Iowa Supreme Court doesn't "override" adverse verdict against state employee

In the final round of cases decided by the Iowa Supreme Court in its 2014-2015 term, the Court decided Rivera v. Woodward Resource Center, a case requiring the high court to decide whether a plaintiff has the burden to prove an employer did not have an overriding business reason for taking an adverse employment action in a violation of public policy retaliation case.  Terri Rivera was hired in April 2006 as a residential treatment worker at Woodward Resource Center (WRC), a facility which provides services to children and adults with mental and physical disabilities. During the approximately six months of her employment, Ms. Rivera alleged she witnessed several incidents of patient abuse. She alleged that she witnessed a coworker forcing a patient to eat mayonnaise until the patient gagged and eating a meal into which the patient had just vomited.

Additionally, Ms. Rivera learned from others that the same coworker had put hot sauce into a patient's eyes. Ms. Rivera reported the abuse to both her supervisor and her supervisor's supervisor in September 2006. Ms. Rivera's employment was terminated in early October 2006, a few weeks after her reports of abuse, for having three unscheduled absences during her six-month probationary period. Ms. Rivera brought a claim of wrongful discharge in violation of public policy, claiming she was terminated for her reports of abuse by a coworker.  Trial testimony and evidence revealed a dispute as to WRC's attendance policy Ms. Rivera presented the written attendance policy which allowed for up to ten unscheduled absences prior to termination; but WRC supervisors testified that they maintained a practice of terminating employees after three unscheduled absences. Ms. Rivera presented evidence of numerous instances of employees who were not fired after three absences during their probationary period.

Additionally, Ms. Rivera offered testimony from a former WRC employee who had more than three absences during her probationary period and was allowed to keep her position, but was later terminated after her next absence following a report of a coworker abusing a patient. Despite this evidence, the jury returned a verdict in favor of WRC. Ms. Rivera appealed claiming that the district court's instruction defining the term 'determining factor' had improperly placed the burden of proof on her. The jury instruction stated, in part, The reports [of abuse] were not the determinative factor if [WRC] had an overriding business reason for terminating Rivera's employment. 

The Iowa Supreme Court agreed that the jury instruction was not properly worded, but it left the jury verdict intact, finding that the error was harmless. The Court reiterated its jurisprudence that in order for plaintiffs to prove a common-law retaliatory discharge theory, they must show their engagement in a protected activity – here, reports of patient abuse – was the 'determining factor' in the adverse employment decision. The 'determining factor' does not necessarily have to be the main factor in an employer's decision to take an adverse employment decision; however, it 'must be the factor that makes the difference in the employment outcome.'

The Court held that a plaintiff does not have the burden to prove that a defendant lacks an overriding business justification for the adverse action taken. Rather, an employer may use evidence of the legitimate business reason for the adverse employment action to convince the factfinder that something other than the protected conduct (i.e., the overriding business justification) was the determining factor in the employment decision. As the Court emphasized, 'Iowa law does not impose liability on an employer when the determining factor was a legitimate business reason . . . .' The Court opined that only in rare circumstances would an employer be entitled to an affirmative defense of an overriding business justification. Such a situation would arise where the employer admits that the protected activity was the 'determining factor' but some other public policy overrides the otherwise unlawful nature of the employment decision. Although the Court found error with the district court's jury instruction, it held that the error was harmless and did not require a reversal and remand for a new trial for Ms. Rivera. While the nuances of this decision may seem to apply only in particular trial situations, there are broader lessons. First, employers must follow their written policies in actual practice. Whether an employer allows three unexcused absences or ten unexcused absences before termination of employment, the policy must be clear and regularly followed. Exceptions should be rare, explainable, and based on lawful grounds.

Follow-up policy training will help reiterate to supervisors and employees the importance of consistently applying the policy. Second, reports of alleged abuse or violence in the workplace must be taken seriously and investigated immediately. Contemporaneous investigations, particularly for reports as serious as those in this case, help document allegations, prevent escalation, and affirm that the employer takes these kind of allegations seriously.

The material in this blog is not intended, nor should it be construed or relied upon, as legal advice. Please consult with an attorney if specific legal information is needed.

- Bryan O' Neill