BUSINESS LAW: Honest belief as a defense

2012-12-09T00:00:00Z BUSINESS LAW: Honest belief as a defenseJames L. Jorgensen Times Business Columnist
December 09, 2012 12:00 am  • 

In our last article, we discussed age discrimination claims. Today, we will examine one key defense available to employers.

Consider these facts: a 57-year old employee worked for her employer for 16 years. Her employer implemented new information system software, to which the employee had trouble adapting.

The employee received a performance evaluation rating her below expectations in several areas, such as attitude, judgment, team effort/leadership and technical skills. According to the employer, the poor performance continued in the following years. Eventually, the employee’s supervisor prepared a memo documenting his reasons for recommending the employee’s termination. Three days after the memo was prepared, the employee was terminated.

Following her termination, the employee filed an age discrimination lawsuit. The employer denied the claim, asserting the employee’s termination was based on her documented poor work performance.

The employee argued the employer’s stated reasons for the termination had no basis in fact. Instead of focusing on whether the reasons were “right or wrong”, the court focused on whether the employer had an “honest belief” in the reasons.

Under the rule, the employer prevails if it establishes it reasonably relied on the facts before it when the decision was made.

The employee can only defeat this defense if she can prove that the employer did not “honestly believe” the reasons it relied upon. This can be difficult to do. The employer will still prevail even if had not completed the most exhaustive investigation.

The employer prevailed because it had an honest belief in its reasons for terminating the employee. It was able to establish this by referring to the fact it documented the employee’s poor performance on several occasions.

Opinions are solely the writer's. James Jorgensen practices law at Hoeppner Wagner & Evans in Valparaiso.

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