Employer to Pay Punitive Damages for Firing Saleswoman with Cancer

A California appeals court upheld the award of $ 500,000 in damages to the children of an employee who was fired after being diagnosed with cancer.

The employee had sued her former employer for firing her against public order, but she died in the initial trial. The court then replaced her three children as plaintiffs in the lawsuit and found in a second trial that the employer fired the employee for her medical condition and awarded her $ 15,000 in economic damage – to compensate her for money lost to the employer behavior. – and $ 500,000 in damages, which are intended to punish the employer for flagrant behavior.

The employer appealed, arguing that the punitive damages were disproportionate.

The employee worked as a sales representative for the employer. In October 2012, she learned she had cancer and took three months of medical leave for surgery. In January 2013 she returned to work full-time. As of February 2013, she underwent chemotherapy once every three weeks. In August 2013, she had completed chemotherapy but still had follow-up medical appointments about twice a month. In November 2013, the company fired her for performance-related reasons, but the employee thought she had been fired for having cancer.

When the employee was fired, her personnel file did not contain any written performance warnings or disciplinary action. In 2011, 2012, and 2013, she was the top-performing salesperson at the Los Angeles office. When she was fired, she had higher sales than the other two reps in the same office.

E-mails between the employee and her supervisor showed that before she went on medical leave, he praised her work and was pleasant when she asked for time off.

After the employee returned from sick leave, her supervisor made negative comments to her and the other employees about taking time for medical appointments. He rolled his eyes and took a heavy breath as if frustrated. The supervisor started to complain about the employee’s behavior, specifically that she took a coffee break in the morning, which hadn’t caused a problem before her medical leave. He started to treat her differently from the other two sales reps. For example, he kept asking her for more information about her call logs.

The employee felt significant stress because of the supervisor’s behavior and sought help from the company’s HR department. However, the HR manager told her not to bump into her supervisor.

The actual paperwork prepared by the employer for the termination stated that the employee had been fired for “inadequate work performance”. However, the supervisor gave several reasons for the termination during the trial and showed no documentation that the employee’s performance had decreased. He also denied knowing the employee had cancer, but other evidence presented at trial contradicted this claim.

Damage attribution is not excessive

The appeals court first noted that the procedural clause of the Fourteenth Amendment to the United States Constitution prevents courts from awarding punitive damages that are excessively excessive or arbitrary.

Courts assessing punitive damages should look at the degree of reprehensibility of the defendant’s misconduct and any disparity between the actual harm suffered by the plaintiff and the award of damages, the appellate court said.

The employer claimed that the damages were excessive because his behavior was not particularly reprehensible and because the punitive damages were 33.3 times the amount of the economic damage awarded.

However, the court noted that, under California law, the employee’s death meant that certain types of compensation – such as emotional distress compensation – were not available in the lawsuit.

Had such damages been awarded, the discrepancy between the two types of damages awarded would not have been so great, the court said.

And, the appeals court continued, the most important factor in assessing punitive damages is the degree of reprehensibility of a suspect’s behavior. The court found the employer’s behavior “despicable and reprehensible,” the appeals court said, noting that it found a “medium” level of reprehensibility.

Falsely telling a hard-working, skilled employee that she is being fired for poor performance would affect the employee’s emotional well-being, the appeals court noted. The behavior is particularly harsh if the person is suffering from cancer.

In addition, the employee’s degree of financial vulnerability when she was fired supported a high assessment of reprehensibility, the court said.

And the supervisor’s changing stories about why the employee was fired and not being able to provide documents supporting his story supported the finding that the employer’s behavior was objectionable, the court concluded.

The court upheld the lower court’s damages.

Rubio v. CIA Wheel Group, California Ct. App., No. B300021 (April 15, 2021).

Professional pointer: While most federal labor laws – such as Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act – set a maximum for the amount of punitive damages that can be awarded, California labor laws have no such limits. The amount can generally only be limited by considerations of proper procedure.

Joanne Deschenaux, JD, is a freelance writer based in Annapolis, Maryland.

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