Jul 7 2014

The Case of the $180,000 Bag of Potato Chips: Business Owners Must Be Mindful of the Americans with Disabilities Act and How it Affects Their Employees

If you are a business owner with 15 or more employees, you are subject to the requirements of the Americans with Disabilities Act (ADA). One of the fundamental obligations of employers under the ADA is to provide “reasonable accommodation” for individuals with disabilities, unless it would cause undue hardship to the business. A reasonable accommodation is any change in the work environment or in the way a job is performed that enables a person with a disability to enjoy equal employment opportunities. 

What constitutes a “reasonable accommodation” can often be difficult to discern, but failing to make such an accommodation when required can prove costly. A recent settlement in a Northern California lawsuit involving Walgreens, a diabetic employee, and the “theft” of a $1.37 bag of chips illustrates the challenges involved in making sure disabled employees are treated in accordance with ADA requirements.

Josefina Hernandez had worked at Walgreens for 18 years. Five years into her employment she was diagnosed with type II diabetes. She promptly advised Walgreens of her condition and, in an effort to comply with the ADA by providing reasonable accommodation, Walgreens allowed her to keep candy nearby in case of low blood sugar, keep her insulin in the break room refrigerator, and take additional breaks to test her blood sugar or eat to keep her diabetes under control. One day in 2008, Hernandez found herself feeling the symptoms of low blood sugar and an impending hypoglycemic attack while stocking shelves with items from a shopping cart. She didn’t have a candy bar available, and, feeling shaky and faint, she opened a $1.37 bag of potato chips that was in the cart and ate some of them.  As the court noted, “She did not notify or request assistance from a manager before she opened and ate the chips.   After 10 minutes, when she started feeling better, [she] claims she went to pay for the chips at the cosmetic counter (where she had been instructed to pay for store items) but no one was there.   [She] put the potato chips under the counter at her cash register and returned to restocking items.”

Unsurprisingly, Walgreen’s has a company-wide policy regarding employees and the purchase and eating of food from store shelves. Its zero-tolerance “anti-grazing” policy, as it is known, is very strict, consistently applied, and requires that food must be purchased by the employee before it can be eaten.

For her “theft” of the bag of chips, Hernandez was suspended and fired by her store manager. She then filed an EEOC complaint, and the EEOC subsequently filed suit against Walgreens on her behalf, alleging that her termination was a violation of the ADA and that Walgreens should have made a “reasonable accommodation” by making an exception to the “anti-grazing” policy in the emergency that existed.

Walgreens asserted that permitting “employee theft” cannot be a “reasonable” accommodation and moved for summary judgment. The court denied Walgreens’ motion, holding that there were triable questions of fact as to whether her “misconduct” resulted from her disability, and it was for a jury to decide whether allowing her to “steal” should have constituted a “reasonable accommodation.”

The prospect of a trial on whether an employee could legally be terminated for opening a $1.37 bag of potato chips to avoid going into diabetic shock was unappealing to Walgreens. Therefore, Walgreens agreed to a settlement under which it would pay Hernandez $180,000 and implement substantial changes to its antidiscrimination policy and training procedures. All that for a bag of chips.

This particular case may be unique and extreme, but it illustrates a very simple point for any employer, whether one with 15 employees or one with 15,000. Employers must be cognizant of the laws governing employees, including not only the ADA, but all anti-discrimination and wage and hour laws. The implications of employment decisions regarding disabled employees must be fully evaluated through the prism of the ADA and other applicable laws in order to minimize the possibility of paying a large sum of money over an ultimately insignificant and justifiable employee infraction.

The Cohen Law Firm: Westlake Village Small Business Law Firm

The Cohen Law Firm in Westlake Village serves the unique needs of business owners. From formation to restructuring to employment matters, and in an ever-changing legal, regulatory and economic landscape, businesses must constantly evolve to survive. To talk about your business’s goals and challenges or to make an appointment, please call the Cohen Law Firm today at (805) 267-7147 or send an e-mail to Randall Cohen at racohen@racohenlawfirm.com.

This website has been prepared by the Cohen Law Firm for informational purposes only and does not, and is not intended to, constitute legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice from an attorney licensed in your jurisdiction.

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