Richard W. Bunch, PhD, PT, CBES
It always amazes me when reviewing legal cases about allegations of employee discrimination how employers too often create their own problems that are quite costly. In the California case, Abarca v. Citizens of Humanity, LLC, Mr. Abarca, a warehouse worker employed by Citizens, a company that markets and manufactures blue jeans and other apparel, was fired shortly after telling his employer of a lifting restriction. Mr. Abarca subsequently sued Citizens of Humanity, LLC for disability bias under California’s Fair Employment and Housing Act (FEHA). The jury awarded him $620,000, of which $70,000 was for lost earnings and $550,000 for punitive damages. Citizens of Humanity, LLC contested the $550,000 punitive award, indicating the punitive damages award amount of more than seven times the amount of compensatory damages violated its due process rights. However, California appellate court rejected the employer’s plea and allowed Mr. Abarca to keep the punitive damages award.
Key Facts of the Case
The plaintiff, Mr. Abarca, age 57, was employed at a salary of $8.25 /hour in the company’s quality control department for the primary purpose to lift boxes weighing up to 40 lbs. His job also required separating and inspecting boxes of jeans. Mr. Abarca was required by his job to lift boxes from pallets and load them onto carts to permit co-workers to inspect the contents of jeans.
After about four months on the job, Mr. Abarca reported feeling pain in his chest and shoulder that as aggravated by lifting approximately after 4 months of being employed. His pain became worsen over the next two years and his supervisor instructed Mr. Abarca to consult and a doctor. Mr. Abarca’s doctor informed the employer that the worker could not lift more than 20 pounds on the job due to back pain. He was placed on a light duty by the doctor with admonition to avoid lifting more than 15 to 20 pounds for a month.
During the work restriction period, Mr. Abarca’s supervisor instructed him to lift no more than 20 pounds and brought in another male worker to help lift the boxes. Mr. Abarca continued to inspect jeans and lift boxes after the light-work restriction expired but took steps to lighten the load of the box by removing some of the items before lifting. However, two days after the light-work restriction ended, the company fired Mr. Abarca even though he indicated that he could continue inspecting jeans.
Mr. Abarca testified at trial was that he could have continued working for Citizens had they continued to honor his work restriction. The jury found that Citizens initially provided Abarca with reasonable accommodations prior to his termination by asking his fellow employees to help, limiting his lifting to lighter boxes, and/or allowing him to separate out the jeans to move them in bundles. However, the court considered that Mr. Abarca could have continued to do his job for Citizens if reasonable accommodations could be maintained.
Two key mistakes were made by the employer in this case. The first mistake by the employer was that their HR director did not continue to engage Mr. Abarca in an interactive discussion regarding his ability to continue to perform the job with accommodations after his period of light duty or at the time of his termination. This supported an impression of wrongful discharge. The employer had obviously known that Mr. Abarca had a medical problem that translated into an occupational disability and as such, should have known that he was protected under California’s Fair Employment and Housing Act (FEHA).
The second mistake was that the HR director had Mr. Abarca complete a workers’ compensation claim form upon being terminated and asked Mr. Abarca to write down the date of being terminated as being the date that the employer first knew of injury.
The day after his firing, the employee unsuccessfully sought unemployment benefits. He also applied for five different jobs in nearby factories and told potential employers about the lifting restriction. He did not receive any callbacks.
While employed at the clothes warehouse, Mr. Abarca earned approximately $400 to $600 per week, which included overtime. He had been the sole income earner in his family, and after his firing, he relied on his state disability benefits and modest savings for income. Once his savings dwindled and his disability benefits expired, he collected and recycled bottles and cans in his neighborhood to earn money. About a month after the firing, the employee met with an orthopedic surgeon, who diagnosed his degenerative disc disease, insomnia, anxiety and depression.
