Details, Details…

Federal Court Provides Reminder about the Importance of Complete and Easy-to-Understand Documentation

In a recent case, a federal district court made clear the importance of completely and thoroughly documenting employee performance problems in language that can easily be understood by an outside party, such as a court or the Equal Employment Opportunity Commission (EEOC). The plaintiff in McDonald v. Best Buy Co., Inc. was demoted and sued her employer for age discrimination. Even though her employer presented evidence that the plaintiff had received several written warnings prior to her demotion, the U.S. District Court for the Central District of Illinois (located in the Seventh Circuit, which covers Indiana, Illinois, and Wisconsin) found that the plaintiff’s claims could proceed to trial.

The plaintiff was hired by Best Buy in 1986. By 2003, she was the customer service manager at a Best Buy store in Moline, Illinois. In March 2004, when the plantiff was 54 years old, Best Buy instituted a company-wide transformation in which the company’s business model changed from being “product focused” to “customer focused.” Although she had previously been a strong performer, she struggled to adapt to her increased responsibilities under the new model. In May 2004, the plaintiff received a written warning. In August 2004, a new store manager became her boss and promptly began referring to her as “Grandma.” Soon thereafter, the new manager bragged that he could fire any employee “with documentation.” The plaintiff continued to struggle with her new duties, and received two written warnings on September 16, 2004. One criticized her for failing to “influence and inspire her subordinates,” and the other stated that her “behaviors [were] not being aligned with the [company’s] transformation and values.” In October, the plaintiff took a 6-day vacation. When she returned, she was given a back-dated letter regarding her inability to “manage labor effectively” and was demoted two grades. Rather than accept the demotion, the plaintiff resigned and sued Best Buy for age discrimination.

Best Buy moved for summary judgment, but the court denied its motion and held that the plaintiff’s claims could proceed to trial. The court found that the plaintiff had pointed to enough evidence to present a “convincing mosaic” that her age was a “determinative factor in a corporate culture that was intended to clean out older individuals.” Importantly, the court was not swayed by Best Buy’s invocation of her disciplinary record. In arguing that the plaintiff's claims should be dismissed, Best Buy had relied heavily on the written warnings she received in 2004. However, the court found these warnings insufficient evidence of the plaintiff's shortcomings. For example, the court pointed to the warning, which stated that her “behaviors [were] not being aligned with the [company’s] transformation and values.” According to the court, this documentation did not provide enough detail about her deficiencies - that is, the court simply could not determine what the plaintiff had done wrong. Reading this ambiguous documentation together with the manager’s remarks about being able to terminate any employee “with documentation,” the court said that it viewed the documentation with suspicion and raised the possibility that the manager was “laying a pretextual record” for the plaintiff’s ultimate demotion.

This court decision provides a reminder about the importance of complete and easy-to-understand documentation of employee performance problems. Just creating a paper record of performance problems with a general description of a performance problem (such as “failure to inspire and influence subordinates” or “inability to manage labor effectively”) is not enough to shield an employer in a discrimination lawsuit. Rather, the paper record should contain details about the precise nature of the employee’s performance problems—the who, what, when, where, and why—so that an outside party (such as the EEOC or the court) can understand exactly what the employee has done wrong.

The decision also provides a warning about the dangers of corporate lingo. Although the phrases “failure to influence and inspire her subordinates” and “not being aligned with the [company’s] transformation and values” might have made sense in the Best Buy environment—and, indeed, might have communicated to the plaintiff precisely what she was doing wrong—that language did not translate well before the court. The take-home-lesson for employers is that relying on such “corporate shorthand,” without further explanation, not only makes an employer’s case harder to win, but may actually—at it did in Best Buy’s case—be used against the employer. Documenting problems completely and using language that is easily-understandable by an outside observer best positions an employer for any possible future litigation.

Susannah Pieper is an associate in Ice Miller's Labor and Employment Group.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice.  The reader must consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.