Collateral Estoppel Does Not Work Both Ways
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.