Punitive Damages Award Did Not Violate Due Process
An award of punitive damages is considered to benefit the public by punishing wrongdoing and deterring future misconduct, either by the same defendant or other potential wrong doers. (Power Standards Lab, Inc. v. Federal Express Corp, 2005). In this case, the award of punitive damages was intended to deter Citizens and other employers in the garment industry who rely on low-wage laborers from wrongfully discharging their employees. The court felt that there was no evidence that the award would constitute an undue burden or result in Citizens’s financial downfall. In 2015, approximately two years before trial, Citizens was worth an estimated $119 million. In addition, the court pointed out that “to the extent we need to evaluate the difference between the punitive damages awarded by the jury and potential civil penalties, there is no cap on civil penalties for employers who are liable for disability discrimination under FEHA.” Therefore, the court found that the punitive damages award did not violate due process under these circumstances where there was substantial evidence of an employer’s malicious, oppressive, and fraudulent conduct.
In reference to the impression of the employer’s malicious, oppressive, and fraudulent conduct, the court pointed out the following: One month before his termination, Abarca reported an injury and presented Citizens with a doctor’s note with a work restriction. Citizens did not advise Abarca to file a workers’ compensation claim form at that time and then terminated Abarca two business days after the work restriction expired. Citizens’s head of HR had Abarca fill out a claim form on the day of his termination and instructed him to postdate the day that Abarca first reported the injury to Citizens. Abarca also presented evidence that Citizens did not follow its own policies when it terminated Abarca or received notice that he was injured. The court also considered evidence that the employer may have also partially misled Abarca about the reason for his termination.
In reviewing a jury’s award for punitive damages, the court looks to the following:
- The degree of reprehensibility of the defendant’s misconduct.
- The disparity between the actual harm suffered by the plaintiff and the punitive damages award.
- The difference between the jury’s punitive damages award and damages awarded in comparable cases.
- The defendant’s wealth.
The most important factor when deciding the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant’s conduct and in evaluating reprehensibility, the court looks at whether:
- The harm caused was physical rather than economic.
- The defendant’s conduct showed an indifference to or a reckless disregard for the health or safety of others.
- The targeted employee was financially vulnerable.
- The harm was the result of intentional malice, trickery or deceit.
The employee’s financial vulnerability also weighed heavily in finding a high degree of reprehensibility, the court said. After he was fired, Mr. Abarca could not find work. His job with the employer provided the only income for his family. He ultimately spent his savings and resorted to collecting bottles and cans for income.
WorkSaver’s Opinions:
This case clearly indicates that employers must remain vigilant and aggressively review any case involving an employee who claims he/she is unable to work due to a medical reason. It is essential that employers avoid all actions that may be deemed retaliatory in nature after an employee claims an injury or illness while employed. Employers must make sure that employees complete all paperwork such as required for workers’ compensation claim form accurately and always indicate the correct date in which the employer first became aware of the employee’s complaint. It is also critical that the employer conduct a thorough and ongoing interactive accommodation review with the employee and document all efforts to accommodate the employee, to include providing the employee with the opportunity to work in an alternative job that he/she is qualified to perform with or without an accommodation. Remember, an interactive accommodation review is an ongoing dynamic process, not a one and done process. Employers must realize that the nature of a disability can change with time, potentially changing from temporary to permanent disability status. Lastly, employers should be aware that legally designed fitness-for-duty (FFD) examinations for new hires and return to work cases, as provided nationally by WorkSaver, can prevent most of these situations like the Abarca case from ever occurring in the first place.
For more information on FFD testing and accommodation review processes, please contact WorkSaver Employee Testing Systems, LLC at (800) 414-2174 or contact the CEO or President of WorkSaver (i.e., Dr. Bunch, PhD, PT, CBES and Mr. Trevor Bardarson, PT, OCS, CBES respectively) via their respective e-mail addresses at: Dr.bunch@worksaversystems.com or Trevor@worksaversystems.com
References:
- Abarca v. Citizens of Humanity LLC, Calif. Ct. App., No. B283154 (July 31, 2019).
- Joanne Deschenaux, J.D., SHRM Publication, September 13, 2019