. 2001). So, a factual dispute about whether the fired employee shoved a co-worker doesn't make the employer's stated reason pretextual. Same for when the employee denies having made the payroll data errors the employer cited as the basis for his termination. Majewski v. Automatic Data Processing, Inc., 274 F.3d 1106, 1117 (6th Cir. 2001) ("Majewski's assertion that he did not delete the payroll wrap is insufficient to call into question ADP's honest belief that he did.").
An employer's honest mistake can itself be a legitimate nonpretextual reason for firing an employee. Today's unpublished decision in Smith v. Towne Properties Asset Management Co. Inc. demonstrates this. Smith worked for Towne, an Ohio apartment management company. She lived in one of the apartments rent free. A co-worker accused Smith of theft in the form of not paying for gas, electricity and parking. Towne investigated, even talked to one of the prior owners (who had employed Smith before them) and asked if the prior owners had agreed to free utilities and parking for Smith (he said no). Shortly after Towne fired Smith, one of the other owners said she believed Smith was entitled to the free utilities and parking.
So, it turns out that Smith probably had not stolen utilities (at least not intentionally). She sued Towne under the ADA and FMLA. Towne won. It prevailed because while it was mistaken, its investigation was reasonably informed and established Towne honestly believed, at the time it made the decision, Smith had misappropriated utilities.
Smith argued Towne's mistake was too obvious to be unintentional, that is, if an employer's "mistakes in its investigation" are so "blatant," that can raise doubts about the honesty of the employer's reasons. But blatant mistakes are hard to prove, especially when the employer carefully documents the steps it took to investigate the employee's misconduct.
Here, Smith argued Towne made a blatant mistake by not talking to her before firing her. But it is settled precedent that an employer ordinarily does not have to interview an employee before a termination decision. Of course, there may be times it is a good idea to talk to an employee, this case shows why. On the other hand, in a theft investigation, giving an employee the opportunity to deny stealing is often a pointless exercise.
Towne did not reconsider its position when it learned there may be doubts about the reason why Smith wasn't paying for utilities. The court said this didn't matter because there was no evidence Smith ever asked for her job back after being fired. Had she, Towne might have had a more difficult time in the litigation. It didn't necessarily have to take her back if she had asked, but Towne would have needed to come up with a legitimate reason for the refusal that was based on more than its prior mistake.
Reading between the lines, there was more to this story than Towne being mistaken. Towne went with theft as a stated reason but Smith was apparently a manager, so Towne could have justified the decision on less sensational grounds. Employers can rightly expect managers to adhere to a higher standard. So when Smith asked Towne for a letter itemizing her compensation and the letter she received did not mention free utilities and parking, Towne could have justified later firing her for continuing to receive the "free" perks even if Smith believed she was entitled to them. As long as it treated nondisabled managers the same, Towne can expect managers to be proactive and forthright.
Employers don't always have to go with the most sensation reason for terminating an employee. Sometimes, particularly with a manager, going with the simplest explanation - we've lost trust in you - and explaining why - is better.
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